Annual Report 2024

Tsuji Culinary Institute TOKYOTsuji Culinary Institute TOKYO

ProfileSince Okumura was established in 1907, our mission has been to contribute to society through ourbusiness under our corporate mottos, “steadfast management” and “sincere operation.”
We will continue to accumulate a wealth of technical expertise and, as a general contractor
company with a harmonious mix of civil engineering and architectural construction, make steadystrides forward in our aim to realize comfortable, safe and secure lives for people, and a sustainable
society as well.
Contents
1
2
4
6
10
12
13

Financial Highlights
To Our Shareholders
Review of Operations
TopicsConsolidated Balance Sheet
Consolidated Statement of Income
Consolidated Statement of Comprehensive Income

14
15
16
40
43
44
45

Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to Consolidated Financial Statements
Independent Auditor’s Report
Breakdown of Orders (Nonconsolidated)
Network
Board of Directors / Investor Information

Financial Highlights
Okumura Corporation Annual Report 2024

For the years ended March 31

2022

2023

Consolidated:

2024

2024
Thousands of
U.S. Dollars

Millions of Yen¥242,459¥249,443¥288,147$1,903,213

Operating income

12,647

11,847

13,70890,543

Net income attributable to owners of the parent

12,542

11,262

12,49382,517

Total assets

332,349

343,728

384,750

2,541,284

Total equity

167,425

173,216

191,574

1,265,348

Net sales

Per Share:

Yen

U.S. Dollars

Basic net income¥334.11¥306.08¥339.30$2.24

Cash dividends applicable to the year

172.00223.00237.001.57*“Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29, March 31, 2020), etc. have been applied from the beginning of the fiscal period of March 2022. Accordingly, the summaries of business results for the fiscal period of March 2022 and thereafter represent performance results after
applying the said accounting standards, etc.
Note: The U.S. dollar amounts included herein are presented solely for convenience of the reader. Such dollar amounts have been translated from yenat the approximate exchange rate in Tokyo on March 31, 2024, of ¥151.40=$1.

Net Sales

Net income attributable to owners of the parent(Millions of Yen)

300,000

Total Equity(Millions of Yen)

15,000(Millions of Yen)
200,000

240,000

12,000160,000

180,000

9,000

120,000

120,000

6,000

80,00060,0003,000

40,000

0

0

0

2022

2023

2024

2022

2023

2024

2022

2023

2024

Disclaimer Regarding Forecasts and Projections
This Annual Report includes forecasts, projections and other predictive statements that represent Okumura’s assumptions and expectations in light of currently available information. These forecasts, etc., are based on industry trends, circumstances involving clients and other factors, and involve risks, variables and uncertainties.
The Okumura Group’s actual performance results may differ from those projected in this Annual Report. Consequently, no guarantee is presented or implied as tothe accuracy of specific forecasts, projections or predictive statements contained herein.

1

To Our Shareholders

We would like to thank our shareholders for their continuing support and encouragement and wish eachone of them the greatest success in their endeavors.

2

A general overview of our business performance for the fiscal period of March 2024 (April 1,
2023 to March 31, 2024) is provided below.

Results for the Year Ended March 31, 2024
During the period under review, economic activity continued to return to normal, due mainly to thenovel coronavirus (COVID-19) reclassified as a Category 5 infectious disease, but the pace of recovery in
the Japanese economy was sluggish due to ongoing factors such as the soaring price of goods and theslowdown in overseas economies. In this climate, construction investment was robust. However, thebusiness environment for the construction industry still does not warrant optimism mainly due tomaterials prices remaining elevated.
In these circumstances, the Company’s consolidated net sales increased 15.5% year on year to¥288,147 million. This led to an increase of 10.0% year on year in consolidated gross profit to ¥35,192
million and an increase of 15.7% year on year in consolidated operating income to ¥13,708 million. Net
income attributable to owners of the parent rose 10.9% year on year to ¥12,493 million.

Dividend for the Year Ended March 31, 2024
The Company decided to pay a dividend of ¥237.00 per share (interim dividend of ¥77.00, year-end
dividend of ¥160.00) for the period ended March 31, 2024 based on its policy regarding profit sharing.
In order to achieve a balance between proactive investment as we work to achieve our “Vision
toward 2030” and steadily share profits with all shareholders, the Group has determined its shareholder
return policy as follows.

Shareholder Return Policy
Basic policy
To distribute profits in line with business performance and flexibly implement thepurchase of treasury stock, premised on the continuation of stable dividends.

Policy from FY2022 to FY2024(

Consolidated payout ratio of 70% or more
Dividend on equity ratio (DOE) of 2.0% or more, regardless of business performance.
Note: Dividend on equity ratio (DOE) = Total annual dividends (interim + year-end) ÷ equity)

Okumura Corporation Annual Report 2024

Medium Term Business Plan
Despite some uncertainties such as overseas economies and thecontinuing surge in prices, the outlook for the Japanese
economy is expected to follow a modest recovery trajectoryunderpinned mainly by domestic demand due partly to
improvements in employment and wages. In the constructionindustry, although construction investment is forecast to remain strong, the business environment
remains unpredictable due to factors such as concerns about the impact on the construction industry
from regulations applying from April 2024 that cap overtime hours worked.
Under these circumstances, the Okumura Group will aim to continue to grow into the future by
responding to the trust placed in us by society through reliable technologies and honest business
operations. This includes developing businesses and services that anticipate changing social needs andundertaking initiatives for ESG/SDGs in an integrated manner. We will push ahead with initiatives
founded on the basic policies for business strategies upheld in our Medium Term Business Plan (FY2022FY2024), the second step toward the realization of our “Vision toward 2030.”
Specifically, we will pursue the “enhancement of corporate value” by improving our productivity
and technological advantage through operational changes, organizational reforms, and the promotionof digital transformation (DX). At the same time, we will continue to work toward the “expansion ofbusiness domains,” including further expansion of the real estate business, the building of resilient
foundations for our overseas business and the promotion of biomass power generation business, which
is beyond the realm of a traditional construction company. We will continue with our efforts to “leverage
our human resources” by upgrading our internal programs to help all employees achieve a good worklife balance, as well as giving our diverse people the opportunity to flourish.
Additionally, in order to accelerate these initiatives, we opened our new office, “X Innovation
Center,” which is intended to enable our diverse people to perform at their fullest potential, in Tokyo’s
Marunouchi area in October 2023. We will work to strengthen open innovation backed by diverse
internal and external resources, including using this office as a base for technological development
through strengthened collaboration between industry, academia, the government and the private
sector as well as the development of new businesses through exchanges with venture companies.
The Company looks forward to the continued support and guidance of our shareholders.

June 2024

Takanori Okumura
President and Representative Director

3

Review of Operations
CIVIL ENGINEERING
Major Projects Completed

4Sotetsu-Tokyu Link Line, Shin-Yokohama Tunnel
Work period: April 2015 to June 2023
Closed-type shield tunneling method (segment), Construction of new rail
tunnel from 4 km 365.00 m to 7 km 669.04 m (length 3,304.04 m), SotetsuTokyu Link Line

Substructure work for No. 7 Bridge, Shin Maruyama Dam
National Route 418, Year 2021
Work period: March 2022 to March 2024
Road earthwork: 1 set, abutment work: 1 unit, temporary construction: 1 set,
construction length: 240 m

Sakamoto Tunnel, Sakamoto Section (tentative),
National Route 168

Horinouchi Daini Bridge and other 4 bridges anti-seismic
reinforcement work on the Ise Expressway

Work period: October 2020 to August 2023
Construction length: 917 m, NATM tunnel length: 899 m

Work period: September 2021 to September 2023
Bridges: 5, substructure reinforcement (RC lining, continuous fiber sheets,etc.): 76 units, prevention work for faulting: 20 units

Orders Received
Contract CF680B, Circular Line
North Section, Taipei MRTWork period: April 2023 to July 2029
Shield Tunnel work: length 4,537 m(6 spans), internal diameter: φ5.6 m,
Shield Tunneling Machine: 3 unit, soil
improvement: 1 set, building
protection work: 1 set

R5 Kasumigaura Water Delivery
Ishioka Tunnel (fifth work area)
Newly EstablishedWork period: June 2023 to June 2026
New tunnel construction work:
construction length 4,458 m, Shield
Tunneling Machine manufacturing: 1
set, road earthwork: 1 set, Shield
Tunnel work (internal diameter 3.5 m,
external diameter 3.9 m), lining: 1 set,
temporary construction: 1 set,
temporary facility construction: 1 set,soil improvement: 1 set

Hokkaido Shinkansen Kyoritsu
RoadbedWork period: July 2023 to January
2027
Length: 3,921 m, rigid frame bridges:
31 units, RC T-girder bridges: 34 units,
RC piers : 6 units, PC-GRS integrated
bridge: 1 unit, PC through girder (fixedsupport structure , girder length 60 m):
1 unit, cast-in-situ RC piles : approx.
450 units, reinforced soil
(embankment) : 160,000 m3, protective
base embankment: 100,000 m3

Anti-seismic Reinforcement Workfor Minakami Bridges for Kan-Etsu
Expressway
Work period: March 2024 to February
2029
Anti-seismic reinforcement work for
Ishikura Bridge, Terama Bridge, Konita
Bridge, Minakami Bridge, andYoshinozawa Bridge between Minakami
IC and Yuzawa IC. Bridge pier antiseismic reinforcement work: 16 units /expansion joint replacement: 4locations / support replacement work:
60 units / bridge collapse prevention
systems: 168 units / parapet
improvement work : 2 locations

Okumura Corporation Annual Report 2024

BUILDINGS
Major Projects Completed

5

GLP ALFALINK Nagareyama 5 & 6

NITORI Nagoya DC

Work period: May 2021 to April 2023
Structure: PCaPC and partial steel
Total floor space: 234,237.69 m2

Work period: March 2022 to March 2024
Structure: Steel
Total floor space: 126,996.1 m2

Kaizuka City HallWork period: March 2020 to May 2023
Structure: Steel
Total floor space: 12,351.4 m2

PMO Ginza II
Work period: July 2022 to October 2023
Structure: Steel
Total floor space: 5,519.72 m2

Orders Received
Mitsugaoka Logistics Facility
Development Project(provisional name)Work period: February 2024 to
February 2025
Structure: Structural Steel
Total floor space: 21,276.35 m2

DPL Chiba Yotsukaido II New
Building Construction

Higashi Umeda Building Plan
Building Construction

Cultural Hall MaintenanceConstruction WorkWork period: July 2023 to July 2025
Structure: PCaPC, partial Structural
Steel
Total floor space: 306,570.38 m2

Work period: November 2023 to
September 2025
Structure: Structural Steel and CFT(floors 1-3)
Total floor space: 14,614.22 m2

Work period: March 2024 to March
2027
Structure: RC and partial Structural
Steel
Total floor space: 18,112.62 m2

Topics
Sustainability-related Initiatives

6

Throughout its history, the Okumura Group has upheld its
management philosophy of “Contribute to bettering the world
through the expansion of business endeavor, excel as a corporate
entity committed to the principles of ‘steadfast management’ and‘sincere operation,’ and continue to play an essential role in society.”
Based on this management philosophy, we are pushing ahead withour business activities as we strive to achieve our future vision set outin “Vision toward 2030.” The vision presented by the Okumura Group
brings together our goals for achieving a “sustainable and symbiotic
society,” which is the aim of the SDGs. We anticipate value creation
through our business activities contributing to the SDGs.
We declared our endorsement of the Task Force on Climate-Related
Financial Disclosures (TCFD) in April 2022. We will aim to realize asustainable society as we push ahead with the disclosure of climatechange-related information based on the four frameworks in the TCFD
recommendations: (1) Governance, (2) Strategy, (3) Risk Management,and (4) Metrics and Targets.

Note: The Task Force on Climate-Related Financial Disclosures (TCFD)
was established by the Financial Stability Board (FSB) to consider how toengage in the disclosure of climate-related information.

(1) Governance

The Group has established the ESG/SDGs Promotion Committee as anorganization to deliberate on issues and other matters related to ESG/
SDGs and for the promotion of strategic initiatives.
Among the urgent issues faced by the construction industry are
improvement in long working hours and realizing a five-day work
week. We have also established the Workstyle Reform Promotion
Committee as an expert committee to promote workstyle reforms
across the company as well as swiftly as possible.
Both committees are chaired by the President and Representative
Director and composed of the heads of each Head Office section andthe presidents of the East Japan and West Japan Branch Offices. The
results of its deliberations are submitted or reported to the Board of
Board of Directors
Supervise
Management Committee
Submit/report(at least once per year)

ESG/SDGs Promotion Committee (held at least twice per year)
President and Representative Director
General Manager of Marketing &Sales Headquarters

General Manager of Civil
Engineering Headquarters

General Manager of Building
Headquarters

General Manager of
Administration Headquarters

General Manager of Safety,
Quality & Environment

General Manager of Investment
Development Headquarters

General Manager of ICTManagement Center

General Manager of Technology
Headquarters

Operational Reform Promotion Project Leader
General Manager of East Japan
Branch Office

General Manager of West Japan
Branch Office

ReportDirectHeadquarters and other sections
ReportDirectEast Japan and West Japan Branch Offices
ReportDirectBranches

Directors as necessary, and a framework is in place for appropriatemonitoring by the Board of Directors.

