Earnings briefing materials for Q1 of the year ending February 28, 2022 - July 16th, 2021 TKP Garden City PREMIUM Kyobashi
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Earnings briefing materials for
Q1 of the year ending
February 28, 2022
July 16th, 2021
TKP Garden City PREMIUM Kyobashi
0
Contents
Executive Summary Q1 FY2021 2
Business Environment &
3
COVID-19 Vaccinations
Performance Review for Q1 of FY 2021 20
Business Operation for Q1 of FY 2021 25
Appendix 41
Definition on periods
FY2020：up to Feb. 21 Q1：Mar. – May
FY2021：up to Feb. 22 Q2：Jun. – Aug.
Q3：Sep. – Nov.
Q4：Dec. – Feb.
1
(C) TKP Corporation 2021
Executive Summary Q1 FY2021
Highlights
EBITDA grew 56.3% from a year ago to reach 574 million, despite continuous
slack demand for TKP meeting rooms due to the state of emergency declaration.
Moving strike share subscription rights started to be executed from February 5th,
2021, creating additional capital of ¥4.4 billion. Shareholders’ equity ratio rose
by 4% to reach 32%.
Topics
Started providing venues for COVID-19 vaccinations at TKP.
Started “TKP Workplace Vaccination Center,” supporting vaccination
process comprehensively mostly for SMEs
2
Business Environment &
COVID-19 Vaccinations
3
(C) TKP Corporation 2021
Q1 FY2021 Key developments in major segments
F&B catering service was downsized due to pandemic impacts
Started The COVID-19 Vaccination project
Ms. Fumiko Motoya, CEO of APA Hotels &
Resorts, was approved to be one of the
external board of directors of TKP
Three APA Hotels , or 40% of all the rooms
we operate, are leased out as dedicated
facilities for mild-case COVID-19 patients
In March, we newly opened SPACES Akasaka, a large-scale,
single building facility. Although the average occupancy rate for
Q1 stayed flat from Q4 last year due to new opening of large-scale
facility, recent order trend has been healthy.
Regus US is recovering very quickly. We should expect similar
trend in Japan once vaccination penetrates
4
(C) TKP Corporation 2021
Regus business trend world-wide
IWG plc (Regus) Founder & CEO
TKP Board Member
Mark Dixon
Please enjoy the video
5
(C) TKP Corporation 2021
USA with vaccination penetration
US vaccination rate (at least once)
New patients COVID-19 patients Vaccination rate ▶ Situation in US
(thousand) (at least once)
Daily activities are returning. NY city
350 60%
新規感染者数
New patients metro is resuming 24/7 operation. Upper
300
ワクチン接種率(1回以上
Vaccination rate guest limit restrictions at restaurants are
(at least once)
接種している割合) 50%
lifted.
250
40%
200 Times Square on June 27, 2021
30%
150
20%
100
10%
50
0 0%
Dec. Jan. Feb. Mar. Apr. May June July
Compiled by TKP from datapoints provided by Our World in Data“Statistics and Research
Coronavirus (COVID-19) Vaccinations”
6
(C) TKP Corporation 2021
Vaccination progress in Japan
Vaccination rate (at least once)
Vaccination rate
COVID-19
Patients
COVID-19 patients ※1 (at least once)
9,000 35%
新規感染者数
New patients Vaccination process started
8,000
Vaccination rate
ワクチン接種率(1回以上 30%
from February 2021 with the
(at least once)
接種している割合) target of all the citizens who
7,000
25%
wishes by the end of
6,000 November 2021 ※2
20%
5,000
In order to accelerate the
Started from
4,000 seniors and
15%
vaccination process to the
medical
workers
workplace
vaccination
working population and to
3,000
started
10%
the entire nation, workplace
2,000
vaccination kickstarted from
5%
June 21st, 2021
1,000
0 0%
Feb.
