Japan Metropolitan Fund Investment Corporation (8953) reported a slightly weaker half and a slightly larger payout. Net income for the six months to August 2026 fell 4.3% to ¥22.7bn on operating revenue of ¥51.5bn, down 1.1%. The distribution per unit still edged up to ¥3,012 from ¥3,006, while net income per unit slipped to ¥3,152 from ¥3,294.
How the payout is built
The fund's distribution policy is to pay out more than 90% of distributable profit. The payout ratio was 95.6%, against 91.3% in the previous half.
The total of ¥21.66bn started from ¥22.7bn of undistributed profit. The fund added ¥458mn from its dividend reserve and set aside ¥1.47bn into a reduction reserve. The notice says the fund uses dividend-reserve reversals to avoid extra tax caused by mismatches between accounting and tax treatment. In the previous half, the same arithmetic involved a ¥1.10bn dividend-reserve reversal and a ¥3.18bn transfer to the reduction reserve. At August 31, 2026 the balance sheet showed ¥6.77bn in the reduction reserve and ¥2.04bn in the dividend reserve.
Property sale gains, booked inside operating revenue, were ¥5.1bn, down from ¥6.6bn. Rental income rose to ¥45.8bn from ¥44.9bn. Interest expense rose to ¥2.66bn from ¥2.36bn.
Guidance leans harder on reserves
The fund guides to a 17.1% fall in net income to ¥18.8bn for the half to February 2027, with operating revenue down 6.2%. Net income per unit is forecast at ¥2,613, yet it guides to a ¥3,000 distribution. The gap is filled by a ¥325mn dividend-reserve reversal and a ¥2.46bn voluntary reversal from the reduction reserve, bringing the total to ¥21.58bn. For the half to August 2027 it guides to net income up 12.5% to ¥21.1bn and a ¥3,050 distribution, using ¥337mn and ¥455mn from the same two reserves.
| Period | Operating revenue | Net income | Distribution per unit | Net income per unit |
|---|---|---|---|---|
| Six months to Aug 2026 (result) | ¥51.5bn | ¥22.7bn | ¥3,012 | ¥3,152 |
| Six months to Feb 2027 (forecast) | ¥48.3bn | ¥18.8bn | ¥3,000 | ¥2,613 |
| Six months to Aug 2027 (forecast) | ¥51.5bn | ¥21.1bn | ¥3,050 | ¥2,939 |
The notice plans no distribution in excess of profit. The reserves are retained profit from earlier periods, not fresh operating earnings. The notice also states that its forecast does not guarantee the distribution amount.
The forecast assumes property sale gains of ¥1.20bn in the half to February 2027, from the sale of land under the Edion Kyobashi store, and ¥2.96bn in the half to August 2027, from four disposals. Forecast non-operating expenses, which include interest, are ¥3.60bn and ¥4.13bn in the two halves, against ¥3.30bn in the half just reported.
What the fund's own slides stress
In its results presentation the fund puts underlying earnings per unit, which excludes sale-related gains and losses and is stated before goodwill amortisation, at roughly 3% growth. It calls the period's total return 10.7%. Net asset value per unit was ¥132,900, up ¥3,900 on the previous half.
Occupancy across 157 properties was 99.4% and loan-to-value was 37.3%. Interest-bearing debt was ¥632.0bn. By the end of August 2027, ¥1.3bn of short-term loans, ¥62.35bn of long-term loans and ¥13.0bn of bonds fall due, with refinancing assumed to come from new borrowing and cash on hand.