TKP Corporation...Our opening strategy is to focus on large existing buildings for TKP and new construction and relatively new buildings for Regus while keeping an eye on the real

TKP Corporation

Earnings briefing materials for the first nine months of the fiscal year ending February 29, 2020

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1

Introduction

Topics

2

6Q3 FY02/20

Performance overview 11

Business overview 19

Growth strategy and medium-term business plan 33

Appendix 40

Contents

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2

Introduction

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3

Multiple ancillary services targeted to customer needs

Business model and sourcing strategy

Real estate owner Business users

Existing buildings

Sell in small lots

(space sharing)

Revitalizes space

Secures rent income Rent burden reducedFlexible workstyles

The company

Serviced office

Conference room

BPO

Accommodation

Food & Beverage

Event

Our opening strategy is to focus on large existing buildings for TKP and new construction and relatively new buildings for Regus while keeping an eye on the real estate market. When opening a

Regus location, using part of the space as TKP meeting room rental space at the outset can shorten the time it takes to break even.

New

and relatively new

buildings

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4

Main openings in Q3 FY02/20

The Company reduced TKP rental meeting room openings in FY02/20 due to the tight real estate market, but aggressively opened Regus locations, which have high unit prices.

TKP Garden City PREMIUM Tenjin Sky Hall

(September 2019)

TKP Shinagawa Grand Central Tower

Conference Center(October 2019)

SPACES Shinagawa(November 2019)

Regus Nagasaki BizPORT Center (October 2019)

Regus Omiya West Center

(October 2019)

Regus Hachinohe Center

(November 2019)

Regus Akita Ekimae Center

(November 2019)

OpenOffice Osaka Higobashi

(November 2019)

TKP Toranomon Ekimae Conference Center

(Increased floorspace; November 2019)

TKP Himeji KaigishitsuRegus Himeji Ekimae Center

(October 2019)

Regus OkayamaAcross Cube

(November 2019)

TKP Matsuyama-shi Ekimae Conference Center(November 2019)

Regus Matsuyama-shi Ekimae Center(January 2020)

Jointopenings

TKP STAR Meeting Room Tachikawa

(November 2019)

TKP STAR Meeting Room Suidobashi

(November 2019)

TKP Shinbashi Kaigishitsu(October 2019)

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5

Completed and planned openings in FY02/20 (as of January 2020)

We planned to open roughly 12,231 m2 of Regus Japan floorspace in the medium-term plan announced August 2019, but the actual figure appears likely to reach 14,215 m2. Openings and costs were skewed toward Q3 in contrast to the plan, which had assumed a steady pace.

Q4 (planned)Q3Q2Q1

3 locations 8 locations(including one large SPACES

location)

3 locations

3,213 m2 8,499 m2 2,519 m2

9 locations 4 locations 7 locations 3 locations11,210 m2 7,253 m2

(including 5,547 m2 of increased floorspace)

5,365 m2(including 145 m2 of increased

floorspace)

10,902 m2(including 7,954 m2 of increased

floorspace)

Openings planned for FY02/20 (As of January 2020)

14 locationsApprox. 14,215 m2

Openings completed in FY02/19


Openings planned for FY02/20 (As of January 2020)


We expect to open fewer TKP meeting rooms (and add less TKP floor space) than in FY02/19.

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6

Topics

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7

Main topics through Q3

Apr. 15

May 31

Jun. 1

Jun. 26

Jul. 1

Aug. 9

Aug. 16

1H topicsAnnounced acquisition of Regus Japan

Made Regus Japan a subsidiary

Regus Japan commenced operations on a consolidated basis

Formulated medium-term business plan and announced revised forecast for FY02/20

Made Shinagawa Haizennin Shokaijo a subsidiary

Announced acquisition of Regus Taiwan**Collective name for the 13 entities operating the Regus business in Taiwan

Announced revisions to the new medium-term business plan and the forecast for FY02/20

Q3 topicsShinagawa Haizennin Shokaijo commenced operations on a consolidated basis

Announced issuance and sale of new shares

Decided share issue and selling price; completed conversion of Regus Taiwan to a subsidiary

Received 2nd in 2019 Award for Excellence in Corporate Disclosure in the Emerging Markets category

Regus Taiwan scheduled to commence operations on a consolidated basis(Reference) Q4 topics

Sep. 1

Sep. 18

Sep. 30

Oct. 8

Dec. 1

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8

Shinagawa Haizennin Shokaijo consolidated in Q3 FY02/20 (September 1, 2019)

Overview

Name:

Established:

Businesses:

Registered members:

Sales:

Main clients:

Shinagawa Haizennin Shokaijo Y. K.

July 16, 1970

Wait staff recruiting and staffing

Approx. 5,500 (as of January 2020)

¥937 million (FY06/19)

Palace Hotel Tokyo

Grand Hyatt Tokyo

Andaz Tokyo

Tokyo Kaikan

Hotel Grand Hill Ichigaya

Tokyo Dome Hotel

Shinagawa Haizennin Shokaijo is a major temporary staffing service operator that conducts business with numerous high-end hotels.

