SANKEI REAL ESTATE Inc (2972.T) Q2 2024 Earnings Report

Revenue: 2,461,403,000 JPY (YoY -10.54%; QoQ 100.00%)
Gross Profit: 1,354,314,000 JPY (YoY -2.25%; QoQ 98.98%)
Operating Income: 1,293,949,000 JPY (YoY -2.61%; QoQ 99.07%)
Net Income: 1,106,649,000 JPY (YoY -2.03%; QoQ 100.00%)
EPS (Diluted): 2,369.20 JPY (YoY -2.03%; QoQ 100.00%)
EBITDA: 1,618,474,000 JPY (EBITDA Margin ~65.8%)
Gross Margin: 55.02%
Operating Margin: 52.57%
Net Margin: 44.96%
EBITDA Margin: 65.75%
Cash Flow: Operating cash flow 1,983,913,000 JPY; Capex -10,870,689,000 JPY; Free Cash Flow -8,886,776,000 JPY
Dividends Paid: -1,037,388,000 JPY
Cash, End of Period: 7,444,330,000 JPY
Balance Sheet Strength: Total assets 104,878,112,000 JPY; Total debt 50,200,000,000 JPY; Net debt 45,072,183,000 JPY; Equity 50,542,350,000 JPY
Solvency & Liquidity: Current ratio 0.78; Quick ratio 0.78; Cash ratio 0.511; Debt-to-Equity 0.993; Long-term debt to capitalization 0.448; Total debt to capitalization 0.498
Dividend Yield: ~2.70%; P/BV: ~0.76; P/S: ~15.62; P/E: ~8.68

Notes: The earnings transcript data set provided for SANKEI REAL ESTATE QQ2 2024 is empty in the provided material. As a result, there are no management quotes or thematic pull-quotes available to quote directly. Expected themes in a typical SS&E REIT call would include asset recycling progress with the sponsor, rent collection/occupancy trends, leasing pipeline for office assets, and capital allocation strategy including dividend policy and leverage management. Given the quantitative results, investors should monitor: (1) occupancy and rent reversions across the Greater Tokyo, Osaka, and Nagoya office footprint; (2) pace and modular phasing of CAPEX under the sponsor-led development pipeline; (3) funding costs and debt maturity profile; (4) progress on asset recycling to grow NOI and stabilize FFO.

SANKEI REAL ESTATE operates with a solid margin framework and a clear growth lever through sponsor-led asset recycling. The QQ2 2024 results show a revenue retreat YoY, but margins remain robust, supported by stable NOI generation. The principal near-term challenge is negative free cash flow due to CAPEX intensity, which necessitates careful liquidity management and refinancing strategy. If the sponsor pipeline translates into meaningful asset acquisitions and redevelopment milestones, and occupancy/rent trends recover in Japan’s core office markets, the stock could trade toward its asset base (P/B ~0.76) with potential multiple expansion. Investors should monitor capex pacing, funding costs, and the timing of asset recycling outcomes, as well as macro office demand signals and occupancy metrics across the portfolio.