2月 ３月
Mar. ４月
Apr. ５月
May ６月
June ７月
July
※1 Compiled by TKP from datapoints provided by Our World in Data“Statistics and Research
Coronavirus (COVID-19) Vaccinations”
7
※2 Prime Minister’s Office
(C) TKP Corporation 2021
TKP proposed to offer vaccination venues to Government and
setup vaccination centers to accelerate vaccination progress
8
(C) TKP Corporation 2021
COVID-19 Vaccinations – workplace vaccinations & TKP
4/27 TKP decided to offer vaccination venues to local governments
We decided to offer
5/30 vaccination venues
TKP proposed to offer venues to the Prime Minister Suga for big corporates
6/1 Announced to tie-up with M3 Group in order to secure enough medical
professionals for upcoming vaccination process
Proposed supporting measures for vaccination venues to Minister Made a contract
Nishimura and Minister Kono with Met Life
6/7 Announced specific address and tenure for vaccination venues
6/9 Basic agreement for workplace vaccination with Met Life Japan closed
Decided to support
6/10 Announced our Tie up with Keizai Doyukai in order to accelerate the SMEs through
vaccinations for SMEs in Japan Keizai Doyukai
6/15 Joint press conference with Keizai Doyukai was held and announced
the details of the vaccination plans
6/16 Announced TKP Vaccination Center where TKP supports the venue Notified to TKP
operations as well as securing medical professionals clients
6/19 Started TKP
Started free-of-charge vaccination venue
Vaccination Center
6/21 Workplace vaccinations started TKP Vaccination Center also started 9(C) TKP Corporation 2021
Free of charge vaccination venues are provided for workplace vaccination
For the large-scale workplace vaccination program, Free of
charge venues announced on June 7th & started on June 19th
※
Brewers Association of Japan
Asahi Beer
Kirin Beer
Sapporo Beer
Suntory Beer
Orion Beer
Suntory Holdings
20 facilities were provided
for free
※up to 10 days 10(C) TKP Corporation 2021
Full support for vaccination from large corporates to SMEs
With Met Life, we conducted Supported SMEs with less than 1000
workplace vaccinations to about employees as they are not eligible to
52,000 individuals at its workplace vaccination program.
Nagasaki HQ and major branch offices more than160 companies with
in Japan. Thereafter, the venue will be
open to Nagasaki local companies for about 57,000 individuals
workplace vaccinations ※Based upon the number of applications (as of the end of June）
Mr. Dirk Ostijin, CEO Met Life Japan K.K. Mr. Kengo Sakurada, Chairman of Keizai Doyukai,
(right on the photo) Group CEO of SOMPO Holdings (left on the photo)
11(C) TKP Corporation 2021
Group vaccination at TKP Workplace Vaccination Center for our clients
Group vaccination became available with TKP clients, as we team up with medical
institutions to setup venue, prepare necessary equipment, supported the operation,
securing necessary number of vaccines and medical professionals.
application arrange
processing
visit dispatch
vaccination vaccination
Clients TKP Workplace Vaccination Center Medical Institute
12(C) TKP Corporation 2021
TKP Workplace Vaccination Center
TKP Workplace Vaccination Center expanded to 20 facilities at 12 areas. We can
support large companies with nation-wide operation and employees
Outline of TKP Workplace Vaccination Center
Name TKP Workplace Vaccination Cost charged at cost
Eligibility TKP Member Clients Areas Major 12 areas of Japan
Jab Batch 50 per batch Facilities 20 as outlined below
Area and Facility Name
Hokkaido TKP Garden City PREMIUM Sapporo Nagoya TKP Garden City Nagoya
Sendai TKP Garden City PREMIUM Sendai Kyoto TKP Kyoto Shijo Conference Center
Chiba TKP Garden City Chiba TKP Garden City Osaka Umeda
Osaka
TKP Garden City PREMIUM Shinsaibashi
Saitama TKP Omiya Business Center Hiroshima TKP Garden City Hiroshima
TKP Ichigaya Conference Center
Tokyo TKP Shinjuku Conference Center and 8 more Hakata TKP Conference City Hakata
Yokohama TKP Garden City PREMIUM Yokohama Nagasaki Nagasaki Met Life Nagasaki Building
13(C) TKP Corporation 2021
TKP track record for workplace vaccination program
By July 15th, at TKP venue,
already vaccinated more than
白い
300,000 people, and
we plan to raise the number up
to 500,000 in the
future, with 1,000 clients
Strengthen relationship
with GA and HR depts.
