MIRAI : (Delayed) (REIT) Financial Report for the Fiscal Period ended April 30, 2022

(REIT) Financial Report for the Fiscal Period ended April 30, 2022 (The 12th Period)

													June 14, 2022
Name of REIT issuer:		MIRAI Corporation			Stock exchange listing: Tokyo Stock Exchange
Security code:		3476						URL:https://3476.jp/en/
Representative:			Michio Suganuma, Executive Director
Name of asset manager:		Mitsui Bussan & IDERA Partners Co., Ltd.
Representative:			Michio Suganuma, Representative Director, President
Contact:			Nobuaki Takuchi, Director, CFO
			TEL: [phone]
Scheduled date for submission of securities report:	July 29, 2022
Scheduled date for commencing dividend payments:	July 14, 2022
IR Material:	Will be posted on the website
IR Meeting:	Will be held for institutional investors and securities analysts
										(Figures are rounded down to the nearest million yen)
1. Performance for the Fiscal Period ended April 2022 (The 12th period from November 1, 2021 to April 30, 2022)
(1) Operating Results									(% represents change from the previous period)
		Operating Revenue			Operating Profit			Ordinary Profit		Net profit
Period ended		Million yen		%		Million yen		%		Million yen		%	Million yen		%
Apr. 30, 2022		5,275		3.2		2,547		6.3		2,245		4.7	2,244		4.7
Oct. 31, 2021		5,113		2.8		2,397		3.3		2,144		3.4	2,143		3.4
		Net Profit per Unit		Net Profit to Net Assets		Ordinary Profit to		Ordinary Profit to
				Total Assets		Operating Revenue
Period ended			Yen				%				%			%
Apr. 30, 2022		1,291				2.9				1.3			42.6
Oct. 31, 2021		1,289				2.8				1.3			41.9

(Note) Net Profit per Unit is calculated by dividing the net income by the day-weighted average number of investment units. (Fiscal period ended October 31, 2021:1,662,240 units, Fiscal period ended April 30, 2022:1,738,544 units)

(2) Distributions
	Distributions per	Total Distributions	Distributions in	Total
	Unit	excess of	Distributions in		Distributions to
	(excluding distributions	Payout Ratio
	(excluding distributions in	earnings per	excess of	Net Assets
	in excess of earnings)
	excess of earnings)	Unit	earnings
Period ended	Yen	Million yen	Yen	Million yen	%	%
Apr. 30, 2022	1,267	2,244	-	-	100.0	2.8
Oct. 31, 2021	1,289	2,142	-	-	100.0	2.8

(Note 1) Payout Ratio = Total Distributions (excluding distributions in excess of earnings) / Net Profit * 100

(Note 2) Distributions to Net Assets are calculated based on Total Distributions (excluding distributions in excess of earnings).

(3) Financial Position

	Total Asset	Net Asset	Net Assets to Total Assets	Net Assets per Unit
Period ended	Million yen	Million yen	%	Yen
Apr. 30, 2022	171,982	80,743	46.9	45,580
Oct. 31, 2021	161,226	75,308	46.7	45,305
(4) Cash Flows
	Operating Activities	Investing Activities	Financing Activities	Cash and Cash Equivalents
	at End of Period
Period ended	Million yen	Million yen	Million yen	Million yen
Apr. 30, 2022	2,730	(11,105)	8,104	4,421
Oct. 31, 2021	2,391	(876)	(2,097)	4,691

－ 1 －

2. Forecasts for the Fiscal Period ending October 2022 (The 13th Period from May 1, 2022 to October 31, 2022) and ending April 2023 (The 14th Period from November 1, 2022 to April 30, 2023)

(% represents change from the previous period)

										Distributions per	Distributions in
										Unit (excluding
	Operating Revenue	Operating Profit	Ordinary Profit	Net Profit		excess of earnings
		Distributions in excess
										of earnings)	per Unit
Period ending	Million	%	Million	%	Million	%	Million		%	Yen	Yen
	yen		yen		yen		yen
Oct. 31, 2022	5,492	4.1	2,564	0.7	2,277	1.4	2,276		1.4	1,285	-
Apr. 30, 2023	5,393	(1.8)	2,573	0.3	2,277	0.0	2,276		0.0	1,285	-

(Reference) Forecasted Net Profit per Unit (Forecasted Net Profit / Forecasted Unit at end of period)

The Fiscal Period ending October 2022:
Forecasted Unit at end of period 1,771,440 units	Forecasted Net Profit per Unit 1,285 yen
The Fiscal Period ending April 2023:
Forecasted Unit at end of period 1,771,440 units	Forecasted Net Profit per Unit 1,285 yen

Others

(1) Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial statements due to

corrections of errors
(i)	Changes in accounting policies due to revisions to accounting standards	None
(ii)	Changes in accounting policies other than (i)	None
(iii) Changes in accounting estimates	None
(iv) Restatement of prior period financial statements due to corrections of errors	None