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9

We announced a capital increase through public offering on September 18, 2019 and decided the conditions on September 30.

Issuance of new shares and secondary offering of shares

Primary offering

Secondary offering

¥5,095 per share

4,282,700 shares

Of the total amount we raised through the public offering and third-party allotment,

we applied approximately ¥13.1 billion to TKPSPV-9 Corporation in December 2019 and repurchased and cancelled Class A preferred shares. This reduced financial costs stemming from the payment of preferred dividends. We expect the equity ratio to be roughly 30% after repurchase and cancellation of preferred shares.

Total amount raised

Approx. ¥23.4 billion

Issue/selling price

500,000 shares Increase in the number of floating shares, sufficient liquidity

Third-party allotment 538,600 shares

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10

Business: Serviced offices, co-working spaces, rental meeting rooms

Brands: Regus, SPACES, HQ

Locations: 14 (11 Regus locations, 2 SPACES locations,

1 HQ location [scheduled to open in spring 2020])

Sales: ¥951 million (FY12/18)

Operating profit: ¥172 million (FY12/18)

Total assets: ¥1,376 million (FY12/18)

Hsinchu・SPACES: 1 location

Taichung・Regus: 3 locations

Taipei・Regus: 8 locations・SPACES: 1 location・HQ: 1 location(planned)

Making Regus Taiwan1 a subsidiary

1. Collective name for the 13 entities operating the Regus business in Taiwan2. Figures originally disclosed as in New Taiwan dollars (IFRS) have been converted to yen at TWD1.00 = JPY3.48, the rate prevailing on June 28, 2019.

Figures have not been subjected to external audits.

We completed conversion of Regus Taiwan to a subsidiary on September 30, 2019. Consolidation of the company was postponed from October 1 until December 1 (Q4)

to coincide with accounting integration.

(In three years)Sales

Approx. ¥2,300 millionEBITDA

Approx. ¥600 million

(In six years)50 locations

・Concentrate openings in Taipei・Collaborate in the rollout of rental meeting rooms

Transaction price£18 million(¥2,410 million)

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11

Q3 FY02/20Performance

overview

2TKP Garden City PREMIUM Marunouchi Pacific Century Place opened in December 2019

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12

Consolidated results for the nine months ended November 30, 2019

(Millions of yen)

Nine months ended Nov. 30,

2018

Nine months ended Nov. 30,

2019YoY change

Net sales 26,662 39,674 +48.8%

Gross profit 10,412(39.1%)

15,293(38.5%)

+46.9%

SG&A 6,918(25.9%)

10,333(26.0%)

+49.4%

EBITDA2 4,104(15.4%)

7,276(18.3%)

+77.3%

Operating profit

3,493(13.1%)

4,959(12.5%)

+42.0%

Ordinary profit 3,295(12.4%)

3,379(8.5%)

+2.6%

Profit3 1,095(4.1%)

1,287(3.2%)

+17.6%1. The parent and 17 subsidiaries (all except two added in FY02/20: Regus Japan and Shinagawa Haizennin Shokaijo)2. EBITDA = operating profit + goodwill amortization + depreciation3. Profit indicates profit attributable to owners of parent.

(Factors affecting non-operating income/expenses)Bank arrangement fees: -¥500mn (Q1)Forex losses: -¥180mn (Q2)M&A fees: -¥400mn (Q1: -¥300mn/Q3: -¥90mn)Increase in interest expenses: -¥160mn (bridge loan)(Q2/Q3)Fees accompanying public offering: -¥50mn (Q3)

(Factors affecting extraordinary income/losses)Impairment losses on shares in Otsuka Kagu: -¥200mn (Q2)Preferred dividend payouts: -¥150mn (Q3)Gain on sale of JAIC shares: +¥390mn (Q3)

(Factors affecting SG&A expenses)Goodwill amortization from acquisitions: -¥1,100mn (Q2/Q3)One-time expenses related to integration of Regus Japan: Approx. -¥400mn (Q3)Registration license tax for public offering: -¥80mn (Q3)

Despite a large increase in goodwill amortization, SG&A expenses remained close to 26% thanks to an improvement in profitability at the main TKP Group.

Special factors pertaining to Q3 FY02/20 only are marked in red.

Sales and gross profit grew rapidly on the contribution of Regus Japan (consolidated in Q2). EBITDA, our most important performance indicator, was up a remarkable 77.3% accompanying improved performance at the main TKP

Group1. Operating profit margin meanwhile fell due to goodwill amortization from the acquisition of Regus Japan. Non-operating expenses such as M&A and financing costs for the Regus Japan acquisition squeezed ordinary profit.

