Earnings briefing material - Q4 FY2021 TKP Corporation April 14th, 2022 TKP Garden City PREMIUM Jimbocho
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Earnings briefing material
Q4 FY2021
TKP Corporation
April 14th, 2022
TKP Garden City PREMIUM Jimbocho
0
Contents
Executive Summary of FY 2021 P.２
Performance Review & Business Review P.３～18
Overview of FY 2021 P.19～20
Financial forecast & Management Strategy
P.21～39
for 2022
Appendix P.40～47
1
(C) TKP Corporation 2022
Highlights of the fiscal year ended February 2022
• Profit improvement in the 2nd half stronger than expected,
leading to an upward revision of the earnings forecast
announced on April 11
Key metric EBITDA improved 50% year-on-year
• Steady recovery in the rental meeting room business, and the
TKP business achieved positive operating profit
for the full year
• Regus Japan continued opening new facilities while
maintaining positive EBITDA.
With high facility utilization, achieved record revenue
in Q4 and for the full year
• Although there will still be some impact from Covid-19 to
consolidated earnings in the year ending Feb 2023, we expect
to book positive figures at all levels of profit
2
Performance Review
FY2021
3
(C) TKP Corporation 2022
Consolidated results Q４ FY2021
In Q4 (Dec-Feb), despite the increase in Covid-19 infections caused by the
Omicron variant, earnings improved for both the TKP business and Regus
Japan, and sales for the full year improved 3.6％ year-on-year
EBITDA was up +50.7％
Feb. 2021 Feb. 2022 Y-Y change
(million yen）
Q1 Q2 Q3 Q4 Full year Q1 Q2 Q3 Q4 Full year (%)
Net sales 10,447 10,097 11,688 10,905 43,138 10,272 11,683 10,948 11,781 44,685 +3.6%
Gross profit 2,744 2,317 3,334 2,814 11,210 2,588 3,689 2,602 3,193 12,073 +7.7%
（％ to sales） 26.3% 23.0% 28.5% 25.8% 26.0% 25.2% 31.6% 23.8% 27.1% 27.0% +1.0pt
SG & A 3,709 3,367 3,239 3,392 13,708 3,418 3,357 3,219 2,961 12,957 △5.5%
EBITDA 367 362 1,515 827 3,073 574 1,709 748 1,598 4,630 +50.7%
（％ to sales） 3.5% 3.6% 13.0% 7.6% 7.1% 5.6% 14.6% 6.8% 13.6% 10.4% +3.2pt
Operating
Profit (loss)
△964 △1,049 94 △578 △2,497 △829 331 △616 231 △883 ー
（％ to sales） △9.2% △10.4% 0.8% △5.3% △5.8% △8.1% 2.8% △5.6% 2.0% △2.0% +3.8pt
Ordinary Profit (loss) △1,288 △831 4 △206 △2,321 △979 233 △691 △147 △1,585 ー
Profit (loss)
attributable to △1,464 △938 △453 △646 △3,503 △1,878 △255 △805 △272 △3,211 ー
owners of the parent
4
(C) TKP Corporation 2022
Quarterly trend in net sales / EBITDA by operation
TKP ：Despite sales volatility due to impact from Covid-19, lowered fixed costs
and thus the breakeven point, leading to significant improvement in EBITDA
Regus Japan：Steady growth in sales, with almost no impact from Covid-19, reaching
record sales in Q4. Also achieved growth in EBITDA
（million yen） （million yen）
Net sales EBITDA
12,000 2,500
TKP Regus Japan
※１ 2,000 ※１
10,000 TKP Regus Japan
1,500
8,000
1,000
6,000
500
4,000
0
2,000 △500
0 △1,000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 ※2 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2/2020 2/2021 2/2022 2/2020 2/2021 2/2022
5
※1：Started consolidation of Regus Japan from Q2 2/2020 ※2：One-time acquisition cost was recorded at Regus Japan in Q3 2/2020
(C) TKP Corporation 2022
TKP
Business performance FY2021 for TKP (non-consolidated)
In Q4 there was an increase in Covid-19 infections due to the Omicron variant, but with robust
demand for exams, sales increased 10% from Q3, and EBITDA tripled.
