| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥830.8B | ¥677.2B | +22.7% |
| Operating Income / Operating Profit | ¥47.4B | ¥26.6B | +77.8% |
| Ordinary Income | ¥55.2B | ¥33.4B | +65.1% |
| Net Income / Net Profit | ¥40.8B | ¥27.4B | +48.7% |
| ROE | 5.6% | 4.0% | - |
For the fiscal year ended March 2026, the company achieved substantial revenue and profit growth: Revenue ¥830.8B (YoY +¥153.6B +22.7%), Operating Income ¥47.4B (YoY +¥20.8B +77.8%), Ordinary Income ¥55.2B (YoY +¥21.8B +65.1%), and Net Income attributable to parent company shareholders ¥42.9B (YoY +¥13.9B +47.9%). The main driver of operating profit improvement was an improvement in the gross profit margin on completed construction contracts in the construction engineering business from 13.3% to 15.3% (+2.0pt), resulting in an operating margin increase from 3.9% to 5.7% (+1.8pt). At the ordinary income level, foreign exchange gains of ¥5.6B and dividend income received of ¥2.4B contributed, while at the net income level, special gains from sales of investment securities of ¥12.3B and gains on sale of fixed assets of ¥8.2B were upward factors. Operating Cash Flow (OCF) exceeded net income at ¥47.1B, allowing reduction of short-term borrowings by ¥56.5B while increasing cash and deposits by ¥20.4B. Dividends were ¥63.00 per share annually (interim ¥28.00, year-end increased to ¥35.00) with a payout ratio of 48.8%. Free Cash Flow (FCF) was ¥56.4B, sufficient to cover dividends and share buybacks.
[Revenue] Completed construction revenue was ¥830.8B (+22.7%), a significant increase. The main construction engineering segment led with ¥801.4B (+24.7%), while the Energy division recorded ¥465.2B (¥374.1B prior year, +24.3%), the Nuclear division ¥200.3B (¥151.1B prior year, +32.6%), and the Green Energy division ¥133.0B (¥115.4B prior year, +15.2%) — all divisions achieved double-digit growth. Other businesses were ¥84.3B (+1.2%) and flat; revenue composition was concentrated with Construction Engineering 90.5% and Others 9.5%. Gross profit on completed construction was ¥127.0B (+41.0%), with a gross margin of 15.3% (up from 13.3% +2.0pt), reflecting improved project profitability and mix effects.
[Profitability] From gross profit on completed construction of ¥127.0B, SG&A expenses of ¥79.6B (SG&A ratio 9.6%, up 25.6% from ¥6,339 million prior year) were deducted, resulting in Operating Income of ¥47.4B (+77.8%). Segment operating profits were Construction Engineering ¥106.9B (+155.7%) and Others ¥0.7B (-38.1%) totaling ¥107.6B; corporate expenses ¥52.6B (¥40.5B prior year) and intersegment eliminations -¥1.6B offset these to arrive at consolidated Operating Income of ¥47.4B. Although increased corporate expenses diluted operating leverage somewhat, gross margin improvement and scale effects outweighed this. Non-operating income/expenses resulted in net income of +¥7.8B (prior year +¥6.8B), primarily foreign exchange gains ¥5.6B and dividend income received ¥2.4B. Ordinary Income was ¥55.2B (+65.1%). Extraordinary gains/losses produced net +¥16.7B (extraordinary gains ¥20.5B less extraordinary losses ¥3.8B), with gains on sale of investment securities ¥12.3B and gains on sale of fixed assets ¥8.2B contributing, while impairment losses ¥3.7B were recorded. Pre-tax income ¥71.9B less income taxes ¥29.0B (effective tax rate 40.4%) yielded Net Income attributable to parent company shareholders of ¥42.9B (+47.9%), maintaining a trend of higher revenue and profit.
The Construction Engineering segment posted Revenue ¥801.4B (+24.7%), Operating Income ¥106.9B (+155.7%), and a margin of 13.3%, a substantial improvement. The Energy division achieved both revenue growth and margin improvement, while the Nuclear division also recorded higher revenue and profit due to progress on large projects. The Green Energy division captured renewable energy demand and posted double-digit growth. Other businesses recorded Revenue ¥84.3B (+1.2%) with Operating Income ¥0.7B (-38.1%) and a margin of 0.8%, reflecting low profitability in non-core businesses such as power generation, real estate, and leasing; improving profitability here is a challenge. Segment operating profit of ¥107.6B less corporate expenses ¥52.6B resulted in consolidated Operating Income ¥47.4B; controlling corporate expense growth is key to future margin improvement.
