Occurrence of Unprofitable Projects in System Development
First written in FY2016. 17 of 35 entries say "Mitigated", first in FY2017. Latest entry: 2026-07-31.
Sakura Kcs 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 2025: 5 of 16 companies on the "Worse" side.
3 other companies' latest entry also says "Worsened".
- 2026-07-31WorsenedEarnings
「Provision for loss on orders 1 41」
The provision for loss on orders increased from ¥1 million at the end of the previous consolidated fiscal year to ¥41 million, indicating a larger provision for unprofitable projects. - FY2026MitigatedAnnual report
「In addition to continuing from the previous fiscal year its efforts to win highly profitable projects and curb unprofitable projects through stronger quality control,」
The company continued to curb unprofitable projects, and the provision for loss on orders decreased from ¥3 million in the previous fiscal year to ¥1 million. The risk remains, but the provision recorded in the current fiscal year has declined. - FY2026-H1Continued curbing of unprofitable projects and increase in provisionAnnual report
「In addition to continuing from the previous fiscal year its efforts to win highly profitable projects and curb unprofitable projects through stronger quality control,」
While explaining that it had continued to curb unprofitable projects, the company stated that the provision for loss on orders increased from ¥3 million at the end of the previous fiscal year to ¥8 million. - FY2025MitigatedAnnual report
「As a result of continuing to curb unprofitable projects through stronger quality control」
The company explained that it had continued to curb the occurrence of unprofitable projects, and the provision for loss on orders decreased from ¥9 million in the previous fiscal year to ¥3 million. The risk remains, but its disclosed impact is declining. - FY2025-H1RestatedAnnual report
「During the interim consolidated accounting period, there were no new major risks or significant changes to the business risks described in the annual securities report that management recognized as potentially having a material effect on the financial position, operating results, or cash flows of the consolidated companies, among the matters concerning business conditions and financial matters described in this Semiannual Report.」
The Company states comprehensively that there has been no new occurrence or significant change concerning the risk of unprofitable projects. - FY2024-Q3MitigatedAnnual report
「In addition to curbing unprofitable projects through productivity improvements and stronger quality control, initiatives undertaken since the previous medium-term management plan, the company improved the profitability of individual projects by scaling back or withdrawing from low-margin projects and focusing on winning high-margin projects.」
The company curbed unprofitable projects and scaled back or withdrew from low-margin projects, and reported improved project profitability. The provision for loss on orders increased from ¥12 million at the end of the previous fiscal year to ¥13 million, and the company did not state that the risk itself had disappeared. The impact was quantified through the cited performance figures, but no new large unprofitable project was indicated. - FY2024-Q2MitigatedAnnual report
「In addition to curbing unprofitable projects through productivity improvements and stronger quality control, initiatives undertaken since the previous medium-term management plan, the company improved the profitability of individual projects by scaling back or withdrawing from low-margin projects and focusing on winning relatively high-margin projects, including projects対応 to the invoice system.」
The company stated that the profitability of individual projects improved as a result of curbing unprofitable projects and scaling back or withdrawing from low-margin projects. The provision for loss on orders also decreased from ¥12 million at the end of the previous fiscal year to ¥10 million. - FY2024-Q1MitigatedAnnual report
「In addition to the effect of higher revenue, the gross profit margin improved as a result of improvements in the profitability of individual projects, including a decline in low-margin projects. Operating profit was ¥205 million, an increase of ¥189 million from the same quarter of the previous year; ordinary profit was ¥241 million, an increase of ¥200 million, or 493.0%; and quarterly net profit attributable to owners of the parent was ¥170 million, an increase of ¥145 million, or 577.4%.」
The decline in low-margin projects and improved project profitability led to an improvement in the gross profit margin, indicating that the impact of the risk from unprofitable projects on performance was declining. Quantified improvements in performance were also reported. - FY2023-Q3MitigatedAnnual report
「Although lower revenue had a negative impact, the gross profit margin improved primarily due to preventing the occurrence of unprofitable projects and improving productivity. Consequently, operating profit was ¥485 million, up ¥366 million, or 306.6%, year on year; ordinary profit was ¥526 million, up ¥351 million, or 201.9%; and quarterly net profit attributable to owners of the parent was ¥391 million, up ¥274 million, or 234.8%.」
Limiting the occurrence of unprofitable projects contributed to the improvement in the gross profit margin and led to higher operating profit and other earnings. The provision for loss on orders also decreased from ¥16 million at the end of the previous fiscal year to ¥3 million. - FY2023-Q2MitigatedAnnual report