With the gradual recovery in demand for rental meeting rooms, as well as contribution from
services that meet social needs, such as the Covid-19 vaccination centers, there was a
significant year-on-year improvement in every level of profit
Y-Y change
Feb. 2021 Feb. 2022 (full year)
Q1 Q2 Q3 Q4 full year Q1 Q2 Q3 Q4 Full year (%)
(million yen）
Net sales 5,410 5,261 6,887 6,278 23,838 5,466 6,859 5,965 6,601 24,892 +4.4%
Gross profit 1,266 891 1,986 1,723 5,867 1,368 2,449 1,836 2,307 7,961 +35.7%
（％ to sales） 23.4% 16.9% 28.8% 27.4% 24.6% 25.0% 35.7% 30.8% 35.0% 32.0% +7.4pt
SG&A 2,150 1,884 1,839 1,876 7,752 1,860 1,893 1,817 1,827 7,398 △4.6%
EBITDA △674 △744 382 69 △967 △275 797 233 693 1,448 ー
（％ to sales） △12.5% △14.1% 5.6% 1.1% △4.1% △5.0% 11.6% 3.9% 10.5% 5.8% +9.9pt
Operating
△884 △993 146 △153 △1,884 △491 555 19 479 563 ー
profit (loss)
（％ to sales） △16.3% △18.9% 2.1% △2.4% △7.9% △9.0% 8.1% 0.3% 7.3% 2.3% +10.2pt
6
(C) TKP Corporation 2022
Regus
Business performance FY2021 for Regus Japan
The occupancy of facilities remained high, leading to record sales in Q4 and the
full year.
Despite a decline in gross profit from the scheduled increase in the IWG franchise expense,
continued to actively open new facilities and continued to secure positive EBITDA
Y-Y change
Feb. 2021 Feb. 2022 (full year)
Q1 Q2 Q3 Q4 full year Q1 Q2 Q3 Q4 full year (%)
(million yen）
Net sales 4,456 4,375 4,294 4,173 17,298 4,208 4,376 4,443 4,539 17,569 +1.6%
Gross profit 1,547 1,439 1,298 1,011 5,296 1,111 1,177 675 703 3,668 △30.7%
（％ to sales） 34.7% 32.9% 30.2% 24.2% 30.6% 26.4% 26.9% 15.2% 15.5% 20.9% △9.7pt
SG&A 1,275 1,274 1,262 1,324 5,136 1,397 1,329 1,258 958 4,945 △3.7%
EBITDA 1,034 941 802 476 3,255 492 578 159 493 1,724 △47.0%
（％ to sales） 23.2% 21.5% 18.7% 11.4% 18.8% 11.7% 13.2% 3.6% 10.9% 9.8% △9.0pt
Operating
271 165 36 △313 160 △286 △151 △582 △255 △1,276 ー
profit (loss)
（％ to sales） 6.1% 3.8% 0.8% △7.5% 0.9% △6.8% △3.5% △13.1% △5.6% △7.3% △8.2pt
7
※SG&A, and operating profit (loss) are calculated after deducting amortization of goodwill & customer related assets
(C) TKP Corporation 2022
Consolidated balance sheet
Due to the execution of the 7th series of share subscription rights through a third-party allotment, the
Shareholders’ equity ratio increased 5.7 points from the previous period to become 34.1％. Operating cashflow
was negative, due to the payment of 2 years’ worth of corporate tax etc. which we had been allowed to defer
due to Covid-19.