[Profitability] Operating margin was 5.7% (up +1.8pt from 3.9% prior year), and net margin was 5.2% (up +1.2pt from 4.0% prior year). Improvement in gross profit margin on completed construction to 15.3% (+2.0pt) was the main driver of profitability improvement. ROE rose to 5.9% (4.2% prior year), while ROA remained at 3.4% (2.5% prior year). [Cash Quality] Operating Cash Flow / Net Income was 1.10x, indicating cash backing of profits is generally favorable, but OCF/EBITDA was 0.70x (threshold <0.9x), showing working capital absorption is constraining cash conversion. Accrual ratio was -0.3% ((OCF ¥47.1B - Net Income ¥42.9B) ÷ Total Assets ¥119.3B) and is within a healthy range. [Investment Efficiency] Capital expenditure was ¥8.8B, 0.45x depreciation ¥19.6B, indicating restrained investment — monitoring is needed to maintain long-term equipment competitiveness. [Financial Soundness] Equity Ratio was 60.7% (63.3% prior year), current ratio 215.5%, Debt/EBITDA 1.96x, Interest Coverage 25.1x (Operating Income / Interest Expense) — overall financial soundness is maintained.
Operating Cash Flow was ¥47.1B (significant improvement from prior year -¥152.3B). Starting from pre-tax income ¥71.9B, addbacks included depreciation ¥19.6B and goodwill amortization ¥0.7B. Working capital movements included increases in trade receivables & contract assets of -¥64.2B and inventories increase -¥4.2B which absorbed cash, partially offset by increases in contract liabilities ¥13.9B and trade payables increase ¥12.8B. After income taxes paid -¥4.7B, OCF totaled ¥47.1B. Investing Cash Flow was net inflow ¥9.3B (prior year -¥0.9B), with proceeds from sale of securities & investment securities ¥16.6B exceeding capital expenditure ¥8.8B and acquisition of investment securities ¥6.2B. Free Cash Flow was ¥56.4B and ample. Financing Cash Flow was -¥36.7B (prior year +¥106.6B), reflecting net decrease in short-term borrowings ¥56.5B (drawdowns ¥205.9B - repayments ¥262.3B), repayment of long-term borrowings -¥8.2B, bond issuance ¥50.0B, dividends paid -¥17.9B, and share buybacks -¥3.7B. Cash increased from ¥76.5B at the beginning of the period by ¥20.4B to ¥96.9B at period-end, improving liquidity.
Operating Income ¥47.4B reflects recurring earnings from improved gross profit and scale effects in the Construction Engineering business. Non-operating income ¥12.7B (1.5% of sales) comprised foreign exchange gains ¥5.6B, dividend income ¥2.4B, interest income ¥0.7B, etc.; foreign exchange gains are largely temporary due to market movements. Extraordinary gains ¥20.5B (gains on sale of investment securities ¥12.3B, gains on sale of fixed assets ¥8.2B) less extraordinary losses ¥3.8B (including impairment losses ¥3.7B) resulted in net +¥16.7B, accounting for about 39% of Net Income ¥42.9B — indicating a significant contribution from one-off factors. The gap between Ordinary Income ¥55.2B and Net Income ¥42.9B is attributable to extraordinary items and a high effective tax rate (40.4%). Since OCF ¥47.1B exceeds Net Income ¥42.9B (1.10x), cash backing of accounting profits is good, but OCF/EBITDA 0.70x shows cash conversion is constrained by working capital absorption. The increase in trade receivables & contract assets ¥64.2B is strongly tied to construction progress and billing timing; future collectability will determine sustainability of earnings quality.
For the fiscal year ending March 2027, full-year guidance forecasts Revenue ¥950.0B (+14.3%), Operating Income ¥73.0B (+54.1%), Ordinary Income ¥75.0B (+35.9%), and Net Income attributable to parent company shareholders ¥52.0B (+21.2%). Sales progress rate at the end of Q2 is 87.5% (¥830.8B / ¥950.0B) and Operating Income progress rate is 64.9% (¥47.4B / ¥73.0B), implying additional profit accumulation in H2. The guidance implies an expected Operating Margin of approximately 7.7% (¥73.0B / ¥950.0B), an improvement of +2.0pt from this fiscal year’s 5.7%, assuming maintenance of gross margin and further fixed cost absorption. EPS forecast is ¥156.93 (current ¥128.96), and dividend forecast is ¥38.00 (current ¥63.00), implying an assumed payout ratio of approximately 24.2% and a conservative stance. Achievement of the full-year forecast hinges on steady execution of large projects, working capital management, and control of corporate expenses.
