Unprofitable construction projects and unexpected additional costs
First written in FY2020. 4 of 16 entries say "Materialised", first in FY2021-Q1. Latest entry: 2026-08-12.
Japan Foundation Engineering moved to the "Worse" side of this theme in 2020, 1 year before the typical company in this theme (2021).
The whole theme swung hardest in 2019: 6 of 16 companies on the "Worse" side.
6 other companies' latest entry also says "Materialised".
- 2026-08-12MaterialisedEarnings
「The construction profit margin declined because unexpected costs were incurred for the treatment of discharged slurry on a pile construction project in the Tokyo metropolitan area.」
Unexpected costs arose on a pile construction project in the Tokyo metropolitan area, resulting in a lower construction profit margin and the materialization of risks related to unprofitable construction and additional costs. - FY2026MitigatedAnnual report
「Provision for construction losses 15,032 123」
The provision for construction losses fell substantially from ¥15.032 million at the end of the previous fiscal year to ¥123,000 at the end of the current fiscal year, indicating an improvement in the provision coverage for unprofitable construction projects. - 2026-05-14MitigatedEarnings
「Provision for loss on construction contracts 15,032 123」
The balance of the provision for loss on construction contracts declined from ¥15.032 million at the end of the previous fiscal year to ¥123 thousand. - FY2026-H1MitigatedAnnual report
「Provision for construction losses 15,032 15,264」
The provision for construction losses increased slightly from ¥15.032 million at the end of the previous consolidated fiscal year to ¥15.264 million at the end of the current interim consolidated accounting period, while declining from ¥23.421 million recognized in the same period of the previous year. - FY2025-H1MaterialisedAnnual report
「Provision for construction losses - 23,421」
A provision for construction losses of ¥23.421 million, which had not been recognized at the end of the previous consolidated fiscal year, was recognized at the end of the current interim consolidated accounting period, indicating that the risks relating to unprofitable construction projects and additional costs materialized through the recognition of a provision. - FY2024RestatedAnnual report
「If unprofitable construction projects arise because of unexpected additional costs during construction, the Group's performance may be affected.」
It continues to disclose the risk of construction projects becoming unprofitable due to unexpected additional costs. The balance of the provision for construction losses was zero at the end of the fiscal year. - FY2023MaterialisedAnnual report
「In terms of profit, the construction profit margin declined because construction became unprofitable due to delays in the progress of some large-scale projects, and labor costs increased as the workforce was expanded to meet strict deadlines despite reduced working days,」
It states that the risks of unexpected additional costs and unprofitable construction projects materialized in the form of delays in large-scale projects, higher labor costs and a lower construction profit margin. - FY2023-Q3RestatedAnnual report
「However, at JAFEC USA,Inc., the U.S. subsidiary, construction on the planned large-scale project continued to be suspended for ecological and environmental protection reasons, causing indirect costs to be incurred ahead of schedule,」
At the US subsidiary, overheads continue to be incurred ahead of revenue as a result of construction suspensions, and the risks relating to unprofitable construction projects and additional costs continue. - FY2023-Q2RestatedAnnual report
「However, construction interruptions for ecosystem and environmental protection continued at JAFEC USA,Inc., the U.S. subsidiary, causing indirect costs to be incurred ahead of revenue,」
Overheads continue to be incurred ahead of revenue as a result of construction suspensions, and the risks relating to unprofitable construction projects and additional costs continue. - FY2023-Q1RestatedAnnual report
「However, at JAFEC USA,Inc., the U.S. subsidiary, indirect costs were incurred ahead of schedule because construction was suspended for ecological and environmental protection reasons,」
At the US subsidiary, overheads continue to be incurred ahead of revenue as a result of construction suspensions, and the risks relating to unprofitable construction projects and additional costs continue. - FY2022WorsenedAnnual report
「However, at the U.S. subsidiary, the company worked to cut expenses in anticipation of a significant decline in revenue, but nevertheless operated at a substantial loss.」
At the US subsidiary, revenue fell substantially and significant operating losses were incurred. The risks relating to unprofitable construction projects and additional costs continue to materialize. - FY2022-Q3WorsenedAnnual report
「Meanwhile, at the U.S. subsidiary, construction profitability deteriorated because of work stoppages caused by natural disasters and the novel coronavirus disease, but the company reduced indirect expenses and yard costs and reviewed its staffing, maintaining its initial operating profit plan.」
At the US subsidiary, construction suspensions worsened construction profitability, and the risks relating to unprofitable construction projects and additional costs continue to materialize. Meanwhile, the company has maintained its operating profit plan through cost reductions and other measures. - FY2021-Q3WorsenedAnnual report
「Meanwhile, at the U.S. subsidiary, earnings fell significantly below expectations as construction delays caused by the impact of the coronavirus disease led to higher construction overhead costs.」
At the US subsidiary, significant delays in construction progress and higher construction overheads caused a substantial downside in earnings. The risks relating to unprofitable construction projects and additional costs continue to materialize. - FY2021-Q2WorsenedAnnual report
「At the U.S. subsidiary, earnings fell significantly short of expectations due to substantial delays in construction progress and increased indirect construction costs.」
Significant delays in construction progress and higher construction overheads caused a substantial downside in earnings. It states that the risks relating to unprofitable construction projects and additional costs materialized to a greater extent at the US subsidiary. - FY2021-Q1MaterialisedAnnual report
「In terms of profit, delays in construction progress and other factors caused costs to be recognized ahead of revenue, resulting in operating profit of ¥72 million, down ¥126 million year on year, and net profit attributable to owners of the parent of ¥16 million, down ¥84 million year on year.」
Delays in construction progress caused costs to be recognized ahead of revenue, reducing operating profit and quarterly net profit attributable to owners of the parent from the same quarter of the previous year. It states that the risk relating to unprofitable construction projects and unexpected additional costs materialized in the form of costs being recognized ahead of revenue. - FY2020First statedAnnual report
「If unprofitable construction projects arise because of unexpected additional costs during construction, the Group's performance may be affected.」
It identifies for the first time, as a separate risk, the impact on results of unexpected additional costs arising during construction and projects becoming unprofitable.