Our Business Fiscal 2014 Core Business Operating Results Hankyu Hanshin Holdings The Group comprises six core businesses: Urban Transportation, Real Estate, Entertainment and Communications, Travel, The Urban Transportation and Real Estate Businesses drive income International Transportation and Hotels. The businesses are operated by five core companies: Hankyu Corporation, Hanshin Electric and contribute to generating a stable cash flow. Railway Co., Ltd., Hankyu Travel International Co., Ltd., Hankyu Hanshin Express Co., Ltd., and Hankyu Hanshin Hotels Co., Ltd., with the aim of the organic growth of the entire Group. The major revenue pillars for the Group are the Urban Transportation Business and Real Estate Business, with both holding about 60% of revenues from operations and roughly 80% of operating income. Among these, the Urban Transportation Business’ railway business and the Real Estate Business’ leasing business account for more than half of Group profits, and generate a stable cash flow. A major characteristic of the Group is also that the Entertainment and Communications Business stably records about 10% of the Group’s total operating income. Forming a mega network in Expand businesses of high Offer high-quality global P.38 the Kansai area that provides P.48 brand value such as Hanshin P.54 logistics services mainly various urban transportation Tigers professional baseball through Hankyu Hanshin services linking Group rail- team, Hanshin Koshien Express ways, buses and taxis Stadium and Takarazuka Revenues from Operations Operating Income Revue Approx.Approx. Approx.Approx. 60%60% 80%80% ¥67¥967.29.2 ¥91¥.891.8 billionbillion billionbillion Urban Transportation 32.5% 40.3% Urban International Real Estate 28.9% 39.8% Real Estate Entertainment and Travel Hotels Transportation Communications Transportation Entertainment and Communications 15.3% 14.8% Travel 4.6% 1.3% Hankyu Corporation International Transportation 5.2% 2.1% Hankyu Travel Hankyu Hanshin Hankyu Hanshin Hotels 8.8% 0.8% International Express Hotels Hanshin Electric Railway Other 4.8% 0.9% * Figures for % of revenues from operations are calculated based on the simple aggregate amount (including intersegment transactions) of each segment. Operating Income by Core Business (¥ billion) 100 4.1 4.8 80 11.2 14.2 4.2 11.1 10.1 60 3.0 10.0 37.3 38.0 30.9 29.1 40 24.0 Develop and manage Expanding sales, focusing on Operate Japan’s major hotel Urban Transportation high-quality housing, com- P.42 our mainstay Trapics brand P.51 groups under the Hankyu- P.57 20 Real Estate 37.2 38.5 mercial facilities and offices with its extensive travel Hanshin-Daiichi Hotel 31.0 29.4 32.3 in the areas served by our packages, through various Group, and manage The Entertainment and lines media including newspaper Ritz-Carlton, Osaka Communications 0 -1.0 advertising, member maga- 2010 2011 2012 2013 2014 (FY) zines, and the Web. Other Business Portfolio Focusing on its Railway Business, the Group is working to enhance the value of the areas served by its stations by expanding Developing a Balanced Business Portfolio organic links primarily between the Real Estate Business and the Entertainment and Communications Business. In addition, we will realise a stable and balanced business portfolio by building on the unique strengths of each business. Looking ahead, the Capable of Sustainable Growth comprehensive strength of the entire Group will be redoubled in such areas as bolstering competitiveness in each core business, aiming to be a No.1 and only one company, and generating Groupwide synergies that transcend barriers between businesses. Urban Transportation Travel Annual number of passengers carried (FY2014) Total length of lines operated Total travel billings: Overseas travel billings: Hankyu Railway Core Companies: Hankyu Corporation, Hanshin Electric Railway 143.6km Core Company: Hankyu Travel International No. 5 in the industry No. 3 in the industry 630 million Total travel billings* (FY2014) Total length of lines operated Hanshin Electric Railway 48.9km ¥408.7 billion 230 million * The total of both Hankyu Travel International and Hankyu Hanshin Business Travel Real Estate International Transportation Leasable area (As of the end of March 2014) Of this total, Japan outbound export Japan inbound import approximately handling volume: handling volume: 800,000m2 are Core Companies: Hankyu Corporation, Hanshin Electric Railway Core Company: Hankyu Hanshin Express Approx. concentrated in No. 4 in the industry No. 4 in the industry the Umeda area 2 1.7 million m Sales* (FY2014) Number of condominiums sold for FY2014 ¥78.5 billion 1,356 * Includes the equivalent amount of initial export freight charges Entertainment and Hotels Total attendances (FY2014*) Communications Number of rooms* Hanshin Tigers (Home games) * Total attendance at Hanshin Core Companies: Hankyu Corporation, Hanshin Electric Railway Tigers home games during Core Company: Hankyu Hanshin Hotels 10,326 the 2013 season Approx. 