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13

Consolidated results for the nine months ended November 30, 2019(results for newly acquired companies shown separately)

(Millions of yen)

(1) Nine months ended Nov. 30, 2018Main TKP Group

(2) Nine months ended Nov. 30, 2019Main TKP Group

YoY change([1] and [2])

(3) Nine months ended Nov. 30, 2019

Regus Japan

(4) Nine months ended Nov. 30, 2019

Shinagawa Haizennin Shokaijo

Net sales 26,662 30,921 +16.0% 8,471 281


12,475(40.3%) +19.8% 2,750

(32.5%)67

(24.1%)

SG&A 6,918(25.9%)

7,781(25.2%) +12.5% 2,503

(29.6%)47

(17.0%)

EBITDA 4,104(15.4%)

5,665(18.3%) +38.0% 1,582

(18.7%)28

(10.0%)

Operating profit 3,493(13.1%)

4,693(15.2%) +34.4% 246*

(2.9%)19*

(7.0%)

Growth in premium grade businesses at the main TKP Group spurred rapid growth asgross profit margin, the EBITDA margin, and operating profit margin all rose significantly.

*Operating profit figures for Regus Japan and Shinagawa Haizennin Shokaijo exclude goodwill amortization.

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14

Q3 FY02/20 consolidated results (September–November)

Due to the consolidation of Regus Japan, sales and EBITDA expanded dramatically in Q3 comparisons as well. Although all profit lines increased YoY, each profit margin fell as Regus Japan

was roughly ¥170 million in the red in Q3.

(Millions of yen)Q3 FY02/19 Q3 FY02/20 YoY change

Net sales 9,051 15,401 +70.2%


5,380(34.9%)

+65.5%

SG&A 2,341(25.9%)

3,984(25.9%)

+70.1%

EBITDA 1,149(12.7%)

2,418(15.7%)

+110.4%

Operating profit

909(10.0%)

1,395(9.1%)

+53.4%

Ordinary profit 844(9.3%)

1,152(7.5%)

+36.5%

Profit 498(5.5%)

542(3.5%)

+8.7%

(Factors affecting non-operating income/expenses)Increase in interest expenses: -¥60mnM&A fees: -¥90mnFees accompanying public offering: -¥50mn

(Factors affecting extraordinary income/losses)Preferred dividend payouts: -¥150mnGain on sale of JAIC shares: +¥390mn

(Factors affecting SG&A expenses)Goodwill amortization from acquisitions: -¥550mnOne-time expenses related to integration of Regus Japan: Approx. -¥400mnRegistration license tax for public offering: -¥80mn

Special factors pertaining to Q3 FY02/20 only are marked in red.

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15

Q3 FY02/20 consolidated results (September–November)(results for newly acquired companies shown separately)

(Millions of yen)

(1) Q3 FY02/19Main TKP Group

(2) Q3 FY02/20Main TKP Group

YoY change([1] and [2])

(3) Q3 FY02/20Regus Japan

(4) Q3 FY02/20Shinagawa

Haizennin Shokaijo

Net sales 9,051 10,785 +19.2% 4,334 281


4,203(39.0%)

+29.3% 1,108(25.6%)

67(24.1%)

SG&A 2,341(25.9%)

2,658(24.6%)

+13.5% 1,278(29.5%)

47(17.0%)

EBITDA 1,149(12.7%)

1,886(17.5%)

+64.2% 503(11.6%)

28(10.0%)

Operating profit/loss

909(10.0%)

1,544(14.3%)

+69.9% -169-

19(7.0%)

The main TKP Group achieved record high results in Q3. Growth in premium grade businesses spurred rapid growth as gross profit margin, the EBITDA margin, and operating profit margin all rose significantly.

Meanwhile, Regus Japan booked a loss of roughly ¥170 million due to upfront spending for the opening of a large SPACES location and one-time expenses related to integration.

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16

Summary of consolidated balance sheet

Substantial growth in the equity ratio due to capital increaseFinancial position greatly improved

(Millions of yen)End-FY02/19 End-1H FY02/20 End-Q3 FY02/20 Change

Current assets 16,747 21,347 34,075 +17,328

(Cash and deposits) 11,967 16,271 27,560 +15,592

(Accounts receivable) 3,355 2,995 4,506 +1,151

Non-current assets 34,318 89,722 99,615 +65,297

(Property, plant and equipment) 24,959 31,028 38,390 +13,430

(Intangible fixed assets) 254 42,959 45,272 +45,017

Total assets 51,066 111,069 133,691 +82,625

Current liabilities 9,299 48,135 48,744 +39,445

Non-current liabilities 31,003 38,164 35,911 +4,908

Total liabilities 40,302 86,299 84,656 +44,353

(Interest-bearing debt) 35,913 73,333 67,221 +31,308

Total net assets 10,763 24,769 49,035 +38,271

Total liabilities and net assets 51,066 111,069 133,691 +82,625

Equity ratio 21.0% 10.5% 26.8% +5.8pp

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17

Full-year company forecast announced August 16, 2019 (YoY comparisons)

(Millions of yen)

Full-year FY02/19

(actual)

Full-year FY02/20(forecast)

Announced Aug. 16

YoY change

Net sales 35,523 56,206 +58.2%

EBITDA 5,180(14.6%)

11,228(20.0%)

+116.8%


7,607(13.5%)

+77.4%


5,913(10.5%)

+45.9%

Profit 1,893(5.3%)

2,863(5.1%)

+51.2%

We expect tremendous earnings growth due to growth at the main TKP Group and consolidation of Regus Japan (Q2), Shinagawa Haizennin Shokaijo (Q3), and Regus Taiwan (Q4).

