Business Segment

The percentage figures for breakdown of net sales and operating income by segment

The percentage figures for breakdown of net sales by segment

The percentage figures for breakdown of operating income by segment

  • Note: Net sales and Operating income by segment include intragroup transactions between segments

Single-Family Houses Business

In the Single-Family Houses Business segment, we earnestly addressed our role as a home builder and pursued community-based business projects to expand sales.

In Japan, we aim to meet customer needs with a varied product lineup. This includes the launch of 3-storied "skye3" in September, a housing product with larger open interior spaces and wider wall openings, along with the enhanced ability to fit on various sites. In addition, we are expanding customer contact points that are tailored to changes in society and lifestyles. One such example is the "online home building" event at our website, which offers online housing exhibition tours, consultation, and home building simulations. In November, we held another online program named "ONLINE Ikken Hakken Tour." The program provides potential customers with opportunities for “looking around” from home the actual houses constructed by Daiwa House and for listening directly to the voices of owners living in there.

Moreover, in June, as a series of home environment proposals to match the "new normal," we began proposing our company's original telework style "Comfortable workplace" and "Connecting work pit" which allows owners to work from home comfortably. The proposal was followed by "Antivirus Fresh Air Package Plan," the second in the series launched in November, under which we proposed ways to make the entire house antiviral with the use of “adsorptive photocatalyst coating” verified by Nara Medical University and other institutions.

In our overseas operations, in the United States, Stanley-Martin Communities, LLC and Trumark Companies, LLC remained their business performance favorably on track, in spite of the COVID-19 pandemic.

As a result, net sales for this segment amounted to 367,732 million yen (+4.0% year on year), while operating income came to 14,538 million yen (+14.9% year on year).

Rental Housing Business

In the Rental Housing Business segment, we make comprehensive judgments on the issues faced by landowners, the characteristics of each site held, market needs, and other factors, and resolve the issues faced by landowners, while at the same time providing high-value land- use proposals for residents, communities, and society.

In Japan, we have actively promoted "GRACA," a 3-storied housing product for urban areas and city centers in July. In addition, we worked to build ongoing relationships with our customers through providing information on trends in the rental market and needs of tenants under the COVID-19 pandemic. This includes regular online seminars targeted at landowners considering an effective use of the land they own and the owners of rental housing constructed by the Company.

In response to the declaration of a state of emergency regarding the expansion of the number of people infected with COVID-19, Daiwa Living Management Co., Ltd. announced in April that it would allow tenants to defer rent payment. Providing the information on administrative grants and benefits, the company worked to protect the livelihoods of tenants living in its properties to retain the occupancy rates. In addition, in November, Daiwa Living Care Co., Ltd., its subsidiary, opened a serviced house for the elderly "D-Festa Kodaira" (Tokyo).

However, due to the impact of COVID-19, net sales for this segment amounted to 703,006 million yen (-5.1% year on year), while operating income came to 59,272 million yen (-21.5% year on year).

Condominiums Business

In the Condominiums Business segment, in addition to constructing condominiums designed to reduce environmental impact that provide asset value and a high level of added value for both the owners and the community at large, we also strove to improve our condominium building management support service, in which we leverage an integrated and comprehensive system to enable a safe residential experience, with peace of mind.

In Japan, we sold out all the dwelling units of our "PREMIST Heiwadai" (Tokyo), winning favorable recognition. The condominium had been selected as a "ZEH-M Ready" building by the Ministry of Economy, Trade and Industry for its environmentally friendly scheme for supplying renewable energy to each dwelling unit for self-consumption. Our "PREMIST Kitaurawa Brightfort" (Saitama Prefecture), a condominium rebuilt under the new quakeproof standard, was sold out, too in a short time for its accessibility to central Tokyo and its comfortable living environment with facilities convenient for daily life within walking distance.

Also, the sales of "PREMIST TOWER Shirokane Takanawa," (Tokyo) a condominium rebuilt under the new quakeproof standard, has been steady for its accessibility, the view of the tower and habitability.

In our overseas operations, we have two projects underway in China. The one in Changzhou, which is our second condominium development project in the city, had its residential section sold out, while the other condominium development project in Nantong completed contracts for more than 90% of the entire dwelling units.

Group member Cosmos Initia Co., Ltd. conducted online sales of newly built and renovated condominiums to prevent infection with COVID-19. In promoting face-to-face sales (when the customer requests it), the company has seen sales trending roughly in line with its forecasts. In order to meet new needs of customers, Cosmos Initia also designed a plan for condominium buildings being renovated, whereby workspaces are built into dwelling units, and these units are being put on sale.

However, due to the impact of COVID-19, net sales for this segment amounted to 200,851 million yen (-9.1% year on year), while operating loss of 1,361 million yen was recorded which compares with an operating income of 6,463 million yen for the corresponding quarter of the previous fiscal year.

Existing Homes Business

In the Existing Homes Business segment, we worked to strengthen the relationship with owners of single-family houses and rental housing constructed by the Company through building inspections. We also strengthened our efforts to propose renovations required for extended warranty. To our corporate customers, we focused on proposing maintenance of their business assets.

