Occurrence of Unprofitable Construction Projects
First written in FY2016. 19 of 28 entries say "Materialised", first in FY2018-Q1. Latest entry: 2026-11-12.
Kyowanissei moved to the "Worse" side of this theme in 2017, 4 years before the typical company in this theme (2021).
The whole theme swung hardest in 2019: 8 of 22 companies on the "Worse" side.
11 other companies' latest entry also says "Materialised".
- FY2026MaterialisedAnnual report
「In addition to the decline in net sales, the completion of several projects with low profit margins resulted in ordinary profit of ¥603 million, down 49.3% year on year.」
The completion of low-margin projects was reflected in a 49.3% decline in ordinary profit in the gas pipeline business, and the impact of loss-making construction project risk became apparent. - FY2025MaterialisedAnnual report
「On the profit side, ordinary profit was ¥285 million, down 43.8% year on year, mainly because many projects with high cost ratios were completed in gas equipment construction.」
Many high-cost-ratio projects were completed in gas equipment construction, and the impact of loss-making construction project risk was reflected in full-year ordinary profit, which fell 43.8% year on year. - FY2025-H1MaterialisedAnnual report
「On the profit side, the completion of many projects with high cost ratios, mainly in gas equipment construction, resulted in an ordinary loss of ¥15 million, compared with ordinary profit of ¥59 million in the same period of the previous year.」
The completion of high-cost-ratio projects was reflected in an ordinary loss of ¥15 million in the gas equipment business, and the impact of loss-making construction project risk became apparent in the interim period as well. - FY2024MitigatedAnnual report
「The completion of large-scale, high-margin projects in renovation and repair work, together with an improvement in the profit margin of the GHP maintenance business, resulted in an ordinary loss of ¥311 million, compared with an ordinary loss of ¥436 million in the previous fiscal year.」
Although the architectural equipment business continued to post an ordinary loss, the loss narrowed from ¥436 million to ¥311 million, and an improvement in the profit margin was also reported. - FY2024-Q3MaterialisedAnnual report
「On the profit side, ordinary profit was ¥150 million, down 32.8% year on year, mainly because many projects with high cost ratios were completed in gas equipment construction.」
Many projects with high cost ratios were completed in gas equipment construction, resulting in a 32.8% year-on-year decline in ordinary profit. The impact of loss-making construction project risk was reflected in actual results this quarter as well. - FY2024-Q2MaterialisedAnnual report
「In terms of profit, in addition to the decline in profit accompanying the decrease in net sales, the completion of many plumbing and sanitary installation projects with high cost ratios resulted in an ordinary loss of ¥255 million, compared with an ordinary loss of ¥183 million in the same period of the previous year.」
The architectural equipment business completed many projects with high cost ratios, causing the ordinary loss to widen from ¥183 million in the same period of the previous year to ¥255 million. The impact of loss-making construction projects became apparent in actual results. - FY2024-Q1MaterialisedAnnual report
「Meanwhile, in terms of profit, the completion of many projects with high cost ratios in the gas equipment and gas pipeline businesses resulted in operating profit of ¥50 million, down 9.5% year on year.」
The completion of many projects with high cost ratios in the gas equipment and gas pipeline businesses was reflected in a 9.5% year-on-year decline in operating profit, demonstrating the impact of the risk of unprofitable construction work. - FY2023WorsenedAnnual report
「The completion of many projects with high cost ratios in plumbing and sanitary installation work and renovation work, including repair work such as drainpipe lining, resulted in an ordinary loss of ¥436 million, compared with an ordinary loss of ¥43 million in the same period of the previous year.」
Projects with high cost ratios continued to be completed in the building equipment business, causing the ordinary loss to widen from ¥43 million in the previous year to ¥436 million. - FY2023-Q3WorsenedAnnual report
「The completion of many projects with high cost ratios in plumbing and sanitary installation work, renovation work, including repair work such as drainpipe lining, and repair and maintenance work related to factory facilities resulted in an ordinary loss of ¥270 million, compared with an ordinary loss of ¥40 million in the same period of the previous year.」
The completion of projects with high cost ratios became apparent in the form of an ordinary loss of ¥270 million in the building equipment business, with the loss widening from ¥40 million in the same period of the previous year. In the electrical and civil engineering business as well, ordinary profit declined 52.5% year on year because of the completion of projects with high cost ratios. - FY2023-Q2MaterialisedAnnual report
「In terms of profit, in addition to the decline in profit accompanying the decrease in net sales, the completion of many projects with high cost ratios in plumbing and sanitary installation work, renovation work and repair and maintenance work related to factory facilities resulted in an ordinary loss of ¥183 million, compared with an ordinary loss of ¥26 million in the same period of the previous year.」
Many projects with high cost ratios were completed in the building equipment business, resulting in an ordinary loss of ¥183 million. The loss widened from ¥26 million in the same period of the previous year, and the impact of unprofitable construction work became apparent again. - FY2023-Q1MitigatedAnnual report
「As a result of the improvement in the cost ratio, operating profit was ¥55 million, compared with an operating loss of ¥4 million in the same period of the previous year, and ordinary profit was ¥108 million, up 162.8% year on year.」
While profitability had deteriorated in the same period of the previous year because of projects with high cost ratios and other factors, the cost ratio improved in the first quarter of the current fiscal year, and operating profit turned from a loss to a profit. However, it was not stated that the risk of unprofitable construction work had been eliminated. - FY2022MaterialisedAnnual report
「However, the completion of many plumbing and sanitary installation and GHP projects with high cost ratios resulted in an ordinary loss of ¥171 million.」
