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Apaman 8889

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Asahi Seimei Otemachi Building 2-6-1 Otemachi, Chiyoda-ku Tokyo, Japan 100-0004
http://www.apamanshop-hd.co.jp/
Summary
Japan’s leading rental property broker, offering comprehensive services through its proprietary real estate information network.
Real Estate Management & Development
Key dates
2013-01-31
Coverage initiation
Full Report
2022-05-16
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Key financial data

Income statementFY09/12FY09/13FY09/14FY09/15FY09/16FY09/17FY09/18FY09/19FY09/20FY09/21FY09/22
(JPYmn)Cons.Cons.Cons.Cons.Cons.Cons.Cons.Cons.Cons.Cons.Est.
Sales38,61636,64236,65537,27037,38340,26241,68245,93444,11944,41945,000
YoY-9.3%-5.1%0.0%1.7%0.3%7.7%3.5%10.2%-4.0%0.7%1.3%
Gross profit10,0349,91410,22110,90710,96511,80611,30911,6379,67810,385
YoY-5.6%-1.2%3.1%6.7%0.5%7.7%-4.2%2.9%-16.8%7.3%
Gross profit margin26.0%27.1%27.9%29.3%29.3%29.3%27.1%25.3%21.9%23.4%
Operating profit2,3162,3102,1082,4072,4892,5561,6262,0558401,3561,800
YoY5.9%-0.3%-8.7%14.2%3.4%2.7%-36.4%26.4%-59.1%61.4%32.7%
Operating profit margin6.0%6.3%5.8%6.5%6.7%6.3%3.9%4.5%1.9%3.1%4.0%
Recurring profit1,3531,4081,4391,6822,0652,01788172987951,000
YoY57.5%4.1%2.2%16.9%22.8%-2.3%-56.3%-17.3%-98.9%-25.8%
Recurring profit margin3.5%3.8%3.9%4.5%5.5%5.0%2.1%1.6%0.0%1.8%2.2%
Net income932,2131,482-3,6661,6531,300-1,073272166602200
YoY---33.0%---21.4%---39.0%262.7%-66.8%
Net margin0.2%6.0%4.0%-9.8%4.4%3.2%-2.6%0.6%0.4%1.4%0.4%
Per-share data (JPY)
No. of common shares (year-end; '000)1,3601,36314,19814,19816,02818,27818,27818,27818,27818,278
No. of preferred shares (year-end; '000)6556,545--------
EPS47.91,133.176.7-206.9113.776.8-60.315.39.433.911.2
EPS (fully diluted)-1,064.070.6-104.973.4---33.6
Dividend per share-100.010.012.012.012.024.024.020.020.020.0
Book value per share3,796.85,514.8577.2143.2260.5332.5249.7258.9235.2246.6
Balance sheet (JPYmn)
Cash and cash equivalents4,4043,1612,5352,6093,8473,2017,7737,9597,5617,359
Total current assets8,2237,1076,5876,5927,8888,73315,08715,12214,82414,804
Tangible fixed assets19,22517,68517,34217,17815,95616,6254,6934,2993,7333,275
Investments and other assets9,83511,04411,4717,3826,9426,6006,5565,8396,6746,091
Intangible assets15,43814,20513,15012,33811,50411,6879,2078,6679,0229,070
Total assets52,79750,04348,55143,49242,29143,64635,54533,92934,25533,241
Short-term debt11,0872,1322,0662,8472,8392,9151,9792,0531,9422,364
Total current liabilities16,3237,0547,1008,1688,4229,39310,52310,2239,19010,202
Long-term debt23,85328,99926,91728,29424,98923,59617,79716,07617,78715,892
Total fixed liabilities29,08833,95731,68733,31129,78128,23020,47418,84420,62118,459
Total liabilities45,41141,01138,78841,48038,20437,62330,99829,06829,81128,662
Net assets7,3859,0329,7632,0114,0876,0234,5464,8614,4434,578
Total interest-bearing debt34,94031,13128,98331,14127,82826,51119,77618,12919,72918,256
Cash flow statement (JPYmn)
Cash flows from operating activities2,5792,2002,6052,8003,4082,6647381,4252242,222
Cash flows from investing activities8551,333-185-744799-2,32810,575679-615-269
Cash flows from financing activities-3,114-3,834-2,978-1,985-2,963-987-6,739-1,927-44-1,949
Financial ratios
ROA (RP-based)2.5%2.7%2.9%3.7%4.8%4.7%2.2%2.1%0.0%2.4%
ROE1.4%28.2%15.9%-62.8%55.0%26.1%-20.7%6.0%3.8%14.0%
Equity ratio12.7%17.9%20.0%4.5%9.6%13.6%12.5%13.6%12.2%13.2%
Source: Shared Research based on company data
Note: Figures may differ from company materials due to differences in rounding methods.

Trends and outlook

Quarterly trends and results

Quarterly results
Cumulative performanceFY09/21FY09/22
FY09/22
(JPYmn)Q1Q1–Q2Q1–Q3Q1–Q4Q1Q1–Q2Q1–Q3Q1–Q4
% of Est.FY Est.
Sales11,10022,58233,69944,41910,84522,744


