ES-CON JAPAN

Investor Relations

ES-CON JAPAN is a life developer that builds the settings of people’s futures, bringing ideals into reality and the future of Japan to life.

Current Endeavors

The corporate operating environment, including the devaluation of the Japanese yen and rising costs and interest rates, will significantly affect economic trends. Furthermore, we are called on to urgently address various social problems ranging from global warming to the declining birthrate and aging population, decrease in population, gender issues, economic gap issues, and geopolitical risks, on top of digital transformation (DX) in various fields and fiercer competition that goes beyond industry boundaries. Moreover, the consumption behavior and values of customers are constantly and swiftly changing, and in order to achieve sustainable growth, businesses find themselves in an environment where they must provide true value to customers and society through business activities.

In order to realize sustainable growth through contributions to society under this environment of rapid diversification and change, we, as the ES-CON JAPAN Group, need to adopt new, flexible ideas not bound by precedent or established concepts, carry out business activities, and contribute to revitalizing the local community. Concurrently, we should strive to conduct stable management based on the solid financial foundation and grow surely and steadily through the satisfaction of our customers with the ultimate aim of being a “life developer” bringing the ideal into reality, building a future, and developing a lifestyle per se by envisioning the happiness of those living there.

Through a multifaceted real estate business that includes residential development, commercial development, logistics development, leasing business, office development, hotel development, overseas business, planning/consulting, facility operation management, asset management, capital investment operations overseas and elsewhere, and columbarium business, we must constantly strike the optimal balance of businesses in our operations and establish a firm management base that can withstand any economic environment. In addition, to achieve sustainable growth, recognizing the further enhancement of organizational power, human capital—that is, our employees or their knowledge, skills, talents, and the like— is our top priority, we have started preparations to formulate our policy on human resources development, build an educational and training system, and disclose information on matters related to human capital.

We will carry through both “deepening” and “evolution” based on our dual focus on business strategy and sustainability management; create a virtuous cycle of sustainable growth for the Group; and, by doing our part for society, seek to achieve true corporate value that transcends financial indicators alone.

Our specific endeavors are the following:

(1) Basic Policy on Corporate Management

We recognize the need to improve and strengthen our corporate governance. We must do so to improve the soundness and transparency of management, build corporate value in sustainable fashion for the long term, and become a company needed by society in accordance with our “Purpose,” “Vision,” and “Principles of Action.”

Purpose (The Group’s societal reason for being and value for society)

“IDEAL to REAL: Bringing ideals into reality to create a new future”
We create value rooted in the community, helping to bring about cherished cities and living environments in which residents can take pride. The value we create represents our contributions to society. Consequently, each of us seeks to realize original forms of self-actualization through that value. While designing an ideal future, we will be creating a new future, with the aim of being regarded as a unique, essential presence by all our stakeholders.

Vision (Our ideal shape for achieving our Purpose)

“To Be A Life Developer” To develop not just buildings but the lives of those who live in them, with their happiness in mind –this is the kind of life developer we aspire to be. Through solutions proposed by cross-departmental teams made up of the best and brightest minds, we create a new prosperity unprecedented in the real estate industry, thereby connecting people with people and communities with the future.

Principles of Action (Actions we should take to realize our vision)

1.

Provision of new value: We will use our information networks, planning ability, and product development expertise to tap the unlimited potential of real estate and create new value that responds to every need of our clients.

2.

Sustainability management: We will respond to various social challenges with precision and pursue scenarios in which our company and society can grow sustainably and side by side.

3.

Growth and stability: Rather than pursuing volume and scale, we aspire to achieve high-quality growth based on a keen awareness of capital and cash efficiency. At the same time, we seek to build firm financial and operational foundations capable of accommodating a broad range of business risk.

4.

Management awareness: We will strive to achieve a strong offense in management that is always one step ahead by ensuring that all Group employees are aware of management issues and by continuing to be a company that practices rapid decision-making.

5.

Compliance: We will comply with all applicable laws, regulations, and societal norms both within and outside Japan, maintain a keen awareness of compliance and governance issues, take appropriate action as human beings, and form an organization with great bottom-up communication.

6.

6. Gratitude: We will act at all times in ways that demonstrate our clear appreciation and respect for colleagues, whether within or outside the company. We will seek to build and maintain strong working relationships.

(2) Medium- to Long-Term Corporate Management Strategy and Management Indicator Targets

To serve as guidelines and strategies for continuing sustained long-term growth, we established our “Long-Term Vision 2030,” which lays out what kind of company we want to be by FY2030 and the direction we are aiming for.