of clients
14(C) TKP Corporation 2021
Converting space in accordance with the social needs
Solving social problems by providing additional value to the available space
Revitalizing idle properties
Old building to
Revitalizing old inn Hospital to Hotel
meeting rooms
Meeting room in Roppongi Lectore APA Hotel (Nishi Kasai) 15(C) TKP Corporation 2021
Converting space in accordance with the social needs
Solving social problems by providing additional value to the available space
Example of space utilization ideas by TKP
Working Style COVID-19 Optimization
Meeting room to Meeting room to Meeting room to
flexible office vaccination venue Interview room
software
software
software
Vaccination Center Interview room
hardware
hardware
hardware
16(C) TKP Corporation 2021
Secured a major HR BPO contract, other than vaccination center business
HR BPO hiring project of 1,500 new employees
Flexible setup between
Coordinate Interviewer
face to face & online
software
HR information control
Call center operation
and data input
hardware
Nation-wide venues Online equipment anti COVID-19
TKP excels accumulated know-how in utilizing more than 400
facilities nation-wide & procuring necessary resources quickly
17(C) TKP Corporation 2021
Providing services in addition to providing space
Human Contents
Solution
Operation
Service
Clients Venue
more than Unrivaled
300,000 choices of
locations
Based upon unrivaled number of locations and enriched client track record,
we will propose services and contents which suit client demand and needs 18(C) TKP Corporation 2021
Scenario for demand expansion
We will actively capture serviced office demand. We also predict a recovery
in meeting rooms. We are going to flexibly manage the conversion back &
forth between the two. We will continue to fortify hotel & Regus businesses.
Hourly rental
meeting room
Contents
solution
Conversion will
be quickly done
Serviced office
Regus
APA Hotel (FC)
19Performance Review
for Q1 of FY2021
20(C) TKP Corporation 2021
Consolidated results for Q1 of FY2021
Although TKP meeting room business continued to be slack due to pandemic,
EBITDA and Operating profit improved thanks to the cost reduction last year.
We lost some clients at Regus Japan, which was later backfilled. But because of this,
we impaired the customer related intangible assets by 1.6 billion yen in this Q1
（Millions of yen） FY 2020 FY 2021 YoY change FY 2021
Q1 Q2 Q3 Q4 Full Year Q1 (%) Forecast
Net sales 10,447 10,097 11,688 10,905 43,138 10,272 -1.7% 48,000
Gross profit 2,744 2,317 3,334 2,814 11,210 2,588 -5.7% -
（％ to sales） 26.3% 23.0% 28.5% 25.8% 26.0% 25.2% -1.1pt -
SG&A 3,709 3,367 3,239 3,392 13,708 3,418 -7.8% -
EBITDA 367 362 1,515 827 3,073 574 +56.3% 5,800
（％ to sales） 3.5% 3.6% 13.0% 7.6% 7.1% 5.6% +2.1pt 12.1%
Operating profit(loss) -964 -1,049 94 -578 -2,497 -829 - 700
（％ to sales） -9.2% -10.4% 0.8% -5.3% -5.8% -8.1% +1.2pt 1.5%
Ordinary profit(loss) -1,288 -831 4 -206 -2,321 -979 - 100
Profit (loss)
attributable to owners -1,464 -938 -453 -646 -3,503 -1,878 - -
of the parent
※ EBITDA is calculated as operating profit/loss plus depreciation, goodwill amortization, amortization of long-term prepaid expenses, and amortization of intangible assets
such as customer-related assets .
※ In Q2 of FY 2020, the company finalized provisional accounting treatment for the corporate merger, which is reflected retroactively in FY 2020 figures.
21(C) TKP Corporation 2021
Quarterly trend in net sales/EBITDA
Although net sales trend remained flattish due to the pandemic, EBITDA, which is
our most important KPI, continued to generate profit.
（Millions of yen） （Millions of yen）
Quarterly trend of net sales Quarterly trend of EBITDA
18,000
Others 4,000
16,000 Regus Japan
3,500
TKP単体
14,000
3,000
12,000
2,500
10,000
2,000
8,000
1,500
6,000
1,000
4,000
2,000 500
- -
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
FY2020 FY2021 FY2022 FY2019 FY2020 FY2021 22(C) TKP Corporation 2021
Summary of consolidated balance sheet
In addition to the asset sale, as some of moving strike share subscription rights, issued by way of
the third-party allotment, were exercised, shareholders’ equity ratio improved to 32.7%. Our cash
& deposits is 10 billion yen, and we agreed to another bank credit line. Together with unexercised
share subscription rights, we secured more than 30-billion-yen dry powder.