50.5%45,000

YoY4.4%2.4%2.1%0.7%-2.3%0.7%



1.3%
Gross profit2,5264,9987,72410,3852,5625,305





YoY8.4%13.2%10.0%7.3%1.4%6.1%





Gross profit margin22.8%22.1%22.9%23.4%23.6%23.3%




SG&A expenses2,3814,5706,7869,0292,1704,377





YoY3.6%1.8%3.3%2.2%-8.9%-4.2%





SG&A ratio21.5%20.2%20.1%20.3%20.0%19.2%




Operating profit1444289381,356392927


51.5%1,800

YoY336.4%-105.3%61.4%172.2%116.6%



32.7%

Operating profit margin1.3%1.9%2.8%3.1%3.6%4.1%



4.0%
Recurring profit55324672795226701


70.1%1,000

YoY----310.9%116.4%



25.8%

Recurring profit margin0.5%1.4%2.0%1.8%2.1%3.1%



2.2%
Net income-122298360279161


80.5%200

YoY---262.7%-455.2%



-66.8%

Net margin-0.1%0.2%1.4%0.7%0.7%



0.4%
Quarterly performanceFY09/21FY09/22

(JPYmn)Q1Q2Q3Q4Q1Q2Q3Q4


Sales11,10011,48211,11710,72010,84511,899





YoY4.4%0.5%1.4%-3.4%-2.3%3.6%




Gross profit2,5262,4722,7262,6612,5622,743





YoY8.4%18.6%4.4%0.3%1.4%11.0%





Gross profit margin22.8%21.5%24.5%24.8%23.6%23.1%




SG&A expenses2,3812,1892,2162,2432,1702,207





YoY3.6%-0.1%6.6%-1.1%-8.9%0.8%





SG&A ratio21.5%19.1%19.9%20.9%20.0%18.5%




Operating profit144284510418392535





YoY336.4%--3.8%9.1%172.2%88.4%





Operating profit margin1.3%2.5%4.6%3.9%3.6%4.5%




Recurring profit55269348123226475





YoY---7.9%-24.1%310.9%76.6%





Recurring profit margin0.5%2.3%3.1%1.1%2.1%4.0%




Net income-122151545197982





YoY----51.3%--45.7%





Net margin-1.3%0.5%4.8%0.7%0.7%




Source: Shared Research based on company data
Note: Figures may differ from company materials due to differences in rounding methods.
Performance by segment (cumulative)
CumulativeFY09/21FY09/22
(JPYmn)Q1Q1–Q2Q1–Q3Q1–Q4Q1Q1–Q2Q1–Q3Q1–Q4
Sales11,10022,58233,69944,41910,84522,744
YoY4.4%2.4%2.1%0.7%-2.3%0.7%
Platform8,69517,94827,02435,7388,65618,241
YoY5.6%4.5%4.3%2.6%-0.4%1.6%
Technology1,8783,9135,7987,6011,9053,977
YoY-4.3%-3.1%-0.3%0.4%1.4%1.6%
Other7601,1791,5341,934490962
YoY7.2%-15.2%-26.3%-29.9%-35.5%-18.4%
Adjustments-234-459-658-855-206-437
Gross profit2,5264,9987,72410,3852,5625,305
YoY8.4%13.2%10.0%7.3%1.4%6.1%
Gross profit margin22.8%22.1%22.9%23.4%23.6%23.3%
Platform2,0934,6166,9659,2562,1984,988
YoY10.4%5.3%7.9%7.1%5.0%8.1%
Gross profit margin24.1%25.7%25.8%25.9%25.4%27.3%
Technology4996401,2651,825504616
YoY7.1%19.9%10.9%3.6%1.0%-3.8%
Gross profit margin26.6%16.4%21.8%24.0%26.5%15.5%
SG&A expenses2,3814,5706,7869,0292,1704,377
YoY3.6%1.8%3.3%2.2%-8.9%-4.2%
Platform1,8313,6585,4767,2621,7703,585
YoY5.5%6.9%8.8%6.5%-3.3%-2.0%
Technology246453672906214413
YoY-2.0%-9.0%0.0%-0.9%-13.0%-8.8%
Operating profit1444289381,356392927
YoY336.4%-105.3%61.4%172.2%116.6%
Operating profit margin1.3%1.9%2.8%3.1%3.6%4.1%
Platform2629581,4891,9944281,403
YoY64.8%-0.4%4.8%9.6%63.4%46.5%
Operating profit margin3.0%5.3%5.5%5.6%4.9%7.7%
Technology253187593919290203
YoY17.7%419.4%26.4%8.5%14.6%8.6%
Operating profit margin13.5%4.8%10.2%12.1%15.2%5.1%
Other-193-364-631-859-170-342
YoY------
Adjustments-178-353-513-698-156-336
Source: Shared Research based on company data
Note: Figures may differ from company materials due to differences in rounding methods.
Note: The company revised its segment classifications in Q2 FY09/21 (January–March 2021), folding the Sharing Economy segment (fabbit and parking lot businesses) into the Other segment. In January 2021, equity-method affiliate SystemSoft Corporation absorbed consolidated subsidiary fabbit Co., Ltd., resulting in the removal of fabbit from Sharing Economy segment results. The Cloud Technology segment was also renamed simply Technology to clarify the company’s focus not only on cloud services but also on general technical services such as robotic process automation (RPA) and online systems management. Figures in the above table are based on the new segment classifications.
Performance by segment (quarterly)
QuarterlyFY09/21FY09/22
(JPYmn)Q1Q2Q3Q4Q1Q2Q3Q4
Sales11,10011,48211,11710,72010,84511,899
YoY4.4%0.5%1.4%-3.4%-2.3%3.6%
Platform8,6959,2539,0768,7148,6569,585
YoY5.6%3.5%3.9%-2.2%-0.4%3.6%
Technology1,8782,0351,8851,8031,9052,072
YoY-4.3%-1.9%6.0%2.7%1.4%1.8%
Other760419355400490472
YoY7.2%-38.6%-48.6%-41.1%-35.5%12.6%
Gross profit2,5262,4722,7262,6612,5622,743
YoY8.4%18.6%4.4%0.3%1.4%11.0%
Gross profit margin22.8%21.5%24.5%24.8%23.6%23.1%
Platform2,0932,5232,3492,2912,1982,790
YoY10.4%1.4%13.4%4.9%5.0%10.6%
Gross profit margin24.1%27.3%25.9%26.3%25.4%29.1%
Technology499141625560504112
YoY7.1%107.4%3.0%-9.7%1.0%-20.6%
Gross profit margin26.6%6.9%33.2%31.1%26.5%5.4%
SG&A expenses2,3812,1892,2162,2432,1702,207
YoY3.6%-0.1%6.6%-1.1%-8.9%0.8%
Platform1,8311,8271,8181,7861,7701,815
YoY5.5%8.4%12.7%0.1%-3.3%-0.7%
Technology246207219234214199
YoY-2.0%-16.2%25.9%-3.3%-13.0%-3.9%
Operating profit144284510418392535
YoY336.4%--3.8%9.1%172.2%88.4%
Operating profit margin1.3%2.5%4.6%3.9%3.6%4.5%
Platform262696531505428975
YoY64.8%-13.3%15.7%26.9%63.4%40.1%
Operating profit margin3.0%7.5%5.9%5.8%4.9%10.2%
Technology253-66406326290-87
YoY17.7%--6.2%-13.8%14.6%-
Operating profit margin13.5%-21.5%18.1%15.2%-
Other-193-171-267-228-170-172
YoY------
Adjustments-178-175-160-185-156-180
Source: Shared Research based on company data
Note: Figures may differ from company materials due to differences in rounding methods.
Note: The company revised its segment classifications in Q2 FY09/21 (January–March 2021), folding the Sharing Economy segment (fabbit and parking lot businesses) into the Other segment. In January 2021, equity-method affiliate SystemSoft Corporation absorbed consolidated subsidiary fabbit Co., Ltd., resulting in the removal of fabbit from Sharing Economy segment results. The Cloud Technology segment was also renamed simply Technology to clarify the company’s focus not only on cloud services but also on general technical services such as robotic process automation (RPA) and online systems management. Figures in the above table are based on the new segment classifications.