We anticipate EBITDA, our most important performance indicator, will more than double YoY.

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18

Q3 progress versus full-year FY02/20 forecasts

45.0%

57.2%

65.2%

64.8%

70.6%

Profit

Ordinary profit

Operating profit

EBITDA

Net sales

Full-year forecast: ¥56,206 million





Q3 progress: ¥39,674 million





Net sales have made steady progress considering our plan assumes a heavier weighting toward 2H.

Ordinary profit and profit came in below plan as a result of extraordinary expenses booked in Q3 (public offering, etc.) and expenses related to post-merger integration being higher than expected. However, we expect Q4 progress to be much more rapid as most one-time expenses accompanying the acquisitions were recorded in Q3 and earlier.

We have left full-year forecasts unchanged as the main TKP Group is performing better than expected.

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19

Business overview

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20

Five business areas

Five business areas with flexible workspace at the center

吉田

Flexible Workspace(Hotel banquet facilities, rental meeting rooms,serviced offices, co-working spaces)

EventProduction BPO

Hotel/Accommodationand Training

Food &Beverage/Banquet

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21

Japan

April 15, 2019Announced Regus Japan acquisition

Signed long-term exclusive partnership agreement with IWG

May 31, 2019Conversion to subsidiary

completedIncome statement consolidated

in Q2 FY02/20

Making Regus Japan Holdings K.K. a subsidiary

The process of making Regus Japan a subsidiary was completed on May 31, 2019, and the company was included in the scope of consolidation in Q2 (June 1).

As the companies’ customer bases differ (TKP: major Japanese companies; Regus Japan: major non-Japanese companies), we expect both to benefit greatly from reciprocal customer referrals and joint openings.

Rental meeting rooms

Serviced offices, co-working spaces

Flexible workspace business

Transaction price:£304 million

(approx. ¥42.9 billion)

Major Japanese companies

Major non-Japanese companies

Japanese SMEs

Individuals

Major Japanese companies

Major non-Japanese companies

Japanese SMEs

Individuals

Rental meeting rooms

Serviced offices

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22

Diverse workspace possibilities from rentals by the hour to short- to medium-term plans.We source new and existing buildings based on extensive information.

TKP brands

High-grade

Long-term

Regus brands

Rental meeting rooms and hotel banquet facilities Serviced offices and co-working spaces

Short-term

Budget-priced

Garden CityLarge hotel banquet facilities and multipurpose conference

room catering systems

Garden City PREMIUMHigh class and well-equipped

conference room catering systems

Conference CenterConference room catering

systems suitable for conferences and training

Business CenterConference facilities with numerous meeting rooms

STAR rental meeting rooms

Local meeting rooms

From rentals by the hour to short- to medium-term workspace businesses

Entrepreneurial communitiesOptimal spaces available

when needed

Useful spaces provided economically

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23

We aim to further expand our network of locations in Japan and drive growth of the flexible workspace market.

TKP Group network

Facilities

Rooms

Seats

Contracted floorspace

413

11,451

185,029

521,811

facilities

rooms

seats

m2

As of November 30, 2019




As of November 2019

521,000 m2

(413 locations)

In 2030, approx. 1.4 million m2

(approx. 1,500 locations)Sapporo

Obihiro

Aomori

Sendai

Morioka

NiigataKoriyama

MitoNagano

Karuizawa

Hachinohe

Akita

Tokyo

ChibaHayama

Utsunomiya

KawasakiYokohama

HamamatsuHakone, Yugawara

AtamiIzu

MatsumotoKobuchizawa

ToyamaKanazawa

NagoyaKyoto

Shiga

Osaka

KobeHimejiOkayama

Hiroshima

Yamaguchi

Takamatsu

MatsuyamaKokuraHakata, Tenjin

Oita

Kumamoto

Miyazaki

Kagoshima

Naha

Nagasaki

TKP facilities Regus Japan facilities

Omiya

New York andNew Jersey19 rooms/2 facilities

Cities in the Americas

1,300 facilitiesCities in the

Asia–Pacific region

690 facilities

Hong Kong, Taiwan, and Singapore8 rooms/3 facilities

Regus Taiwan

14 facilities

Cites in the UK

330 facilities

Cities in Europe, Middle East, and Africa

1,020 facilities

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24

Grade FY02/17 FY02/18 FY02/19 Q3 FY02/20

Garden CityPREMIUM

(GCP)

Rooms 113 137 223 247Locations 11 13 20 23

Garden City(GC)

Rooms 372 417 458 456Locations 32 39 46 48

Conference Center(CC)

Rooms 796 881 992 979Locations 67 79 87 86

Business Center(BC)

Rooms 351 313 319 305Locations 53 49 50 48

STAR rental meeting rooms

Rooms 91 88 93 102Locations 41 38 40 44

(Within training facilities)

LecTore, Ishinoya, others Rooms 29

822

75210

6912

TKP total

Rooms 1,752 1,858 2,137 2,158Locations 212 225 253 261

Floor space (m2) 277,728 339,490 379,470 402,082

Regus Japan

Workstations - - - 23,087Locations - - - 152

Floor space (m2) - - - 119,725

Number of meeting rooms, locations, and workstations1 by grade(We offer five grades to meet different purposes, scales, and budgets. We are also developing meting rooms within training facilities.)