(2) Strategy

Policies related to climate change, etc.

Under the Okumura Group’s basic philosophy of “creating andsustaining an environment that is friendly to both people and theplanet,” we strive to prevent environmental pollution, reduce
environmental burden, and protect the environment. We are working
toward the “realization of a sustainable society” in addressing
sustainability issues, including climate change, based on a recognitionof these as key management issues.
We analyze the impact that risks and opportunities will have on theorganization, including those related to climate, through an
examination (scenario analysis) based on the “2°C or lower scenario”
and the “4° scenario.” Please refer to ★ in Table 1 for issues related toclimate change.
• 2°C or lower scenario: A scenario that assumes that the rise inaverage global temperatures will be kept well within 2°C above
pre-industrial levels and continuing efforts will be made to keep
the rise in temperatures within 1.5°C.
• 4°C scenario: A scenario that assumes that the rise in average global
temperatures will be approximately 4°C above pre-industrial levels.
Based on the results of these analyses as well as issues and othermatters, we have set non-financial targets in our Medium TermBusiness Plan (FY2022-FY2024) for the “stable supply of renewableenergy-derived electric power,” “promotion of measures for CO2
emissions reductions at the construction stage,” and “promotion of
measures for CO2 emissions reductions at the design stage.” We havealso established “greenhouse gas (GHG) emission reduction targets” asa metric and target for use in assessing and managing climate-relatedrisks and opportunities. Based on these targets, we are advancing
initiatives to achieve a decarbonized society, including contributions
to CO2 emissions reductions and mitigation of CO2 emissions.

Policy related to human capital, etc.

The Okumura Group has set “leverage our human resources” as a basic
policy of its business strategy in the Medium Term Business Plan
(FY2022 to FY2024). In order to promote the creation of workplaces
enabling all employees to prosper, we have formulated the “Human
Resources Policy” and “Work Environment Improvement Policy,“ andour initiatives are based on these policies.

Human Resources Policy

The Okumura Group believes that the development of humanresources able to embody our management philosophy is essential forcontinued sustained growth, and we will therefore focus ondeveloping human resources that steadfastly and sincerely value trust,
are able to act on their own initiative and are full of a drive for growth.
Specifically, we will systematically and proactively provide training byrank in response to job performance abilities and training by occupation
with the aim of learning specialist knowledge. At the same time, we alsoseek to enhance human resource readiness through appropriatecompensation reflecting evaluations of performance records anddemonstrated capabilities as well as feedback of the evaluation results.
Additionally, in order to promote digital transformation (DX) andachieve further productivity gains, we will focus on securing anddeveloping experts, while also engaging in education to lift IT literacy
companywide.
Beyond this, we have been working to lift employee engagement
and morale in order to improve earnings over the medium and longterm as well as bolster corporation value, including the introduction in
April 2023 of the “Stock Benefit Trust for Employees.”Work Environment Improvement Policy

In our “Vision toward 2030,” the Okumura Group set out its plans to be “acompany that its employees are proud of and that leverages and values
its people,” spurred by our vision of being a company that continues togrow while sharing our wealth with all people involved with us.
In order to achieve this, we will work to create a workplace whereOkumura Corporation Annual Report 2024

Table 1: ESG/SDGs-related material issues (materiality)
ESG

Risks

E

S

E·S

S·G

Opportunities

E

S

Impact if the risk oropportunity
materializes*1

Significanceunder the2ºC orlower
scenario*2

Significanceunder the4ºC
scenario*2

Type of risk oropportunity

TimingThe OkumuraGroup’s
ESG/SDGs-related
challenges*3

Increasingly frequent anddevastating large-scaledisasters due to abnormal
weather associated withclimate change as well as
earthquakes and typhoons

Deterioration of thefoundation forlivelihood and industry
due to the failure of
infrastructure, as well as
damages to assets held

4

5

Physical risk
(acute)/Transition
risk (regulatory,
market)Short,
medium,and long
term

Contribution toresilientinfrastructuredevelopment ★

Destruction of the naturalenvironment due to risingtemperatures associatedwith climate change anddevelopment without
regard for the environment

Destruction of ecosystems
and the pollution of water
sources; decline in orders
received due to thedeterioration of corporate
valuations

4

5

Physicalrisk(acute,chronic)/Transitio
n risk (regulatory,
reputation)

Short,
medium,and long
term

Promotion ofenvironmentallyfriendly businesses★

Skyrocketing materials
and outsourcing costs
due to the introduction ofcarbon taxes (carbon
pricing) associated withclimate change

Decline in profitability
due to the increase inconstruction costs

4

3

Transition risk
(regulatory, market)

Short,
medium,and long
term

Promotion of
decarbonization ★

Waste of the natural
resources contained inconstruction materials

Decline in sustainability
due to the depletion ofnatural resources

3

3

Transition risk
(market)Mediumand long
term

Effective use ofresources throughrecycling

Dangerous working
environments

Decline in worker
motivation

3

3

Physical risk
(acute)/ Transition
risk (market)

Short andmediumterm

Safe and secure
workingenvironments

Increase in vacant houses
and shops, as well asderelict buildings

Deterioration in the public security
and hygienic environment, disasters
due to building collapse, and adecrease in real estate rental income

33

Physical risk
(chronic)/Transition
risk (market)

Mediumand long
term

Effective use of realestate stock

Lack of diversity inworking environments

Outflow of female
employees and other diverse
talent, and the loss of
employment opportunities

33

Physical risk
(acute)/ Transition
risk (market)

Short andmediumterm

Promotion ofdiversity-focusedmanagement

Deterioration in working
environments due to risingtemperatures associatedwith climate change

Increase in the risk ofheatstroke and rise inconstruction costs due tolower labor productivity

34

Physical risk
(chronic)/
Transition risk
(market)Short,
medium,and long
term

Promotion of
mechanization, laborsaving and greater
efficiency ★

Increase in demand formore energy-savingbuildings as climatechange countermeasures

Progressive shift toenergy-saving buildings

4

3

Products andservices, market

Short,
medium,and long
term

Energy-saving designof buildings ★

Rise in demand for clean
energy as a climatechange countermeasure

Spread of power
generation methods with
low CO2 emissions

4

3

Products andservices, energy
sources, market

Short,
medium,and long
term

Promotion ofrenewable energy
businesses ★

Advance of ICT and its
application to
construction techniques

Better construction
techniques through ICT

3

3

Products andservices, market

Short,
medium,and long
term

Enhancement oftechnical capabilities
and productivity
through ICT

Reduction in overtime
work through more
efficient operations

Increase in theattraction of theconstruction industry
and the promotion of
employee health44Products andservices

Short andmediumterm

Promotion ofworkstyle reforms

Progressively morediverse workstyles andgreater employment
mobility

Realization of diverse
workstyles

3

3

Products andservices

Short andmediumterm

Promotion of decent
work

Rise in demand forhigh-quality infrastructure

Construction of long-lived
infrastructure3

3Products andservices, resilience

Mediumand long
term

Assurance andenhancement ofconstruction quality

Promotion ofcollaboration with local
communities andcompanies

Demonstration of synergies
through partnerships withlocal communities andcompanies

3

3

Products andservices, market

Short,
medium,and long
term

Collaboration withlocal communities
and companies

ESG/SDGs-related risks
and opportunities

SDGs*1 Negative impact is described for risks and positive impact is described for opportunities.
*2 Significance is evaluated using the two axes of probability and impact. Each is given a score from 1 to 5, with 5 indicating the highest degree of significance(5: Extremely high; 4: High; 3: Medium; 2: Low; 1: Extremely low).
*3 The ESG/SDGs-related material issues (materiality) for the Okumura Group are indicated in green type. The ★ and ★ marks indicate climate change-related issues.

7Topics

8

all employers can prosper by securing a safe and engaging
environment and by fostering a corporate climate that values
individuality and creativity to ensure that diverse human resources,
including women, can realize each of the greatest potential.
Specifically, we will promote workstyle reforms and make humanresources investments to improve employee motivation by
establishing workplaces where diverse human resources can prosper.
As part of these efforts, we are steadily working to promotewomen’s participation. In addition to actively recruiting and training
female employees, we are establishing workplaces where women canwork with a sense of security through enhanced systems to support
the balance between childcare and work. Through this, we are steadily
promoting women’s participation in leadership positions.
We also proactively support the health promotion of ouremployees. By establishing an environment where employees candemonstrate their individuality and abilities to the maximum extent
possible, we strive to achieve the wellbeing of all employees, bothmental and physical health.
In October 2023, we opened our new office in Tokyo’s Marunouchi
area, “Cross Innovation Center,” which is designed to harness ourdiverse human resources to the utmost. The office has obtained thehighest S rank in the “CASBEE-Wellness Office” evaluation.
*CASBEE-Wellness Office evaluation is a tool evaluating building specifications,performance and initiatives that support the maintenance and promotion of thehealth and comfort of building users.

(3) Risk Management

At the Okumura Group, the ESG/SDGs Promotion Committee and theWorkstyle Reform Promotion Committee analyzes, identifies, andassesses issues associated with ESG/SDGs and comprehensively
manages associated risks, including appropriate reviews of materiality
in accordance with changes in the business environment. Additionally,by reflecting measures to solve sustainability-related issues in theMedium Term Business Plan, we have established a framework that
integrates our business activities and ESG/SDGs initiatives, thereby
improving the effectiveness of measures for solving such issues.

Additionally, we have set the following targets for the reduction ofgreenhouse gas (GHG) emissions as long-term targets. We obtained
SBT certification for these targets in January 2023.
*SBT (Science Based Targets): These aregreenhouse gas emission reduction
targets set by companies to meet thegoals of the Paris Agreement (to keep
the rise in average global temperatures
well within 2°C above pre-industrial
levels and continue efforts to keep therise in temperatures within 1.5°C) withthe target years 5-15 years from now.

Metrics*1

GHG Emission Reduction Targets for
FY2030 (Total Emissions)*2

Scope 1+2

25% (from FY2020)

Scope 313% (from FY2020)*1 Scope 1: Direct greenhouse gas emissions from sources that are owned or controlled by
the company
Scope 2: Indirect greenhouse gas emissions from the use of electricity, heat and vapor
supplied by other companies
Scope 3: Other indirect greenhouse gas emissions that are a consequence of the activitiesof the company, but occur from sources not owned or controlled by the company*2 (Reference)
Total emissions in FY2020: Scope 1+2 41,466.13t-CO2, Scope 3 1,180,258.95t-CO2
Total emissions in FY2023: Scope 1+2 51,801.65t-CO2, Scope 3 1,291,719.97t-CO2

Metrics and Targets Related to Human Capital

The Okumura Group has established the following metrics and targets
related to our policies for human resources and work environment
improvements as set out in (2) Strategy.
Metrics

Results (FY2023)

Targets (FY2024)

Percentage of female
recruits

20.5%

20.0%

Percentage of womenin managerial positions

4.0%

5.0%

Percentage of male
employees taking
childcare leave

96.9%

100%

(4) Metrics and Targets

Achievement rate ofconstruction sites closed
8 days per 4 weeks

Civil engineering:
68.9%
Buildings: 44.2%

Civil engineering:at least 90.0%
Buildings: at least 75.0%

At the Okumura Group, we have set metrics and targets for use in theassessment and management of climate change-related risks andopportunities as non-financial targets in our Medium Term Business
Plan (FY2022 to FY2024).

Certified Health &Productivity Management
Outstanding Organization(White 500)

Certification

Certification

Metrics and Targets Related to Climate Change

Major Leaguer Masataka Yoshida is featured in our TV commercials
Starting Sunday, January 28, 2024, we have begun airing two newnationwide TV commercials featuring Major League Baseball player,
Mr. Masataka Yoshida, who belongs to Boston Red Sox - “The uniform
epitomizing our beliefs” and “The backs carrying our instilled beliefs”.
Mr. Yoshida became a professional baseball player throughcontinued hard work, eventually making it to the Major League. We

asked him to appear in our commercials because
his mindset makes him well-qualified as anambassador to communicate our corporate
image anchored by our corporate creed of“steadfast management” and “sincere
The commercials can be
operations.”
viewed via our website.