Consolidated results for 1H FY09/22 

The company moved to the new accounting standard for revenue recognition at the beginning of FY09/22. The switch to this new accounting standard reduced both consolidated sales and the cost of sales by JPY342mn compared with what would have been reported under the previous standard. There was no impact on earnings from the operating profit level on down. The figures for YoY percentage change shown below reflect the change versus results reported for the same six-month period the previous year without adjusting for the change in accounting standards.

  • Sales:               JPY22.7bn (+0.7% YoY)
  • Operating profit: JPY927mn (+116.6% YoY)
  • Recurring profit:  JPY701mn (+116.4% YoY)
  • Net income:       JPY161mn (+455.2% YoY))

The top-line growth was driven by the Platform and Technology segments.

The jump in operating profit reported for the six-month period reflected a 6.1% YoY rise in gross profit (to JPY5.3bn) and a 4.2% decline in SG&A expenditures to JPY4.4bn. Earnings were up across all segments. 

The rise in earnings at the gross profit level was driven by higher gross margins at the Platform segment. Breaking down the gross profit into recurring and non-recurring profit (see explanation below), recurring gross profit of JPY3.5bn was up 3.5% YoY and non-recurring gross profit of JPY1.8n was up 5.9% YoY.

Recurring gross profit refers to gross profit generated from rental property management and subleasing in the Platform segment, and the Technology segment. Non-recurring gross profit refers to gross profit generated from rental brokerage commissions in the Platform segment.

Factors adding to operating profit
  • Higher gross profit at Platform segment:      JPY372mn
  • Fewer adjustments (increase in gross profit): JPY14mn 
  • Reduced SG&A spending:                         JPY192mn
Factors reducing operating profit
  • Lower gross profit at Technology segment: JPY24mn 
  • Lower gross profit at other businesses:     JPY55mn

The rise in recurring profit was driven solely by the increase in operating profit, as at the non-operating income/expense level the company reported net non-operating expenses of JPY227mn versus net non-operating expenses of JPY105mn in the same period the previous year. Holdings in equity-method subsidiaries resulted in a loss of JPY79 versus a year-earlier profit of JPY119mn. 

The outsized jump in earnings at the after-tax profit level reflected JPY434mn in corporate tax adjustments (versus JPY245mn in the same period the previous year) booked in connection with reversals of deferred tax assets. 

The breakdown of results by segment is shown below.

Platform segment
  • Sales:                JPY18.2bn (+1.6%)
  • Gross profit:       JPY5.0bn (+8.1% YoY) 
  • Gross profit margin: 27.3% (+1.6pp YoY)
  • Operating profit: JPY1.4bn (+46.5% YoY) 

The number of units under management increased by 0.1% or 110 units YoY to 90,532 units. Rental management operations generated JPY4.8bn in revenues versus JPY9.9bn from subleasing.

The number of directly managed stores increase by two, to 71, producing sales of JPY1.5bn.

Sales of ancillary products, such as emergency services and rent guarantees, generated a gross profit of JPY758mn (+6.6% YoY).

For its leased company housing business, the company reported a total of 96 contracts with corporate clients, an increase of 69 contracts versus the same period the previous year.

Technology segment
  • Sales:               JPY4.0bn (+1.6% YoY)
  • Gross profit:      JPY616mn (-3.8% YoY)
  • Gross profit margin: 15.5% (-0.9pp YoY)
  • Operating profit: JPY203mn (+8.6% YoY) 
"Other" segment
  • Sales:              JPY962mn (-18.4% YoY)
  • Operating loss:  JPY342mn (versus loss of JPY364mn in 1H FY09/20)

The number of coin-operated parking spaces (contract basis) totaled 4,174 (-1.4%, -59 spaces YoY), generating total revenues of JPY505mn.

Company forecast

Company forecast for FY09/22
Est.(JPYmn) FY09/21FY09/22
1H Act.2H Act.FY Act.1H Act.2H Est.FY Est.
Sales22,58221,83744,41922,74422,25645,000
YoY2.4%-1.0%0.7%0.7%1.9%1.3%
Cost of sales17,58316,45034,03317,439
Gross profit4,9985,38710,3855,305
YoY13.2%2.4%7.3%6.1%
Gross profit margin22.1%24.7%23.4%23.3%
SG&A expenses4,5704,4599,0294,377
SG&A ratio1.8%2.6%2.2%-4.2%
Operating profit4289281,3569278731,800
YoY-1.6%61.4%116.6%-5.9%32.7%
Operating profit margin-4.2%3.1%4.1%3.9%4.0%
Recurring profit3244717957012991,000
YoY--12.8%-116.4%-36.5%25.8%
Recurring profit margin-2.2%1.8%3.1%1.3%2.2%
Net income2957360216139200
YoY--42.0%262.7%455.2%-93.2%-66.8%
Source: Shared Research, based on company data
Note: Figures may differ from company materials due to differences in rounding methods.

For FY09/22, Apaman forecasts consolidated sales of JPY45.0bn (+1.3% YoY), operating profit of JPY1.8bn (+32.7% YoY), recurring profit of JPY1.0bn (+25.8% YoY), and net income attributable to owners of the parent of JPY200mn (-66.8% YoY).

The company expects sales to grow 1.3% YoY due to an increase in the number of units under management in the Platform segment and improvement in the occupancy rate of subleased units.

In Platform, it projects higher sales and profit in the property management business. On the other hand, it expects an increase in depreciation expenses with overhaul of the core Apamanshop Operation System (AOS) to lead to lower profit in Technology.

Projections by segment

Platform

In the Platform business, the company projects higher sales and profit at property management operations. It aims to enhance operational efficiency through digitalization and increase the number of units under management by winning more management contracts. It also intends to focus on expanding the leased company housing business.

In property management, it anticipates profit growth due to an increase in the number of units under management and improvement in the occupancy rate of subleased units.

In FY09/21, a temporary upturn in purchase prices associated with the electric retailing business weighed on profit, but the company expects no such phenomenon in FY09/22.