「Although lower revenue had a negative impact, the improvement in the gross profit margin, primarily due to measures to prevent the occurrence of unprofitable projects, outweighed that impact and lifted gross profit. Consequently, operating profit was ¥273 million, up ¥116 million, or 74.4%, year on year; ordinary profit was ¥301 million, up ¥117 million, or 63.3%; and quarterly net profit attributable to owners of the parent was ¥234 million, up ¥109 million, or 88.2%.」
The company stated that limiting the occurrence of unprofitable projects contributed to the improvement in the gross profit margin, and that the impact of the risk on performance had declined. - FY2023-Q1MitigatedAnnual report
「In terms of earnings, although lower revenue had a negative impact, the improvement in the gross profit margin, primarily due to measures to prevent the occurrence of unprofitable projects, outweighed that impact and lifted gross profit. Consequently, operating profit was ¥16 million, an earnings improvement of ¥73 million year on year; ordinary profit was ¥40 million, an earnings improvement of ¥67 million; and quarterly net profit attributable to owners of the parent was ¥25 million, an earnings improvement of ¥49 million.」
The company stated that limiting the occurrence of unprofitable projects contributed to the improvement in the gross profit margin, and that the impact of the risk on performance had declined compared with levels through the previous quarter. - FY2022-Q3MaterialisedAnnual report
「Although profit benefited from the recovery in personnel utilization, which had declined due to measures to address COVID-19, and from higher revenue, the impact of a major unprofitable project and the increase in selling, general and administrative expenses associated with higher personnel expenses and other factors resulted in operating profit of ¥119 million, compared with ¥342 million in the same quarter of the previous year; ordinary profit of ¥174 million, compared with ¥423 million; and net profit attributable to owners of the parent of ¥116 million, compared with ¥372 million.」
The impact of a large unprofitable project continued to be reflected in cumulative earnings through the third quarter. The provision for loss on orders decreased from ¥13 million at the end of the previous fiscal year to ¥8 million, but the impact of the risk on performance remains. - FY2022-Q2MaterialisedAnnual report
「In addition to the impact of a large unprofitable project, the increase in selling, general and administrative expenses, including higher personnel costs, had a significant effect. Operating profit was ¥156 million, compared with ¥283 million in the same quarter of the previous year.」
The impact of a large unprofitable project was explicitly identified as affecting performance. The provision for loss on orders increased from ¥13 million at the end of the previous fiscal year to ¥155 million, and the estimated future losses recorded also increased. - FY2022-Q1MaterialisedAnnual report
「In terms of earnings, although unprofitable projects were incurred, the recovery in personnel utilisation, which had declined due to measures taken against COVID-19, and the effect of higher revenue lifted gross profit. As a result, the operating loss was ¥56 million, compared with an operating loss of ¥63 million in the same quarter of the previous year.」
The company explicitly stated that an unprofitable project was incurred during the quarter. The provision for loss on orders also increased from ¥13 million at the end of the previous fiscal year to ¥127 million, indicating an increase in estimated future losses recorded. - FY2021-Q3MitigatedAnnual report
「Provision for loss on orders 36 23」
The provision for loss on orders decreased from ¥36 million at the end of the previous fiscal year to ¥23 million. The company also stated that the impact of the infectious disease on estimated costs is currently considered immaterial. The risk remains, but the provision recorded has declined from the previous quarter. - FY2021-Q2WorsenedAnnual report
「Provision for contract losses 36 54」
The provision for contract losses increased from ¥36 million at the end of the previous consolidated fiscal year to ¥54 million. The amount recognized for estimated future losses related to unprofitable projects increased. - FY2021-Q1WorsenedAnnual report
「Provision for contract losses 36 42」
The provision for contract losses on the balance sheet increased from ¥36 million at the end of the previous consolidated fiscal year to ¥42 million. - FY2020WorsenedAnnual report
「For items for which future losses are expected as of the end of the consolidated fiscal year and for which the amount of such losses can be reasonably estimated, a provision for contract losses is recognized for the amount of losses expected to arise in the following consolidated fiscal year and thereafter.」
The Company estimates future losses related to unprofitable projects and recognizes a provision for contract losses. The provision expense increased from ¥16 million in the previous fiscal year to ¥36 million in the current fiscal year. - FY2020-Q3RestatedAnnual report
「Improvement in the gross profit margin, primarily due to acquiring highly profitable projects, improving profitability on individual projects and maintaining stable personnel utilization」
The Company continues to report improvements in project profitability. No clearly new measures or milestone achievements are indicated beyond the previous explanation that the impact of the risk of unprofitable projects on earnings is declining. - FY2020-Q2MitigatedAnnual report
「Improvement in the gross profit margin, primarily due to acquiring highly profitable projects, improving profitability on individual projects and maintaining stable personnel utilization」
The gross profit margin has improved through better profitability on individual projects and the acquisition of highly profitable projects, indicating a decline in the impact of the risk of unprofitable projects on earnings. - FY2020-Q1MitigatedAnnual report
