Large project wins and order backlog increase; execution capacity is the focus for FY2027-H1

FY2027-Q1 order intake was ¥146,350 million. The company said it pursued strategic order-taking, mainly for redevelopment projects and logistics facilities, taking into account price pass-through for higher costs and its construction structure. Order intake was ¥275,256 million in FY2026-H1 and ¥479,014 million for FY2026 as a whole, making the ability to at least maintain the prior-year level in FY2027-H1 the first benchmark for assessing the full-year order base.

Ending backlog, equivalent to orders outstanding, increased from ¥476,049 million at the end of FY2026 to ¥528,041 million at the end of FY2027-Q1. The ¥51,992 million increase represents approximately 10.9% growth on a simple calculation. However, even if backlog rises, revenue recognition may be delayed if many projects are still in their early stages. In FY2027-Q1, revenue declined 1.9% year on year to ¥98,696 million, as progress-based revenue recognition was limited because large projects were in their early phases.

FY2026 order intake centered on redevelopment in the Tokyo metropolitan area and Fukuoka, an integrated resort in the Kansai region, and data center-related construction. In FY2027-H1, it will be necessary to assess not only whether these projects added to order intake, but also how much they contributed to revenue and operating profit and whether their profitability at order intake has been maintained. At present, order intake by project or region and the amount of order growth attributable to price pass-through have not been disclosed.

Accordingly, the next results should be assessed together across first-half order intake, ending backlog, project progress and any schedule delays. If order intake exceeds the prior-year period but backlog declines, it will be necessary to distinguish between progress in revenue recognition and weakness in new orders. Conversely, if only backlog increases while revenue and operating profit do not advance accordingly, the key issue will be whether construction personnel, materials procurement or schedule management has become a bottleneck.