The company operates Apaman Denki, an electrical power retail service through which it purchases electricity and subsequently provides it to households. In Q2 FY09/21, trading prices on the Japan Electric Power Exchange (JEPX) temporarily soared, and purchase prices associated with the company’s electric retailing business rose.

As of end-FY09/21, the company had 61 contracts with corporate clients in the leased company housing business. It provided rental brokerage services to about 10,000 companies (including franchise stores), and based on these partnerships plans to grow the leased company housing business in the medium term (please refer to the "Medium- to long-term outlook" section).

Technology

In the Technology segment, Apaman will strive to promote and expand its digital transformation (DX) services. Shared Research understands that the company anticipates a drop in segment profit due to an increase in depreciation expenses accompanying overhaul of its core system.

In spring 2022, the company will begin offering Apamanshop franchise stores its next-generation AOS, an overhauled version of its core AOS. The cost of acquiring the next-generation AOS is roughly JPY2.1bn. The company expects to take delivery of the new AOS in May 2022 and will use straight line depreciation over five years. Shared Research understands the start of depreciation will increase depreciation expenses by approximately JPY200mn in FY09/22.

Other

The Other segment includes real estate leasing, operation and management of commercial facilities, operation of wepark branded metered parking, and operation of some fabbit facilities.

In FY09/21, Apaman recorded impairment loss of JPY264mn, mainly on fabbit facilities. In FY09/22, it expects profit to increase due to a decrease in depreciation expenses associated with this impairment loss.

Medium- to long-term outlook

As of December 2021, the company had not released a medium-term management plan.

Starting in FY09/18, the company reorganized its business segments as Cloud Technology, Platform, and Sharing Economy, and has been focusing on providing services built around technology. It had planned to focus particularly on the Sharing Economy segment while striving to generate JPY10.0bn each in sales from co-working spaces, minpaku (vacation rental facilities), parking, and bicycle sharing services for total segment sales of JPY40.0bn.

However, the company sold a portion of its stake in equity-method affiliate Grandouce Inc., which had been responsible for its minpaku business, in September 2019 and made the decision to withdraw from this business. In addition, equity-method affiliate SystemSoft Corporation absorbed consolidated subsidiary fabbit, which operates the company's co-working facilities, in January 2021, and Apaman removed fabbit from its list of consolidated subsidiaries. Following these changes, the company will focus on its Platform and Technology (formerly Cloud Technology) segments.

During its financial results briefing for FY09/20, the company identified “expansion of online operations” and “growth in recurring revenue” as priorities. By concentrating on these priorities, the company aims to achieve a profit structure that will be resistant to impact from the COVID-19 pandemic and business conditions.

Expansion of online operations

Under a set of initiatives called “Online First,” the company is striving to expand its online operations by implementing online customer service, explanations, and contracting services, as well as shared electronic keys for apartments (details below). Meanwhile, the company is promoting the adoption of AI-based customer support, automated rental management, and automated rental brokerage services.

Online customer service, explanations, and contracting services

  • Online customer service: Using a variety of online tools, customers will be able to receive room introductions and referrals from store staff via the Internet without having to pay visits to physical stores.
  • Online previews: Customers will be able to preview rental properties by connecting to tablets and smartphones carried on site by store staff.
  • Online explanations: Customers will be able receive online explanations regarding important matters prior to concluding contracts and without meeting staff face to face.
  • Contracting by mail: Customers will be able to send and receive rental agreements, disclosure statements, and other application forms, receive room keys, and conduct other correspondence via physical mail.

“Selkey” shared electronic keys for apartments: Since July 2020, the company has been installing Selkey shared electronic apartment key systems provided by Seltech (unlisted) at properties under its management. Installing Selkey systems at properties will allow customers wishing to preview apartments to receive temporarily usable keys through their smartphones. These systems will eliminate the need for the company to physically hand apartment keys to apartment previewers and will allow the company to automate management operations, including key return and preview history administration.

Growth in recurring revenue

The company is planning to expand its recurring revenue by securing more rental units under management and increasing its leased company housing.

Securing more rental units under management

As of September 2020, the company had 92,676 rental units under management (+4,706 properties YoY). Included below are two simulations under which the company adds 10,000 units under management per year: In the first, the company expands its sales staff. In the second, it increases its number of units under management through M&A.

Increasing units under management through the company’s own sales and marketing

If the company uses its own sales team to acquire 10,000 units under management per year, it will require 50 sales personnel. In this case, the company will be potentially able to achieve JPY20mn in operating profit for every group of 1,000 units under management. Even if the company encounters a factor that reduces its units already under management by about one percent annually, it maintains that it is capable of generating profit by the third year after beginning to establish its sales structure (during the first year, it projects loss of JPY200mn due to upfront costs such as labor costs). Under this simulation, the company estimates that it can achieve operating profit of JPY570mn by the fifth year after beginning to establish its sales system and operating profit of JPY1.5bn by the 10th.

Simulation of operating profit achieved through an increase in unit under management
Year 1Year 2Year 3Year 4Year 5Year 6Year 7Year 8Year 9Year 10
Units under management10,00019,90029,70039,40049,00058,50067,90077,20086,40095,500
Operating profit (JPYmn)-200-101903805707609501,1301,3101,490
Source: Shared Research based on company data
Notes: All figures are simulated estimates.
These estimates assume a yearly increase of 10,000 units under management and an annual one-percent decline in previously held units under management.
Increasing units under management through M&A

The company indicates that if it increases its number of units under management through M&A, it can potentially achieve JPY18mn in operating profit for each group of 1,000 units. Even if the company encounters a factor that lowers units under management by about one percent annually, the company estimates it can generate operating profit of JPY180mn in the first year, JPY530mn in the third year, JPY870mn in the fifth year, and JPY1.7bn in the 10th year.

Simulation of operating profit achieved by increasing units under management through M&A
Year 1Year 2Year 3Year 4Year 5Year 6Year 7Year 8Year 9Year 10
Units under management10,00019,90029,70039,40049,00058,50067,90077,20086,40095,500
Operating profit (JPYmn)1803505307008701,0401,2101,3801,5401,700
Source: Shared Research based on company data
Notes: All figures are simulated estimates.
These estimates assume a yearly increase of 10,000 units under management and an annual one-percent decline in previously held units under management.
Increase in leased company housing

The company is aiming to increase its number of leased company housing units over the medium term. “Leased company housing” refers to rental properties that companies lease from realtors and subsequently rent out to employees while collecting only a portion of the rent from these personnel. Through the leased company housing system under employee benefit programs, companies provide low-cost accommodations to their staff.