“The uniform epitomizing our beliefs”“The backs carrying our instilled beliefs”

Okumura Corporation Annual Report 2024

Developed “Rockfall Monitoring System” as Safety Measure for Mountain
Tunnel Construction-Detecting signs of rockfalls with AI using tunnel face imagesOkumura and Research Institute of Systems Planning, Inc. havedeveloped a “Rockfall Monitoring System” that detects cracks on thesurface of mirror-sprayed concrete*1 on the tunnel face and notifies
about signs of rockfalls in order to prevent rockfall*2 accidents at thetunnel face area during mountain tunnel construction.
*1 Concrete sprayed to vertical face at the front of an excavated tunnel*2 Falling rocks, etc. from the front of an excavated tunnel

The system uses AI to detect cracks occurring in mirror-sprayedconcrete using images of the tunnel face taken using cameras during
the work at tunnel face area and alerts about signs of rockfalls. Using
AI learning models created using images of cracks in sprayed concrete

specimens and mirror-sprayed concrete, etc. as training data, cracks
can be detected with a high accuracy of at least 86%. As a result, thesystem is to prove effective in assisting the monitoring of rockfalls sothat responsible workers for monitoring the tunnel face will be able toconfirm status of cracks in mirror-sprayed concrete without getting
too close to the face.
Going forward, we will actively deploy this system in the site andutilize it as one of the effective tools for prevention of rockfall
accidents. At the same time, we will work to identify issues withverification and address further improvements toward to thesophistication of the system.

Analysis-use PC (with GPU)
Learning modelfor tunnel facedeterminations

Camera(USB)

Crack
detection
model

Designparameters

Red line shows detected crack

CameraSDK
ImagesAnalysisprogramImages foranalysis
results

Web server

Overview of rockfall monitoring system

Crack detection results using AI learning models

Support for the Shogaisha Jiritsu Suishin Kikou Association

X Innovation Center (Tokyo)

As part of efforts to contribute to achieving theSDGs, we have signed an official partnershipagreement with the Shogaisha Jiritsu Suishin Kikou
Association to support people with disabilities tolive independent lives through the organization’s
Paralym Art program. Artworks created by artists
with disabilities who are registered with Paralym
Art are displayed at 30 locations, including
Okumura’s Head Office and other main offices, aswell as on temporary fencing at its working
construction sites.
We will continue to contribute to achieving theSDGs through initiatives such as these, in addition
to our business activities.

Hospital Construction Site (Hiroshima)

Operation of the Okamura Commemorative Museum
In 2007, we built the “Okumura Commemorative Museum” in Nara, a region deeply connectedwith Okumura Corporation, to show our gratitude for the opportunity to celebrate ourcentennial anniversary. The museum is designed in harmony with the atmosphere of thisancient capital. It features relaxation spaces where visitors can rest at ease and display spaces
showing Okumura’s history and technologies without any admission charge. The museum
adopts “Seismic Isolation Technology”, one of Okumura’s special expertise, and it provides a
space where visitors can learn about how actual Seismic Isolation System is installed. It also
features an “Earthquake and Seismic Isolation Experience Simulator” that enables visitors tohave the feeling of an earthquake and the effect of seismic isolation, as well as comparative
seismic isolation models, by which visitors can observe the difference depending on thepresence or absence of Seismic Isolation System, and a model of Shield Machine.
The museum also provides a space for performances by amateur musicians, and concerts
are held for the enjoyment of visitors.
Please take time to visit when you are next in Nara.

A concert9Consolidated Balance Sheet
Okumura Corporation and Consolidated Subsidiaries
March 31, 2024

ASSETS

Millions of Yen

Thousands of
U.S. Dollars(Note 1)

2024

2023

2024

¥ 28,918¥ 48,793$ 191,002

1,330

1,451

8,788

Current assets:
Cash and cash equivalents (Note 14)
Time deposits (Notes 14 and 16)
Receivables:

10

3,662

3,007

24,190168,656

126,717

1,113,975

53

2,743

347

Other

5,815

5,936

38,410Allowance for doubtful receivables (Note 14)

(190)

(142)

(1,254)

Trade notes (Note 14)
Trade accounts (Note 14)
Unconsolidated subsidiaries and associated companies (Note 14)

Inventories (Note 5)

8,098

6,912

53,489Prepaid expenses and other

4,076

3,438

26,919Total current assets

220,418

198,855

1,455,866

35,15034,668232,165

Property, plant and equipment (Notes 6 and 7):
Land (Note 16)
Buildings and structures (Note 16)

22,28022,840147,158

Machinery and equipment

16,70019,169110,304

Furniture and fixtures

535

389

3,536

Lease assets (Note 13)

17

6

114

Construction in progress
Total property, plant and equipment

794

50

5,245

75,476

77,122498,522

68,48454,698452,338

294

307

1,942

Investments and other assets:
Investment securities (Notes 4, 14 and 16)
Investments in and advances to unconsolidated subsidiaries and associated companies (Notes 14 and 16)
Long-term loans receivable (Note 14)

13

12

86

Asset for retirement benefits (Note 8)

5,525

4,435

36,4942

3

15

Goodwill

349

379

2,305

Other assets

16,1209,861

106,469

Deferred tax assets (Note 10)

Allowance for doubtful receivables (Note 14)
Total investments and other assets
Total
See notes to consolidated financial statements.

(1,931)(1,944)(12,753)

88,85667,751

586,896¥384,750¥343,728$2,541,284

Okumura Corporation Annual Report 2024

Millions of Yen

Thousands of
U.S. Dollars(Note 1)

2024

2023

2024

¥ 16,708¥ 10,710$ 110,356

Trade notes (Note 14)

2,694

3,003

17,795Trade accounts (Note 14)

49,38047,265326,158

Other

3,009

3,313

19,874

Advances received on construction projects in progress

19,161

12,594

126,561

Income taxes payable

3,386

3,051

22,362

627

505

4,141

LIABILITIES AND EQUITYCurrent liabilities:
Short-term bank loans including current portion of long-term debt (Notes 7, 13 and 14)
Payables:Allowance for warranty work on construction projects

859

1,566

5,675

Deposits received (Note 16)

19,51920,062

128,926

Suspense receipt of consumption taxes

23,96017,939158,258

Other

7,064

9,040

46,655

146,367

129,048966,761

5,124

3,115

33,845

Allowance for losses on construction contracts

Total current liabilities
Long-term liabilities:
Long-term debt (Notes 7, 13,14 and 15)
Non-recourse loans (Notes 7, 14, 15 and 16)

22,33426,003

147,516

Deferred tax liabilities (Note 10)18,74011,999123,780

150

—

992

Provision for share awards

461

347

3,042

Total long-term liabilities

46,80941,464309,175

Total liabilities

193,176

170,5121,275,936

Other

Commitments and contingent liabilities
Equity (Notes 9, 17 and 19):
Common stock
19,83919,839131,036

Capital surplus

26,467

26,240174,814Retained earnings

107,685

103,827

711,261(5,317)(5,185)(35,118)

34,97724,802231,020

Deferred gain on hedges

3,840

1,830

25,364

Defined retirement benefit plans

1,201

662

7,934

Total

40,01827,294

264,318

Noncontrolling interests

2,882

1,201

19,037authorized, 96,000,000 shares; issued, 38,665,226 shares

Treasury stock—at cost
1,837,409 shares in 2024* and 1,860,310 shares in 2023
Accumulated other comprehensive income:Unrealized gain on available-for-sale securities

Total equity

191,574

173,216

1,265,348

Total¥384,750¥343,728$2,541,284*The number of shares of treasury stock as of March 31, 2024 includes 275,000 shares of the Company held by the trust account of Employee Share Award Plan.

11

Consolidated Statement of Income
Okumura Corporation and Consolidated Subsidiaries
Year Ended March 31, 2024

Millions of Yen

Thousands of
U.S. Dollars(Note 1)

2024

2023

2024

¥288,147
252,955
35,192¥249,443
217,442
32,001$1,903,213
1,670,771
232,442

Selling, general and administrative expenses (Note 12)
Operating income

21,484
13,70820,154
11,847

141,899
90,543

Other income (expenses):
Interest and dividend income
Interest expense
Gain on sale of investment securities
Other—net
Other income —net

1,300
(606)
3,206
564
4,464

1,190
(550)
3,056
(207)
3,489

8,588
(4,005)
21,175
3,725
29,483

Income before income taxes

18,172

15,336

120,026

Income taxes (Note 10):
Current
Deferred
Total income taxes

5,770
238
6,008

4,693
100
4,793

38,115
1,570
39,685

12,164(329)¥ 12,493

10,543(719)¥ 11,262

80,341(2,176)82,517

Net sales
Cost of sales
Gross profit

12

Net income
Net loss attributable to noncontrolling interests
Net income attributable to owners of the parent

Per share of common stock (Notes 2.p,18 and 19):
Basic net income
Cash dividends applicable to the year
See notes to consolidated financial statements.

¥ 339.30
237.00$Yen

U.S. Dollars(Note 1)

¥ 306.08
223.00$ 2.24
1.57

Consolidated Statement of Comprehensive Income
Okumura Corporation and Consolidated Subsidiaries
Year Ended March 31, 2024

Net income
Other comprehensive income (Note 17):
Unrealized gain on available-for-sale securities
Deferred gain on hedges
Defined retirement benefit plans
Total other comprehensive income
Comprehensive income
Total comprehensive income attributable to:
Owners of the parent
Noncontrolling interests
See notes to consolidated financial statements.

Okumura Corporation Annual Report 2024

Millions of Yen

Thousands of
U.S. Dollars(Note 1)

2024

2023

2024

¥12,164¥10,543$ 80,341

10,1754,020
539
14,734¥26,898

136
1,461
(803)
794
¥11,337

67,20726,555
3,559
97,321$177,662¥25,217
1,681¥11,325
12$166,561
11,101

13

Consolidated Statement of Changes in Equity
Okumura Corporation and Consolidated Subsidiaries
Year Ended March 31, 2024

Thousands

Millions of Yen
Accumulated othercomprehensive income (loss)

Number ofshares ofcommonstock
outstanding

14

BALANCE, APRIL 1, 2022
Net income attributable to owners of the parent
Cash dividends, ¥173 per share
Purchase of treasury stock
Disposal of treasury stock
Cancellation of treasury stock*1
Net change in the year
BALANCE, MARCH 31, 2023
Net income attributable to owners of the parent
Cash dividends, ¥234 per share
Purchase of treasury stock*2
Disposal of treasury stock*3
Net change in the year
BALANCE, MARCH 31, 2024

36,773
—
—
(2)
34
—
—
36,805
—
—
(278)
301
—
36,828

Commonstock

Unrealized
gain onavailableCapital Retained Treasury
for-salesurplus earnings
stock securities¥19,839 ¥26,240 ¥101,711 ¥(8,062) ¥24,666—— 11,262————(6,364)
—
—
—
—
—
(5)
—
—
6
—
94
—
—
(6) (2,782)
2,788
—
—
—
—
—
136
19,839 26,240 103,827 (5,185) 24,802—— 12,493———— (8,635)
—
—
—
—
—
(971)
—
—
227
—
839
—
—
—
—
— 10,175¥19,839 ¥26,467 ¥107,685 ¥(5,317) ¥34,977

DefinedDeferred retirement
gain onbenefit Noncontrollinginterests
hedgesplans¥1,099
—
—
—
—
—
731
1,830
—
—
—
—
2,010
¥3,840¥1,465
—
—
—
—
—
(803)
662
—
—
—
—
539
¥1,201Total
equity¥467 ¥167,425—
11,262—(6,364)
—
(5)
—
100
—
—
734
798
1,201 173,216—
12,493—(8,635)
—
(971)
—
1,066
1,681
14,405¥2,882 ¥191,574

Thousands of U.S. Dollars(Note 1)
Accumulated othercomprehensive income

Commonstock

BALANCE, MARCH 31, 2023
Net income attributable to owners of the parent
Cash dividends, $1.55 per share
Purchase of treasury stock*2
Disposal of treasury stock*3
Net change in the year
BALANCE, MARCH 31, 2024

Unrealized
gain onavailableCapital Retained Treasury
for-salesurplus earnings
stock securities$131,036 $173,318 $685,781 $(34,250) $163,813—— 82,517———— (57,037)
—
—
—
—
—
(6,415)
—
—
1,496
—
5,547
—
—
—
—
— 67,207$131,036 $174,814 $711,261 $(35,118) $231,020

DefinedDeferred retirement
gain onbenefit Noncontrollinginterests
hedgesplans$12,086————
13,278$25,364

Total
equity$4,375 $7,936 $1,144,095——
82,517——(57,037)——(6,415)——
7,043
3,559 11,101
95,145$7,934 $19,037 $1,265,348

See notes to consolidated financial statements.
*1 The Company cancelled some treasury stock (1 million shares) on April 5, 2022.
*2 Purchase of treasury stock for the year ended March 31, 2024 includes the acquisition of 275,000 shares of the Company by the trust account of Employee Share
Award Plan.
*3 Disposal of treasury stock for the year ended March 31, 2024 includes the disposal of 275,000 shares of treasury stock through a third-party allotment associatedwith the introduction of Employee Share Award Plan.