Annual dividend was ¥63.00 (interim ¥28.00, year-end ¥35.00), up ¥37.00 from prior year annual ¥26.00. Total dividends of ¥17.4B against Net Income ¥42.9B result in a payout ratio of 48.8%. Dividends paid ¥17.9B relative to OCF ¥47.1B results in a dividend cover of 2.63x; relative to FCF ¥56.4B the cover is 3.15x, indicating high sustainability. Share buybacks amounted to ¥3.7B; combined with dividends, total return was ¥21.1B, giving a Total Return Ratio of 49.2% and an FCF-based cover of 2.67x, which is healthy. Full-year dividend guidance is ¥38.00, with assumed Net Income ¥52.0B implying total dividends ¥12.6B (payout ratio approx. 24.2%), showing a conservative policy and leaving room for future capital allocation prioritizing growth investment and working capital needs while maintaining stable dividends.
Construction profitability risk: Although gross profit margin on completed construction improved to 15.3% (+2.0pt YoY), provision for construction losses doubled to ¥7.2B (up +108.1% from ¥3.5B prior year), indicating risk from rising material and labor costs under fixed-price contracts and project delays. Uncompleted construction costs also increased to ¥14.4B (+39.1%), so cost management on large ongoing projects is directly linked to future gross margin preservation.
Short-term liquidity risk: Short-term borrowings are ¥88.2B and current liabilities ratio is 67.1%, indicating high reliance on short-term debt. A rising interest rate environment or changes in refinancing conditions could affect funding costs. Although cash and deposits ¥96.9B exceed short-term borrowings and near-term liquidity is secured, seasonal working capital swings and delayed collections could lead to temporary funding strain.
Business concentration risk: The Construction Engineering business accounts for 90.5% of revenue, with dependence on three divisions: Energy, Nuclear, and Green. Regulatory changes (e.g., stricter nuclear regulations), policy shifts (reduction in renewable energy subsidies), or capital expenditure cuts by major customers could materially impact revenue and profit. Profitability in Other businesses is low at 0.8%, limiting diversification benefits.
Profitability & Returns
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 5.7% | 5.5% (3.5%–7.2%) | +0.2pt |
| Net Margin | 4.9% | 3.5% (2.5%–4.4%) | +1.4pt |
Profitability exceeds the industry median, driven by gross margin improvement.
Growth & Capital Efficiency
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 22.7% | 9.8% (-2.1%–15.1%) | +12.8pt |
Revenue growth substantially exceeds the industry median, reflecting significant order expansion in core segments.
※ Source: Company compilation
A rise in gross profit margin on completed construction to 15.3% (+2.0pt) confirms uplift in project profitability, and the Construction Engineering segment operating margin of 13.3% suggests structural improvement in earnings power. Full-year guidance targeting Operating Margin 7.7% (+2.0pt additional improvement) implies continued project mix improvement and fixed-cost absorption. However, the doubling of provisions for construction losses (+108.1%) indicates uncertainty in profit control, and progress on large H2 projects will determine achievement.
OCF ¥47.1B exceeds Net Income, but OCF/EBITDA at 0.70x indicates low cash conversion and working capital absorption (trade receivables -¥64.2B, increase in contract assets) is constraining growth funding. FCF ¥56.4B covers dividends and buybacks nearly threefold, leaving ample distribution capacity, but in a growth phase working capital efficiency (receivables turnover days, appropriate management of contract liabilities) will decide capital allocation flexibility.
Payout ratio 48.8% and Total Return Ratio 49.2% are at sustainable levels. Full-year forecast dividend ¥38.00 (assumed payout ratio ~24%) is conservative and leaves room for further increases. Equity Ratio 60.7% and Debt/EBITDA 1.96x indicate strong financial health, providing capacity for growth investments, M&A, or additional returns. However, ROE 5.9% and an estimated ROIC likely below the cost of capital suggest improving capital efficiency (controlling corporate expenses, compressing working capital, and selecting higher-margin projects) is the next step to enhance shareholder value.
This report was auto-generated by AI analyzing XBRL financial statement data. It does not constitute a recommendation to invest in any specific security. Industry benchmarks are reference information compiled by the Company from public financial statement data. Investment decisions are your own responsibility; consult a professional advisor as needed.