We wish to express our heartfelt appreciation to our shareholders for their excellent cooperation.

The Tosei Group conducts a wide range of real estate-related businesses in line with its corporate philosophy "To create new value and inspiration in all aspects of real estate as a global-minded group of seasoned professionals".

The business environment surrounding the Group in the recent years has become increasingly uncertain amid revolutionary changes, including the escalation of climate change issues, the emergence of geopolitical risks, the declining birthrate and the aging of society in Japan, the acceleration of behavioral changes triggered by the COVID-19 pandemic, and rapid advances in digital technology. In order to adapt to such changes in the business environment, ensure the Group's sustainable growth over the future, and enhance corporate value by contributing to the realization of a sustainable society, we formulated "Tosei Group Long-Term Vision 2032" and the medium-term management plan "Further Evolution 2026" (December 2023 - November 2026), which started from the fiscal year ended November 30, 2024. We are now in the final year of the term.

What we aim to be in the Tosei Group Long-Term Vision 2032 is as follows: "We will contribute to the realization of a sustainable society as a unique real estate portfolio manager with diverse solution capabilities". We will further strengthen and expand the Tosei Group's core competencies to achieve both business growth and contribution to sustainable society.

The Group has recently announced its financial results for the third quarter of FY2026, the final year of our current medium-term management plan, as well as an upward revision of its full-year profit and dividend forecasts. We forecast an annual dividend of ¥58 per share, an increase of ¥3 from the ¥55 per share announced at the beginning of the fiscal year, resulting in an increase in the dividend payout ratio from 35.2% to 35.4%.

The domestic real estate investment market, which is the Group's mainstay market, continues to thrive, propelled by robust investment appetite from both domestic and overseas investors. Despite concerns about the Bank of Japan accelerating the pace of policy interest rate hikes, investors' appetite has been fueled by medium- to long-term expectations for rent growth and the strong performance of the office leasing market, where a mindset that views office selection as part of a talent acquisition strategy has increasingly taken hold. Amid this environment, this upward revision was made due to the prospect of securing higher operating profit than initially expected at the beginning of the fiscal year, particularly in the Fund and Consulting Business and the Rental Business.
Regarding the Group's full-year forecasts, we have shifted the sales timing of prime assets from this fiscal year to the next and beyond for sustainable profit growth. Although revenue has been revised to ¥113.6 billion (-¥9.3 billion from the initial forecast), operating profit has been revised to ¥25.0 billion (+¥449 million from the same) and profit before tax to ¥22.7 billion (+¥700 million from the same). The progress ratios of the financial results until the third quarter of FY2026 against the revised forecasts are exceptionally strong, at 87.7% for revenue, 93.6% for operating profit, and 95.4% for profit before tax.

In particular, the Revitalization Business, our core business, drove overall performance. Our strategic shift in investment from the Development Business to the Revitalization Business in response to soaring construction costs has been successful. Additionally, in the Fund and Consulting Business, we have been entrusted with the management of AUM totaling \2.85 trillion and have steadily accumulated achievements as a partner for domestic and overseas institutional investors in domestic real estate investment, whose investment appetite has further strengthened in recent years.

Financial and capital markets are surrounded by various risks, including concerns about the Bank of Japan accelerating the pace of policy interest rate hikes, and geopolitical risks such as the uncertain situation in the Middle East. Leveraging portfolio management that balances the growth and stability of our real estate business, along with a diverse asset portfolio, we will adeptly respond to these market changes and strive to achieve the revised targets for the final year of our medium-term management plan.

We would appreciate your continued support.