2.77 million Group hotels* Takarazuka Revue (Including nationwide stage productions) 48 Approx. 2.50 million * As of 31st March 2014 Arashiyama Kawara Hankyu Railway Network 143.6km Hanshin Electric Railway Network 48.9km Kyoto Pref. machi Our Railway Network Kobe Line 46.9km Hanshin Line 43.9km Katsura Kyoto (Kobe Line, Imazu Line, Itami Line, Koyo Line) (Hanshin Main Line, Hanshin Namba Line, Mukogawa Line) Hankyu Arashiyama Line The Group’s railway network connects the Kansai economy’s main urban area, Takarazuka Line 28.5km Kobe Rapid Transit Railway Line 5.0km Kobe and Kyoto, and neighbouring cities (Takarazuka Line, Mino-o Line) Our Strength with Umeda (Osaka) as a starting point. Kyoto Line 65.4km From the Group’s initial start-up, we have (Kyoto Line, Senri Line, Arashiyama Line) contributed to the creation and develop- Kobe Rapid Transit Railway Line 2.8km ment of culture through our high-quality New station “Nishiyama-tennozan Station” homes, commercial facilities, and amuse- Myokenguchi The Potential ment facilities, as well as attracting univer- Nissei-chuo sities and so on, and we have developed Hankyu Kyoto Line together with the people of the region. of the Kansai Area Nosé Electric Railway Line Osaka Pref. Hyogo Pref. Hankyu Mino-o Line Kita-Osaka Kyuko Line N Extension Project Population: Mino-o Kawanishi-noseguchi About 16% of Japan Kita-senri Osaka Senri- Takarazuka International Ishibashi chuo Airport Kita-Osaka Kyuko Kyoto Railway Line Hankyu Senri Line Area: Hankyu Imazu Line Kansai Tokyo Hyogo Kyoto City Shiga Itami Shinkansen Hankyu Koyo Hankyu Itami Line About 7% of Japan Kobe City Line Osaka City Tanigami Hankyu Takarazuka Line Koyoen Esaka Osaka Hokushin Kyuko Railway Line Nara Shukugawa Tsukaguchi Awaji Hankyu Kobe Line Nishinomiya-kitaguchi Shin-Osaka Hankyu Building Kyoto Shin-Osaka Wakayama Imazu (Construction completed in July 2012) Nara Pref. Kansai Tokyo Hyogo Kyoto City Shiga Imazu Mukogawa Daimotsu Juso The Kansai area, the Group’s Kobe City Kobe Rapid Transit Railway Line Tenjimbashisuji- rokuchome Amagasaki Rebuilding of Umeda Hankyu Building business base, has a popu- Osaka City Shin-Kobe Umeda (Grand opening held in November 2012) Osaka lation of about 20 million, Mukogawadanchi-mae GRAND FRONT OSAKA (Opened in April 2013) Nara Kobe Hanshin Main Line Umeda 1-1 Project Sannomiya making it the second largest Hanshin Mukogawa Line Subway Sakaisuji Line Minatogawa populated area in Japan. The Wakayama Shinkaichi Motomachi Improvement works at Osaka Bay economic scale of the Kansai Nishidai Hanshin Sannomiya Station Hanshin Namba Line (Completed in March 2013) area, on the basis of GDP, Osaka-Namba Kintetsu Nara Line is approximately $971.0 billion, boasting one of Asia’s largest To Kintetsu-Nara Top ranked area in survey of economies. preferred residential areas To Himeji Strength 15,534 Sources: IMF/World Economic and Financial Surveys 2011 1 ($ billion) 15,000 Cabinet Office, Government of Japan, Survey of Preferred Residential Areas (Kansai Area) “Prefectural Accounts FY2011” Tenga chaya Rank Place Location 7,322 1 Nishinomiya Nishinomiya, Hyogo 11 Mikage Kobe, Hyogo (Higashi-nada-ku) 6,000 5,906 One of Asia’s Ability to create value in 2 Ashiya Ashiya, Hyogo 12 Namba Osaka (Chuo-ku) 3 Shukugawa Nishinomiya, Hyogo 13 Takarazuka Takarazuka, Hyogo 4,000 3,631 Largest Economies 2,785 areas served by our stations 4 Umeda Osaka (Kita-ku) 14 Tennoji Osaka (Tennoji-ku) 2,000 5 Kobe Kobe, Hyogo (Chuo-ku) 15 Toyonaka Toyonaka, Osaka 1,169 1,114 971 846 834 0 6 Okamoto Kobe, Hyogo (Higashi-nada-ku) 16 Downtown Kobe Kobe United States China Japan Germany France Mexico Korea Kansai Area Indonesia Netherlands As a result of valuing the relationships of trust with residents living 7 Kyoto Kyoto 17 Ibaraki Ibaraki, Osaka (15th) (2nd) (3rd) (5th) along the railway line, our long-term efforts to enhance the value of (14th) 8 Sannomiya Kobe, Hyogo (Chuo-ku) 18 Fukushima Osaka (Fukushima-ku) (4th) (16th) the areas served by our stations have been well received. At present, (17th) 9 Senri-chuo Toyonaka, Osaka 19 Abeno Osaka (Abeno-ku) (1st ) the area along the Group’s rail lines has, on the whole, become highly 10 Takatsuki Takatsuki, Osaka 20 Motomachi Kobe, Hyogo (Chuo-ku) popular within the Kansai area. This creative ability for enhancing the Source: Survey by Sumitomo Realty & Development and six other major real estate firms (26th September 2013) area along our rail lines is one of the strengths of our Group. Strength 2 Strength 3 Leveraging our strong presence in Umeda, Ownership of content with strong brand value Kansai’s economic centre The Umeda area of Osaka, the Group’s most important base, is one of the most famous shopping and entertainment districts of The Group delivers inspiration and dreams through the Hanshin Tigers professional baseball team/Hanshin Koshien Stadium and the Japan, served by the Umeda stations of the Hankyu and Hanshin lines and the Osaka Municipal Subway as well as JR Osaka Station.