As of November 30, 20191. Workstations: Number of seats at Regus Japan facilities

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25

Interrelation of Group businesses

With flexible workspace as our mainstay business, we also develop ancillary services.We go beyond merely subletting space, differentiating ourselves by expanding our business

domains in response to the demands of our corporate customers.

Rental meeting rooms,

hotel banquet facilities

Serviced offices,co-working spaces

Flexible workspace business

Event Production

Food & Beverage/Banquet

BPO

Pod hotels1

Hotel/Accommodation and Training

APA Hotel1New city

(business) hotels

Hot spring innsCity

(business) hotels

Accommodationand training

facilities Prepared lunchboxes

Staffing service

Restaurants,cafés

Event production

Medical academicconferences

Equipmentrentals

Call centers

Outsourced administrative

services

1. Operated as a franchise business

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26

1,771 2,886 3,966

6,698 7,243

7,803

7,328

8,478

9,436 1,468

1,605

1,667

137

199

189

2,068

3,652

5,053

1,829

2,596

3,085

8,471

Nine monthsended Nov. 30,

2017


2018


2019

Sales by grade

STAR rental meeting rooms (-4%)

Others1 (+18%)

Accommodation/training facilities (+38%)

Business Centers (+3%)

Conference Centers (+11%)

Garden City (+7%)

Garden City PREMIUM (+37%)

(Millions of yen, YoY comparison)

1. Mainly comprises restaurant sales and sales from projects using non-company facilities.

Premium and accommodation/training facilities

are driving growth.

Regus Japan

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27

Consolidated net sales

¥26,662 million

Sales composition by service

Nine months ended Nov. 30, 2018 Nine months ended Nov. 30, 2019

Share of ancillary services (additional services other than room rent) at the main TKP Group has expanded

(Millions of yen, % of total)

Consolidated net sales

¥31,202 million

Room rent15,30149.0%

Room rent13,36050.1%

Options2

2,5629.6%

F&B5,31719.9%

Accommodations2,96611.1%

Others1

2,4559.2%

Options2

3,0799.9%

F&B5,89018.9%

Accommodations4,09313.1%

Others1

2,8399.1%

1. Others: Mainly comprises sales of accommodation at non-company facilities, service fees, and vending machine sales at each location.2. Options: Mainly comprises sales of equipment used in meeting rooms.

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28

Meeting room rentals business model

The company’s meeting room rentals business extends beyond simple subletting of space to include ancillary services such as food and beverage and accommodation, which greatly enlarge its sales.

Meeting room facilities on average take three months to break even and 12 months to reach cruising speed.

Total cost

Meeting room Meeting room

Lunchboxes

Meeting room

Banquet

Meeting room

Accommodation

Meeting room

Event production

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29


Room rent makes up a large portion of the sales composition from February–June when demand spikes due to school entrance exams and seasonal hiring and training. However, additional services (e.g. Food & Beverage)

make up the majority of sales from July–January. We do not emphasize the occupancy rate in the meeting room rentals business because it has little connection to sales.

1,547 1,835

1,506 1,763

1,387 1,050

1,253 1,470 1,568

1,140 1,258

1,852

1,337

1,523

1,355

1,492

1,484

1,328

1,472

1,602 1,689

1,670 1,399

1,544

0%

10%

20%

30%

40%

50%

60%

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000Occupancy rate and portion of sales occupied by room rent

Room rent sales Non-room rent sales Occupancy rate

Notes: Actual FY02/19 figuresOccupancy rate is for properties owned or leased by the company and is estimated assuming eight hours of potential operation per day.

(Millions of yen) (Occupancy rate)

Q3 Q4Q2Q1

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30


Sales per square meter, a KPI for the business, trended upward every quarter. It jumped markedly in Q2 and Q3 as the portion of non-room rent sales climbed.

Sales per square meter and operating profit are correlated.

Note: The sales total comprises fees for room rentals, options, and catering.