Consolidated Statement of Cash Flows
Okumura Corporation and Consolidated Subsidiaries
Year Ended March 31, 2024

Okumura Corporation Annual Report 2024

Millions of Yen

Thousands of
U.S. Dollars(Note 1)

2024

2023

2024

¥18,172¥15,336$120,026(5,399)4,341
30(3,206)(3,388)2,302
30(3,024)(35,658)
28,671
196(21,175)(39,869)
(514)
(672)
1,921
6,567
(314)
(542)
2,346
(35,311)(17,139)

9,841
(568)
(878)
3,095
1,058
(515)
(5,549)161
2,565
17,901(263,335)(3,396)(4,439)12,68743,375(2,072)(3,582)
15,497(233,231)(113,205)

Investing activities:
Net decrease in time deposits
Payments for purchases of securities
Proceeds from sales of securities
Purchases of property, plant and equipment and intangible assets
Proceeds from sales of property, plant and equipment and intangible assets
Investment in loans receivableCollection of loans receivable
Other—net
Net cash provided by investing activities

205
(209)
4,210
(2,993)
355
(3)
13
(120)
1,458

140
(761)
5,592
(4,115)
19
—
13
(115)
773

1,354
(1,377)27,806(19,769)
2,344
(21)
87
(792)
9,632

Financing activities:
Increase (decrease) in short-term bank loans—net
Proceeds from long-term debt
Repayments of long-term debt
Proceeds from non-recourse loans
Repayments of non-recourse loans
Purchase of treasury stock
Disposal of treasury stock
Dividends paid
Proceeds from share issuance to noncontrolling shareholders
Other—net
Net cash used in financing activities

9,993
2,000
(4,002)—(3,669)(14)
1(8,610)—(3)(4,304)

(833)
2,000
(2,002)
5,947(1,007)(30)
0(6,368)722(1)(1,572)66,006
13,210(26,433)—(24,236)(91)
4(56,872)—(18)(28,430)

110(19,875)
48,793¥28,918

69
17,171
31,622¥48,793727(131,276)
322,278$191,002

Operating activities:
Income before income taxes
Adjustments for:
Income taxes—paidDepreciation and amortization
Amortization of goodwill
Gain on sale of investment securities
Changes in assets and liabilities:
Decrease (increase) in trade notes and accounts receivable
Increase in accumulated costs of construction projects in progress
Increase in other inventories
Increase in trade notes and accounts payable
Increase in advances received on construction projects in progress
Increase in asset for retirement benefits
Decrease in deposits received
Other—net
Total adjustments
Net cash provided by (used in) operating activities

Foreign currency translation adjustments on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents, beginning of year
Cash and cash equivalents, end of year
See notes to consolidated financial statements.

15

Notes to Consolidated Financial Statements
Okumura Corporation and Consolidated Subsidiaries
Year Ended March 31, 2024

16

1. Basis of Presentation of Consolidated Financial
Statements
The accompanying consolidated financial statements havebeen prepared in accordance with the provisions set forth in
the Japanese Financial Instruments and Exchange Act and its
related accounting regulations and in accordance withaccounting principles generally accepted in Japan, which are
different in certain respects as to the application and disclosure requirements of IFRS Accounting Standards.
In preparing these consolidated financial statements,
certain reclassifications and rearrangements have been madeto the consolidated financial statements issued domesticallyin order to present them in a form which is more familiar toreaders outside Japan. In addition, certain reclassifications
have been made in the 2023 consolidated financial statements to conform to the classifications used in 2024.
The consolidated financial statements are stated inJapanese yen, the currency of the country in which Okumura
Corporation (the “Company”) is incorporated and operates.
The translations of Japanese yen amounts into U.S. dollar
amounts are included solely for the convenience of readers
outside Japan and have been made at the rate of ¥151.40 to$1, the approximate rate of exchange at March 31, 2024.
Such translations should not be construed as representations
that the Japanese yen amounts could be converted into U.S.
dollars at that or any other rate.
2. Summary of Significant Accounting Policies
a. Consolidation — The consolidated financial statements
as of March 31, 2024, include the accounts of the Company
and its 4 (4 in 2023) significant subsidiaries (together, the“Group”).
Under the control and influence concepts, those companies in which the Company, directly or indirectly, is able toexercise control over operations are fully consolidated, andthose companies over which the Group has the ability to
exercise significant influence are accounted for by the equity
method.
Investments in 7 (9 in 2023) unconsolidated subsidiaries
and 6 (6 in 2023) associated companies are stated at cost. If
the equity method of accounting had been applied to theinvestments in these companies, the effect on the accompanying consolidated financial statements would not be material.
The excess of the cost of acquisition over the fair valueof the net assets of an acquired subsidiary at the date ofacquisition is amortized over a period of 17 years.
All significant intercompany balances and transactions
have been eliminated in consolidation. All material unrealized
profit included in assets resulting from transactions within theGroup is also eliminated.
b. Cash Equivalents — Cash equivalents are short-term
investments that are readily convertible into cash andexposed to insignificant risk of changes in value.
Cash equivalents include time deposits, certificates ofdeposit and commercial paper, all of which mature or
become due within 3 months of the date of acquisition.
c. Inventories — Construction projects in progress and workin process are stated at cost, determined by the specific identification method.

Real estate held for sale and development projects inprogress are stated at the lower of cost, determined by the
specific identification method, or net selling value, which isdefined as the selling price less additional estimated manufacturing costs and estimated direct selling expenses.
Raw materials and supplies are stated at the lower ofcost, determined by the weighted average method, or net
selling value.
d. Marketable and Investment Securities — Marketable
and investment securities are classified and accounted for,depending on management’s intent, as follows:(1) held-to-maturity debt securities, for which there is a positive intent and ability to hold to maturity, are reported atamortized cost; and(2) available-for-sale securities, which are not classified as
held-to-maturity are reported at fair value, with unrealized
gains and losses, net of applicable taxes, reported in a separate component of equity.
Nonmarketable available-for-sale securities, which do
not have a market price, are stated at cost determined by themoving-average method. For other-than-temporary declines
in fair value, investment securities are reduced to net realizable value by a charge to income.
Investments in limited partnerships, which are considered securities under Article 2, Clause 2 of the Japanese
Financial Instruments and Exchange Act, are recorded underthe equity method and based on the latest consolidated
financial statements available on the reportable date ruled by
the partnership contracts.
e. Property, Plant and Equipment — Property, plant andequipment are stated at cost. Depreciation, except for leaseassets, is computed by the declining-balance method basedon the estimated useful lives of the assets, while the straightline method is applied to buildings acquired on or after April
1, 1998, and building improvements and structures acquiredon or after April 1, 2016, and lease assets. The range of useful lives is principally from 3 to 60 years for buildings andstructures, from 2 to 17 years for machinery and equipment,
and from 2 to 15 years for furniture and fixtures. Lease assets
under finance lease arrangements are depreciated using thestraight-line method over the terms of the respective leases
without any salvage value.
Accumulated depreciation totaled ¥23,418 million($154,677 thousand) and ¥19,762 million as of March 31,
2024 and 2023, respectively.
f. Long-Lived Assets — The Group reviews its long-lived
assets for impairment whenever events or changes in circumstance indicate the carrying amount of an asset or asset
group may not be recoverable. An impairment loss is recognized if the carrying amount of an asset or asset groupexceeds the sum of the undiscounted future cash flows
expected to result from the continued use and eventual disposition of the asset or asset group. The impairment loss
would be measured as the amount by which the carrying
amount of the asset exceeds its recoverable amount, which is
the higher of the discounted cash flows from the continued
use and eventual disposition of the asset or the net selling
price at disposition.

Okumura Corporation Annual Report 2024

g. Allowance for Doubtful Receivables — The allowancefor doubtful receivables is stated in amounts considered to beappropriate based on the Group’s past credit loss experienceand an evaluation of estimated losses in the receivables outstanding.
h. Allowance for Warranty Work on Construction
Projects — The allowance for warranty costs for completed
work is provided at the amount of warranty costs based on
past loss experience.
i. Allowance for Losses on Construction Contracts — An
allowance for losses on construction contracts is provided
with respect to construction projects for which eventual losses are reasonably expected and estimated.
j. Provision for Share Awards — Provision for share awards
is provided at the estimated amount of share award obligations to provide for granting shares of the Company toemployees based on the share award regulations, etc.
k. Employees’ Retirement Benefits — The Company andcertain consolidated subsidiaries have a contributory fundedpension plan covering substantially all of their employees.
The Company and certain consolidated subsidiaries
account for the liability for retirement benefits based on the
projected benefit obligations and plan assets at the balance
sheet date. The projected benefit obligations are attributed toperiods on a benefit formula basis. Actuarial gains and losses
and past service costs that are yet to be recognized in profit
or loss are recognized within equity (accumulated other comprehensive income), after adjusting for tax effects, and arerecognized in profit or loss over 10 years but no longer thanthe expected average remaining service period of theemployees.
l. Asset Retirement Obligations — An asset retirement
obligation is recorded for a legal obligation imposed either by
law or contract that results from the acquisition, construction, development and normal operation of a tangible fixed
asset and is associated with the retirement of such tangible
fixed asset. The asset retirement obligation is recognized as
the sum of the discounted cash flows required for the future
asset retirement and is recorded in the period in which the
obligation is incurred if a reasonable estimate can be made. If
a reasonable estimate of the asset retirement obligation cannot be made in the period the asset retirement obligation isincurred, the liability should be recognized when a reasonable estimate of the asset retirement obligation can be made.
Upon initial recognition of a liability for an asset retirement
obligation, an asset retirement cost is capitalized by increasing the carrying amount of the related fixed asset by theamount of the liability. The asset retirement cost is subsequently allocated to expense through depreciation over theremaining useful life of the asset. Over time, the liability is
accreted to its present value each period. Any subsequent
revisions to the timing or the amount of the original estimateof undiscounted cash flows are reflected as an adjustment tothe carrying amount of the liability and the capitalized
amount of the related asset retirement cost.

m. Construction Contracts — Regarding the construction
business, the primary business of the Group, the Group recognizes revenue when control of promised goods or services
is transferred to a customer.
The performance obligations for construction contracts
in the construction business are mainly construction anddelivery of buildings, etc. When control of goods or services
is transferred to a customer over time, the Group recognizes
revenue over time as the performance obligation is satisfied
by transferring promised goods or services to a customer. The
progress toward complete satisfaction of a performance obligation is measured based on the proportion of construction
costs incurred by the end of the reporting period to the total
expected construction costs.
In some circumstances such as the first stage of a contract, if the Group may not be able to reasonably measure
the progress toward complete satisfaction of a performanceobligation but expect to recover the costs, the Group applies
the cost recovery method.
Regarding construction contracts whose periods are very
short from the initial transaction date of the contract to the
expected date of completely satisfying performance obligations, the Group does not recognize revenue over time, but
recognizes revenue when the performance obligations are
satisfied completely (the time of completing and delivering
constructions).
n. Income Taxes — The provision for income taxes is computed based on the pretax income included in the consolidated statement of income. The asset and liability approach isused to recognize deferred tax assets and liabilities for the
expected future tax consequences of temporary differences
between the carrying amounts and the tax bases of assets
and liabilities. Deferred taxes are measured by applying currently enacted income tax rates to the temporary differences.
o. Derivatives and Hedging Activities — The Group uses
derivative financial instruments to manage its exposures tofluctuations in foreign exchange and interest rates. Foreign
currency forward contracts are utilized by the Group to
reduce foreign currency exchange rate risks on foreign currency denominated trade payables for imported materials. In
addition, interest rate swaps are utilized by the Group to
reduce interest rate risks on long-term loans. The Group does
not enter into derivatives for trading or speculative purposes.
Interest rate swaps that qualify for hedge accounting
and meet specific matching criteria are not remeasured atmarket value, but the differential paid or received under theswap agreements is recognized and included in interest
expense or income.
p. Per Share Information — Basic net income per share iscomputed by dividing net income attributable to commonshareholders by the weighted-average number of commonshares outstanding for the period.
Diluted net income per share is not presented as there
are no dilutive potential shares.
Cash dividends per share presented in the accompanying consolidated statement of income are dividends applicable to the respective fiscal years, including dividends to be
paid after the end of the year.