FY 2021
FY 2020 YoY change
（Millions of yen） Q1
Current assets 21,373 16,314 -5,058
（Cash and deposits） 15,195 10,197 -4,998
（Accounts receivable） 3,318 2,175 -1,143
Non-current assets 95,573 91,129 -4,443
（Property, plant and equipment） 38,735 36,320 -2,414
（Intangible fixed assets） 42,196 39,842 -2,353
Total assets 116,946 107,443 -9,502
Current liabilities 26,955 17,636 -9,318
Non-current liabilities 54,849 52,770 -2,078
Total liabilities 81,804 70,407 -11,397
（Interest-bearing debt） 62,676 56,913 -5,763
Total net assets 35,142 37,036 1,894
Total liabilities & net assets 116,946 107,443 -9,502
Shareholders’ Equity Ratio 28.4% 32.7% +4.3pt
23(C) TKP Corporation 2021
Progress on share subscription rights (announced on January 14th, 2021)
63 billion yen of fresh capital was injected to the company by the end of June as some of
moving strike share subscription rights, issued by way of the third-party allotment (announced on
Jan. 14th, 2021), were exercised. Capital will be used to secure new flexible office locations.
Option to suspend Option to commence
7th share subscription rights (allocated on Feb. 4th, 2021 8th share subscription rights
Expected capital：c.¥10 bn* Expected capital：c. ¥10bn *
Month Exercised shares Fresh capital (¥ million)
February 2021 294,600 728
March 2021 599,000 1,478
April 2021 413,900 928
May 2021 625,000 1,301
June 2021 863,600 1,898
Total 2,796,100 6,336
Not already exercised 1,178,200 ―
* Calculated based upon the closing price of ¥2,672 as of January 13th as the base price. Expected capital amount would change in
accordance to the strike price, which is moving strike structure. 24Business Operation
for Q1 of FY 2021
25(C) TKP Corporation 2021
Facility openings and closures in core operations
TKP closed 11 facilities facilities either because of the contract expiry or deteriorating
profitability due to pandemic but opened one large facility in Shinjuku.
Regus opened 2 facilities; one in Nagoya and one in Akasaka. Akasaka is under
SPACES brand and this is a joint opening with TKP Conference Center.
FY Feb. 2021 FY Feb. 2021 FY Feb. 2021 FY Feb. 2022
first half second half full year Q1
Opened ＋10（＋4,453 tsubo ） ＋２（＋373 tsubo ） ＋12（＋4,826 tsubo ） ＋１（＋654 tsubo）
Closed - 21（- 6,349 tsubo ） - 25（- 5,448 tsubo ） - 46（- 11,797 tsubo ） - 11（- 5,275 tsubo）
(Japan) Opened ＋８（＋2,319 tsubo ） ＋１（＋764 tsubo ） ＋９（＋3,083 tsubo ） ＋２（＋833 tsubo）
Closed － - ３（- 706 tsubo） -３（- 706 tsubo） －
(Taiwan)
Opened － ＋１（＋1,000 tsubo ） ＋１（＋1,000 tsubo ） －
Closed － － － －
Joint opening
(Japan) (Breakdown of 11 closures)
SPACES Regu
CC
s
TKP Garden City PREMIUM - 1 facility
TKP Garden City - 4 facilities
SPACES Akasaka TKP Conference Center - 2 facilities
（from Mar. 2021）
TKP Business Center - 2 facilities
CC TKP STAR rental meeting Rooms - 2 facilities
Regus KDX Nagoya
TKP Shinjuku Nishiguchi TKP Akasaka 2choume Ekimae building
Conference Center Conference Center Business Center
（from Apr. 2021.） （from Jan. 2021） （from Apr. 2021）
26(C) TKP Corporation 2021
TKP
Number of meeting rooms, locations by grade (TKP)
We provide rental conference rooms in grades according to the purpose of use, scale, budget,
and other factors. These comprise 241 facilities and over 130,000 tsubo of floor space.
