Risk of Intensifying Competition and Declining Contract Prices

「The possibility of renewed intense price competition cannot be ruled out」

「The number of bidders for public works is increasing and competition is intensifying」

「Meanwhile, the earnings environment has improved gradually as the domestic economy has finally emerged from a prolonged period of deflation, and dumping competition over construction costs has subsided, although」

「Although the order environment remained firm for both public and private investment, the outlook for private investment remains uncertain, in correlation with trends in the global economy.」

「Signs of price competition have begun to emerge, particularly in major metropolitan areas, following a decline in large-scale inquiries.」

「Signs of price competition have begun to emerge, particularly in major metropolitan areas,」

「Construction costs remain elevated due to higher construction material prices and chronic shortages of various skilled workers, while signs of price competition are becoming more pronounced as inquiries decline and uncompetitive projects emerge,」

「Construction costs are increasing due to higher construction material prices and labor costs, among other factors, leading to fewer inquiries. As price competition has begun to flare up again, the overall environment is shifting toward greater difficulty.」

「If intensified competition causes order prices to fall significantly, it could adversely affect the business performance and financial condition of our Group.」

「Profitability has begun to show signs of weakening due to major general contractors entering regional projects as large-scale projects in major metropolitan areas decline, as well as soaring and persistently high material prices,」

「In the public works sector, the order environment in the construction industry, the core business of our Group, remains stable, with steady demand for infrastructure renewal and other projects related to national resilience policies. In the private-sector construction field, housing demand remains firm for both for-sale and rental housing despite the COVID-19 pandemic. However, the earnings environment is becoming increasingly difficult as signs of price competition have begun to re-emerge amid a trend toward fewer projects, while major general contractors are increasingly entering regional projects as large-scale projects decline, particularly in major metropolitan areas. This is compounded by higher labor costs resulting from chronic labor shortages and rising material prices.」

「The order environment in the construction industry, the Group’s core business, is expected to remain firm in public investment due to measures to strengthen national resilience and extend the service life of social infrastructure. However, private-sector construction investment is beginning to trend downward. The earnings environment is expected to deteriorate as price competition to secure projects reduces profitability, compounded by higher labor costs due to shortages of technical and skilled workers and increases in the prices of some materials. The outlook remains uncertain.」

「Orders from the private sector have shifted to a declining trend under the impact of slowing domestic and overseas economies, and price competition is intensifying,」

「Private capital investment has shown an increasingly pronounced weakening trend due mainly to deteriorating business performance caused by the COVID-19 pandemic and delays in the recovery of demand, and price competition is beginning to emerge.」

「As a result, price competition is expected to flare up and intensify. Given the slow pace of economic recovery and other factors, the company is operating in an environment that requires continued caution in managing the business.」

「Amid the continuing tight supply of construction engineers and skilled workers, signs have begun to emerge of a return to price competition that disregards profitability,」

「At the same time, pressure for higher costs is beginning to emerge as construction demand remains elevated, labor shortages become more severe, and work-style reforms are enacted. Competition for orders to secure projects after the Olympics and Paralympics is also beginning to flare up, and the business environment is becoming increasingly difficult to view optimistically.」

「The disparity in investment conditions between major metropolitan and regional areas is becoming more pronounced, and price competition among industry peers for orders is expected to intensify.」

「In the construction industry, the Group’s core business, the operating environment is shifting toward one in which more cautious business management than ever is required. Signs of intense price competition are beginning to emerge amid a chronic labor shortage, restraint on additional investment following the completion of major capital investment cycles, and an overall decline in public investment in regional areas.」

「Among mid-sized general contractors that have not been able to fully benefit from large-scale construction projects related to the Tokyo Olympics and other events, signs of intense price competition have begun to emerge, compounded by the expansion of regional general contractors into their markets.」

「Signs have begun to emerge of a return to price competition that disregards profitability in both major metropolitan and regional areas.」

「Improvement in order unit prices and a decrease in low-margin burdened projects」

「Signs of renewed intense price competition have begun to emerge in our main operating areas.」

「If intensified competition causes order prices to fall significantly, it could adversely affect the business performance and financial condition of our Group.」