(2) Number of investment units issued and outstanding

(i) Number of investment units (including treasury units) issued and outstanding at the end of each period

As of Apr. 30, 2022:	1,771,440 units As of Oct. 31, 2021:	1,662,240 units
(ii) Number of treasury units issued and outstanding at end of period
As of Apr. 30, 2022:	0 unit As of Oct. 31, 2021:	0 unit

• Financial Report is not subject to audit by certified public accountants or audit corporations.
• Explanation on the appropriate use of forecasts and other notes

(Note to forward-looking statements)

This document contains forecasts and other forward-looking statements based on the information currently available and on certain assumptions judged as rational by MIRAI Corporation (hereinafter "MIRAI"), and the actual operating results and so on may differ significantly from that anticipated by MIRAI due to various factors. Moreover, the forecasts are not intended to guarantee any amount of dividend distribution and distribution in excess of earnings. For notes regarding assumptions underlying these forecasts, please refer to "Assumptions Underlying Forecasts for the Fiscal Periods Ending October 31, 2022 and April 30, 2023." on page 3.

－ 2 －

Assumptions Underlying Forecasts for the Fiscal Periods Ending October 31, 2022 and April 30, 2023

Item			Assumptions
Calculation period	・	The Fiscal Period Ending October 2022: May 1, 2022 to October 31, 2022 (184 days)
・	The Fiscal Period Ending April 2023: November 1, 2022 to April 30, 2023 (181 days)
	・	The forecasts assume that MIRAI owns 37 assets as real estate and real estate trust beneficiaries (hereinafter the
Portfolio assets		"Portfolio assets") as of the released of this document.
・	It assumes that there is no movement of the "Portfolio assets" (acquisition of new assets and/or dispositions of assets).
	・	Changes may occur in reality due to changes in the "Portfolio assets".
Total number of	・	It is assumed that total number of investment units outstanding is 1,771,440 units.
investment units
・	No changes in the number of investment units due to any issuances of new units are assumed until April 30, 2023.
issued
	・	Of the interest-bearing debt of 84,000 million yen as of today. MIRAI assumed that the current portion of long-term
		debt of 7,000 million yen that will mature during the fiscal period ending April 30, 2023 would be refinanced into long-
		term debt.
Interest-bearing debt	・	The interest-bearing debt outstanding as of October 31, 2022 and April 30, 2023 is expected to be 84,000 million yen.
	・	The LTV (based on total assets) as of October 31, 2022 and April 30, 2023 is expected to be approximately 49%.
	・	The calculation of the LTV (based on total assets) uses the following formula.
		LTV (based on total assets) (%) = total amount of interest-bearing debt outstanding / total assets
	・	Lease business revenue from the "Portfolio assets" is calculated primarily by taking into account leasing contracts
		effective as of today, trends in the real estate leasing market (vacancy rates, rent levels, etc.) and status of negotiation
		with tenants. Revenue from the lease of the Acquisition is calculated primarily by taking into account information on
		trends in lease contracts provided by the previous owner, etc., leasing contracts to be effective as of the scheduled date
		of acquisition of the Acquisition, and trends in the real estate leasing market (vacancy rates, rent levels, etc.).
Operating revenue	・	MIRAI disposed "Comfort Hotel Nagano" during the fiscal period ending October 31, 2022. It expects to receive 0
		million yen for the fiscal period ending October 31, 2022 in gain on sales of real estate properties (disposition gain).
	・	It is assumed that hotels with variable rent ("Smile Hotel Naha City Resort", "Smile Hotel Hakataeki-mae" and "Smile
		Hotel Nagoya-Sakae") will not incur variable rent until the end of April 2023, excluding the period during which "Smile
		Hotel Naha City Resort" is provided as a recovery accommodation facility for patients with minor illnesses of COVID-
		19 (contract period: October 11, 2021 to October 31, 2022).
	・	Expenses for the lease business other than depreciation are based on past records and information provided by the
		previous owners, etc. while reflecting other variable factors into consideration.
	・	In principle, the fixed asset tax, city planning tax, and depreciation asset tax (the "Fixed Asset and City Planning
		Taxes") of "Asset to be Acquired" during a fiscal year will be settled on the acquisition date with previous owners in
		proportion to holding period for the assets. Such costs are to be capitalized without having any impact to profit and/or
		loss in the fiscal period of the acquisition.
	・	Total repair expenses for buildings are calculated based on the repair plans developed by Mitsui Bussan & IDERA
		Partners Co., Ltd., the asset manager of MIRAI and takes into account the engineering reports and appraisal reports,
		and are accrued in each fiscal period. It should be noted, however, that the actual repair expenses in each fiscal period
		may differ considerably from the estimates, mainly due to urgent repair expenses for any damages of assets arising
		from unexpected factors, significant yearly fluctuations in the amount of repair expenses and the nature of repair
		expenses whereby they do not arise on a regular basis.
Operating expense	・	Depreciation including incidental expenses is calculated using the straight-line method.
	・	The breakdown of expenses for the lease business is as follows.
			The Fiscal Period Ending	The Fiscal Period Ending
			October 31, 2022	April 30, 2023
		Outsourcing services:	382 million yen	374 million yen
		Utilities expenses:	540 million yen	462 million yen
		Taxes and dues:	422 million yen	422 million yen
		Repair expenses:	104 million yen	79 million yen
		Other expenses for leasing business:	260 million yen	246 million yen
		Depreciation:	657 million yen	675 million yen
	・	Other operating expenses (asset management fees, administrative servicing fees, etc.) are estimated to be 559 million
		yen for the fiscal period ending October 31, 2022, and 559 million yen for the fiscal period ending April 30, 2023.
Non-operating	・	Interest expenses and borrowing-related expenses are estimated to be 287 million yen for the fiscal period ending
expenses		October 31, 2022, and 295 million yen for the fiscal period ending April 30, 2023.
	・	Distributions per unit (excluding distributions in excess of earnings) are calculated based on the cash distribution policy
		described in the Articles of Incorporation of MIRAI.
	・	The amount of distributions per unit (excluding distributions in excess of earnings) may fluctuate due to various factors
Distributions per unit		such as acquisitions and sales of assets, changes in rent income caused by tenant relocations, unexpected repairs
(Excluding		incurred, and interest rate fluctuations.
distributions in excess	・	Derivatives transactions (interest rate swaps transaction) will be continuously in place during the fiscal periods ending
of earnings)		October 31, 2022 and April 30, 2023. It is estimated that deferred losses on hedges as deduction from net assets (as
		specified in Item 30-B, Clause 2, Article 2 of the Calculation Rules for Investment Corporations) is 2 million yen which
		is the same amount as the fiscal period ended April 30, 2022. It is calculated based on the assumption that there is no
		change in the market value of interest rate swaps.
Distributions in	・	As described above, no change in the amount of deferred losses on hedges as deduction from net assets is assumed in
	the fiscal period ending October 31, 2022 and April 30, 2023, and distributions in excess of earnings related to the
excess of earnings per
	allowance for temporary difference adjustment are not scheduled at present.
unit
・	Distributions in excess of earnings by decreasing unitholders' capital under taxation are not scheduled at present.
	・	Excluding above, it is assumed that impact of spread of COVID-19 will not be significantly wider than current estimate
		and that the epidemic will not last longer. In reality, potential for the impact of spread of COVID-19 continuing to
Others		expand and becoming prolonged cannot be ruled out.
	・	The forecasts assume that no revisions that may impact the above projections will be made to laws and regulations,
		taxation, accounting standards, listing rules, the rules of the Investment Trust Association, Japan, or others.
		－ 3	－

