Risk of Deteriorating Profitability in System Development Projects
First written in FY2016. 7 of 23 entries say "Materialised", first in FY2018-Q1. Latest entry: 2026-08-12.
SRA Holdings moved to the "Worse" side of this theme in 2017, 5 years before the typical company in this theme (2022).
The whole theme swung hardest in 2017: 9 of 31 companies on the "Worse" side.
14 other companies' latest entry also says "Materialised".
- 2026-08-12MaterialisedEarnings
「Provision for loss on construction contracts — 11」
The provision for loss on construction contracts increased from zero at the end of the previous consolidated fiscal year to ¥11 million at the end of the first quarter, indicating that a provision related to deteriorating project profitability was recorded again. - FY2026MaterialisedAnnual report
「Provision for losses on orders included in cost of sales Previous consolidated fiscal year － million Current consolidated fiscal year ¥19 million」
While the balance of the provision for losses on construction contracts fell to zero, a ¥19 million provision for losses on orders was recognized for orders received, indicating that the risk of deteriorating project profitability materialized in a different form. - 2026-05-13MaterialisedRevision of earnings forecasts
「Provision for loss on construction contracts 95 — Provision for loss on orders — 19」
The provision for loss on construction contracts fell from ¥95 million at the end of the previous fiscal year to zero, while a new ¥19 million provision for loss on orders was recorded. - FY2026-H1MitigatedAnnual report
「Provision for losses on construction contracts 95 44」
The balance of the provision for losses on construction contracts decreased from ¥95 million at the end of the previous consolidated fiscal year to ¥44 million at the end of the current interim consolidated accounting period. - FY2025MaterialisedAnnual report
「Provision for losses on construction contracts included in cost of sales Previous consolidated fiscal year － million Current consolidated fiscal year ¥95 million」
The company recognized a ¥95 million provision for losses on construction contracts and an additional provision corresponding to ¥75 million of work in progress, meaning that the risk of deteriorating project profitability materialized again. - FY2025-H1MaterialisedAnnual report
「Provision for losses on construction contracts － 37」
The provision for losses on construction contracts increased from zero at the end of the previous consolidated fiscal year to ¥37 million at the end of the current interim consolidated accounting period, indicating that losses related to deteriorating project profitability were recognized again. - FY2023-Q1MitigatedAnnual report
「Provision for losses on construction contracts 1 －」
The balance of the provision for losses on construction contracts fell from ¥1 million at the end of the previous consolidated fiscal year to zero at the end of the first quarter. - FY2022-Q3Provision for losses on construction contracts decreasedAnnual report
「Provision for losses on construction contracts 333 330」
The balance of the provision for losses on construction contracts decreased from ¥333 million at the end of the previous consolidated fiscal year to ¥330 million at the end of the third quarter. - FY2022-Q2WorsenedAnnual report
「Provision for losses on construction contracts 333 342」
The balance of the provision for losses on construction contracts increased from ¥333 million at the end of the previous consolidated fiscal year to ¥342 million at the end of the second quarter, indicating a slight increase in the provision related to deteriorating project profitability. - FY2021WorsenedAnnual report
「Provision for losses on construction contracts included in cost of sales Previous consolidated fiscal year － million Current consolidated fiscal year ¥2 million」
The provision for losses on construction contracts increased from zero in the previous consolidated fiscal year to ¥2 million, while the provision balance also increased slightly from ¥330 million to ¥333 million. - FY2021-Q3RestatedAnnual report
「Provision for losses on construction contracts 330 330」
The balance of the provision for losses on construction contracts remained at ¥330 million at the end of the third quarter, unchanged from ¥330 million at the end of the previous consolidated fiscal year, with no material change from the recent level. - FY2021-Q1Provision for losses on construction contracts increased slightlyAnnual report
「Provision for losses on construction contracts 330 332」
The balance of the provision for losses on construction contracts increased slightly from ¥330 million at the end of the previous consolidated fiscal year to ¥332 million at the end of the first quarter. - FY2020MitigatedAnnual report
「Provision for losses on construction contracts included in cost of sales Previous consolidated fiscal year ¥9 million Current consolidated fiscal year － million」