（million yen） End of Feb. 2021 End of Feb. 2022 Change
Current assets 21,373 22,803 ＋1,430
(Cash & deposits) 15,195 13,931 △1,264
(Accounts receivable) 3,318 3,558 ＋239
Non-current assets 95,573 88,477 △7,096
(Property, plant and equipment) 38,735 35,564 △3,170
(Intangible fixed assets) 42,196 37,883 △4,313
Total assets 116,946 111,280 △5,665
Current liabilities 26,955 20,156 △6,799
Non-current liabilities 54,849 51,377 △3,471
Total liabilities 81,804 71,533 △10,270
(Interest-bearing debt) 62,676 56,448 △6,227
Total net assets 35,142 39,746 ＋4,604
Total assets & liabilities 116,946 111,280 △5,665
Shareholders’ equity ratio 28.4% 34.0% +5.6pt
End of Feb. 2021 End of Feb. 2022 Change
Cash flow from operation 7,022 △2,892 △9,914
Cash flow from investment 1,140 1,228 ＋88
Free Cash Flow 8,162 △1,663 △9,826
Cash flow from finance △2,191 292 ＋2,484 8
Business Review
FY2021
9(C) TKP Corporation 2022
Facility openings and closures in core operations
TKP closed 4 facilities in Q4, with the contract expiries, and will accelerate new facility
openings in the fiscal year ending Feb 2023 onwards, in anticipation of demand recovery.
Regus will also continue aggressively opening new facilities using flexible contract structures
FY 2021 FY 2020 FY 2021
Q4 full year full year
Opens － ＋12（＋4,826 tsubo） ＋7（＋2,268 tsubo）
Closed -4（-641 tsubo） -46（-11,797 tsubo） -20（-6,781 tsubo）
Opens － ＋10（＋4,083 tsubo） ＋８（＋2,795 tsubo）
(Japan＋Taiwan) Closed － -３（-706 tsubo） －
(Break down of 4 closures) TKP Garden City １facility TKP Business Center １facility
TKP Conference Center １facility LecTore １facility
Opening plan in Q1 FY2022
LecTore Kobe（2022.4～） Signature ROPPONGI HILLS Regus Kanazawa Park Building
（2022.3～） （2022.4～）
10(C) TKP Corporation 2022
TKP
Number of meeting rooms, locations by grade (TKP)
We provide rental meeting rooms in grades according to the purpose of use, scale,
budget, and other factors. These comprise 238 facilities and over 130,000 tsubo of
floor space. Grade Feb. 2020 Feb. 2021 Feb. 2022
Locations 24 24
Co-branded with
Escrit Inc. CIRQ Rooms 51 51
－
Tsubo － 19,776
Garden City Locations 25 27 26
Temporary offices in
large, new buildings REMIUM Rooms 300 296 304
（GCP） Tsubo － － 15,833
Locations 58 54 49
Banquet facilities in Garden City
large, older hotels （GC） Rooms 563 522 450
Tsubo － － 36,447
Conference Locations 82 66 64
Temporary offices in
large, older buildings
Center Rooms 918 780 759
（CC） Tsubo － － 29,234
Temporary offices in Business Locations 45 34 30
medium-sized, older Center Rooms 286 223 209
buildings
（BC） Tsubo － － 5,337
Temporary offices in Locations 36 32 27
STAR rental
small, older
Meeting rooms Rooms 70 71 53
buildings
Tsubo － － 1,602
Locations 15 14 18
LecTore and Ishinoya
（accommodations & training venue） Rooms 101 90 137
Tsubo － － 24,526
Locations 261 251 238
TKP Total Rooms 2,238 2,033 1,963
Tsubo 133,193 142,002 132,756
11(C) TKP Corporation 2022
TKP
Sales by service
Demand for rental meeting rooms bottomed in Q2 and steadily recovered (except for
Covid-19 vaccination centers). With the contribution of Covid-19-related block-
leases of APA Hotels to the national and regional governments, sales of
accommodation services also recovered to pre-Covid levels.
12,000
Room rent Options Vaccination Center F&B Accommodation Others Cancellation fee
（million yen）
10,000 92 105 ※“Option” mainly represents sales for the use of meeting room equipment.