12,837

10,716

11,296 11,307

12,916

11,423

12,203

13,000

14,000

15,000

16,000

17,000

18,000

19,000

20,000

21,000

8,000

9,000

10,000

11,000

12,000

13,000

14,000

Q1 average Q2 average Q3 average Q4 average

Sales per square meter and meeting room floor space

FY02/19 sales FY02/20 salesFY02/19 floor space FY02/20 floor space

Monthly sales/m2

(JPY)

Meeting roomfloor space (m2)

1,765

817 909

795

2,087

1,061

1,545

Q1 Q2 Q3 Q4

Quarterly operating profit at the main TKP Group

FY02/19 FY02/20

(Millions of yen)

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31

Regus Japan’s business model

On average, Regus Japan facilities break even 8–12 months after opening (occupancy rate of 45%) and reach cruising speed after around 18 months (occupancy rate of 65%). While it takes longer for these facilities

to turn a profit compared to rental meeting room facilities, they employ a recurring revenue model and we can expect them to achieve stability and high earnings in the long term (after 10+ years).

-40%

-20%

0%

20%

40%

60%

80%

100%

6 months 12 months 18 months 24 months. . . . . . . . . . . 5 years . . . . . . . . . . . 10 years

Typical occupancy rates and profit margins after opening

CBIT margin (operating profit margin of location) Occupancy rate

Rent incurs

Time elapsed after opening

Reach the breakeven point at around 8 to 12 months

Location opens

Reach cruising speed at around 18 months

Contract concluded,

construction begins

Takes an average of three to four months to open a location after concluding a

contract

High occupancy rates maintained over the long term

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32

Regus Japan performance indicators

Occupancy rate is the most important KPI for Regus Japan.Locations opened in December 2017 and earlier, which comprise a majority of Regus Japan’s capacity,

have maintained a high occupancy rate.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%Occupancy rate by year opened

2017 and earlier 2018 2019

0

5,000

10,000

15,000

20,000

25,000Workstations by year opened

2017 and earlier 2018 2019

Break even occupancy rate

(Actual 2019 results) (Actual 2019 results)

(Seats)

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33

Growth strategy and medium-term business plan

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34

Announcement on August 16, 2019 of a new growth strategy to coincide with the TKP Group’s new medium-term business plan

1. Merging of resources with Regus Japan toward joint property development, product sales, and location management

2. Promotion of a workstyle revolution as Japan’s largest flexible workspace provider through service expansion focusing on B2B as well as improvement of customer satisfaction and repeat order rate

3. Development and acquisition of businesses related to the flexible workspace field

4. Rapid global expansion of TKP’s network with Asia as a springboard combining rental meeting rooms, serviced offices, co-working spaces, and accommodation

New growth strategy

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35

We position EBITDA, a global metric for assessing enterprise value, as our most important performance indicator, and aim for an EBITDA margin of 23% in FY02/22.

New medium-term business plan (FY02/20–FY02/22)

(Millions of yen)FY02/20

(plan)FY02/21

(plan)FY02/22

(plan)

Net sales 56,206 69,150 79,326

EBITDA 11,228(20.0%)

14,996(21.7%)

18,313(23.1%)


9,617(13.9%)

12,471(15.7%)


9,038(13.1%)

11,918(15.0%)

Profit attributable to owners of parent

2,863(5.1%)

4,456(6.4%)

6,406(8.1%)

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36

We formulated the new medium-term business plan based on growth at the main TKP Group and consolidation of Regus Japan and Regus Taiwan.

Background for the formulation of the new medium-term business plan

7,700 9,700

11,400

3,200

4,800

6,200

100

400

500

FY02/20(target)

FY02/21(target)

FY02/22(target)

42,800 48,300

54,200

12,700

19,000

22,800

600

1,700

2,200

FY02/20(target)

FY02/21(target)

FY02/22(target)

Net sales (Millions of yen) EBITDA (Millions of yen)

Regus Taiwan

Main TKP Group

56,200

69,100

79,300

11,200

14,900

18,300

Regus Taiwan

Regus Japan

Main TKP Group

Regus Japan

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37

8.6%

13.4%14.3% 14.2% 14.6%

20.0%

21.7%

23.1%

Profit targets of the new medium-term business plan

For FY02/20, we target an operating profit margin of more than 15% and an EBITDA margin of more than 23%.

6.2%

11.2%

12.3% 12.0% 12.1%

13.5%13.9%

15.7%

Operating profit and operating profit margin EBITDA and EBITDA margin

Actual results New plan

(Millions of yen)

Actual results New plan

878

2,004 2,694

3,449 4,289

7,607

9,617

12,471

FY02/15 FY02/16 FY02/17 FY02/18 FY02/19 FY02/20(target)

FY02/21(target)

FY02/22(target)

(Millions of yen)

1,224 2,411

3,134 4,084

5,180

11,228

14,996

18,313

FY02/15 FY02/16 FY02/17 FY02/18 FY02/19 FY02/20(target)

FY02/21(target)

FY02/22(target)

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38

We plan to deploy overseas the business model we have developed in Japan(offering a combination of rental meeting rooms, serviced offices, co-working spaces, and

accommodation and training facilities).