17

18

q. Accounting Policy Disclosures, Accounting Changes
and Error Corrections — Under Accounting Standards
Board of Japan (“ASBJ”) Statement No. 24, “AccountingStandard for Accounting Policy Disclosures, Accounting
Changes and Error Corrections,” and ASBJ Guidance No. 24,“Guidance on Accounting Standard for Accounting Policy
Disclosures, Accounting Changes and Error Corrections,”
accounting treatments are required as follows:(1) Changes in Accounting Policies:
When a new accounting policy is applied following revisionof an accounting standard, the new policy is applied retrospectively unless the revised accounting standard includes
specific transitional provisions, in which case the entity shallcomply with the specific transitional provisions.
(2) Changes in Presentation:
When the presentation of financial statements is changed,
prior-period financial statements are reclassified in accordance with the new presentation.
(3) Changes in Accounting Estimates:
A change in an accounting estimate is accounted for in the
period of the change if the change affects that period only,
and is accounted for prospectively if the change affects boththe period of the change and future periods.
(4) Corrections of Prior-Period Errors:
When an error in prior-period financial statements is discovered, those statements are restated.
r. Accounting Policies and Procedures Which Are
A d o p t e d W h e n t h e P ro v i s i o n s o f t h e R e l e v a n t
Accounting Standards Are Not Clear
Accounting for works by joint ventures formed, in order totake orders and carry out the works jointly with several constructors, are incorporated in the consolidated financial statements according to the proportion of investment equities.
s. Additional Information
Employee Share Award Plan
(1) Outline of the Transaction
The Company has introduced the “Employee Share Award
Plan” (hereinafter, the “Plan” and the trust established basedon the trust agreement concluded with Resona Bank, Limited
associated with the Plan shall be referred to as the “Trust”) as
an incentive plan for the Company’s employees effective April
1, 2023.
The Plan involves the Trust established by the Company
through monetary contributions, which acquire shares of theCompany. Based on the “Share Award Regulations” prescribed in advance by the Board of Directors of the Company,
the Trust provides shares of the Company and cash equivalent to the market value of shares of the Company (hereinafter collectively referred to as “Shares of the Company, etc.”)
to employees who satisfy certain beneficiary requirements.
Under the Plan, the Company awards points to eligible
employees on the basis of their performance evaluations andother criteria in accordance with the Share Award
Regulations. If employees satisfy the specified beneficiary
requirements, the Company grants Shares of the Company,
etc. equivalent to the awarded points. Since the Company
contributes all the money necessary to establish the Trust,
there is no financial burden on employees.
The introduction of the Plan allows employees to gain
economic benefits from a rise in the price of shares of theCompany, encouraging them to work to improve theCompany’s performance with an awareness of the shareprice. Additionally, the voting rights associated with shares of
the Company held in the Trust are exercised based on theintentions of employees who satisfy the beneficiary requirements, so the Plan is expected to foster a sense of participation in management among employees.
(2) Shares of the Company remaining in the Trust
Shares of the Company remaining in the Trust are recorded
as treasury stock in net assets at the carrying value in the
Trust (excluding incidental expenses). The carrying amountand the number of shares of treasury stock were ¥960 million($6,339 thousand) and 275,000 shares as of March 31,
2024, respectively.
3. Significant Accounting Estimates
Revenue Recognition over Time and Allowance forLosses on Construction Contracts(1) Amounts recorded in the consolidated financial statements for the fiscal years ended March 31, 2024 and2023
Millions of Yen
2024
2023

Construction revenues
recognized over time
Allowance for losses on
construction contracts

Thousands of
U.S. Dollars
2024¥263,935 ¥232,023 $1,743,298
859

1,566

5,675

(2) Information about the contents of significant accounting
estimates on the identified items
1) Calculation method
Construction revenues recognized over time are recognized by multiplying the total construction revenue by
progress, which is estimated based on a proportion of
construction costs incurred by the end of each reporting period to the estimated total construction costs.
In addition, when it is probable that the total construction costs will exceed total construction revenue,
an allowance for losses on construction contracts will
be recorded at the expected excess amount (loss on
construction contracts) less the profit or loss alreadyrecognized.
2) Major assumptions
For example, in the event an agreement on consideration for changes in design or scope of a construction
are not timely finalized in the contracts and other documents, the total construction revenue is obtained byestimating consideration based on the details of thechange in works and other matters as instructed.
Total construction costs are estimated mainly considering the market conditions of materials and subcontract
costs and individual risk factors associated with theprogress of works.
These estimates and underlying assumptions are continuously reviewed.
3) Impact on consolidated financial statements for the following fiscal year
Any changes in major assumptions as of March 31,
2024, might affect construction revenue and allowance
for losses on construction contracts for the following
fiscal year.

Okumura Corporation Annual Report 2024

4. Marketable and Investment Securities
Marketable and investment securities as of March 31, 2024 and 2023, consisted of the following:
Millions of Yen
2024
2023

Non-current:
Marketable equity securities
Non-marketable equity securities and otherTotal¥66,600
1,884¥68,484¥52,879
1,819¥54,698

Thousands of
U.S. Dollars
2024$439,892
12,446$452,338

19

The costs and aggregate fair values of marketable and investment securities at March 31, 2024 and 2023, were as follows:
Millions of Yen

March 31, 2024

Securities classified as:
Available-for-sale:
Equity securities

Cost

Unrealized
Gains

Unrealized
LossesFair Value¥17,723¥48,879¥2¥66,600

Cost

Unrealized
Gains

Unrealized
LossesFair Value¥18,682¥34,214¥17¥52,879

Cost

Unrealized
Gains

Unrealized
LossesFair Value$117,062$322,848$18$439,892

Millions of Yen

March 31, 2023

Securities classified as:
Available-for-sale:
Equity securities

Thousands of U.S. Dollars

March 31, 2024

Securities classified as:
Available-for-sale:
Equity securities

The information for available-for-sale securities which were sold during the years ended March 31, 2024 and 2023 is asfollows:
Millions of Yen

March 31, 2024

Available-for-sale:
Equity securities

Proceeds

Realized
Gains

Realized
Losses¥4,180¥3,206¥—

Proceeds

Realized
Gains

Realized
Losses¥5,592¥3,056¥33

Proceeds

Realized
Gains

Realized
Losses$27,609$21,175$—

Millions of Yen

March 31, 2023

Available-for-sale:
Equity securities

Thousands of U.S. Dollars

March 31, 2024

Available-for-sale:
Equity securities
No impairment loss was recognized for the year ended March 31, 2024.

The impairment losses on unlisted available-for-sale equity securities for the year ended March 31, 2023, were ¥19 million.

5. Inventories
Inventories at March 31, 2024 and 2023, consisted of the following:
Millions of Yen
2024
2023

20

¥3,695
934
1,960
927
582
¥8,098Construction projects in progress
Real estate held for sale
Development projects in progress
Work in process
Raw materials and supplies
Total¥3,181
959
796
1,231
745
¥6,912Thousands of
U.S. Dollars
2024$24,406
6,167
12,947
6,122
3,847$53,489

6. Investment Property
The Group owns certain rental properties such as residential buildings, warehouses, and land in Osaka and other areas. Somerental warehouses leased to third parties of which the Company utilizes a part are classified as rental properties in part.
The net of rental income and operating expenses for those rental properties was ¥3,109 million ($20,536 thousand) and¥3,205 million for the years ended March 31, 2024 and 2023, respectively.
In addition, the carrying amounts, changes in such balances and market prices of such properties were as follows:

Rental properties
Rental properties in part
Total

Rental properties
Rental properties in part
Total

April 1,
2023

¥34,128
1,112¥35,240

April 1,
2022

¥34,334
1,144¥35,478

Increase/
Decrease

¥974
(32)
¥942

Increase/
Decrease¥(206)(32)¥(238)

Carrying AmountMillions of Yen
Fair Value

March 31,2024

March 31,2024

Carrying AmountMillions of Yen
Fair Value

March 31,2023

March 31,2023

¥35,102
1,080¥36,182¥34,128
1,112¥35,240¥72,678
2,042¥74,720¥65,375
2,025¥67,400

Thousands of U.S. Dollars
Carrying Amount
Fair Value

Rental properties
Rental properties in part
Total

April 1,
2023

$225,418
7,346$232,764

Increase/
Decrease$6,428(212)$6,216

March 31,2024

$231,846
7,134$238,980

March 31,2024

$480,041
13,484$493,525

Notes:(1) Carrying amount recognized in the consolidated balance sheets is net of accumulated depreciation and accumulated
impairment losses, if any.
(2) Fair value of properties as of March 31, 2024 and 2023 is measured in accordance with real-estate appraisal performed byreal-estate appraisers for primary properties. The amount measured by the Group is in accordance with its Real-EstateAppraisal Standard for other properties (including those measured using indicators).

Okumura Corporation Annual Report 2024

7. Short-Term Bank Loans and Long-Term Debt
Short-term bank loans at March 31, 2024 and 2023, consisted of bank overdrafts. The annual interest rates applicable to theshort-term bank loans ranged from 0.5% to 1.1% at March 31, 2024 and 0.7% to 4.5% at March 31, 2023.
Long-term debt at March 31, 2024 and 2023, consisted of the following:

Loans from banks and other financial institutions, due serially to 2037
with interest rates ranging from 0.5% to 6.0%
UnsecuredNon-recourse loans
Obligations under finance leases
Total
Less current portionLong-term debt, less current portion

Millions of Yen

Thousands of
U.S. Dollars

2024

2023

2024

¥ 5,110
22,33422
27,466(8)¥27,458¥ 7,11226,003
7
33,122(4,004)¥29,118$ 33,752
147,516
145
181,413(52)$181,361

Millions of Yen

Thousands of
U.S. Dollars

Annual maturities of long-term debt, excluding finance leases, at March 31, 2024, were as follows:Year Ending March 31

2025
2026
2027
2028
2029
2030 and thereafter
Total

¥

2
4,836
1,858
3,586
3,584
13,578¥27,444$13
31,944
12,271
23,684
23,672
89,684$181,268

Assets pledged as collateral for non-recourse debt
Millions of Yen

Thousands of
U.S. Dollars

2024

2023

2024

Amount of business assets of a consolidated subsidiary engaged in renewable energy¥41,866
business pledged as collateral for non-recourse loans¥40,367$276,526

21

8. Employees’ Retirement Benefits
The Company and certain consolidated subsidiaries have a cash balance plan (pension plan linked to the market interest rates)
based on the Defined Benefit Corporate Pension Law.
(1) The changes in defined benefit obligations for the years ended March 31, 2024 and 2023, were as follows:

22

Balance at beginning of year
Current service costs
Interest costs
Actuarial losses
Benefits paid
Past service costs
Balance at end of year

2024

Millions of Yen
2023

Thousands of
U.S. Dollars
2024¥20,832
1,283
104
21
(662)
—
¥21,578¥19,894
1,220
100
10
(765)
373
¥20,832$137,595
8,476
688
139
(4,374)—$142,524

2024

Millions of Yen
2023

Thousands of
U.S. Dollars
2024¥25,267
227
1,183
1,088
(662)
¥27,103¥24,971
225
(218)
1,054
(765)
¥25,267$166,889
1,502
7,811
7,190
(4,374)$179,018(2) The changes in plan assets for the years ended March 31, 2024 and 2023, were as follows:

Balance at beginning of year
Expected return on plan assets
Actuarial gains (losses)
Contributions from the employer
Benefits paid
Balance at end of year

(3) Reconciliation between the liability recorded in the consolidated balance sheet and the balances of defined benefit
obligation and plan assets was as follows:

Defined benefit obligation
Plan assets
Total
Unfunded defined benefit obligation
Net asset arising from defined benefit obligation

Asset for retirement benefits
Net asset arising from defined benefit obligation

2024

Millions of Yen
2023

Thousands of
U.S. Dollars
2024¥ 21,578(27,103)(5,525)—¥ (5,525)¥ 20,832(25,267)(4,435)—¥ (4,435)$ 142,524(179,018)(36,494)—$ (36,494)

2024

Millions of Yen
2023

Thousands of
U.S. Dollars
2024¥(5,525)¥(5,525)¥(4,435)¥(4,435)$(36,494)$(36,494)(4) The components of net periodic benefit costs for the years ended March 31, 2024 and 2023, were as follows:

Service costs
Interest costs
Expected return on plan assets
Recognized actuarial gains
Amortization of past service costs
Net periodic benefit costs

2024

Millions of Yen
2023

Thousands of
U.S. Dollars
2024¥1,283
104
(227)
(385)
0
¥ 775

¥1,220
100
(225)
(527)
(28)
¥ 540

$ 8,476688(1,502)(2,547)3$ 5,118

Okumura Corporation Annual Report 2024

(5) Amounts recognized in other comprehensive income (before income tax effect)in respect of defined retirement benefit plans
for the years ended March 31, 2024 and 2023, were as follows:

Actuarial gains (losses)
Past service costs
Total

2024

Millions of Yen
2023

Thousands of
U.S. Dollars
2024

¥777
0
¥777

¥ (756)(401)¥(1,157)$5,1253$5,128(6) Amounts recognized in accumulated other comprehensive income (before income tax effect) in respect of defined retirement
benefit plans as of March 31, 2024 and 2023, were as follows:

Unrecognized actuarial gains
Unrecognized past service costs
Total

2024

Millions of Yen
2023

Thousands of
U.S. Dollars
2024¥(1,873)142¥(1,731)¥(1,097)
143¥ (954)$(12,371)
939$(11,432)(7) Plan assets
a. Components of plan assets
Plan assets as of March 31, 2024 and 2023, consisted of the following:
Debt investments
Equity investments
Life insurance general account assets
Others
Total