398 328
76
1,258 299 739
1,344
218
8,000 1,396
1,141
1,813
1,878
291 229
1,734 137 269 385
1,717
6,000 1,001 833 603
1,095
153 188
1,105 157 157
328 1,305
953 701 329 153
831 676 282 1,226
1,133 224 253
72 867 247
590 1,510 5
4,000 2,569
187
965
227
3
1,067
1,116
580 890 841
5,391 213
5,078 391
4,687 4,549
2,000 114
243
4,166
3,628
3,157 3,397
2,871 2,763 3,062
1,881
0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2/2020 2/2021 2/2022 12(C) TKP Corporation 2022
TKP
Trend in KPI of the rental meeting room business
Q4 sales per tsubo was 11% higher than in Q3, due to growth in overall usage of
rental meeting rooms, despite the higher ratio of exam demand which do not
generate revenue optional services.
Monthly Sales / tsubo Sales per tsubo and meeting room gross leasable area※ Meeting room GLA
Quarterly average (tsubo)
(yen) floor space sales / tsubo
50,000 70,000
41,831
39,776
38,358
40,000 60,000
36,755 29,687 26,838
30,000 50,000
26,654
25,032
20,000 24,476
22,825
24,141 40,000
20,255
10,000 30,000
0 20,000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2/2020 2/2021 2/2022
※Sales include room charge, options and catering revenues. GLA indicates gross leasable area as meeting room function 13(C) TKP Corporation 2022
TKP
Sales ratio by usage: TKP rental meeting rooms
Together with strong demand for exams such as university exams, due to Q4 being
the exam season, demand also recovered for other types of usage. We expect
growth in Q1 of FY Feb 2023 for recruiting and HR training.
Meeting Recruiting Training Seminar Party Exam Others ※
100%
90% 20.1%
23.4% 24.1%
20.5% 21.3%
26.3% 25.6% 26.5%
29.1% 29.3%
80% 2.9%
39.2%
4.2%
4.9% 3.5% 11.3% 0.6% 50.6%
5.9%
70% 4.3%
3.9% 10.2% 11.8%
15.2% 8.4%
18.9% 0.2% 17.9%
60% 18.0% 25.4%
21.0% 34.0%
13.6% 17.9% 0.4%
0.5%
50% 17.8%
18.0% 27.1%
1.0% 1.0%
16.0% 10.7%
19.4% 20.9%
40% 10.9% 0.3% 0.4% 17.1%
15.5% 11.7%
21.7%
13.9%
30% 18.4% 11.7%
9.2%
7.9%
17.5%
4.9% 6.0% 19.5% 8.2% 6.9%
7.9% 3.9%
20% 4.6% 8.3%
7.3% 4.6% 4.3%
2.3% 4.4%
23.2% 24.7% 24.1%
10% 20.7%
17.2% 18.3% 20.4% 18.9% 18.9%
14.9% 14.4% 12.8%
0%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2/2020 2/2021 2/2022
※Sales include room charge, options and catering revenues. GLA indicates gross leasable area as meeting room function 14(C) TKP Corporation 2022
Regus
Regus: number of locations by brands
We operate four brands in Japan and two brands in Taiwan suitable to different and
diversifying needs for flexible working styles. We provide a total of 184 facilities
with about 50,000 tsubo of flexible workspace.
Brand Feb. 2020 Feb. 2021 Feb. 2022
Location 4 6 8
Large community-type
rental offices
Tsubo － － 6,673
Location 100 105 110
High-grade
rental offices
Tsubo － － 28,952
Japan
Location 5 4 4
Rental offices adjacent
to public transportation Tsubo － － 288
Location 47 47 48
Reasonably priced
unmanned rental
offices
Tsubo － － 7,360
Location 2 3 3
Large community-type
rental offices
Tsubo － － 3,027
Taiwan
Location 11 11 11
－ － 4,134
High-grade
rental offices Tsubo
Location 156 162 170
Regus（Japan）
Tsubo 36,311 39,885 43,273
Location 13 14 14
Regus（Taiwan）
Tsubo 6,161 7,161 7,161
Regus Japan and Taiwan
Total：50,434 tsubo 15(C) TKP Corporation 2022
Regus
New development of single-building facilities
With growth in demand for flexible offices, opened large “whole-building” facilities.