Grade Feb. 2019 Feb. 2020 Feb. 2021
Locations 24 24
Brand with Escrit Inc. CIRQ Rooms 51 51
－
Tsubo － 19,776
Garden City Locations 25 27 26
Temporary offices in
large, new buildings PREMIUM Rooms 300 296 305
（GCP） Tsubo － － 15,896
Locations 58 54 50
Banquet facilities in Garden City
large, older hotels （GC） Rooms 563 522 464
Tsubo － － 37,573
Conference Locations 82 66 67
Temporary offices in
large, older buildings
center Rooms 918 780 783
（CC） Tsubo － － 29,909
Temporary offices in Business Locations 45 34 32
medium-sized, older center Rooms 286 223 216
buildings （BC） Tsubo － － 5,601
Locations 36 32 28
Temporary offices in STAR rental
small, older buildings
meeting rooms Rooms 70 71 55
Tsubo － － 1,660
Locations 15 14 14
LecTore and Ishinoya
(accommodations & training venue) Rooms 101 90 91
Tsubo － － 23,163
Locations 261 251 241
Total TKP Rooms 2,238 2,033 1,965
Tsubo 133,193 142,002 133,578
27(C) TKP Corporation 2021
TKP
TKP business performance for Q1 of FY2021
Actual rental meeting room and hotel usage improved from the same period last year,
when most of our revenues came from cancellation penalty income. Sequentially, net
sales dropped as the state of emergency declaration effected from Q3 – Q4 last year,
when the sentiment improved.
（Millions of yen） FY 2020 FY 2021 YoY change
Q1 Q2 Q3 Q4 Full Year Q1 (%)
Net sales 5,410 5,261 6,887 6,278 23,838 5,466 1.0%
Gross profit 1,266 891 1,835 1,874 5,867 1,368 8.0%
（％ to sales） 23.4% 16.9% 26.6% 29.9% 24.6% 25.0% +1.6pt
SG&A 2,150 1,884 1,839 1,876 7,752 1,860 -13.5%
EBITDA -674 -744 231 220 -967 -275 -
（％ to sales） -12.5% -14.1% 3.4% 3.5% -4.1% -5.0% +7.4pt
Operating
profit(loss)
-884 -993 -4 -2 -1,884 -491 -
（％ to sales） -16.3% -18.9% -0.1% -0.0% -7.9% -9.0% +7.3pt
28(C) TKP Corporation 2021
TKP
Sales by service
Room rent sales dropped from last quarter, when we enjoyed one-time examination
demand, due to the pandemic and the state of emergency declaration. Hotel sales is
recovering partly thanks to the single block lease for mild-COVID-19 patients.
（Millions of yen）
10,000 92 Room rent Option F&B
105
398 328
76 Accommodations Others Cancellation fee
9,000 299
1,258 1,344 739 ※“Options” mainly represents sales for the use of conference room equipment.
218
8,000 1,396
1,141
1,813
7,000 1,878
291
1,734 137
1,717
6,000 1,001
833 603
1,105 157
328
953 701 329
5,000 831 676 282
1,133 224
72 867
2,569 590 965
4,000 227
187
580 890
3,000
5,391 213
5,078 391
4,687 4,549 114 4,166
2,000 243
3,628
3,157 2,871
1,000 1,881
0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
FY2019 FY2020 FY2021
29(C) TKP Corporation 2021
TKP Trend in KPI of the rental conference room business
Sales per tsubo※ continued to struggle due to pandemic and the state of
emergency declaration. On the other hand, as we downsized, gross leasable
area also fell.
Sales per tsubo and meeting room gross leasable area
Monthly Sales / tsubo Meeting room
Quarterly average（Yen） GLA (tsubo)
50,000 66,000
GLA
floor space sales / tsubo
(tsubo)
45,000 65,000
41,831
39,776
40,000 38,358 64,000
35,000 36,755 63,000
30,000 26,654 62,000
24,476 25,032
25,000 22,825 61,000
20,255
20,000 60,000
15,000 59,000
10,000 58,000
5,000 57,000
0 56,000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
FY2019 FY2020 FY2021
※ Sales includes room charge, options and catering 30(C) TKP Corporation 2021
TKP
Sales ratio by usage of TKP meeting rooms
Training rose in Q1 for the seasonal reason, as many corporates tend to conduct fresh employee
training sessions in April.