2024

2023

38%
15
30
17
100%

43%
11
32
14
100%

b. Method of determining the expected rate of return on plan assets
The expected rate of return on plan assets is determined considering allocation of plan assets, which are expectedcurrently and in the future, and the long-term rates of return which are expected currently and in the future from thevarious components of the plan assets.
(8) Assumptions used for the years ended March 31, 2024 and 2023, are set forth as follows:
Discount rate
Expected rate of return on plan assets

2024

2023

0.5%
0.9

0.5%
0.9

23

24

9. Equity
Japanese companies are subject to the Companies Act of Japan (the “Companies Act”). The significant provisions in the
Companies Act that affect financial and accounting matters are summarized below:
a. Dividends
Under the Companies Act, companies can pay dividends at any time during the fiscal year in addition to the year-end dividend upon resolution at the shareholders’ meeting. Additionally, for companies that meet certain criteria including (1) having
a Board of Directors, (2) having independent auditors, (3) having an Audit and Supervisory Committee, and (4) the term ofservice of the directors being prescribed as one year rather than the normal two-year term by its articles of incorporation, theBoard of Directors may declare dividends (except for dividends-in-kind) at any time during the fiscal year if the Company hasprescribed so in its articles of incorporation. However, the Company does not meet all the above criteria.
The Companies Act permits companies to distribute dividends-in-kind (noncash assets) to shareholders subject to a certain limitation and additional requirements.
Semiannual interim dividends may also be paid once a year upon resolution by the Board of Directors if the articles ofincorporation of the company so stipulate. The Companies Act provides certain limitations on the amounts available for dividends or the purchase of treasury stock. The limitation is defined as the amount available for distribution to the shareholders,
but the amount of net assets after dividends must be maintained at no less than ¥3 million.
b. Increases/Decreases and Transfer of Common Stock, Reserve and Surplus
The Companies Act requires that an amount equal to 10% of dividends must be appropriated as a legal reserve (a component of retained earnings) or as additional paid-in capital (a component of capital surplus), depending on the equity accountcharged upon the payment of such dividends, until the aggregate amount of legal reserve and additional paid-in capitalequals 25% of the common stock. Under the Companies Act, the total amount of additional paid-in capital and legal reserve
may be reversed without limitation. The Companies Act also provides that common stock, legal reserve, additional paid-in
capital, other capital surplus and retained earnings can be transferred among the accounts within equity under certain conditions upon resolution of the shareholders.
c. Treasury Stock and Treasury Stock Acquisition Rights
The Companies Act also provides for companies to purchase treasury stock and dispose of such treasury stock by resolutionof the Board of Directors. The amount of treasury stock purchased cannot exceed the amount available for distribution to theshareholders which is determined by a specific formula. Under the Companies Act, stock acquisition rights are presented as aseparate component of equity. The Companies Act also provides that companies can purchase both treasury stock acquisitionrights and treasury stock. Such treasury stock acquisition rights are presented as a separate component of equity or deducted
directly from stock acquisition rights.

Okumura Corporation Annual Report 2024

10. Income Taxes
The Group is subject to Japanese national and local income taxes which, in the aggregate, resulted in a normal effective statutory tax rate of approximately 30.6% for the years ended March 31, 2024 and 2023.
The tax effects of significant temporary differences and tax loss carryforwards which resulted in deferred tax assets and liabilities at March 31, 2024 and 2023, are as follows:

Deferred tax assets:
Tax loss carryforwards (Note)
Impairment losses on securities
Write-down of inventories and others
Allowance for bonuses
Allowance for doubtful accounts
Accrued expenses
Allowance for losses on construction contracts
Other
Less valuation allowance on tax loss carryforward
Less valuation allowance on sum of future deductible temporary difference
Total
Deferred tax liabilities:
Net unrealized gains on available-for-sale securities
Deferred gain on hedges
Retained earnings appropriated for special allowance
Asset for retirement benefits
Total
Net deferred tax liabilities

Millions of Yen

Thousands of
U.S. Dollars

2024

2023

2024

¥ 1,723
1,694
1,215
1,112
647
572
263
733
(1,723)(4,135)
2,101¥ 1,550
1,749
1,134
1,057
639
518
479
632
(1,550)(4,101)
2,107$ 11,380
11,191
8,026
7,342
4,276
3,776
1,737
4,839
(11,380)(27,313)
13,874(13,919)(3,386)(1,843)(1,691)(20,839)¥(18,738)(9,424)(1,614)(1,708)(1,357)(14,103)¥(11,996)(91,933)(22,367)(12,172)(11,167)(137,639)$(123,765)(Note) Tax loss carryforwards and amount of deferred tax assets by maturity
Millions of Yen

March 31, 2024

Tax loss carryforwards*
Valuation allowance
Deferred tax assets

Within one
year

¥3
(3)
—

Over one year Over two years
within two
within three
years
years

¥ 95
(95)
—

¥ 47
(47)
—

Over three Over four years
years within
within five
four years
years Over five years

¥—
—
—

¥ 37
(37)
—

¥ 1,541(1,541)—

Total¥ 1,723(1,723)—
Millions of Yen

March 31, 2023

Tax loss carryforwards*
Valuation allowance
Deferred tax assets

Within one
year

¥—
—
—

Over one year Over two years
within two
within three
years
years

¥3
(3)
—

¥ 95
(95)
—

Over three Over four years
years within
within five
four years
years Over five years

¥ 47
(47)
—

¥—
—
—

¥ 1,405(1,405)—

Total¥ 1,550(1,550)—Thousands of U.S. Dollars

March 31, 2024

Tax loss carryforwards*
Valuation allowance
Deferred tax assets

Within one
year

$ 17
(17)
—

Over one year Over two years
within two
within three
years
years

$ 627
(627)
—

$ 311
(311)
—

Over three Over four years
years within
within five
four years
years Over five years$———* The tax loss carryforwards presented above are the amounts multiplied by the effective statutory tax rate.

$ 245
(245)
—

$ 10,180(10,180)—

Total$ 11,380(11,380)—25

A reconciliation between the normal effective statutory tax rate and the actual effective tax rate reflected in the accompanying consolidated statement of income for the year ended March 31, 2024 was as follows:
2024

26

30.6%
0.6
(0.5)
0.8
(0.9)
1.1
1.4
33.1%

Normal effective statutory tax rate
Expenses not deductible for income tax purposes
Incomes not taxable for income tax purposes
Inhabitant tax per capita
Special income tax credits
Change in valuation allowance
Other—net
Actual effective tax rate

A reconciliation between the normal effective statutory tax rate and the actual effective tax rate reflected in the accompanying consolidated statement of income for the year ended March 31, 2023 was omitted since the difference was 5% or less ofthe normal effective statutory tax rate.
11. Revenue Recognition(1) Disaggregation of revenue from contracts with customers
Please see Note 20 “Segment Information.”(2) Underlying information in understanding revenue from contracts with customers
Please see Note 2.m. “Construction Contracts.”(3) Satisfaction of performance obligations based on contracts with customers and relationship with cash flows arising fromsuch contracts, and the amount and timing of revenue from contracts with customers existing at the end of the fiscal year
expected to be recognized in the following fiscal years
a. Balances of contract assets and contract liabilities, etc.
Millions of Yen
2024

Receivables from contracts with customers
Contract assets
Contract liabilities

Thousands of U.S. Dollars
2024

2023

BeginningbalanceEndingbalance

BeginningbalanceEndingbalance¥60,545
71,903
12,192¥56,356
115,963
18,799¥52,816
89,474
11,254¥60,545
71,903
12,192BeginningbalanceEndingbalance$399,900 $372,234
474,922765,937
80,531
124,171(Note) 1. Contract assets primarily relate to the right of the Group, primarily based on the construction contracts with customers, to consideration for goods or services for which control has been transferred to a customer. Once theGroup has an unconditional right to consideration, it reclassifies contract assets to receivables from contracts withcustomers. The consideration is charged and received in accordance with the payment term determined with a customer by contract.
2. Contract liabilities primarily relate to advances received from customers based on the payment terms of construction contracts with customers. Contract liabilities that are reversed as revenue is recognized. The beginning balanceof contract liabilities is included in revenue from contracts with customers for the fiscal years ended March 31,
2024 and 2023 in its almost entirety.
3. The amount of revenue recognized in the fiscal years ended March 31, 2024 and 2023 from performance obligations that were satisfied (or partially satisfied) in previous periods (mainly fluctuations of transaction amounts basedon changes in design or scope) is immaterial.

Okumura Corporation Annual Report 2024

b. Transaction prices allocated to remaining performance obligations
The transaction prices allocated to remaining performance obligations that are unsatisfied as of March 31, 2024 and2023 amounted to ¥538,295 million (*1,2) ($3,555,448 thousand) and ¥468,149 million (*1, 2), respectively, and revenue is expected to be recognized within approximately 5 years.
*1 The transaction prices describe the price allocated to the remaining performance obligations for the construction business, the primary business of the Group.
*2 The transaction prices include the changes in design or scope for which an agreement on the consideration is notdetermined in the contracts and other documents. The transaction prices for the changes in design or scope are estimated based on the details of the change in works and other matters as instructed.
12. Research and Development Costs
Research and development costs charged to income were ¥1,805 million ($11,920 thousand) and ¥1,771 million for the years
ended March 31, 2024 and 2023, respectively.
13. Leases
Operating leases
Future minimum lease receivables or payments under noncancelable operating leases at March 31, 2024 and 2023, were as
follows:

As a lessor:
Due within one year
Due after one year
Total
As a lessee:
Due within one year
Due after one year
Total

Millions of Yen

Thousands of
U.S. Dollars

2024

2023

2024

¥ 2,228
16,366¥18,594¥ 2,302
17,930¥20,232$ 14,714
108,099$122,813

¥

¥

$

262
1,245
¥ 1,507

¥

88
630
718

$

1,734
8,223
9,957

27

14. Financial Instruments and Related Disclosures(1) Disclosures on financial instruments
1) Group policy for financial instruments
At the Group level, cash surpluses, if any, are invested in low-risk financial assets. Short-term bank loans are used to fundits ongoing operations. Derivatives are not used for speculative purposes, but to manage its exposure to fluctuations inforeign currency exchange and interest rates.

282) Nature and extent of risks arising from financial instruments
Receivables, such as trade notes and trade accounts, are exposed to customer credit risk. Marketable and investment
securities, mainly held-to-maturity securities and equity instruments of customers and suppliers of the Group, are exposedto the risk of market price fluctuations.
Payment terms of payables, such as trade notes and trade accounts, are mostly less than one year.
Bank loans are utilized to finance principally working capital and non-recourse loans are used for financing therenewable energy business of a consolidated subsidiary.
3) Risk management for financial instruments
Credit risk management
Credit risk is the risk of economic loss arising from a counterparty’s failure to repay or service debt according to the contractual terms. The Group manages its credit risk from receivables based on internal guidelines, which include
continuously determining customers’ circumstances from the phase of accepting orders to that of collection of the receivables, along with monitoring of payment terms and balances of each transaction.
Market risk management (foreign exchange risk and interest rate risk)
Marketable and investment securities are managed by monitoring market values and the financial position of issuers on aregular basis. Also, the Group continuously reviews its possession of those securities, except for held-to-maturity securities.
Payables denominated in foreign currencies in association with import of materials for renewable energy business are
exposed to fluctuations in foreign exchange rates. The Group utilizes derivative instruments (comprehensive long-term foreign currency forward contracts) as hedging instruments to manage these market risks.
Bank loans with floating interest rates are exposed to fluctuations in interest rates. With respect to non-recourse
loans, the Group utilizes derivatives (interest rate swaps) by individual contract as hedging instruments to avoid the fluctuation risk of interest expenses and fix interest expenses. The hedge accounting method is described in Note 2.o.
Please see Note 15 for more details about derivatives.

Liquidity risk management
Liquidity risk comprises the risk that the Group cannot meet its contractual obligations in full on maturity dates. The
Group manages its liquidity risk by making the appropriate cash schedule on a monthly basis.