Opened 3 large facilities, totaling more than 2,300 tsubo in FY Feb 2022
October 1, 2020 March 3, 2021 September 1, 2021 November 1, 2021
SPACES Shinjuku Regus Shibuya Koendori
SPACES Akasaka SPACES Roppongi
Business Center
2-9F SPACES 3-6F SPACES New nine-story building 1-6F Regus
10F TKP 7-8F TKP 1-9F SPACES
7-8F TKP
Total：764.3 tsubo Total：991.5 tsubo Total：921.5 tsubo Total：415.1 tsubo
16(C) TKP Corporation 2022
Regus
Sales by service
Sales of rental offices with average contract periods of more than 1 year suffered
almost no impact from Covid-19, and continued to rise steadily from Q4 of the
previous fiscal year, reaching record quarterly sales in Q4.
（million yen）
Office Common area fee and other service Membership ※ Meeting room
5,000
4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2/2020 2/2021 2/2022
※Membership: Monthly subscription service where the members are entitled to use all the Regus lounges & co-working spaces located in Japan 17(C) TKP Corporation 2022
Regus
KPI trends for Regus Japan
Occupancy improved for facilities that have been in operation for less than 2 years, as well as
facilities that have been operating for more than 2 years. Overall average occupancy was 69.7%,
up 2.2 points from Q4 of last year. The average went up to 71.4% in February 22.
Occupancy GLA（tsubo）
（％） Average occupancy rate of all the facilities
90.0% Occupancy and GLA (gross leasable area) of Regus Japan Average occupancy rate of facilities longer than two year track record 25,000
Average occupancy rate of facilities below two year track record
80.0% 76.4% 24,000
73.0%
74.3% 72.0% 72.6% 72.5%
70.5% 70.4%
75.8% 23,000
70.0%
71.5%
69.8% 68.5%
60.0%
68.5% 67.5% 67.4%
69.7%
22,000
21,000
50.0% 45.0%
20,000
37.9% 48.0%
40.0%
30.9% 41.6% 19,000
30.0%
18,000
17.5% 20.4%
Opened SPACES Roppongi
20.0%
Regus Shibuya Koen-dori 17,000
10.0% 15.4% 16,000
0.0% 15,000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2/2021 2/2022 18(C) TKP Corporation 2022
Regus
KPI trends for Regus Japan－Occupancy
Occupancy of facilities that have been in operation for more than 2 years, which we
had been focusing on since the beginning of the fiscal year, bottomed in Q1 and has
been recovering. Expect improvement to continue in Q1 of FY Feb 2023
Occupancy
100% Average occupancy of facilities
that have been in operation for more than 2 years
90%
80% 76.4%
73.0%
74.3% 72.6%
72.0% 72.5%
70.5% 70.4%
70%
60%
50%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1～ Q2
2/2021 2/2022 2/2023
19Summary of FY2021
20(C) TKP Corporation 2022
Summary of FY2021
• Demand for rental meeting rooms entered • Opened 8 new facilities, including 3
a recovery trend, with the normalization of “whole-building”, supplying 3,400 tsubo
economic activities • Continued steady revenue growth,
• Adapted flexibly to Covid-related demand, reaching record sales
and operating P&L turned positive from Q2
30,000
(million yen) Cancelation 4,600 yen)
(million
fee
4,500 Sales trend of
25,000
Regus Japan
5/10 facilities
4,400
20,000 Sales
4,300
from
15,000
actual Block-leased for 4,200
usage Covid-related demand
4,100
10,000 +20% Average occupancy 4,000
year- of facilities under
3,900
5,000 on-year regular operation
71％ Q4 Q1 Q2 Q3 Q4
0
2/2021 2/2022
2/2021 2/2022
Steady progress in planting the seeds for mid-to-long term growth,
as well as improving earnings 21Financial forecast &
Management Strategy for FY2022
22(C) TKP Corporation 2022
Financial result forecast for the fiscal year ending February 28, 2023
Assumed the spread of Covid infections will continue, but will come
under control towards the end of the fiscal year
Expect steady recovery in demand, with less impact of Covid-19
Will continue new facility openings while controlling costs.