Examination continued to show sustainable growth as many traditional examination venues like
universities are still not available due to the pandemic.
Meeting Recruiting Training Seminar Conference Party Exam Others
100%
90% 20.1%
23.4% 20.5% 21.3%
24.1% 26.3% 25.6%
29.1%
80% 2.9%
39.2%
4.2%
4.9% 3.5% 11.3% 0.6%
5.9% 0.7%
70% 3.0% 4.3%
3.7% 3.9% 9.5% 11.8%
12.2% 5.2% 8.4%
18.9% 0.2%
60%
14.3% 3.3% 34.0% 8.7%
15.8% 13.6%
50% 27.1% 0.5%
17.8% 14.7% 9.1%
1.0% 8.1%
16.0% 2.3%
40% 8.6% 0.3%
15.5% 11.2%
11.7% 8.3%
21.7%
30% 18.4% 9.2%
11.7% 7.9%
4.9% 6.0% 19.5% 9.3%
7.9% 3.9%
20% 4.6% 8.3%
2.3%
23.2% 24.7% 24.1%
10% 20.7%
17.2% 18.3% 20.4%
14.9% 14.4%
0%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
FY2019 FY2020 FY2021
Others include temporary offices, workshops, AGMs, and press conferences
31(C) TKP Corporation 2021
TKP
CBT or Computer Based Testing Center was newly established
Assuming that more tests will be done on computer based in the future, we have
already set up CBT center to 15 facilities. Started to provide a package plan including
venue, PC, administrative staff.
Package Plan
from ¥100,000 (+ tax) for 1 seat for 1 month
Venue charges, 1 admin staff, power, LAN,
desk partitions, 1 dedicated fixed line,
laptop PC, printers
CBT is already used in languages, IT,
medial, and accounting tests. Further
penetration is anticipated
CBT tends to be use longer period by
the nature of the test format, giving
flexibility to the examinees. This should
work to stabilize our occupancy rate.
32(C) TKP Corporation 2021
Regus
Regus: number of Locations by brand
We operate four brands in Japan and two brands in Taiwan suited to different needs.
We provide a total of 178 facilities with 50,000 tsubo of workspace.
Brand Feb. 2020 Feb. 2021 May 2022
Locations 4 6 7
Large community-type
rental offices Tsubo － － 5,795
Locations 100 105 106
High-grade
rental offices Tsubo － － 28,812
Locations 5 4 4
Rental offices adjacent
to public transportation
Tsubo － － 288
Reasonably priced
Locations 47 47 47
unmanned rental
offices Tsubo － － 7,122
Locations 2 3 3
Large community-
type rental offices Tsubo － － 3,027
Locations 11 11 11
High-grade
rental offices Tsubo － － 4,134
Locations 156 162 164
Regus（Japan）
Tsubo 36,311 39,885 42,018
Locations 13 14 14
Regus（Taiwan）
Tsubo 6,161 7,161 7,161
Regus Japan and Taiwan
Total：49,179tsubo
33(C) TKP Corporation 2021
Regus
New development of one-building facilities (Regus)
We decided to open one-building format under SPACES brand, as flexible offices are so
much in demand. We plan to open a new SPACES at Roppongi in September 2021,
with GFA of more than 900 tsubo.
Opened on Opened on
October 1, 2020 March 22, 2021
Opening scheduled for Sept. 2021
SPACES Shinjuku SPACES Akasaka
２～９F SPACES ３～６F SPACES
１０F TKP ７～８F TKP
Total：764.3 tsubo Total：991.5 tsubo
SPACES Roppongi
New nine-story building
Total：921.5 tsubo
34(C) TKP Corporation 2021
Regus
Regus Japan - business performance for Q1 of FY2021
Net sales bottomed out at Q4 last fiscal year, as the departures of large-scale
tenants stopped. Orders received in June turned out to be highest ever since the
beginning of 2020. We should expect strong Q2. The rise in cost is related to active
new facility opening, anticipating more flexible office demand in the future.