「Improvement in the gross profit margin, primarily due to progress in improving project profitability」
The Company explains that progress in improving project profitability led to an improved gross profit margin. The impact of the risk of unprofitable projects on earnings is indicated to be declining. - FY2019-Q3MitigatedAnnual report
「Improvement in the gross profit margin, primarily due to progress in improving project profitability and maintaining a solid personnel utilization rate」
The Company explains that progress in improving project profitability led to an improved gross profit margin. The impact of the risk of unprofitable projects on earnings is indicated to be declining. - FY2019-Q2MitigatedAnnual report
「Improvement in the gross profit margin, primarily due to progress in improving project profitability and maintaining a solid personnel utilization rate」
The Company explains that progress in improving project profitability led to an improved gross profit margin. Although the risk of unprofitable projects continues, its impact on earnings is indicated to be declining. - FY2019-Q1RestatedAnnual report
「During the first quarter of the current consolidated cumulative period, there were no occurrences of matters that could materially affect investors’ investment decisions among the matters relating to the business and financial position described in this quarterly report, nor were there any material changes to the “Business and Other Risks” described in the annual securities report for the previous fiscal year.」
The Company states that there have been no significant changes in business and other risks, and indicates no new changes concerning the risk of unprofitable projects. - FY2018MitigatedAnnual report
「In terms of earnings, although margins declined on projects for major customers and expenses increased as the Company strengthened its data center business structure, the gross profit margin was maintained at almost the same level as in the previous fiscal year because the occurrence of unprofitable projects was contained,」
The Company explained that it had contained the occurrence of unprofitable projects, and the provision for contract loss declined from ¥48 million to ¥5 million. The risk of unprofitable projects remains, but the impact of losses during the fiscal year decreased. - FY2018-Q3RestatedAnnual report
「During the nine-month period ended [the current third quarter], there were no newly arising business or other risks, nor any material changes to the business and other risks described in the Annual Securities Report for the prior fiscal year.」
The Company states that there has been no new occurrence or significant change concerning the risk of unprofitable projects in system development. - FY2018-Q2RestatedAnnual report
「During the six-month period ended [the current second quarter], there were no newly arising business or other risks, nor any material changes to the business and other risks described in the Annual Securities Report for the prior fiscal year.」
The Company states comprehensively that there has been no new occurrence or significant change concerning the risk of unprofitable projects in system development. - FY2018-Q1RestatedAnnual report
「During the three-month period ended [the current first quarter], there were no newly arising business or other risks, nor any material changes to the business and other risks described in the Annual Securities Report for the prior fiscal year.」
The Company states that there has been no new occurrence or significant change concerning the risk of unprofitable projects in system development. - FY2017MitigatedAnnual report
「Partly as a result of these initiatives, the loss recognized in relation to unprofitable projects during the fiscal year decreased year on year.」
The risk of unprofitable projects remains, but the Company states that losses recognized decreased year on year as a result of third-party verification, early-warning management and company-wide measures. - FY2017-Q3RestatedAnnual report
「During the nine-month period ended [the current third quarter], there were no newly arising business or other risks, nor any material changes to the business and other risks described in the Annual Securities Report for the prior fiscal year.」
The Company states comprehensively that there has been no new occurrence or significant change concerning the risk of unprofitable projects in system development. - FY2017-Q2RestatedAnnual report
「During the six-month period ended [the current second quarter], there were no newly arising business or other risks, nor any material changes to the business and other risks described in the Annual Securities Report for the prior fiscal year.」
The Company states comprehensively that there has been no new occurrence or significant change concerning the risk of unprofitable projects in system development. - FY2017-Q1RestatedAnnual report
「During the three-month period ended [the current first quarter], there were no newly arising business or other risks, nor any material changes to the business and other risks described in the Annual Securities Report for the prior fiscal year.」
The Company states comprehensively that there has been no new occurrence or significant change concerning the risk of unprofitable projects. - FY2016First statedAnnual report
「Following an increase in unprofitable projects in system development operations in the previous fiscal year (the fiscal year ended March 2016), in addition to organizational measures already in place, such as the “Estimation Review Committee” and the “System Project Council,”」
The previous fiscal year saw an actual increase in unprofitable projects, and the loss recognized in the current fiscal year is described as being at almost the same level as in the previous fiscal year.