Expect steady improvement in occupancy and sales
Feb. 2022 Feb. 2023 Y-Y change
Y-Y change
（million yen） result Forecast (%)
Net Sales 44,685 51,000 ＋6,315 ＋14.1％
EBITDA※ 4,630 7,500 ＋2,870 ＋62.0％
10.4％ 14.7％
Operating △883 2,000 ＋2,883 ―
Profit (loss) △2.0％ 3.9％
Ordinary △1,585 1,500 ＋3,085 ―
Profit (loss) △3.5％ 2.9％
Profit (loss)
attributable to △3,211 400 ＋3,611 ―
owners of the parent △7.2％ 0.8％
※ EBITDA is calculated by adding depreciation, goodwill amortization, amortization of long-term prepaid expenses, and amortization of intangible
assets such as customer-related assets to the operating profit/loss.
23(C) TKP Corporation 2022
Strategy for FY Feb 2023
Portfolio reform
Promote new openings in anticipation of normalization of
Sourcing
economic and social activities.
Begin expansion of Regus subfranchising.
Capture all demand through Physical×Online strategy
Sales Based on the track record built during the pandemic, capture
the recovering demand for rental meeting rooms from all
directions
Accelerate value-add through business partnerships
Business
developm
Increase high value-add projects of ”Space ＋α“, through
ent
business partnerships
24(C) TKP Corporation 2022
Strategy for FY Feb 2023
Portfolio reform
Sourcing Promote new openings in anticipation of normalization of
economic and social activities.
Begin expansion of Regus subfranchising.
Capture all demand through Physical×Online strategy
Sales Based on the track record built during the pandemic, capture
the recovering demand for rental meeting rooms from all
directions
Accelerate value-add through business partnerships
Business
developm
Increase high value-add projects of ”Space ＋α“, through
ent
business partnerships
25(C) TKP Corporation 2022
Reform of portfolio of contracted properties
Before
Present Future
COVID-19
261
facilities
214
156
Facilities
※1 170
facilities
facilities
Accelerated openings, Actively closed ・Large supply of offices in 2023※
in accordance with unprofitable facilities, as ・Continuous rise in vacancy, etc.
strong demand for well as large facilities With external environment as a tail wind,
banquets/parties and which had been signed accelerate openings for both TKP and
physical events at high rent Regus
Replace with facilities that
Aggressive openings Continuing
aggressive openings have better economics
※１ Calculated excluding “CIRQ”, a facility jointly-operated with Escrit 26
※２ Mori Trust ”2021 Survey on Supply of Large Office Buildings in Tokyo 23 Wards”, CBRE “Real Estate Market Outlook 2021” etc.(C) TKP Corporation 2022
Basic policy for sourcing
Replace properties with those Start sub-franchising and
in high demand, through accelerate openings
“Hermit crab strategy”
Opening In central locations of major Focus on Tokyo
cities all over Japan, suburbs and regional
areas especially in Greater Tokyo cities
Unused but convenient
Subject Wide range, from new
properties, and high- to old buildings
properties quality used buildings
・Sub-franchising
Decide on a
Scheme used case by case basis
・Variable rent
・Profit sharing
Openings per
year 10～20 facilities 15～20 facilities
27(C) TKP Corporation 2022
Begin sub-franchising of Regus Japan
Master franchiser Accelerate 1,000 facilities
Exclusive brand rights in Japan and network Target
Royalty
expansion
Taiwan, management system, etc.