The completion of projects with high cost ratios was reflected in an ordinary loss of ¥171 million in the building equipment business. Measures to contain the risk, including higher-level approval, monthly investigations and integration of the sales and construction divisions, were also described. - FY2022-Q2MaterialisedAnnual report
「In addition to the decline in profit accompanying the decrease in net sales, the completion of many gas equipment installation projects with high cost ratios resulted in operating profit of ¥3.47 million, down 23.7% year on year, and ordinary profit of ¥409 million, down 23.0%.」
The completion of many gas equipment installation projects with high cost ratios was reflected in declines in operating profit and ordinary profit, demonstrating the impact of the risk of unprofitable construction work. - FY2022-Q1MaterialisedAnnual report
「In addition to the decline in profit accompanying the decrease in net sales, the completion of many gas equipment installation projects with high cost ratios resulted in an ordinary loss of ¥42 million, compared with ordinary profit of ¥27 million in the same period of the previous year.」
The completion of many gas equipment installation projects with high cost ratios caused ordinary profit to deteriorate from ¥27 million in the same period of the previous year to an ordinary loss of ¥42 million. - FY2021MitigatedAnnual report
「For orders for work that could become unprofitable, the Company has established approval criteria requiring authorization by higher-level personnel. In addition, each month the accounting department investigates projects with profits outside the criteria identified under specified rules and circulates the findings among directors and executive officers, thereby working to identify and contain unprofitable construction work at an early stage.」
The response to the risk of unprofitable construction work has been formalized as a management process involving higher-level approval, monthly investigations of projects with out-of-range profits, and circulation among directors and executive officers. - FY2021-Q3MitigatedAnnual report
「The Company sought to reduce costs and make effective use of resources by, among other measures, setting up a site office for pipeline burial work on land at another location and scrutinizing subcontractor estimates. As a result, it posted an ordinary loss of ¥12 million, compared with an ordinary loss of ¥18 million in the same period of the previous year.」
Cost reductions and resource utilization reduced the ordinary loss in the electrical and civil engineering business from ¥18 million in the same period of the previous year to ¥12 million, but the loss continued. - FY2020-Q3MitigatedAnnual report
「In terms of profit, the cost ratio declined as net sales increased. In addition, because the cost ratio had risen in the previous fiscal year owing to delays in construction progress, ordinary profit increased 74.7% year on year.」
Compared with the higher cost ratio in the same period of the previous year due to delays in construction progress and other factors, the cost ratio declined during the cumulative third-quarter period as net sales increased, resulting in a 74.7% year-on-year increase in ordinary profit in the gas pipeline business. - FY2020-Q1MaterialisedAnnual report
「Many projects under the capital investment plan of major customer Tokyo Gas Co., Ltd. continued to involve difficult work and required more days than planned, resulting in many projects being completed in the second quarter or later. Consequently, in addition to the decline in profit accompanying the decrease in net sales, the increase in the cost ratio caused by the additional time required resulted in ordinary profit of ¥37 million, down 46.6% year on year.」
Difficult work and longer construction periods occurred on Tokyo Gas-related projects, leading to a higher cost ratio and a 46.6% year-on-year decline in ordinary profit. - FY2019-Q3MaterialisedAnnual report
「In addition to the decline in profit accompanying the decrease in net sales, the completion of many projects with high cost ratios through the second quarter resulted in operating profit of ¥394 million, down 31.3% year on year, and ordinary profit of ¥490 million, down 26.0%.」
The completion of projects with high cost ratios was reflected in lower profit, with both operating profit and ordinary profit declining year on year. - FY2019-Q2MaterialisedAnnual report
「The completion of many projects with high cost ratios resulted in operating profit of ¥9 million, down 97.2% year on year, and ordinary profit of ¥78 million, down 80.2%.」
The completion of projects with high cost ratios was reflected in lower profit. It was also noted that many difficult gas pipeline projects required more days than planned, causing the cost ratio to rise. - FY2018WorsenedAnnual report
「In gas pipeline construction, the cost ratio increased because of greater volumes of work in entertainment districts and an increase in difficult work in areas outside central urban areas, which required more days than planned. As a result, ordinary profit was ¥1,111 million, a decrease of ¥209 million, or 15.8%, from the same period of the previous year.」
Increases in difficult work and longer construction periods caused the cost ratio to rise in multiple areas, resulting in a 15.8% decline in ordinary profit in the gas construction business. - FY2018-Q2MaterialisedAnnual report
「In addition to the completion of many hot-water supply and heating projects for multi-unit housing and GHP projects with high cost ratios, the cost ratio also increased because of difficult work in central urban areas on gas pipeline construction.」
The completion of projects with high cost ratios and the increase in the cost ratio resulting from difficult work in central urban areas occurred in practice. - FY2018-Q1MaterialisedAnnual report
「The cost ratio increased because of difficult work in central urban areas on gas pipeline construction, resulting in an operating loss of ¥21 million, compared with operating profit of ¥65 million in the same period of the previous year, and ordinary profit of ¥27 million, down 75.1% year on year.」
The increase in the cost ratio resulting from difficult work in central urban areas occurred in practice, leading to an operating loss and a decline in ordinary profit. - FY2016First statedAnnual report
「If unprofitable construction work arises because unexpected costs or other expenses are incurred during construction, the Company's performance could be affected.」
Unexpected costs during construction are identified as a factor that could worsen profitability.