Overseas development, centered on Asia

Accommodation and training

facilities

Rentalmeetingrooms

Serviced offices, co-

working spaces

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39

Long-term outlook

Flexible workspaces: From Japan industry leader to global brand

Anytime, Anywhere for All workers

From Asia to the world

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40

Appendix

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41

Corporate profile (as of November 30, 2019)Name

Businesses

Executives

Headquarters

Established

Representative director

Capital

Listed

Employees

TKP Corporation

Flexible workspacesFood and beverage/banquetsHotels and resortsEvent productionBPO

Takateru Kawano Representative director/CEOKoji Nakamura Director/COOShingo Nishioka DirectorHaruo Tsuji DirectorKohei Watanabe DirectorMark Dixon DirectorYoshinori Sogabe Standing auditorTakanori Shige AuditorTakayuki Hayakawa Auditor

TKP Ichigaya Building 2F8 Ichigaya-Hachimancho, Shinjuku-ku, Tokyo

August 15, 2005

Takateru Kawano

¥12 billion (as of November 30, 2019)

March 27, 2017: TSE Mothers (3479)

1,727 (as of November 30, 2019)*Excluding part-time employees

Convenistation Co., Ltd.

TKP Properties Corporation

TKP Communications Corporation

Tokiwaken Corporation

TKP Medicalink Corporation

TKP New York, Inc.

TKP New Jersey LLC

Regus Taiwan**Collective name for the 13 entities operating the Regus business in Taiwan

Regus Japan Holdings K.K.

TKP Corporation

Majors Inc.

Shinagawa Haizennin Shokaijo Y.K.

TKPSPV 1–4 / 6–10

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42

2005 20212006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

(target)

(Millions of yen)

187 7572,039 2,659 3,399 3,021

5,9908,293

11,65814,162

17,941

21,978

28,689

35,523

56,206

69,150

79,326

2017

Listed on the TSE Mothers exchangeOpened Azur Takeshiba in Minato-kuBegan providing Cloudspace, a space matching serviceOpened First Cabin TKP Nagoya StationMajors Inc. became a subsidiaryOpened combined rental meeting room/co-working space facility TKP Garden City Hiroshima Ekimae Ohashi (Hiroshima)

2018

Opened CIRQ Shinjuku, a large multipurpose event hallOpened LecTore Hayama Shonan Kokusaimura, a large resort training hotelOpened APA Hotel TKP Sendai EkikitaOpened First Cabin TKP Ichigaya in the same building as the TKP head officeNumber of directly managed meeting rooms exceeded 2,000

2005Opening of first facility, TKP Roppongi KaigishitsuTKP Corporation established in Hamamatsu-cho, Minato-ku, Tokyo

2006Expanded into the Hokkaido, Kansai, and Kyushu regionsMonthly sales exceeded ¥100 million

2007 Expanded into the Tohoku and Tokai regions

2008Registered as a Class 2 travel operatorEstablished Convenistation Co., Ltd. (consolidated subsidiary)

2009 Established TKP Properties Corporation (consolidated subsidiary)

2010Established current TKP Communications Corporation (consolidated subsidiary)Established TKP New York, Inc. (consolidated subsidiary)Expanded into the Chugoku region

2011 Opened TKP Garden City Shinagawa (banquet hall facility inside a hotel)

2012 Number of directly managed meeting rooms exceeded 1,000

2013Established Tokiwaken Corporation (consolidated subsidiary)Joined Keidanren (Japan Business Federation)Expanded into the United States (New York)

2014Registered as Class 1 travel operatorOpened APA Hotel TKP Sapporo Ekimae

2015 Opened TKP Izu Nagaoka Onsen Villa Garden Inshinoya

2016 Entered business alliance with First Cabin, commencing the pod hotel business

History

2005TKP Corporation

established

2017Listed on the TSE Mothers exchange

2019Regus Japan Holdings K.K.

became a subsidiary

2019

Regus Japan Holdings K.K. became a subsidiaryOpened accommodation facility LecTore Hakata Hisayama Onsen (Hakata)Opened APA Hotel Osaka Umeda (Osaka)Shinagawa Haizennin Shokaijo Y.K. became a subsidiaryRegus Taiwan became a subsidiary

(target)

(target)

A company that revitalizes and redistributes space

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43

Food & Beverage/Banquet business

Directly managed restaurants and cafésParty and social event hosting

Wait staff dispatchingLunchbox preparation

Tokiwaken Corporation

“Kizuna” Japanese Dining(Sapporo)

“Ise” Japanese Dining(Nagoya)

26 establishments across Japan

Shinagawa Haizennin Shokaijo Y.K.

