Mismatched Ground Conditions and Construction Losses on a Large-Scale Civil Engineering Project in Singapore
First written in FY2022-Q3. 11 of 14 entries say "Worsened", first in FY2022. Latest entry: 2026-11-09.
Penta-Ocean Construction moved to the "Worse" side of this theme in 2022, 2 years before the typical company in this theme (2024).
2 other companies' latest entry also says "Worsened".
- FY2027-H1WorsenedAnnual report
「Net sales increased to ¥97.8 billion, up 21.9% year on year, mainly because large-scale projects in Singapore and Hong Kong progressed smoothly. However, the segment posted a loss of ¥2.4 billion, compared with a segment loss of ¥400 million in the same period of the previous year, due to additional losses recognized on prior-period projects at an equipment subsidiary.」
Regarding loss risks associated with large overseas construction projects, additional losses arose on prior-year projects of an equipment subsidiary, causing segment loss to increase from ¥400 million in the same period of the previous year to ¥2.4 billion. - FY2026MitigatedAnnual report
「The segment loss improved substantially from the ¥15.6 billion loss in the previous consolidated fiscal year, when construction losses were recorded on 2 major civil engineering projects. However, the segment posted a loss of ¥3.2 billion due to a review of the profitability of 1 building construction project and the recording of additional losses by an equipment subsidiary on projects completed in the current fiscal year and on projects from previous fiscal years.」
Losses on major overseas projects narrowed from ¥15.6 billion to ¥3.2 billion, but additional losses occurred, including at building construction projects and an equipment subsidiary, and the risk remains. - FY2026-H1MitigatedAnnual report
「Revenue was ¥80.2 billion, up 6.0% year on year, while the segment loss narrowed to ¥0.4 billion, compared with a ¥2.3 billion loss in the same period of the previous year.」
Although the loss risk related to major overseas projects persists, the segment loss in the overseas construction business narrowed from ¥2.3 billion in the same period of the previous year to ¥400 million. - FY2025WorsenedAnnual report
「The overseas construction business posted a segment loss of ¥15.6 billion, compared with a segment loss of ¥4.2 billion in the previous consolidated fiscal year. This was due to the recording of additional construction losses on a major civil engineering project in Singapore and a civil engineering project in Hong Kong.」
Regarding the existing loss risk on major overseas projects, additional losses occurred in Hong Kong as well as Singapore, expanding the loss from ¥4.2 billion to ¥15.6 billion. - FY2025-H1WorsenedAnnual report
「Revenue increased 21.6% year on year to ¥75.6 billion, mainly as large projects in Singapore and Hong Kong progressed steadily. However, the segment loss widened to ¥2.3 billion, compared with a ¥2.0 billion loss in the same period of the previous year, due to low vessel utilization.」
Regarding the loss risk on major overseas projects, the segment loss in the overseas construction business widened from ¥2 billion in the same period of the previous year to ¥2.3 billion due to low vessel utilization. - FY2024-Q3WorsenedAnnual report
「This was due mainly to vessel utilization being lower than expected and construction losses increasing on projects for which provisions for construction losses had been recorded in the previous fiscal year, as a result of foreign exchange movements during the cumulative third quarter of the current consolidated fiscal year.」
For major overseas projects, construction losses increased due to foreign exchange movements on projects for which provisions for construction losses had been recorded in the previous fiscal year. The total loss in the overseas construction business decreased from ¥17.2 billion in the same period of the previous year to ¥2.2 billion, but the existing construction-loss risk persists. - FY2024-Q2WorsenedAnnual report
「This was due mainly to an additional provision for construction losses on projects for which provisions had been recorded in the previous fiscal year, as a result of foreign exchange movements during the cumulative second quarter of the current consolidated fiscal year.」
For major overseas projects, provisions for construction losses were increased due to foreign exchange movements, and the segment loss in the overseas construction business widened from ¥100 million in the same period of the previous year to ¥2 billion. - FY2024-Q1WorsenedAnnual report
「This was due to the fact that the profit from projects for which provisions for construction losses were recorded in the previous fiscal year had effectively fallen to zero, construction losses on these projects increased due to the impact of foreign exchange movements during the cumulative first quarter of the current consolidated fiscal year, and vessel utilization declined compared with the same quarter of the previous year, among other factors.」
For major overseas projects, profit from projects for which provisions for construction losses were recorded in the previous fiscal year effectively fell to zero, and losses also increased due to foreign exchange movements. The overseas construction business posted a segment loss of ¥1.2 billion, indicating that the existing construction-loss risk persists. - FY2023WorsenedAnnual report
「Gross profit fell sharply after the company recorded approximately ¥16 billion in construction losses overseas, resulting in substantial losses in operating profit, ordinary profit and net income attributable to owners of the parent for the quarter.」
Construction losses related to major civil engineering projects in Singapore and elsewhere expanded from estimated losses of approximately ¥9 billion in the previous fiscal year to approximately ¥16 billion recorded across multiple projects. - FY2023-Q3WorsenedAnnual report
「Gross profit fell sharply after the company recorded approximately ¥16 billion in construction losses overseas, resulting in substantial losses in operating profit, ordinary profit and net income attributable to owners of the parent for the quarter.」
The impact of the existing loss risks related to mismatched ground conditions, the prolonged infectious disease outbreak and difficulties in negotiating design changes on major civil engineering projects in Singapore and elsewhere expanded to the point where approximately ¥16 billion in construction losses were recorded across multiple major overseas projects. - FY2022WorsenedAnnual report
「In terms of profit, the company recorded estimated construction losses totaling approximately ¥9 billion on a major civil engineering project in Singapore, owing to expected increases in construction costs resulting from mismatched site conditions and the prolonged spread of COVID-19, as well as difficulties in negotiations over design changes to completed works.」
In addition to the previously disclosed construction losses caused by mismatched ground conditions and the prolonged infectious disease outbreak, estimated losses from difficulties in negotiating design changes have raised the total impact to approximately ¥9 billion. - FY2022-Q3MaterialisedAnnual report
「In a large-scale civil engineering project in Singapore, construction costs increased due to discrepancies in ground conditions and the prolonged spread of COVID-19, resulting in the recognition of a construction loss of approximately ¥5.0 billion.」
The company recorded approximately ¥5 billion in construction losses on a major civil engineering project in Singapore due to mismatched ground conditions and increased construction costs resulting from the prolonged spread of infectious disease, and disclosed this as a new specific risk event.