Sub franchisee
250 facilities
（Japan・Taiwan）
Target
Operation Operational knowhow
Royalty Various types of support 170 facilities
Sub franchisee
Directly operated Building owners,
facilities corporates,
real estate investors, etc. 2015 現在
（present） 2025 2035
（existing operations）
Accelerate deployment of high-profitability
business mode, to further grow revenues 28(C) TKP Corporation 2022
Recent opening：LecTore Kobe on April 1st
Opened the first accommodation type training facility ”LecTore Kobe”, the first in the Kansai region
With the recovery in over-night training programs and offline training, will consider openings through
various methods, including direct operation and management contracts
Gross floor area：5,750 tsubo
29(C) TKP Corporation 2022
The highest Regus brand, “Signature” is arriving at Japan
The highest Regus brand “Signature, ” available only at symbolic buildings with
antique style furniture will be opening at Roppongi Hills Mori Tower in March 2022.
Making progress in leasing, mainly with IT and consulting companies
30(C) TKP Corporation 2022
Strategy for FY Feb 2023
Portfolio reform
Promote new openings in anticipation of normalization of
Sourcing
economic and social activities.
Begin expansion of Regus subfranchising.
Capture all demand through Physical×Online strategy
Sales Based on the track record built during the pandemic, capture
the recovering demand for rental meeting rooms from all
directions
Accelerate value-add through business partnerships
Business
developm
Increase high value-add projects of ”Space ＋α“, through
ent
business partnerships
31(C) TKP Corporation 2022
Usage of rental meeting rooms before Covid-19
Party Exam Recruiting
Various events Meeting・Event Business seminar
32(C) TKP Corporation 2022
Changes seen since spread of Covid-19
Party Exams Recruiting
← Online party
packages
together with
contents
→Refreshment
party packages
during Covid
CBT(Computer Based Testing) Online recruiting interviews
centers
Google 2022
Cloud Firm-wide
LINE
Day kickoff
WORKS
DAY
Regular
webinar by Awards AUTODESK
an NPO ceremony UNIVERSITY
organization 2021
Various events Meeting・Event Business seminar 33(C) TKP Corporation 2022
Example of client event：Adapting to demand shift from physical to online
Set up Video
Planning Admin Recording Broadcasting
venue production
One-stop services from planning to broadcasting for online events
Some companies are already going back to physical events 34(C) TKP Corporation 2022
Start providing new technologies
Prepare wide range of lineup for the recovering demand for physical events
Can be combined with new technologies such as virtual productions
35(C) TKP Corporation 2022
Strategy for FY Feb 2023
Portfolio reform
Promote new openings in anticipation of normalization of
Sourcing
economic and social activities.
Begin expansion of Regus subfranchising.
Capture all demand through Physical×Online strategy
Sales Based on the track record built during the pandemic, capture
the recovering demand for rental meeting rooms from all
directions
Accelerate value-add through business partnerships
Business
developm
Increase high value-add projects of ”Space ＋α“, through
ent
business partnerships
36(C) TKP Corporation 2022
Accelerate value-add through business partnerships
Hardware
Software
Large-scale recruiting
Covid vaccination centers BPO office Training sessions outsourcing
37(C) TKP Corporation 2022
COVID scenario
Capture all types of demand for
space, which will recover going Accommodation
forward, through broad coverage
including online and new contents
Rental
Conference Room
Accommodation NEW Content
Rental
Conference Room Virtual Option
Virtual Option
Physical Event Physical Event
Option Option
F&B
Reconsider
in-sourcing F&B
Room Rent Room Rent
Before COVID-19 Initial stage With COVID-19 After COVID-19
38Re-strengthen sourcing
Accelerate sub-
franchise openings
Become fully profitable, by
capturing demand recovery and
accelerating initiatives to expand
new network
Begin the counterattack
39Anytime, Anywhere, for All workers
いつでも、どこでも、すべての働く人たちに。
40Appendix
41(C) TKP Corporation 2022
Business model: 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 Sub-lease
Training
temporary office
Divide space into smaller units Banquets
with value added services
Equipment rentals
Lunch boxes and catering
Real estate owner etc.