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44

Event Production business and BPO business

Event production

Event production

Comprehensive rentals

Simultaneous interpretation system

Interpretation booth and equipment

Technical supportDispatch of interpreters

Support for medical conferences

Call center

Outsourced administrative services

BPO

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45

Hotel/Accommodation and Training business (1)

Accommodation and training facilities Hot spring inn

City (business) hotel

LecToreAtami Koarachi

LecToreAtami Momoyama

LecToreHakone Gora

LecTore Karuizawa

LecToreYugawara

LecTore Hayama Shonan Kokusaimura

LecTore Takamatsu Airport

LecToreYatsugatake

LecToreToyama Jiyukan

LecTore Hakata Hisayama Onsen

Ishinoya

Azur Takeshiba

Directly managed facilities

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46

Hotel/Accommodation and Training business (2)

Franchise facilities

New city (business) hotels Pod hotels

APA HotelTKP Nippori Ekimae

APA HotelTKP Tokyo Nishikasai

APA Hotel TKP Sapporo Ekimae

APA Hotel TKP Sapporo-Eki

Kitaguchi EXCELLENT

APA Hotel TKP Keikyu Kawasaki Ekimae

APA Hotel TKP Sendai Ekikita

APA Hotel Osaka Umeda

APA Hotel Ueno Hirokoji1

APA Hotel Hakata Higashi Hie Ekimae1

APA HotelFukuoka Tenjin Nishi1

1. Provisional names

First Cabin TKP Nagoya Ekimae

First Cabin TKP Ichigaya

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47

Accommodation/training facilities operated by TKP

Facility Guest rooms Opened Building Land

APA Hotel TKP Sapporo Ekimae 203 August 2014 Leased ―APA Hotel TKP Sapporo-Eki Kitaguchi EXCELLENT 108 August 2016 Leased ―APA Hotel TKP Nippori Ekimae 278 December 2016 Owned OwnedAPA Hotel TKP Tokyo Nishikasai 124 December 2017 Leased ―APA Hotel TKP Keikyu Kawasaki Ekimae 143 June 2018 Owned LeasedAPA Hotel TKP Sendai Ekikita 306 October 2018 Owned OwnedAPA Hotel Osaka Umeda 162 May 2019 Owned Leased

APA Hotel Hakata Higashi Hie Ekimae 206 Scheduled for February 2020 Owned Owned

APA Hotel Fukuoka Tenjin Nishi 268 Scheduled for May 2020 Owned OwnedAPA Hotel Ueno Hirokoji 215 Scheduled for June 2020 Owned OwnedLecTore Atami Koarashi 20 November 2013 Leased ―LecTore Hakone Gora 23 January 2014 Leased ―LecTore Karuizawa 14 July 2014 Leased ―LecTore Atami Momoyama 31 July 2014 Leased ―Azur Takeshiba (managed on contract) 122 April 2017 ― ―LecTore Yugawara 108 May 2017 Owned OwnedLecTore Hayama Shonan Kokusaimura 160 April 2018 Owned OwnedLecTore Takamatsu Airport(banquet hall rental/ business alliance) 124 June 2018 ― ―

LecTore Yatsugatake (managed by a third party) 32 November 2018 ― ―LecTore Toyama Jiyukan (managed by a third party) 40 March 2018 ― ―LecTore Hakata Hisayama Onsen 44 June 2019 Owned OwnedIshinoya 22 January 2015 Leased ―First Cabin TKP Nagoya Station 199 September 2017 Owned OwnedFirst Cabin TKP Ichigaya 165 November 2018 Leased ―

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48

TKP Group’s diverse customer acquisition channels

Company-managedIT-supported

reservation system

Extensive advertising

covering all types of media nationwide

406 facilities in Japan with a

sales networkcovering all

main urban areas

94,900 companies had used the

TKP Group’s services

2.5 millionRegus membersin Japan and overseas

As of February 28, 2019

As of October 31, 2019

Facility owners can register with the TKP rental meeting room website to appeal to a wide range of customers.

TKP party and social event site

Facebook

Regus blog

TKP website Regus website

Magazine ads

Regus app

Train station ads

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49

Global collaboration with IWG (Regus Group)

Around the world, IWG boasts overwhelming scale in the businesses of serviced offices and co-working spaces.

1,100+cities

Global network

3,300+locations

110+countries/

regions

Diverse brands

Europe, Middle East, Africa

Approx. 1,020locations

UKApprox. 330

locations

Asia PacificApprox. 690

locations

AmericasApprox. 1,300

locations

2.5mnmembers

Robust Group performance

Sales:￡2,535mn

(Approx. ¥332.0bn)

EBITDA:￡389mn

(Approx. ¥50.4bn)

Operating profit:

￡154mn(Approx. ¥20.1bn)

Note: Operating performance is for FY12/18.

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50

Important Notice

This English translation is only intended for reference. In cases of discrepancies, datacontained within the original Japanese version shall take precedent over datacontained herein.

This material has been prepared to improve the understanding of our Group, and noinformation contained herein shall be construed as solicitation for purchase or sale ofour shares. This material has not been prepared for investment advisory purposes.

Forecasts and related information contained in this material are estimates which werebased on information available to the TKP group at the time when the material wasprepared. They will be impacted by uncertainties including market conditions and futurebusiness progress.

Please be aware that the actual results and other information may differ significantlyfrom what is stated in this material.

Documents

TKP Corporation...Our opening strategy is to focus on large existing buildings for TKP and new construction and relatively new buildings for Regus while keeping an eye on the real