Okumura Corporation Annual Report 2024

(2) Fair value of financial instruments
Millions of Yen

Carrying
AmountFair Value

Unrealized
Gain/Loss

Receivables—trade notes and accounts
Allowance for doubtful receivables (*4)
Net
Investment securities (*3)
Available-for-sale securities
Long-term loans receivable
Allowance for doubtful long-term loans receivable (*4)
Net
Total

¥172,324(184)
172,140¥172,012¥(128)

66,60049(0)49¥238,789

66,600—46¥238,658(3)¥(131)

Lease liabilities
Long-term bank loans
Non-recourse loans
Total
Derivatives (*5)

¥

¥

¥

March 31, 2024

22
5,100
22,334¥ 27,456¥ 11,307

21
5,076
21,922¥ 27,019¥ 11,307

(1)
(24)
(412)
¥(437)¥ —(*1) The fair value of “Cash and cash equivalents,” “Time deposits,” “Payables – Trade notes, accounts, etc.” and “Short-termloans” is omitted because they are cash and the carrying amount approximates the fair value because of their short maturities.
(*2) Investments in equity instruments that do not have a quoted market price in an active market are not included in above“Investment securities.” Such amount of financial instruments (unlisted equity securities) recorded in the consolidated balance sheet was ¥1,388 million.
(*3) Investments in limited partnerships and other similar entities recorded in a net amount of equity equivalents in the consolidated balance sheet are not included. Such investments recorded in the consolidated balance sheet amounted to ¥744 million.
(*4) Allowance for doubtful receivables recorded on “Receivables – trade notes and accounts” or “Long-term loans receivable”
is individually recognized and deducted from such receivables.
(*5) Net receivables and payables generated from derivatives are presented in net amounts and net payables are shown inparentheses.
Millions of Yen

Carrying
AmountFair Value

Unrealized
Gain/Loss

Receivables—trade notes and accounts
Allowance for doubtful receivables (*4)
Net
Investment securities (*3)
Available-for-sale securities
Long-term loans receivable
Allowance for doubtful long-term loans receivable (*4)
Net
Total

¥132,455(137)
132,318¥132,253¥ (65)

52,87992(0)92¥185,289

52,879—88¥185,220(4)¥ (69)

Lease liabilities
Long-term bank loans
Non-recourse loans
Total
Derivatives (*5)

¥

¥

¥

March 31, 2023

7
3,100
26,003¥ 29,110¥ 5,507

7
3,094
25,729¥ 28,830¥ 5,507

(0)
(6)
(274)
¥(280)
¥ —

29

30

(*1) The fair value of “Cash and cash equivalents,” “Time deposits,” “Marketable securities,” “Payables – Trade notes,
accounts, etc.” and “Short-term loans” is omitted because they are cash and the carrying amount approximates the fairvalue because of their short maturities.
(*2) Investments in equity instruments that do not have a quoted market price in an active market are not included in above“Investment securities.” Such amount of financial instruments (unlisted equity securities) recorded in the consolidated balance sheet was ¥1,360 million.
(*3) Investments in limited partnerships and other similar entities recorded in a net amount of equity equivalents in the consolidated balance sheet are not included. Such investments recorded in the consolidated balance sheet amounted to ¥675 million.
(*4) Allowance for doubtful receivables recorded on “Receivables – trade notes and accounts” or “Long-term loans receivable”
is individually recognized and deducted from such receivables.
(*5) Net receivables and payables generated from derivatives are presented in net amounts and net payables are shown inparentheses.
Thousands of U.S. Dollars

Carrying
AmountFair Value

Unrealized
Gain/Loss

Receivables—trade notes and accounts
Allowance for doubtful receivables (*4)
Net
Investment securities (*3)
Available-for-sale securities
Long-term loans receivable
Allowance for doubtful long-term loans receivable (*4)
Net
Total

$1,138,203(1,211)
1,136,992$1,136,145$ (847)439,892
324(0)
324$1,577,208

439,892—

303$1,576,340(21)$ (868)

Lease liabilities
Long-term bank loans
Non-recourse loans
Total
Derivatives (*5)

$

$

$

March 31, 2024

145
33,686
147,516$ 181,347$ 74,679

137
33,525
144,796$ 178,458$ 74,679(8)(161)(2,720)$(2,889)$—(*1) The fair value of “Cash and cash equivalents,” “Time deposits,” “Payables – Trade notes, accounts, etc.” and “Short-termloans” is omitted because they are cash and the carrying amount approximates the fair value because of their short maturities.
(*2) Investments in equity instruments that do not have a quoted market price in an active market are not included in above“Investment securities.” Such amount of financial instruments (unlisted equity securities) recorded in the consolidated balance sheet was $9,170 thousand.
(*3) Investments in limited partnerships and other similar entities recorded in a net amount of equity equivalents in the consolidated balance sheet are not included. Such investments recorded in the consolidated balance sheet amounted to $4,916
thousand.
(*4) Allowance for doubtful receivables recorded on “Receivables – trade notes and accounts” or “Long-term loans receivable”
is individually recognized and deducted from such receivables.
(*5) Net receivables and payables generated from derivatives are presented in net amounts and net payables are shown inparentheses.

Okumura Corporation Annual Report 2024

(Note) 1 Maturity Analysis for Financial Assets and Securities with Contractual Maturities
Millions of Yen

March 31, 2024
Cash and cash equivalents, Time deposits
Receivables—trade notes and accounts
Long-term loans receivable
Total

Due after
5 Years through10 Years

Due after
10 Years—
17,93435¥17,969

¥ —
788
24
¥812

¥—
—
—
¥—

Due after
1 Year through5 Years

Due after
5 Years through10 Years

Due after
10 Years—
37,541
75¥37,616

¥ —
154
29
¥183

¥—
—
—
¥—

Due in 1 Yearor Less

Due after
1 Year through5 Years

Due after
5 Years through10 Years$ 199,790
1,014,542—$1,214,332$—
118,456
230$118,686

Due in 1 Yearor Less¥ 30,248
153,602—¥183,850

Due after
1 Year through5 Years¥

Millions of Yen

March 31, 2023
Cash and cash equivalents, Time deposits
Receivables—trade notes and accounts
Long-term loans receivable
Total

Due in 1 Yearor Less¥ 50,244
94,760—¥145,004¥

Thousands of U.S. Dollars

March 31, 2024
Cash and cash equivalents, Time deposits
Receivables—trade notes and accounts
Long-term loans receivable
Total(Note) 2 Please see Note 7 for annual maturities of long-term debt.

$

—
5,205
160
$5,365Due after
10 Years

$—
—
—
$—

31

32

(3) Fair value information by level within the fair value hierarchy
The fair value of financial instruments is classified into the following three levels according to the observability and materiality of inputs used to measure fair value.
Level 1 fair value: Fair value measured by using quoted prices in active markets for assets or liabilities that are the subject ofthe measurement.
Level 2 fair value: Fair value measured by using observable inputs other than Level 1 inputs.
Level 3 fair value: Fair value measured by using unobservable inputs.
If multiple inputs are used that are significant to the fair value measurement, the fair value measurement is categorized in its
entirety in the level of the lowest priority in the entire measurement.
1) Financial instruments measured at fair values in the consolidated balance sheet
Millions of Yen

March 31, 2024
Investment securities
Available-for-sale securities:
Equity securities
Derivatives
Currency relatedInterest rate related
Total assets

Level 1

Level 2

Level 3

Fair value
Total¥66,600¥—¥—¥66,600——¥66,600

10,869438¥11,307——¥—

10,869438¥77,907
Millions of Yen

March 31, 2023
Investment securities
Available-for-sale securities:
Equity securities
Derivatives
Currency relatedInterest rate related
Total assets

Level 1

Level 2

Level 3

Fair value
Total¥52,879¥—¥—¥52,879——¥52,879

5,180
327¥5,507

—
—
¥—

5,180
327
¥58,386

Thousands of U.S. Dollars

March 31, 2024
Investment securities
Available-for-sale securities:
Equity securities
Derivatives
Currency relatedInterest rate related
Total assets

Level 1

Level 2

Level 3

Fair value
Total$439,892$—$—$439,892——$439,892

71,787
2,892$74,679——$—

71,7872,892$514,571

Okumura Corporation Annual Report 2024

2) Financial instruments not measured at fair values in the consolidated balance sheet
Millions of Yen

March 31, 2024
Receivables—trade notes and accounts
Long-term loans receivable
Total assets
Lease liabilities
Long-term debt
Non-recourse loans
Total liabilities

Level 1

Level 2

Level 3

Fair value
Total

¥—
—
¥—
¥—
—
—
¥—

¥172,012
46¥172,058¥
21
5,076
21,922¥ 27,019

¥—
—
¥—
¥—
—
—
¥—

¥172,012
46¥172,058¥
21
5,076
21,922¥ 27,019
Millions of Yen

March 31, 2023
Receivables—trade notes and accounts
Long-term loans receivable
Total assets
Lease liabilities
Long-term debt
Non-recourse loans
Total liabilities

Level 1

Level 2

Level 3

Fair value
Total

¥—
—
¥—
¥—
—
—
¥—

¥132,253
88¥132,341¥
7
3,094
25,729¥ 28,830

¥—
—
¥—
¥—
—
—
¥—

¥132,253
88¥132,341¥
7
3,094
25,729¥ 28,830

Thousands of U.S. Dollars

March 31, 2024
Receivables—trade notes and accounts
Long-term loans receivable
Total assets
Lease liabilities
Long-term debt
Non-recourse loans
Total liabilities

Level 1

Level 2

Level 3

Fair value
Total

$—
—
$—
$—
—
—
$—

$1,136,145
303$1,136,448$
137
33,525
144,796$ 178,458

$—
—
$—
$—
—
—
$—

$1,136,145
303$1,136,448$
137
33,525
144,796$ 178,458

33

(Note) A description of the valuation techniques and inputs used in the fair value measurements
Investment securities
Listed shares are valued using quoted prices. As listed shares are traded in active markets, their fair values are categorized as
Level 1.
Derivatives
The fair values of interest rate swaps and forward exchange contracts are measured by using the discounted present value
techniques based on observable inputs, such as interest rates and exchange rates, and are categorized as Level 2.

34

Trade notes and accounts receivable
The fair values of these items are measured by using the discounted present value techniques based on the recoverable
amount reflecting credit risk and an interest rate obtained from appropriate indicators such as government bond yields
according to maturity periods, for each receivable amount categorized by a specified period, and are categorized as Level 2
because the impact of unobservable inputs on the fair value is immaterial.
Long-term loans receivable
The fair values of long-term loans receivable are measured separately for each loan agreement using the discounted present
value techniques based on future cash flows and an interest rate obtained by adding the credit spread to appropriate indicators such as government bond yields for each loan agreement, and are categorized as Level 2.
Lease liabilities
The fair values of lease liabilities are measured by using the discounted present value techniques based on the total amountof principals and interests, the remaining period of such liabilities, and an interest rate obtained by adding credit risk, foreach liabilities amount categorized by a specified period, and are categorized as Level 2.
Long-term debt and non-recourse loans
The fair values of these items are measured separately for each loan agreement. The fair values of floating rate borrowings
are measured as carrying value because their rates reflect the market interest rates in a timely manner and their carrying values approximate fair value. The fair values of fixed-rate borrowings are measured by using the discounted present value
techniques based on future cash flows and an interest rate obtained by adding the credit spread to appropriate indicatorssuch as government bond yields. The fair values are categorized as Level 2.

Okumura Corporation Annual Report 2024

15. Derivatives
The Group enters into derivatives, in the normal course of business, to reduce the exposure to fluctuations in foreign exchange
and interest rates. The primary classes of derivatives used by the Group are foreign currency forward contracts and interest rate
swaps.
The Group does not hold or issue derivatives for trading purposes.
Because the counterparties to these derivatives are limited to major financial institutions, the Group does not anticipate
any losses arising from credit risk.
Derivative transactions entered into by the Group have been made in accordance with internal policies which regulate theauthorization and credit limit amount.
Derivative transactions to which hedge accounting is not applied:
There were no derivative transactions to which hedge accounting is not applied at March 31, 2024 and 2023.
Derivative transactions to which hedge accounting is applied:
Millions of Yen

Hedged item

Contract
amountContract
amount due
after one year

Foreign currency forward contracts
Buying: U.S. Dollars

Foreign currency
denominatedforward contracts¥42,914¥39,175¥10,869

Interest rate swaps
Floating-rate receipt, fixed-rate payment

Non-recourse
loans

17,215

15,547438

Hedged item

Contract
amountContract
amount due
after one year

Fair value

Foreign currency forward contracts
Buying: U.S. Dollars

Foreign currency
denominatedforward contracts¥46,625¥42,543¥5,180Interest rate swaps
Floating-rate receipt, fixed-rate payment
Interest rate swaps
Floating-rate receipt, fixed-rate payment

Non-recourse
loans
Short-termbank loans

18,88817,215

326

4,000

—

Note

March 31, 2024

Fair value

Millions of Yen

March 31, 2023

Note: Interest rate swaps which qualify for hedge accounting and meet specific matching criteria are not remeasured at market
value but the differential paid or received under the swap agreement is recognized and included in interest expense or
income. The fair value of such interest rate swaps is included in those of the hedged items (i.e., short-term bank loans).
Thousands of U.S. Dollars