Leased company housing: Some Japanese companies adopt systems through which they pay portions of their employees’ housing costs (housing allowances) under their employee benefit programs. Under Japanese tax law, housing allowances are considered to be portions of employee salaries and are taxed accordingly. Companies that pay housing allowances for their employees also incur higher social insurance premiums. Companies adopting leased company housing systems can effectively (though not officially) issue housing allowances by collecting portions of rent from employees that are less expensive than rents in the surrounding market, with the difference serving as employee support. Under this system, employee salaries do not change, so both the taxes incurred by the employee and the social insurance premiums paid by the company remain the same.

The company provides a large volume of rental brokerage services, through which it finds rental properties for company employees; as of December 2020, the company had formed rental brokerage partnerships with about 10,000 companies. However, at the same point in time, it was providing nearly no services related to leased company housing.

Through its leased company housing business, the company leases rental properties from their owners for use as corporate housing and subleases them to companies. Earnings generated through the company’s rental brokerage services consist primarily of rental brokerage fees. Through leased company housing services, Apaman can continuously generate earnings by collecting rent from companies on an ongoing basis; the difference between rent it collects from other companies and the rent it pays to the owners of the leased company housing properties becomes the company’s profit.

The company has not released its plans for its leased company housing business, but it appears to be modeling this business after the leased company housing business operated by Relo Group, Inc. In FY03/21, Relo Group’s leased company housing business generated sales of JPY197.8bn (+6.5% YoY) and operating profit of JPY5.2bn (-6.8% YoY) while reporting 202,309 leased company housing units under management (+3.3% YoY).

Business

Main business segments

Until FY09/17, the company had four main segments: Brokerage, Property Management, Principal Investment and Fund Management, and Other. The core segments were Brokerage (apartment and condominium rental brokerage) and Property Management (rental property management).

Business segments in operation through FY09/17
Business segmentBusiness details
BrokerageRental property brokerage at directly managed and franchise stores
Property ManagementRental property management and sublease
Principal Investment and Fund ManagementManagement of the company’s real estate including funds
Earnings by segment under segment classifications in place during FY09/17 and earlier
Segment sales and operating profitFY09/12FY09/13FY09/14FY09/15FY09/16FY09/17
(JPYmn)Cons.Cons.Cons.Cons.Cons.Cons.
Sales38,61636,64236,65537,27037,38340,262
YoY-9.3%-5.1%0.0%1.7%0.3%7.7%
Brokerage9,57710,46411,08811,32111,45512,059
YoY17.4%9.3%6.0%2.1%1.2%5.3%
% of total24.8%28.6%30.2%30.4%30.6%30.0%
Property Management26,07524,41323,64223,65823,84525,869
YoY-6.5%-6.4%-3.2%0.1%0.8%8.5%
% of total67.5%66.6%64.5%63.5%63.8%64.3%
Principal Investment and Fund Management2,4961,9321,8361,9381,8511,860
Others1,6334516861,1561,2601,491
Eliminations or company-wide (adjustments)-1,165-619-597-805-1,029-1,019
Operating profit2,3162,3102,1082,4072,4892,556
YoY5.9%-0.3%-8.7%14.2%3.4%2.7%
Operating profit margin6.0%6.3%5.8%6.5%6.7%6.3%
Brokerage1,7701,9892,0502,0861,9181,841
YoY-1.8%12.4%3.1%1.8%-8.1%-4.0%
Operating profit margin18.5%19.0%18.5%18.4%16.7%15.3%
% of total61.8%63.7%68.1%63.2%57.4%54.1%
Property Management1,0091,0611,0441,3001,3951,575
YoY18.6%5.2%-1.6%24.5%7.3%12.9%
Operating profit margin3.9%4.3%4.4%5.5%5.9%6.1%
% of total35.2%34.0%34.7%39.4%41.8%46.3%
Principal Investment and Fund Management114112-81215865
Others-29-39-77-206-32-80
Eliminations or company-wide (adjustments)-549-812-900-895-850-845
Source: Shared Research based on company data
Note: Figures may differ from company materials due to differences in rounding methods.
Note: Operating profit ratios represent the ratios against the sum of each segment’s operating profit prior to adjustments and deductions.
Note: Principal Investment and Fund Management figures for FY09/10 and prior years are the sum of Principal Investment and Fund Management businesses.

In FY09/18, the company restructured its main segments into the Platform, Cloud Technology, and Sharing Economy segments. Thereafter, it revised its segment classifications in Q2 FY09/21 (January–March 2021), folding the Sharing Economy segment (fabbit and parking lot businesses) into the Other segment, and removing the word Cloud from the name of the Cloud Technology segment.

Business segments in operation from FY09/18
Business segmentBusiness details
Platform・Rental real estate management and subleasing: Conducts rental management on behalf of the owners of apartments and condominiums (property owners) or leases whole properties from property owners and serves as the landlord in renting to tenants
・Rental brokerage: Directly managed stores provide brokerage services for rental properties
・Related services: Offers ancillary products and services to property owners, tenants, and franchise stores 
TechnologyProvides franchise stores with the Apamanshop Operation System (AOS) and other systems, as well as branding and information services
OtherManagement of coin-operated parking, etc.
Earnings by segment under the segment classifications in place from FY09/18 onward
Segment sales and operating profitFY09/17FY09/18FY09/19FY09/20FY09/21
(JPYmn)Cons.Cons.Cons.Cons.Cons.
Sales40,26241,68245,93444,11944,419
YoY7.7%3.5%10.2%-4.0%0.7%
Platform31,28033,30635,66034,75735,693
YoY-6.5%7.1%-2.5%2.7%
% of total77.7%79.9%77.6%78.8%80.4%
Technology5,9726,1806,9336,7376,811
YoY-3.5%12.2%-2.8%1.1%
% of total14.8%14.8%15.1%15.3%15.3%
Other3,0082,1943,3392,6231,913
YoY--27.1%52.2%-21.4%-27.1%
% of total7.5%5.3%7.3%5.9%4.3%
Operating profit2,5561,6262,0558401,356
YoY2.7%-36.4%26.4%-59.1%61.4%
Operating profit margin6.3%3.9%4.5%1.9%3.1%
Platform2,2001,9731,8371,8191,994
YoY--10.3%-6.9%-1.0%9.6%
Operating profit margin7.0%5.9%5.2%5.2%5.6%
% of total68.5%85.3%60.2%116.6%68.5%
Technology1,0841,1471,263847919
YoY-5.8%10.1%-32.9%8.5%
Operating profit margin18.2%18.6%18.2%12.6%13.5%
% of total33.7%49.6%41.4%54.3%31.5%
Other-72-807-46-1,106-859
YoY-----
Operating profit margin-----
% of total-2.2%-34.9%-1.5%-70.9%-41.8%
Adjustments-657-687-999-720-698
Source: Shared Research based on company data
Note: Figures may differ from company materials due to differences in rounding methods.
Note: % of total segment profit represents the ratio versus the simple total of operating profit for the corresponding segment, before adjustments.

