Building a stable earnings base resilient to external factors

「土木事業においては、売上高は9,451百万円（前年同四半期連結累計期間比1.2％減）であり、利益面では、連結子会社の収益が伸び悩んだものの、親会社における採算改善が寄与し、セグメント利益25百万円（前年同四半期連結累計期間比68.3％減）となりました。」

「In the fiscal year ended May 2026, the first year of the Medium-Term Management Plan 2027, we worked to establish a stable earnings base, and results substantially exceeded the plan.」

「For the interim consolidated accounting period under review, revenue increased 10.2% year on year to ¥68,323 million. Operating income was ¥3,385 million, up 24.0%, ordinary income was ¥3,396 million, up 31.1%, and interim net income attributable to owners of the parent increased 47.1% to ¥2,508 million.」

「As a result, the building construction business entered a recovery trend and recorded profit above plan. Flow earnings from the sale of some inventory properties in the related businesses and stock earnings from the energy business, centered on solar power generation, also contributed, resulting in a return to profitability. Meanwhile, the civil engineering business remained in recovery, recording substantial losses for the third consecutive fiscal year.」

「Following the substantial loss recorded in the previous fiscal year, we established performance improvement task forces for the civil engineering and building businesses and thoroughly investigated the causes and worked to prevent recurrence. As a result, operating income was ¥2,731 million, compared with an operating loss of ¥7,878 million in the previous interim consolidated accounting period, and ordinary income was ¥2,589 million, compared with an ordinary loss of ¥7,998 million.」

「For the consolidated fiscal year under review, revenue was ¥135,701 million, down 12.0% from the previous fiscal year. Gross loss was ¥541 million, compared with gross profit of ¥13,944 million in the previous fiscal year, and operating loss was ¥9,404 million, compared with operating income of ¥4,487 million. Ordinary loss was ¥9,343 million, compared with ordinary income of ¥4,639 million, and net loss attributable to owners of the parent was ¥7,191 million, compared with net income attributable to owners of the parent of ¥3,291 million.」

「For the cumulative third quarter under review, revenue was ¥98,429 million, down 0.5% from the same period of the previous fiscal year. Operating loss was ¥10,560 million, compared with operating income of ¥414 million in the same period of the previous fiscal year, and ordinary loss was ¥10,692 million, compared with ordinary income of ¥494 million. Net loss attributable to owners of the parent was ¥7,057 million, compared with net income attributable to owners of the parent of ¥224 million in the same period of the previous fiscal year.」

「In the civil engineering business, at a specific large-scale land-development site where corrective work was performed in the previous fiscal year, we carried out accelerated construction to avoid schedule delays. In addition, other additional costs were incurred, and we now expect to record a new construction loss in the current fiscal year.」

「The Group's results for the fiscal year ended May 2023 showed that, although related businesses such as real estate development and renewable energy had grown into one of the Group's pillars, ROE fell sharply from 9.7% in the previous fiscal year to 4.2% due to deteriorating earnings in the civil engineering and building businesses.」

「Under the Medium-Term Management Plan 2021 Move 75 Phase I, which we pursued as a three-year plan beginning in FY2019, we steadily advanced reform of our business portfolio in anticipation of the winding down of earthquake-recovery projects. As a result, related businesses centered on renewable energy and real estate development grew, and in the current consolidated fiscal year, the final year of the three-year plan, they accounted for 73% of total operating income and made a significant contribution to achieving the plan for net income attributable to owners of the parent.」

「Against this backdrop, our Group is implementing the measures established by each business division to achieve the Medium-Term Management Plan 2021 Move 75 Phase I, whose final year is the current fiscal year.」

「Against this backdrop, under the Medium-Term Management Plan 2021 Move 75 Phase I, for which the current fiscal year is the final year, the Group has continued transforming its earnings structure into one that is resilient to economic fluctuations and expanding the contribution of the related businesses, comprising real estate development and renewable energy, to operating income. The Group is also working to establish an even more stable earnings base by strengthening collaboration among the civil engineering, building and related businesses and integrated sales across the Group.」

「During the consolidated fiscal year under review, the second year of the Medium-Term Management Plan 2021 Move 75 Phase I, the accumulation of recurring revenue businesses in the related businesses progressed steadily. Although orders related to earthquake-reconstruction projects are trending downward, we will strengthen collaboration among the civil engineering, building and related businesses, as well as integrated sales across Group companies, to establish a business foundation capable of consistently generating operating income of ¥10 billion. We will also accelerate the development of new equipment for mechanized civil engineering, which supports our strengths, and initiatives in new businesses, including domestic workation operations and overseas water purification businesses.」

「Against this backdrop, the Group is undertaking the initiatives set out by each business division to advance the Medium-Term Management Plan 2021 Move 75 Phase I, for which the previous fiscal year was the first year.」

「There were no material changes during the cumulative second quarter under review in the business and financial issues that the Group needs to address.」

「There were no material changes during the cumulative first quarter under review in the business and financial issues that the Group needs to address.」

「There were no material changes during the cumulative third quarter under review in the business or financial issues that the Group needs to address.」

「There were no material changes during the cumulative first quarter under review in the business and financial issues that the Group needs to address.」

「Our Group is pursuing the current medium-term management plan, which ends in FY2019. Through the development of businesses centered on renewable energy and real estate development as a third pillar alongside civil engineering and building construction, the transformation toward an earnings structure resilient to economic fluctuations is progressing steadily as planned, and the three-business structure is taking shape.」

「To implement a growth strategy suited to this management environment and achieve sustainable growth, our Group is pursuing the Group Medium-Term Management Plan for the 89th to 91st fiscal periods, with FY2017 as its first year.」

「There were no material changes during the cumulative second quarter under review in the business and financial issues that the Group needs to address.」

「There were no material changes during the cumulative first quarter under review in the business and financial issues that the Group needs to address.」

「To implement a growth strategy suited to this management environment and achieve sustainable growth, our Group is pursuing the Group Medium-Term Management Plan for the 89th to 91st fiscal periods, with FY2017 as its first year.」

「We launched the Group Medium-Term Management Plan for the 89th to 91st fiscal periods, with FY2017 as its first year. We will continue working to enhance the corporate value of the Group by pursuing the goal of becoming a strong, excellent company that is not swayed by external factors.」

「Against this backdrop, based on the Medium-Term Management Plan (FY2014-FY2016), for which the current fiscal year was the first year, we worked to build a management base capable of securing stable earnings unaffected by external factors.」