Users
×
TKP handles contracts and all other tiresome procedures 42(C) TKP Corporation 2022
Main feature of the business model
Source of our profit are leasing contracts we conclude advantageously at the time of
recession. We typically reduce rent payment risk by combining Japanese traditional
lease agreements, fixed-term contracts with cancellation options, as well as revenue
sharing agreements. ※As of February 28, 2022
Main features of
Contract the contracts
Rent risk
（Japan）
Revenue sharing Flexibly negotiated 110 facilities 9 facilities
Very low
agreement with asset owners （46.2％） （5.3％）
Contract can be
Traditional lease 42 facilities 87 facilities
cancelled with six Low
agreement （17.6％） （51.2％）
Ichigaya Conference center ：4,058 tsubo months’ notice
Many restrictions on
Fixed-term lease 78 facilities 74 facilities
cancelling the contract Medium
agreement （32.8％） （43.5％）
before expiry date
8 facilities
Ownership No fixed rent
（3.4％） ー ー
Shimbashi Conference center ：2,813 tsubo
(Japan)
Cost
Variable Variable
Fixed rent
46.2% Fixed rent 39.4%
60.6%
53.8%
Garden City Osaka Umeda ：2,152 tsubo 43(C) TKP Corporation 2022
Leasing in accordance with the market changes – breakeven points
Between TKP and Regus, the timings of breakeven are different. By conducting
hybrid operation 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 Smaller initial cost
opening
Shorter time to break
Break-even occupancy rate
even
(approx. 20%)
Greatly influenced by
market conditions
Initial cost Time
Improving P/L balance by joint openings
Regus
Facility Reach break-even point *Stable demand occupancy
opening after approx. 8–12 months rate
Larger initial cost
Break-even occupancy rate Longer time to break
(approx. 45%) 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 2022
Accommodation/training facilities operated by TKP ※As of February 28, 2022
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 ―
LecTore Yugawara 108 May 2017 Owned Owned
LecTore Hayama Shonan Kokusaimura 160 April 2018 Owned Owned
AZUR Takeshiba (managed on contract) 122 April 2017 Leased ―
ISHINOYA Izu Nagaoka 22 January 2015 Leased ―
ISHINOYA Atami 34 September 2020 Leased ―
45
※Only our operation facilities(C) TKP Corporation 2022
Progress on new share subscription rights
In January, we allocated moving strike new share subscription rights to a third
party in order to finance additional flexible office related capital investment
(exercise started in February). 7th tranche was completed on September 29th.
The 8th tranche commencement is currently under deliberation.
finished Option to commence※1
7th new share subscription right
（allocated on Feb. 4th, 2021） 8th new share subscription right
New capital：c. 8.3 bn. Expected new capital：c. 10 bn ※2
Period (M or Q) Exercised share Fresh capital (¥ million)
FY20 Q4 (February) 294,600 728
FY21 Q1 (Mar. to May) 1,637,900 3,709
FY21 Q2 (Jun. to Aug.) 1,339,400 2,711
FY21 Q3 (September) 702,400 1,146
Total 3,974,300 8,296
※１：We have options to decide the commencement day, numbers of the rights to be exercised, as well as termination day.
※２：Calculated based upon the closing price of ¥2,672 as of January 13th as the base price for the strike price. Expected capital amount 46
could change in accordance with the strike price, which is moving strike structure.(C) TKP Corporation 2022
Shareholder composition
As of February 28, 2021 As of February 28, 2022
■ Takateru Kawano(including asset management company) ■ Japanese corporation ■ Treasury stock
■ Individuals and others ■ Foreign corporation
■ Financial institutions ■ Brokerage firms
1.2%
1.1% 1.3% 1.3%
10.7% 13.7%
7.6%
7.0%
Number of Number of
10.4% shares issued shares issued
9.0%
38,422,285 59.7%
42,219,285 54.4%
9.2%
13.4%
47(C) TKP Corporation 2022
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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