Higher cost ratio due to declining contract prices
First written in FY2016. 9 of 19 entries say "Restated". Latest entry: FY2025.
Tokai Lease moved to the "Worse" side of this theme in 2021, 1 year before the typical company in this theme (2022).
The whole theme swung hardest in 2017: 2 of 8 companies on the "Worse" side.
6 other companies' latest entry also says "Mitigated".
- FY2025MitigatedAnnual report
「The cost ratio improved 2.3 percentage points from the previous fiscal year, partly because contract unit prices for projects driven by government demand increased. Operating profit was ¥1,511 million, up 51.3% year on year, and ordinary profit was ¥1,525 million, up 43.8%.」
The Company explains that, in response to the pressure on earnings from lower contract unit prices and a higher cost ratio previously noted, the cost ratio improved by 2.3 percentage points due to factors including higher contract unit prices for projects involving public-sector demand, resulting in higher earnings. - FY2024MitigatedAnnual report
「In terms of earnings, price revisions and cost-reduction initiatives proved effective, resulting in operating income of ¥998 million, up 254.8% year on year, and ordinary income of ¥1,060 million, up 207.6% year on year.」
The Company explains that, in response to the pressure on earnings from lower contract unit prices and a higher cost ratio noted in the previous fiscal year, price revisions and cost-reduction initiatives proved effective, increasing operating income and ordinary income. - FY2023WorsenedAnnual report
「The main factor was a 2.4-percentage-point increase in the cost ratio from the previous consolidated fiscal year, due to lower contract unit prices and higher costs for outsourced construction and other work.」
The decline in contract unit prices and increase in costs for outsourced construction and other work materialized, raising the cost ratio by 2.4 percentage points and leading to declines in gross profit, operating income and ordinary income. - FY2023-Q3MaterialisedAnnual report
「In terms of earnings, due to a decline in contract unit prices for private-sector demand and higher costs for outsourced construction and other work, the operating loss was ¥87 million (compared with operating income of ¥400 million in the same quarter of the previous year), while the ordinary loss was ¥22 million (compared with ordinary income of ¥413 million in the same quarter of the previous year).」
The decline in contract unit prices for private-sector demand materialized, and together with higher costs for outsourced construction and other work, led to an operating loss and an ordinary loss. - FY2022-Q1MaterialisedAnnual report
「In terms of earnings, declines in order prices for private demand and other factors put pressure on profits. Operating income was ¥84 million, down 21.2% from the same quarter of the previous year, and ordinary income was ¥88 million, down 15.8%.」
The previously omitted reference to declining contract prices has reappeared, with the company stating that lower order prices in private demand put pressure on operating income and ordinary income. - FY2020-Q3DroppedAnnual reportThe explanation of operating results and the business environment for the third quarter does not explicitly mention declining contract prices or the resulting increase in the cost ratio.
- FY2019MaterialisedAnnual report
「Gross profit decreased by ¥236 million from the previous consolidated fiscal year to ¥2,427 million, down 8.9% year on year. The main factor was that the cost ratio, including depreciation of lease assets, rose from the same period of the previous year.」
The company states that the higher cost ratio actually led to a decline in gross profit. - FY2019-Q3MaterialisedAnnual report
「In terms of earnings, the company worked to reduce costs and expenses, but the cost ratio, including depreciation of lease assets, rose from the same quarter of the previous year. The company reported an operating loss of ¥97 million, compared with operating income of ¥191 million in the same quarter of the previous year, and an ordinary loss of ¥75 million, compared with ordinary income of ¥186 million.」
The company states that the higher cost ratio actually caused operating income and ordinary income to turn into an operating loss and an ordinary loss, respectively. - FY2019-Q2RestatedAnnual report
「The temporary building leasing industry has remained solid, supported in part by capital investment. However, the shortage of workers across the construction industry continues, while contract prices, including those for projects ordered by government agencies, continue to trend downward, leaving the business environment difficult to predict.」
The company has reconfirmed its statement that the downward trend in contract prices is continuing. - FY2019-Q1RestatedAnnual report
「The shortage of workers across the construction industry continues, while contract prices, including those for projects ordered by government agencies, continue to trend downward, leaving the business environment difficult to predict.」
The company has reconfirmed its statement that the downward trend in contract prices is continuing. - FY2018RestatedAnnual report
「However, the shortage of workers across the construction industry continues, while contract prices, including those for projects ordered by government agencies, continue to trend downward, leaving the business environment difficult to predict.」
The company states that the downward trend in contract prices is continuing. - FY2018-Q3RestatedAnnual report
「The temporary building leasing industry has remained solid, supported in part by capital investment, but the shortage of workers across the construction industry continues, while contract prices, including those for projects ordered by government agencies, continue to trend downward, leaving the business environment difficult to predict.」
The company states that the downward trend in contract prices continued into the third quarter, although cumulative earnings improved from the same period of the previous year. - FY2018-Q2RestatedAnnual report
「The temporary building leasing industry has remained solid, supported in part by firm capital investment, but the shortage of workers across the construction industry continues, while contract prices, including those for projects ordered by government agencies, continue to trend downward, leaving the business environment difficult to predict.」
The company states that the downward trend in contract prices continued into the second quarter, although the earnings discussion for the quarter instead focuses on the recurring incurrence of fixed costs. - FY2018-Q1RestatedAnnual report
「The temporary building leasing industry has remained solid, supported in part by firm capital investment, but the shortage of workers across the construction industry continues, while contract prices, including those for projects ordered by government agencies, continue to trend downward, leaving the business environment difficult to predict.」
The company states that the downward trend in contract prices continued into the first quarter. - FY2017MaterialisedAnnual report
「In terms of earnings, the company reduced expenses but was unable to offset the higher cost ratio resulting from declining contract prices. Operating income was ¥365 million, down 36.4% year on year, and ordinary income was ¥358 million, down 32.6% from the same interim period of the previous year.」
The increase in the cost ratio resulting from declining contract prices outweighed expense reductions, affecting actual earnings through declines in operating income and ordinary income. - FY2017-Q3RestatedAnnual report
「In terms of earnings, the company reduced expenses but was unable to offset the higher cost ratio resulting from declining contract prices. Operating income was ¥31 million, down 92.5% from the same quarter of the previous year, and ordinary income was ¥15 million, down 96.0%.」
The company again describes the increase in the cost ratio resulting from declining contract prices as having outweighed expense reductions and affected earnings. - FY2017-Q2RestatedAnnual report
「The shortage of workers across the construction industry continues, while contract prices, including those for projects ordered by government agencies, continue to trend downward, leaving the business environment difficult to predict.」
The company has reconfirmed that the downward trend in contract prices is continuing. - FY2017-Q1RestatedAnnual report
「Contract prices, including those for projects ordered by government agencies, continue to trend downward, leaving the business environment difficult to predict.」
The company states that the downward trend in contract prices is continuing. - FY2016First statedAnnual report
「Operating income was unable to offset the higher cost ratio resulting from declining contract prices, despite reductions in costs and expenses.」
The company describes the decline in contract prices and resulting increase in the cost ratio as factors that affected operating income for the period.