YoY
(Million yen) FY 2020 FY 2021
change
Q1 Q2 Q3 Q4 Full Year Q1 (%)
Net sales 4,456 4,375 4,294 4,173 17,298 4,208 -5.5%
Gross profit 1,547 1,439 1,298 1,011 5,296 1,111 -28.1%
（％ to sales） 34.7% 32.9% 30.2% 24.2% 30.6% 26.4% -8.3pt
SG&A 1,275 1,274 1,262 1,324 5,136 1,397 9.6%
EBITDA 1,034 941 802 476 3,255 492 -52.4%
（％ to sales） 23.2% 21.5% 18.7% 11.4% 18.8% 11.7% -11.5pt
Operating
profit(loss)
271 165 36 -313 160 -286 -
（％ to sales） 6.1% 3.8% 0.8% -7.5% 0.9% -6.8% -12.9pt
※Operating profit (loss) is after deducting amortization of goodwill & customer related assets
35(C) TKP Corporation 2021
Regus
Sales by service
In addition to mainstay office usage fee, we are observing rapid sales of membership,
which enables the holder to use Regus facilities nation-wide, due to flexible working
style being penetrated among the office workers in Japan under the pandemic
（Millions of yen）
5,000
Office Meeting room Others Membership
4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
FY2019 FY2020 FY2021
36(C) TKP Corporation 2021
Regus
Sales by brands
Most of sales at Regus Japan is Regus brand. However, SPACES started to increase
as we are opening more in SPACES format from last fiscal year
（Millions of yen）
5,000
Regus Spaces Open Office
4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
FY2019 FY2020 FY2021
37(C) TKP Corporation 2021
Regus
KPI trends for Regus Japan
Occupancy stayed flat at 67.4%, despite new facility opening such as SPACES Akasaka, as we
were able to quickly fill in the newly available office area.
From now on, we will focus to improve occupancy rates at the facilities longer than 2-year
operating track record.
Occupancy and GLA (gross leasable area) of Regus Japan
Occupancy GLA (tsubo)
Average occupancy rate of facilities
開設から2年未満の施設の平均稼働率 below two year track record
90% Average occupancy rate of facilities longer than two year 25,000
開設から2年以上経過している施設の平均稼働
track record
率
80.7% 81.9% 24,000
79.3% Average occupancy rate
全施設における平均稼働率 of all the facilities
80% 76.3%
74.2% 73.3% 23,000
75.1% 75.8% 71.5%
68.5% 22,000
70%
21,000
67.5% 67.4%
60% 20,000
19,000
50%
18,000
42.8%
39.6% 48.1%
38.6% 17,000
40% 36.8% 43.8%
16,000
30% 15,000
Q4 Q1 Q2 Q3 Q4 Q1
FY2019 FY2020 FY2021
38(C) TKP Corporation 2021
Working style is changing - before and after the pandemic
BEFORE AFTER
Fixed office location Multiple number of offices depending
Fixed seat in the office upon job nature
After visiting clients, sales reps. No fixed seats
return to the office to do admin. Flexible working style
Full-time employees
Flexible employment style
Temporary staff
Labor hour based Activity based management
Location is fixed, size is fixed Small HQ
Office size = # of employee
Multiple satellite offices
Flexible office size usage
Rental meeting rooms
39Anytime, Anywhere, for All workers
Anytime, Anywhere, for All workers
40Appendix
41(C) TKP Corporation 2021
Business model of flexible office business
Asset light - we do not own the assets, rather we lease them. Then, we sub-
lease in hourly manner with value-added services. This is our value creation.
Conferences
Real estate Lease Sublease
Training
temporary office
Divide space into smaller units Banquets
with value added services
Equipment rentals
Lunch boxes and catering
Etc.
×
Real estate owner Users
TKP handles contracts and all other tiresome procedures 42(C) TKP Corporation 2021
Unique business model
The source of our high profitability is inexpensively secured locations at the time of weaker property
market. We also ask for midway cancellation options even for the term lease contracts. Sometimes
we utilize revenue sharing models as well. By such, we are mitigating business risk.