Platform

The Platform segment accounted for 80.4% of consolidated sales and generated operating profit of JPY2.0bn in FY09/21 (consolidated operating profit was JPY1.4bn), making it the company’s core segment. This segment includes property management (rental property management and subleasing), rental brokerage (Apamanshop), and ancillary and related services for rental apartments and condominiums. Of total segment sales in FY09/21, Shared Research understands that rental property management and subleasing accounted for about 90% and the rental brokerage business operated by directly operated stores for about 10%.

Property management (rental property management and subleasing) for apartments and condominiums 

Property management for apartments and condominiums comprises rental property management and subleasing services.

Rental property management services: Apaman manages rental apartments and condominiums on behalf of their owners. Rental property management entails screening prospective tenants, executing rental contracts, renewing contracts, collecting rent, dealing with tenant complaints, dealing with vacant properties, renovating rooms, conserving buildings, and maintenance.

Subleasing services: The company leases apartments and condominiums from their owners and then rents them to tenants.

Earnings structure for rental property management and subleasing (old Property Management segment)

The chief source of revenues from rental management is fees from property owners for management services. Earnings are in proportion to the number of managed units and are not affected by occupancy rates.

The chief source of revenues from subleasing services is rent collected from tenants of the apartments and condominiums offered by the company (see Business model for details). Earnings depend on the number of managed units, rent amounts, and occupancy rates. The subleasing business is obligated to pay fixed monthly rents to owners regardless of whether or not units are occupied, or how much rent is received from tenants. For this reason, profits from subleasing operations are the difference between the rent revenue received from tenants and the fixed rents paid to property owners, so they are sensitive to the occupancy rate of subleased units.

Source: Shared Research based on company data

Apaman has not provided a breakdown of the Platform segment’s sales, but revenue from the rental property management and subleasing businesses can be easily estimated by multiplying the number of units under management by sales per unit using figures from previous years. In FY09/21, the company had 91,421 units under management (versus 92,676 in FY09/20). The company reported JPY364mn in sales per 1,000 units under management for FY09/17 but has not reported this metric in subsequent years.

Old Property Management segment earnings
FY09/11FY09/12FY09/13FY09/14FY09/15FY09/16FY09/17
(JPYmn)Cons.Cons.Cons.Cons.Cons.Cons.Cons.
Sales--23,83123,64223,65823,84525,869
YoY----0.8%0.1%0.8%8.5%
Subleasing--17,71317,53917,49817,38318,257
YoY----1.0%-0.2%-0.7%5.0%
Rental management--6,1186,1026,1616,4627,612
YoY----0.3%1.0%4.9%17.8%
Operating profit--1,0611,0441,3001,3951,575
YoY----1.6%24.5%7.3%12.9%
Operating profit margin--4.5%4.4%5.5%5.9%6.1%
Source: Shared Research based on company data
Note: Figures may differ from company materials due to differences in rounding methods.
Note: The figures for FY09/13 were obtained after segment transfers of the parking and SOHO businesses.
Rental management and subleasing (old Property Management segment) unit count
FY09/12FY09/13FY09/14FY09/15FY09/16FY09/17FY09/18FY09/19FY09/20FY09/21
Units under management58,87059,61960,42663,49270,04171,45890,19887,97092,67691,421
YoY-9.5%1.3%1.4%5.1%10.3%2.0%26.2%-2.5%5.3%-1.4%
Rental management30,37331,84632,86735,85141,30242,600----
YoY-13.0%4.8%3.2%9.1%15.2%3.1%----
Subleasing28,49727,77327,55927,64128,73928,858----
YoY-5.6%-2.5%-0.8%0.3%4.0%0.4%----
Source: Shared Research based on company data
Note: Figures may differ from company materials due to differences in rounding methods.
Old Property Management segment sales and operating profit per 1,000 units (JPYmn)
FY09/11FY09/12FY09/13FY09/14FY09/15FY09/16FY09/17
Sales per 1,000 units (JPYmn)--397395382359364
YoY----0.5%-3.3%-6.0%1.4%
Operating profit per 1,000 units (JPYmn)--17.717.421.020.922.2
YoY----1.7%20.7%-0.5%6.2%
Source: Shared Research based on company data
Note: Figures may differ from company materials due to differences in rounding methods.
Rental brokerage services

Here, the company offers rental brokerage and basic property management services for owners and tenants, with most of the properties located in the greater Tokyo area, Fukuoka Prefecture, and Hokkaido. It renders these services through its directly managed Apamanshop stores (68 in operation as of end-September 2021 versus 72 as of end-September 2020).

The chief source of revenues from rental brokerage services is brokerage commissions (equivalent to up to 1.1x a month’s rent for the land or building in question) received when a new tenant moves in. With regard to simple management services, Apaman conducts schedule management and renovation after tenants vacate on behalf of property owners, gaining revenues in return, including renewal fees and payment for renovation construction.

The Real Estate Brokerage Act in Japan caps the maximum brokerage fee for rental contracts at one month of the property’s rent plus consumption tax.

Historically in Japan, the word “brokerage” refers to brokering in real estate transactions, but Apamanshop specializes in brokering residential rental properties. Apamanshop initially developed its rental brokerage business through its franchise network (rental brokerages with which it had franchise contracts). Since 2006, the company has operated directly managed stores without cannibalizing its franchisees.

Apaman does not provide a breakdown of the Platform segment’s sales, but the subsegment’s sales can be calculated by multiplying the number of directly managed stores by sales per store. The company reported sales per directly managed store (domestic) of JPY51.5mn in FY09/17, when it had 108 stores, but has not disclosed this metric since then.