Item	Assumptions

• The forecasts assume no unforeseeable significant changes in the general economic trends and real estate market conditions.

－ 4 －

3. Financial Statements

(1) Balance Sheet

		(Thousands of yen)
	As of October 31, 2021	As of April 30, 2022
Assets
Current assets
Cash and deposits	2,542,119	2,050,206
Cash and deposits in trust	2,331,887	2,553,099
Operating accounts receivable	227,272	257,651
Prepaid expenses	131,784	147,320
Consumption taxes receivable	57,176	92,266
Other	28	87
Total current assets	5,290,266	5,100,631
Non-current assets
Property, plant and equipment
Buildings	436,737	436,737
Accumulated depreciation	(10,017)	(16,131)
Buildings, net	426,720	420,605
Structures	564	564
Accumulated depreciation	(157)	(251)
Structures, net	407	313
Machinery and equipment	-	4,770
Accumulated depreciation	-	(39)
Machinery and equipment, net	-	4,730
Land	4,230,785	4,230,785
Buildings in trust	35,077,401	37,118,626
Accumulated depreciation	(4,536,603)	(5,133,371)
Buildings in trust, net	30,540,797	31,985,255
Structures in trust	318,733	318,733
Accumulated depreciation	(68,533)	(75,539)
Structures in trust, net	250,199	243,194
Machinery and equipment in trust	207,051	220,610
Accumulated depreciation	(62,426)	(69,918)
Machinery and equipment in trust, net	144,625	150,692
Tools, furniture and fixtures in trust	218,425	281,097
Accumulated depreciation	(46,316)	(67,601)
Tools, furniture and fixtures in trust, net	172,109	213,496
Land in trust	119,722,380	129,097,520
Construction in progress in trust	54,691	93,037
Total property, plant and equipment	155,542,717	166,439,632
Intangible assets
Software	18,640	16,087
Other	231	231
Total intangible assets	18,872	16,318
Investments and other assets
Long-term prepaid expenses	263,995	304,604
Deferred tax assets	23	18
Guarantee deposits	11,006	11,006
Other	56,134	56,134
Total investments and other assets	331,159	371,763
Total non-current assets	155,892,749	166,827,714
Deferred assets
Investment corporation bond issuance costs	43,500	54,241
Total deferred assets	43,500	54,241
Total assets	161,226,516	171,982,587

－ 5 －