Seeing the direction, we are aiming for as “Deepening” and “Evolution” under each of the below items, we will proceed to carry out a variety of initiatives.

1)

Priority themes for business strategy (Direction we are aiming for)
<<Deepening>>

a. Further growth of main business

b. Synergies with the Chubu Electric Power Group

c. Further stabilizing the revenue structure

d. Establishing management that accounts for capital costs and stock price


<<Evolution>>

a. Diversification of development projects and types

b. Expanding domestic area of operations

c. Global expansion

d. Challenge of new business domains

e. New urban development and management

f. Promoting DX

2)

Priority themes for sustainability management (Materiality/Direction we are aiming for)
<<Deepening>>

a. Harnessing diverse human resources

b. Rigorous compliance

c. Strengthening governance and risk management, including Group companies


<<Evolution>>

a. Promoting a decarbonized society

b. Achieving a society characterized by well-being

3)

FY2030 Indicators
Ordinary income of 30 billion yen / real estate assets of 1 trillion yen
Details are described under 1. Summary of Operating Results (1) Summary of Company Operating Results.

(3) Stable Business Growth in Accordance with Each Segment

To achieve the priority themes for business strategy set forth under Long-Term Vision 2030, we will strive to achieve stable growth by devising strategies specific to each segment.

In our condominium sales business and real estate development business (formerly real estate sales business), with commercial facility development positioned as our core, we are developing these businesses across diverse domains while monitoring market trends. Related efforts include the development of logistics facilities, offices, and hotels, as well as land readjustment projects to revitalize cities.

In our real estate lease business and asset management business (formerly real estate lease business), over the time covered by our fourth medium-term management plan, we converted the Picasso Group and Shijo Omiya Building Co., Ltd. into subsidiaries. Going forward, we plan to identify and assess potential mergers and acquisitions that do not appear on the market through discussions with companies and other entities looking for business successors while continuing to stabilize our revenue structure.

In our other businesses (including businesses formerly subsumed under the real estate planning agency and consulting business), in addition to launching the full-fledged development of capital investment operations overseas and elsewhere, we are undertaking sales efforts for the permanent use rights to our urban columbarium and otherwise enhancing the breadth and quality of our business domains.

(4) Business and Financial Issues to Be Addressed on a Priority Basis

The corporate operating environment, including the devaluation of the Japanese yen and rising costs and interest rates, will significantly affect economic trends. Furthermore, we are called on to urgently address various social problems ranging from global warming to the declining birthrate and aging population, decrease in population, gender issues, economic gap issues, and geopolitical risks, on top of digital transformation (DX) in various fields and fiercer competition that goes beyond industry boundaries. Moreover, the consumption behavior and values of customers are constantly and swiftly changing, and in order to achieve sustainable growth, businesses find themselves in an environment where they must provide true value to customers and society through business activities.

In order to realize sustainable growth through contributions to society under this environment of rapid diversification and change, we, as the ES-CON JAPAN Group, need to adopt new, flexible ideas not bound by precedent or established concepts, carry out business activities, and contribute to revitalizing the local community. Concurrently, we should strive to conduct stable management based on the solid financial foundation and grow surely and steadily through the satisfaction of our customers with the ultimate aim of being a “life developer” bringing the ideal into reality, building a future, and developing a lifestyle per se by envisioning the happiness of those living there.

Through a multifaceted real estate business that includes residential development, commercial development, logistics development, leasing business, office development, hotel development, overseas business, planning/consulting, facility operation management, asset management, capital investment operations overseas and elsewhere, and columbarium business, we must constantly strike the optimal balance of businesses in our operations and establish a firm management base that can withstand any economic environment. In addition, to achieve sustainable growth, recognizing the further enhancement of organizational power, human capital—that is, our employees or their knowledge, skills, talents, and the like— is our top priority, we have started preparations to formulate our policy on human resources development, build an educational and training system, and disclose information on matters related to human capital.

We will carry through both “deepening” and “evolution” based on our dual focus on business strategy and sustainability management; create a virtuous cycle of sustainable growth for the Group; and, by doing our part for society, seek to achieve true corporate value that transcends financial indicators alone.

3 Basic Policy on Selection of Accounting Standard

The ES-CON JAPAN Group uses Japanese GAAP for the preparation of its consolidated financial statements in view of comparability for the period covered by the consolidated financial statements and inter-company comparability. The Group’s policy is to respond to the application of IFRS in an appropriate manner, taking into account a variety of circumstances inside and outside Japan.