Directly managed store earnings per unit (domestic)
FY09/11FY09/12FY09/13FY09/14FY09/15FY09/16FY09/17
(JPY'000)
Sales54,57757,48762,18657,53356,10050,80051,500
YoY1.5%5.3%8.2%-7.5%-2.5%-9.4%1.4%
Operating profit13,47516,27517,72812,91912,2009,0009,000
YoY20.3%20.8%8.9%-27.1%-5.6%-26.2%0.0%
Operating profit margin24.7%28.3%28.5%22.5%21.7%17.7%17.5%
Source: Shared Research based on company data
Note: Figures may differ from company materials due to differences in rounding methods.
Note: Sales and operating profit per store were obtained by averaging out the earnings of open stores during each financial year.
Related services

In this subsegment, the company offers tenants entering apartments or condominiums a range of services and products.

The company offers tenants various optional service packages when they sign rental contracts. Since 2010, Apaman has also offered low-priced appliances and furniture sets working with electronics retailers. It also started providing a wide range of other services and products, such as renters insurance and 24-hour assistance services, fire extinguishers, and optional intermediary collection services for electricity, gas, telephone, public television (NHK), and cable TV charges.

The large number of branches in the Apamanshop network gives the company superior buying power. The company further differentiates itself with its broad service menu. Tenants benefit from the company’s one-stop-shopping model. Property owners benefit from higher occupancy rates. The company acts as a broker of these services.

Apaman does not provide a breakdown of the Platform segment’s sales, but does disclose gross profit figures for ancillary products, reporting total gross profit from ancillary products of JPY1.5bn (-2.5% YoY) in FY09/21.

Synergy of brokerage and property management services
The brokerage and property management services are mutually dependent. The brokerage service receives income for every signed contract, which also creates a steady flow of income for the property management service (a recurring-revenue model). Accordingly, the property management business relies on rental units under management, making the company’s ability to increase occupancy rates (i.e., brokerage power) vital.

To increase the number of brokered units, Apaman must enhance its ability to find potential tenants and raise its rental-contract completion rates (number of tenants divided by number of potential tenants). To find potential tenants, the company conducts various promotional campaigns. To raise contract-completion rates, however, the company must offer prime rental units. To avoid competing with other brokers for prime units, the company must ensure that it already has prime units under management (which other brokers cannot touch).

Through its associated services, the company could potentially raise the appeal of its rental properties by making them more convenient for tenants.

The company could stabilize the operation by increasing the number of units under management. The brokerage service is a “one-time revenue business” as the company receives brokerage fees per contract. On the other hand, the property management service is “recurring-revenue business,” which provides recurring income per contract. 

Technology

The Technology segment accounted for 15.3% of consolidated sales and 31.5% of operating profit in FY09/21. In Technology, Apaman provides primarily franchise stores (1,049 stores as of end-September 2017) with the Apamanshop Operation System (AOS) and other systems, as well as branding and information services.

Apamanshop branch
apamanshop.com website
Source: Shared Research based on company data

The segment’s main sources of revenues are system usage fee, system installation fees, internet advertising fees, and franchise fees from franchise stores.

This segment’s earnings can be simply expressed as the result of multiplying the number of franchise stores by sales per franchise store. In FY09/17, sales by franchise stores came to JPY7.3bn; the number of stores was 1,041 and sales per franchise store were JPY7.0mn (calculated by Shared Research based on company data). The company has not disclosed either the number of franchise stores or sales per franchise store for subsequent years but, since there has not been a major change in the number of franchise stores, Shared Research understands that sales to franchise stores is roughly the same as Technology segment sales.

At the heart of the Apamanshop group’s business is a proprietary real estate information network that enables efficient accumulation and use of information connecting franchisees and directly managed stores across the country, as well as property owners and tenants.

According to the company, its strengths are in combining this information network with the ability to design and manage marketing campaigns to drive the tenant traffic, attract landlords, and sell various option services and products to the customer. Early on in its existence, Apamanshop used relevant celebrities of the moment and has used Internet-based video and website events to boost its name recognition.

AS System

This subsegment manages a rental-brokerage franchise network under the Apamanshop brand. It offers franchise stores several types of services—training, branding, and information provision—under the umbrella name Apamanshop (AS) System.

Training Services include bimonthly conferences for franchise representatives, office heads, and local staff in each prefecture. The company also has full-time operatives in each region—Staff Operation Field Counselors, or OFCs—who regularly visit franchise offices.

Branding Services dovetails nationwide advertising and local advertising campaigns to raise the profile of the Apamanshop brand. The nationwide advertising campaigns involve popular celebrities as brand ambassadors. The company also has around 1,000 separate websites designed to appeal to students, businesses, property owners, and particular regions, such as Hokkaido and Kyushu; the sites are also tailored for PCs, smartphones, and tablets for more precise customer segmentation.

Information Services offers bimonthly meetings in eight areas nationwide, delivering franchisees the latest information on sales rankings, compliance, and other topics. Additionally, the company regularly provides its franchises with information about sales rankings, best practices, and legal and compliance issues, as well as market data.

Information infrastructure services

In this subsegment, the company offers Apamanshop Operation System (AOS) to franchisees, a centralized information that allows driving better efficiency across the entire franchisee network.

 The AOS, together with the Apamanshop Property Management System (APS), is the core of the Apamanshop Total System (ATS) that the company makes available to its franchise stores.

The AOS supports the rental brokerage service by creating a database of information that was traditionally paper-based: rents, photographs, customers, business results, and staff activity plans. The database also helps clients rank properties by rent, distance to train stations, square footage, and so on. Currently, 25mn rental units are in the system.

The APS is management software that works with AOS to centralize data related to all the participants of the property rental process: tenants, owners, renovators, builders, and others. According to the company, this boosts the productivity of franchisees by centralizing and standardizing information related to building management and tenant management, contracts, cash management, and vacancies.

Reference: franchise contracts

The “Apamanshop Network Franchise Contract” governs the company’s franchisees. The company works with standard franchisees and “J” franchisees, which receive management guidance. The majority of the company’s franchisees are standard franchisees.

The company offers franchise stores several types of services—training, branding, and information provision—under the umbrella name AS System, for which franchisees pay a usage fee. There are also shared advertising costs, primarily for television commercials. Total Media Pack expenses are related to all forms of advertising the company conducts and include a partial contribution toward the cost of operating its core Apamanshop Online System (AOS). (In addition, expenses paid for listing properties on the Internet include some expenses related to the operation of the AOS.)

Although there are differences depending on geographic area and the type of franchise, the company receives an average of about JPY7mn a year from each franchise store (Shared Research estimate based on actual data reported for FY09/17).

