Nomura Real Estate Holdings, Inc. announces that it has recently formulated the new Mid– to Long–term Business Plan – Creating Value through Change – (from April 2016 to March 2025).
The Group formulated a Mid– to Long–term business plan (through March 2022) in fiscal 2012. During Phase 1 (from the fiscal year ended March 2013 to the fiscal year ending March 2016) of said plan, we have addressed implementing the basic strategies "To secure earnings growth in existing businesses," "To secure financial foundation toward future growth" and "To make aggressive efforts toward the realization of growth from the long–term perspective." As a result, the goal of \65.0 billion in operating income was achieved two fiscal years ahead of schedule and the goal of 30% in shareholders' equity ratio is expected to be achieved as of the end of March 2016, thereby showing successful progress in quantitative terms.
Looking at the social and economic environments surrounding the Group, diverse changes have continued including the progress of urban renaissance in metropolitan areas, movements for regional revitalization, and the increase and/or obsolescence of the stock of existing properties, in addition to the aging population and declining birthrate, as well as the progress of women's advances in society. Furthermore, such phenomena as the expansion of the real estate investment market, the economic growth of the Asian zone and accelerated globalization are expected to have significant effects on the business environment of the Group in the future.
Given the aforementioned background, we have formulated this business plan to realize our growth model that emphasizes "Continuous expansion of revenue with ensured high asset efficiency" based on the streamlined financial foundation.
We have set financial goals up to FY25/3 and have deployed growth strategies for their achievement. Meanwhile, the target period is divided into three phases, and the respective milestones are planned for each phase in anticipation of realizing stepwise growth.
■ Phase 1: FY17/3 through FY19/3
■ Phase 2: FY20/3 through FY22/3
■ Phase 3: FY23/3 through FY25/3
Utilizing what people and communities mutually respect to engage in urban development that anticipates the future, and nurturing an affluent time to live in together with communities while creating new value for society.
Pursue an optimum balance among efficiency, financial soundness and return to shareholders.
|Asset efficiency||Capital efficiency||Financial soundness||Total return ratio|
|ROA Above 5%||ROE 10% level||Shareholders' equity ratio 30% level||Dividend payout ratio Approximately 30%|
Realize sustainable revenue growth while maintaining a stable financial foundation and high asset efficiency.
Operating income to be doubled by the end of the target period (compared with the corresponding figure for FY16/3)
|Phase 3 (FY25/3)|
|Operating income||¥150 billion level|
|Operating revenue||Above ¥1 trillion|
|Phase 1 (FY19/3)||Phase 2 (FY22/3)|
|Operating income||¥85.0 billion||¥110 billion level|
Proactive increase of investment based on a solid financial foundation(Billions of yen)
|Total for the target period
|Residential Development Business|
|Return to investment ratio||95%||92%|
|Return to investment ratio||38%||47%|
|Return to investment ratio||74%||73%|