In our Livness business, we worked to inject greater vitality into the market for good-quality previously-owned homes. Specifically, to meet the needs of home owners, we organized "Liveness Future-oriented Sale Campaign" for owners of single-family houses and condominiums. We also held online seminars as a new form of marketing under the COVID-19 pandemic. We expanded our Livness business premises to 60 locations nationwide, which were established in Single-Family Houses Division to meet the needs of a wide range of customers, particularly owners.

However, due to the impact of COVID-19, net sales for this segment amounted to 86,932 million yen (-19.1% year on year), while operating income came to 6,306 million yen (-54.5% year on year).

Commercial Facilities Business

In our Commercial Facilities Business segment, we designed and proposed store-opening plans that matched tenant corporations' strategic needs and also took into account the impact of the COVID-19 pandemic. The different plans offered included those that make the best of the particular characteristics of each region and meet a wide range of needs.

In particular, we strengthened our efforts in the field of large-scale projects such as commercial buildings and office buildings. Also, for customers looking for options in the purchase of real estate for investment purposes, we took steps to expand our services to encompass land acquisition, construction, and leasing-out to tenants.

In addition, we started "Kasugai Commercial Project" (tentative name), a development plan of a large-scale shopping mall with 70 tenants in Kasugai City, Aichi Prefecture, in August. In these ways, we combine and utilize our management assets to develop multipurpose facilities that meet our customers' needs.

However, due to the impact of COVID-19, net sales for this segment amounted to 602,376 million yen (+3.7% year on year), while operating income came to 94,144 million yen (-10.5% year on year).

Logistics, Business and Corporate Facilities Business

In the Logistics, Business and Corporate Facilities Business segment, we worked to enhance the Group’s business scope by constructing a variety of facilities to suit the differing business needs of our corporate customers, and by providing total support services that enable customers to most effectively utilize their assets.

In Japan, in order for us to nurture another mainstay next to logistics facilities, we are planning to develop a data center park, which will be the largest in Japan, in Chiba New Town in Inzai City, Chiba Prefecture. The construction of the first data center building has already started.

In the field of logistics facilities, we began construction of 29 new facilities nationwide, leveraging our extensive experience and know-how to provide the essential back-up to our customers' logistics strategies. Particularly notable among these newly commenced projects is the "DPL Meiko-yatomi" in Yatomi City, Aichi Prefecture, which is 4.3 times the size of Nagoya Dome.

In the field of medical and nursing care facilities, we targeted hospitals whose existing facilities are showing signs of aging and which do not meet current earthquake resistance standards, making proposals for reconstruction or relocation. We also strengthened our lineup of solutions to meet the management needs of healthcare corporations, such as those operating homes for senior citizens or multipurpose nursing care facilities.

In the area of support for offices, manufacturing plants, and so on, we have strengthened our efforts to attract companies to industrial parks developed by Daiwa House. In the "Hofu No.2 Techno-Town" in Hofu City, Yamaguchi Prefecture, which is currently under development, we succeeded in attracting companies for the first time.

For food factories, we held seminars for manufacturers and processors of food products for making HACCP* compulsory, while also enhancing our proposals for the building of facilities adapted to safety certification.

In our overseas operations, we started a project which is the second multi-tenant logistics facility "D Project Malaysia Ⅱ" near Kuala Lumpur, Malaysia.

However, due to the impact of COVID-19, net sales for this segment amounted to 768,126 million yen (-11.0% year on year), while operating income came to 100,691 million yen (∔6.8% year on year).

* Hazard analysis and critical control points (HACCP) is a systematic preventive approach to food safety in production and preparation processes, in which the dangers posed by contamination by microorganisms at each stage of the process are analyzed and managed.

Other Businesses

In our home centers business, sales and profit increased due to strong sales of DIY supplies and gardening equipment, as well as outdoor gear as an easy leisure activity, spurred by the rise in demand among consumers changing their lifestyles and choosing to stay at home due to the pandemic.

In our accommodation business, the occupancy rate of hotels operated by Daiwa Resort Co., Ltd. is improving, but has not recovered to the normal-year level.

In the field of logistics, despite an increase in work volume caused by growing demand for e-commerce, we experienced a decrease in the volume of goods transport as a result of suspension and postponement of construction work at sites, the closure of retail outlets and a reduction in operating hours by others in response to the declaration of the state of emergency.

In our fitness club business, Sports Club NAS Co., Ltd. conducts operation by implementing various safety measures in compliance with the guidelines set by the Fitness Industry Association of Japan.

However, due to the impact of COVID-19, net sales for this segment amounted to 376,402 million yen (-4.9% year on year), while operating income came to 13,251 million yen (-28.3% year on year).

Notes:

1. Net sales for each segment include internal (inter-segment) sales and transfers in addition to sales to external customers.

2. The above monetary amounts are exclusive of consumption tax, etc.

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