  • Franchise contracts were two-year contracts (renewable every two years), required the use of standardized shop names, covered specific territories, and included a lump-sum termination clause that allowed a franchisee to exit the contract in return for payment of remaining Apamanshop (AS) system-usage fees. (See Franchise rental brokerage services for details of Apamanshop systems.)
Franchise contracts
General payment structure for franchiseesJ-FC payment structure
Basic initial feeFranchise feesDiffers by region; JPY1–3mn (ex. tax) for new franchisees, JPY250,000–750,000 per store for additions at existing franchisees (ex. tax)JPY1.5mn per store (ex. tax) for new franchisees, and JPY1.0mn per store (ex. tax) for additions at existing franchisees
Advertising assistance feesJPY100,000 (ex. tax) per store for new franchisees, JPY50,000 (ex. tax) per store for existing franchisees
Basic monthly feeAS System usage fees (equal to royalty payments)Basically, monthly fee of JPY70,000 per franchisee (ex. tax)Basically, monthly fee of 5% of gross profit per store (ex. tax)
Advertising feesDiffers by region; monthly fee of JPY10,000–120,000 per store (ex. tax)
Total Media Pack feeDiffers by region; monthly fee of JPY65,000–90,000 per store (ex. tax)
Expenses for online property listingBilled based on the number of responses to property listing
Running cost for Information Magazine Publishing SystemRegions publishing the magazine are billed separately
Source: Shared Research based on company data

Other

The company adjusted its reporting segments in Q2 FY09/21, moving the former Sharing Economy segment into the Other segment. Through this segment, the company primarily operated co-working space and metered parking businesses. In January 2021, equity-method affiliate SystemSoft Corporation absorbed co-working facilities operator fabbit Corporation (a consolidated subsidiary of the company), and metered parking became the primary focus of the former Sharing Economy segment.

With these changes, the Other segment now includes real estate leasing, operation and management of commercial facilities, operation of wepark branded metered parking, and operation of some fabbit facilities.

Parking

In this business, the company leases land or parking lots from property owners while providing rent guarantees, and rents the space out as hourly parking spots. Its earnings are equivalent to the annual earnings per parking spot multiplied by the number of spots operated. The main cost incurred by the company is the rent paid to parking space owners (property owners).

As of end-FY09/21, Apaman operated 4,320 parking spaces (up from 4,051 at end-FY09/20).

Profitability snapshot and financial ratios

Profit marginsFY09/12FY09/13FY09/14FY09/15FY09/16FY09/17FY09/18FY09/19FY09/20FY09/21
(JPYmn)Cons.Cons.Cons.Cons.Cons.Cons.Cons.Cons.Cons.Cons.
Gross profit10,0349,91410,22110,90710,96511,80611,30911,6379,67810,385
Gross profit margin26.0%27.1%27.9%29.3%29.3%29.3%27.1%25.3%21.9%23.4%
Operating profit2,3162,3102,1082,4072,4892,5561,6262,0558401,356
Operating profit margin6.0%6.3%5.8%6.5%6.7%6.3%3.9%4.5%1.9%3.1%
EBITDA3,9523,9473,7854,1404,3104,4013,2183,6622,4292,943
EBITDA margin10.2%10.8%10.3%11.1%11.5%10.9%7.7%8.0%5.5%6.6%
Net margin0.2%6.0%4.0%-9.8%4.4%3.2%-2.6%0.6%0.4%1.4%
Financial ratios
ROA (RP-based)2.5%2.7%2.9%3.7%4.8%4.7%2.2%2.1%0.0%2.4%
ROE1.4%28.2%15.9%-62.8%55.0%26.1%-20.7%6.0%3.8%14.0%
Total asset turnover0.710.710.740.810.870.941.051.321.291.32
Working capital (JPYmn)8837117588177161286688611,2531,366
Current ratio50.4%100.8%92.8%80.7%93.7%93.0%143.4%147.9%161.3%145.1%
OCF / Current liabilities0.220.190.370.370.410.300.070.140.020.23
Net debt / Equity413.5%309.7%270.9%1,418.8%586.8%387.0%264.0%209.2%273.9%238.0%
OCF / Total liabilities0.10.10.10.10.10.10.00.00.00.1
Cash conversion cycle (days)4.15.14.24.33.8-0.8-0.53.56.58.0
Change in working capital265-1724759-101-588540193392113
Source: Shared Research based on company data
Note: Figures may differ from company materials due to differences in rounding methods.

Strengths and weaknesses

Strengths

Best-in-class network and track record in rental brokerage: Apaman has built one of the leading domestic rental agency networks, and its strong track record in winning the trust of landlords across Japan helped the company sustain growth in number of properties under management. That in turn is allowing it to offer new ancillary services for the benefit of tenants, landlords, and particularly franchisees. Strong marketing and a sophisticated IT system complement the offering, further boosting Apaman’s appeal.

Low risk in rental management, subleasing, and rental brokerage businesses (Platform segment): Apaman’s core businesses—rental management, subleasing, and rental brokerage—have relatively low risk because they do not require significant capex, property on the balance sheet, or any physical inventory. Shared Research believes this allows them to generate strong and stable cash flows.

Weaknesses

Balance sheet still weak after failed property investment foray: The balance sheet has deteriorated because Apaman attempted to grow non-core businesses and made some aggressive (and, in hindsight, unfavorable) acquisitions. Since FY09/08, the company has been reducing interest-bearing debt, and had achieved an equity ratio of 20.0% as of end-September 2014. However, due to the impact of tax reforms and the acquisition and cancellation of class A preferred shares in FY09/15, the equity ratio dropped to 4.5% in FY09/15. As of end-FY09/21, the equity ratio was 13.2% (versus 12.2% at end-FY09/20) and the debt-to-equity ratio stood at 4.2x (versus 4.7×), which underscores its weak finances.

Intense competition: The rental brokerage business has extremely low barriers to entry, and there are a sizable number of competitors, both large and small. Maintaining and boosting market share in the present environment requires substantial marketing spending. Shared Research believes the competitive environment puts pressure on profitability to a degree.

Group companies

At end-FY09/21, the group comprised the parent company, 31 consolidated subsidiaries, and one equity-method affiliate. The following are major consolidated subsidiaries (stake in parentheses):

  • Apaman Property Co., Ltd. (99.0%): Primarily brokers rental properties through directly run stores and manages rental properties
  • Apaman Network Co., Ltd. (99.0%): Apamanshop-brand franchise rental brokerage business 

The following company is the equity-method affiliate:

  • SystemSoft Corporation (24.4%): Systems consulting, development, maintenance, and operation.

Market and value chain

Market overview

Internal migrants (nationwide and 21 major cities)