Main characteristics
Contract on the contracts
Rent risk
（Japan）
Revenue sharing Flexibly negotiated with 86facilities 11facilities
Very low
agreement asset owners （39.6％） （6.8％）
Japanese style Contract can be
42facilities 84facilities
lease cancelled with six Low
（19.4％） （51.2％）
Ichigaya Conference center ：4,058Tsubo agreement months’ notice
Many restrictions on
Fixed-term lease 81facilities 69facilities Medium
cancelling the contract
agreement （37.3％） （42.1％）
prematurely
8facilities
Ownership No fixed rent
（3.7%） ー ー
※As of May 31, 2021
Shimbashi Conference center ：2,813Tsubo
▶
（Japan）
Cost
Variabl
Variable
Fixed e
rent Fixed
rent rent
39.6％ rent
60.4％ 42.1％
57.9％
Garden City Osaka Umeda ：2,152Tsubo 43(C) TKP Corporation 2021
Procurement in accordance with the market changes – breakeven points
Between TKP and Regus, the timings of breakeven are different. By conducting
joint opening and mutual conversion, we control profit & loss at one location.
*Fluctuating demand based on
market conditions
TKP
Reach break-even point occupancy
soon after opening
(within 2–3 months)
rate
Facility
opening Smaller initial cost
Break-even occupancy rate Shorter time to break even
(approx. 20%) Greatly influenced by
market conditions
Initial cost Time
Improving P/L balance by joint openings
Regus
Facility Reach break-even point after *Stable demand occupancy
opening approx. 8–12 months rate
Larger initial cost
Break-even occupancy rate
(approx. 45%) Longer time to break even
Little influenced by
market conditions
Contract start; Initial cost Time
construction (average of 3–4 months from the
begins start of a contract to opening)
44(C) TKP Corporation 2021
Accommodation/training facilities operated by TKP ※As of May 31, 2021
Facility Guest rooms Opened Building Land
APA Hotel TKP Sapporo Ekimae 203 August 2014 Leased ―
APA Hotel TKP Sapporo-Eki Kitaguchi EXCELLENT 108 August 2016 Leased ―
APA Hotel TKP Nippori Ekimae 278 December 2016 Owned Owned
APA Hotel TKP Tokyo Nishikasai 124 December 2017 Leased ―
APA Hotel TKP Keikyu Kawasaki Ekimae 143 June 2018 Owned Leased
APA Hotel TKP Sendai Ekikita 306 October 2018 Owned Owned
APA Hotel Osaka Umeda 162 May 2019 Owned Leased
APA Hotel Hakata Higashi Hie Ekimae 206 February 2020 Owned Owned
APA Hotel Fukuoka Tenjin Nishi 268 May 2020 Owned Owned
APA Hotel Ueno Hirokoji 215 July 2020 Owned Owned
LecTore Atami Koarashi 20 November 2013 Leased ―
LecTore Hakone Gora 23 January 2014 Leased ―
LecTore Karuizawa 14 July 2014 Leased ―
LecTore Atami Momoyama 31 July 2014 Leased ―
AZUR Takeshiba (managed on contract) 122 April 2017 Leased ―
LecTore Yugawara 108 May 2017 Owned Owned
LecTore Hayama Shonan Kokusaimura 160 April 2018 Owned Owned
LecTore Takamatsu Airport
124 June 2018 ― ―
(banquet hall rental/ business alliance)
LecTore Yatsugatake (managed by a third party) 32 November 2018 ― ―
LecTore Toyama Jiyukan (managed by a third party) 40 March 2018 ― ―
ISHINOYA Izu Nagaoka 22 January 2015 Leased ―
ISHINOYA Atami 34 September 2020 Leased ―
First Cabin TKP Ichigaya 165 November 2018 Leased ―
Tohan seminar house Iidabashi(managed by a third
15 March 2016 ― ―
party)
FUKUICHI(Ikaho Onsen) (managed by a third party) 64 April 2019 ― ― 45(C) TKP Corporation 2021
Important Notice
This English translation is only intended for reference. In cases of discrepancies, data
contained within the original Japanese version shall take precedent over data
contained herein.
This material has been prepared to improve the understanding of our Group, and no
information contained herein shall be construed as solicitation for purchase or sale of
our shares. This material has not been prepared for investment advisory purposes.
Forecasts and related information contained in this material are estimates which were
based on information available to the TKP group at the time when the material was
prepared. They will be impacted by uncertainties including market conditions and future
business progress.
Please be aware that the actual results and other information may differ significantly
from what is stated in this material.
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