The provision for losses on construction contracts recognized during the period was zero, and the provision balance also decreased from ¥340 million at the end of the previous fiscal year to ¥330 million. - FY2020-Q3Provision for losses on construction contracts decreasedAnnual report
「Provision for losses on construction contracts 340 330」
The balance of the provision for losses on construction contracts decreased from ¥340 million at the end of the previous consolidated fiscal year to ¥330 million at the end of the third quarter. The main text does not specify the reason for the decrease. - FY2020-Q2Provision for losses on construction contracts decreasedAnnual report
「Provision for losses on construction contracts 340 330」
The balance of the provision for losses on construction contracts decreased from ¥340 million at the end of the previous consolidated fiscal year to ¥330 million at the end of the second quarter. The main text does not specify the reason for the decrease. - FY2019-Q3Provision for losses on construction contracts decreased furtherAnnual report
「Provision for losses on construction contracts 780 334」
The balance of the provision for losses on construction contracts decreased from ¥780 million at the end of the previous consolidated fiscal year to ¥334 million at the end of the third quarter. The main text does not specify the reason for the decrease. - FY2019-Q2Provision for losses on construction contracts decreased furtherAnnual report
「Provision for losses on construction contracts 780 378」
The balance of the provision for losses on construction contracts decreased from ¥780 million at the end of the previous consolidated fiscal year to ¥378 million at the end of the second quarter. The main text does not specify the reason for the decrease. - FY2019-Q1Provision for losses on construction contracts decreasedAnnual report
「Due to the payment of corporate income taxes and other taxes, income taxes payable decreased by ¥521 million to ¥213 million, while the provision for losses on construction contracts decreased by ¥407 million to ¥373 million.」
The provision for losses on construction contracts decreased by ¥407 million, from ¥780 million at the end of the previous consolidated fiscal year to ¥373 million. The disclosure describes the change in the provision balance related to deteriorating project profitability, but the main text does not specify the reason for the decrease. - FY2018WorsenedAnnual report
「Provision for losses on construction contracts included in cost of sales Previous consolidated fiscal year ¥4 million Current consolidated fiscal year ¥365 million」
The provision for losses on construction contracts recognized in cost of sales was ¥365 million, and the provision balance also increased from ¥419 million to ¥780 million. The impact of deteriorating project profitability is expanding. - FY2018-Q3MaterialisedAnnual report
「Provision for losses on construction contracts 419 871」
The provision for losses on construction contracts increased from ¥419 million at the end of the previous consolidated fiscal year to ¥871 million at the end of the third quarter of the current consolidated fiscal year, indicating that losses related to deteriorating project profitability continued to be recognized. - FY2018-Q1MaterialisedAnnual report
「In terms of earnings, operating profit was ¥665 million, down 17.0% year on year, due in part to the recognition of a provision for losses on construction contracts.」
A provision for losses on construction contracts related to deteriorating profitability in system development and other projects was recognized during the quarter, resulting in an actual impact on operating profit. The provision balance was ¥532 million. - FY2017RestatedAnnual report
「Some projects take more than 1 year from order receipt through completion and delivery. Consequently, even projects for which a certain level of profit is expected when the order is received may become less profitable after development begins due to customer requests for specification changes or additional work beyond the initial estimate.」
The risk of deteriorating project profitability due to projects lasting more than 1 year, specification changes, additional work and warranty obligations, among other factors, continues. - FY2016First statedAnnual report
「Some projects take more than 1 year from order receipt through completion and delivery. Consequently, even projects for which a certain level of profit is expected when the order is received may become less profitable after development begins due to customer requests for specification changes or additional work beyond the initial estimate.」
The company identifies the risk that long-term projects may become unprofitable due to specification changes, additional work and warranty obligations, among other factors.