Hedged item

Contract
amountContract
amount due
after one year

Foreign currency forward contracts
Buying: U.S. Dollars

Foreign currency
denominatedforward contracts$283,448$258,748$71,787

Interest rate swaps
Floating-rate receipt, fixed-rate payment

Non-recourse
loans

113,707

102,687

2,892

March 31, 2024

Fair value

35

36

16. Assets Pledged as CollateralLand in the amount of ¥21 million ($137 thousand) is pledged for a deposit received from a lessee related to a fixed-term landleasehold at March 31, 2024. Land in the amount of ¥1,458 million ($9,632 thousand) and buildings in the amount of ¥895
million ($5,909 thousand) are pledged as construction assistance funds pursuant to building lease contracts at March 31, 2024.
Investment securities in the amount of ¥16 million ($104 thousand) and investments in and advances to unconsolidated
subsidiaries and associated companies in the amount of ¥59 million ($386 thousand) are pledged as collateral for contract performance obligation of the private finance initiative (PFI) business, and the loans of an affiliate, respectively, at March 31, 2024.
Time deposits in the amount of ¥1,208 million ($7,982 thousand) are pledged as security for performance obligation of
construction contracts at March 31, 2024.
Assets pledged as collateral for non-recourse debts are business assets of a consolidated subsidiary engaged in renewableenergy business for the amount of ¥41,866 million ($276,526 thousand) at March 31, 2024.
17. Other Comprehensive Income
The components of other comprehensive income for the years ended March 31, 2024 and 2023, were as follows:
Millions of Yen

Thousands of
U.S. Dollars

2023

2024

¥17,873(3,204)
14,669(4,494)¥10,175¥ 3,171(3,023)
148
(12)
¥ 136

$118,054(21,161)
96,893(29,686)$ 67,207¥ 7,667(1,874)
5,793(1,773)¥ 4,020¥ 2,865
(821)
2,044
(583)
¥ 1,461$ 50,638(12,375)
38,263(11,708)$ 26,555¥ 1,162
(385)
777
(238)
¥ 539
¥14,734¥ (592)(565)(1,157)354¥ (803)
¥ 794

$

2024

Unrealized gain on available-for-sale securities
Gain arising during the year
Reclassification adjustments to profit or loss
Amount before income tax effect
Income tax effect
Total
Deferred gain on hedges
Gain arising during the year
Reclassification adjustments to profit or loss
Amount before income tax effect
Income tax effect
Total
Defined retirement benefit plans
Adjustments arising during the year
Reclassification adjustments to profit or loss
Amount before income tax effect
Income tax effectTotal
Total other comprehensive income

7,672(2,544)
5,128(1,569)$ 3,559$ 97,321

Okumura Corporation Annual Report 2024

18. Per Share Information
Yen

Net assets per share
Basic net income per share

U.S. dollars

2024

2023

2024

¥ 5,123.61¥ 339.30¥ 4,673.68¥ 306.08$33.84$ 2.24

Millions of yen

Thousands of
U.S. dollars(Note) 1. The basis for the calculation of basic net income per share is as follows:

Net income attributable to owners of the parent
Net income not attributable to common shareholders
Net income attributable to owners of the parent available to common stock
Average number of shares of common stock during the year (thousands)

2024

2023

2024

¥12,493—¥12,493
36,820¥11,262—¥11,262
36,793$82,517—$82,517

As noted in Note 2.s., the Company has introduced the Employee Share Award Plan from the year ended March 31, 2024. In
calculating the number of weighted-average number of shares above, the number of shares that are held by the Trust (275thousands in 2024) is reflected.
(Note) 2. The basis for the calculation of net assets per share is as follows:
Millions of yen

Total net assets
Amount deducted from total net assets
Of which noncontrolling interests
Net assets of common stock
Number of shares of common stock at March 31 (thousands)

Thousands of
U.S. dollars

2024

2023

2024

¥191,574
2,882
2,882
¥188,692
36,828¥173,216
1,201
1,201
¥172,015
36,805$ 1,265,348
19,037
19,037$ 1,246,311

As noted in Note 2.s., the Company has introduced the Employee Share Award Plan from the year ended March 31, 2024. In
calculating the number of shares above, the number of shares that are held by the Trust (275 thousands in 2024) is reflected.
19. Subsequent Events
Appropriation of Retained Earnings
The following appropriation of retained earnings at March 31, 2024, was approved at the Company’s shareholders’ meeting
held on June 27, 2024:
Year-end cash dividends, ¥160 ($1.06) per share

Millions of Yen

Thousands of
U.S. Dollars¥5,936*$39,210**The total year-end cash dividends include cash dividends of 44 million ($291 thousand) paid on shares of the Company heldby the trust account associated with the Trust.

3720. Segment Information
1. Description of reportable segments
The Group’s reportable segments are those for which separate financial information is available and regular evaluation by
the Company’s management is being performed in order to decide how resources are allocated among the Group.
Therefore, the Group’s reportable segments consist of “Civil engineering,” “Architectural construction,” and “Investment
development.”

38

2. Methods of measurement for the amounts of sales, profit, assets, liabilities and other items for each reportable segment
The accounting policies of each reportable segment are consistent with those disclosed in Note 2, “Summary of Significant
Accounting Policies.”
3. Information about sales, profit, assets, liabilities, other items and disaggregation of revenue is as follows:
Millions of Yen
2024

Sales
Domestic public agencies
Domestic non-government
Overseas
Revenue from contracts
with customers
Revenue from othersources
Sales to externalcustomers
Intersegment
sales or transfers
Total
Segment profit
Other:
Depreciation
Amortization of goodwill

Civilengineering

Architectural
construction¥ 61,492
32,744
8,919¥ 23,088
142,098—

103,155

Reportable segment
Investment
development
Total

Total

Reconciliations(Note 2)

Consolidated(Note 3)¥———

¥ 84,669
190,144
9,227

23
10,081—¥ 84,603
184,923
8,919

¥ 66
5,221
308

¥ 84,669
190,1449,227

165,186

10,104278,445

5,595

284,040—

284,040

—

—

4,107

4,107

—

4,107

—

4,107

103,155

165,186

14,211

282,552

5,595

288,147—

288,147—
103,155
9,552—
165,186914

37
14,2482,606

37282,589
13,072

2,020
7,615
615

2,057
290,204
13,687(2,057)(2,057)21—
288,147
13,708693—¥ 3,08930(7)—¥ 4,341
30

¥

511
—

¥

¥

Other
(Note 1)

¥

4,293
30

¥

55
—

¥

4,348
30

¥

Millions of Yen
2023

Sales
Domestic public agencies
Domestic non-government
Overseas
Revenue from contracts
with customers
Revenue from othersources
Sales to externalcustomers
Intersegment
sales or transfers
Total
Segment profit
Other:
Depreciation
Amortization of goodwill

Reportable segment
Investment
development
Total

Other
(Note 1)

Total

¥ 93,006
141,576
5,985

¥ 18
4,653
7

¥ 93,024
146,229
5,992

3,918

240,567

4,678

—

4,198

4,198

97,286

139,363

8,116—
97,286
8,771—
139,363
674

37
8,153
1,871

722
—

¥ 969
30

Civil
engineering

Architectural
construction¥ 64,975
26,587
5,724¥ 28,005
111,097
261

¥ 26
3,892
—

97,286

139,363

—

¥

566
—

¥

¥

Reconciliations(Note 2)

Consolidated(Note 3)¥———

¥ 93,024
146,229
5,992

245,245—

245,245

—

4,198

—

4,198

244,765

4,678

249,443—

249,44337
244,802
11,316

2,363
7,041
614

2,400
251,843
11,930(2,400)(2,400)(83)—
249,443
11,847(7)—¥ 2,302
30

2,257
30

¥

52
—

¥

2,309
30

¥

Okumura Corporation Annual Report 2024

Thousands of U.S. Dollars
2024

Sales
Domestic public agencies
Domestic non-government
Overseas
Revenue from contracts
with customers
Revenue from othersources
Sales to externalcustomers
Intersegment
sales or transfers
Total
Segment profit
Other:
Depreciation
Amortization of goodwill

Reportable segment
Investment
development
Total

Other
(Note 1)

Total

Reconciliations(Note 2)

Consolidated(Note 3)$ 558,804
1,221,420
58,909$ 436
34,481
2,035$ 559,240
1,255,901
60,944$———$ 559,240
1,255,901
60,944

66,738

1,839,133

36,952

1,876,085—

1,876,085—

27,12827,128—27,128—27,128681,339

1,091,056

93,866

1,866,261

36,952

1,903,213—

1,903,213—
681,339
63,095—
1,091,056
6,040

247
94,113
17,209247
1,866,508
86,344

13,34650,298
4,056

13,593
1,916,806
90,400(13,593)(13,593)143—
1,903,213
90,543$ 3,377—$$20,401
196

$

$

$

Civil
engineering

Architectural
construction$406,158
216,272
58,909$ 152,493
938,563—$ 153
66,585—681,339

1,091,056

—

4,575
—

28,353196

364—

28,717
196

$

(46)
—

$

28,671
196

Notes:
1. “Other” is a business segment which is not included in any reportable segment and includes business related to
manufacturing and sale of construction machinery, materials, and so on.
2. Reconciliations to segment profit in the amount of ¥21 million ($143 thousand) and ¥(83) million for the years ended March
31, 2024 and 2023, respectively, include eliminations of intersegment transactions.
3. The consolidated amounts of segment profit above correspond to the amounts of operating income in the consolidated
statement of income.

39Independent Auditor‘s Report
Deloitte Touche Tohmatsu LLC
Yodoyabashi Mitsui Building
4-1-1 Imabashi, Chuo-ku
Osaka 541-0042
Japan
Tel: +81 (6) 4560 6000
Fax: +81 (6) 4560 6001
www.deloitte.com/jp/en

INDEPENDENT AUDITOR’S REPORTTo the Board of Directors of Okumura Corporation:<Audit of Consolidated Financial Statements>

40

OpinionWe have audited the consolidated financial statements of Okumura Corporation and its consolidated subsidiaries (the“Group”), which comprise the consolidated balance sheet as of March 31, 2024, and the consolidated statement of income,consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement ofcash flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant
accounting policies, all expressed in Japanese yen.
In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated
financial position of the Group as of March 31, 2024, and its consolidated financial performance and its consolidated cash
flows for the year then ended in accordance with accounting principles generally accepted in Japan.
Convenience Translation
Our audit also comprehended the translation of Japanese yen amounts into U.S. dollar amounts and, in our opinion, suchtranslation has been made in accordance with the basis stated in Note 1 to the consolidated financial statements. Such U.S.
dollar amounts are presented solely for the convenience of readers outside Japan.
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our responsibilities under thosestandards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements sectionof our report. We are independent of the Group in accordance with the provisions of the Code of Professional Ethics in Japan,
and we have fulfilled our other ethical responsibilities as auditors. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our opinion.
Key Audit Matter
A key audit matter is a matter that, in our professional judgment, was of most significance in our audit of the consolidated
financial statements of the current period. The matter was addressed in the context of our audit of the consolidated financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on the matter.
Revenue recognized over time
Key Audit Matter Description
As described in Note 2.m. “Summary of Significant Accounting
Policies – Construction Contracts” to the consolidated financial
statements, the Group recognizes revenue over time as theGroup satisfies the performance obligations by transferring
control of a promised good or service to a customer.
Revenues recognized over time were ¥263,935 million out
of total construction revenue of ¥268,341 million for thecurrent year.
As described in Note 3. “Summary of Significant Accounting
Policies – Significant Accounting Estimates,” construction revenues recognized over time based on satisfying performanceobligations according to the construction contracts are recognized by multiplying the total construction revenue by thestage of completion of the contract, which is calculated asa percentage of actual costs incurred at the balance sheet
date to the estimated total cost. The measurement of thetotal construction revenue, the total construction costs andthe stage of completion of the contract involve significant
estimates and judgments made by management.

How the Key Audit Matter Was
Addressed in the Audit
Based on our understanding of the business environment surrounding the Group and its industry, we evaluated the designand operating effectiveness of internal controls, including
Information Technology controls, over the process of revenue
recognition over time based on satisfaction of the performanceobligations. Our procedures related to estimated total construction revenue and total construction costs were as follows:(1) Estimated total construction revenue
We performed inquiries and inspected related documents
to test the design and operating effectiveness of internal
controls related to the determination of the estimatedcontract amount. This included approval of the reports on
certain projects prepared by estimating the contract
amount for the agreed upon changes in each construction
project, and monitoring activities.
(2) Estimated total construction costs
We performed inquiries and inspected related documents
to test the design and operating effectiveness of internal
controls related to approval of the reports on working
budget, construction projects and costs incurred to date,and monitoring activities.

Okumura Corporation Annual Report 2024

Revenue recognized over time
Key Audit Matter Description
The reliability of estimating the total construction revenue
and the total construction costs in applying revenue recognition over time has a significant impact on the consolidated
financial statements where a higher estimation uncertainty
may exist in relation to the following matters:(1) Estimating total construction revenue
During construction, when changes in the design or scopeof construction are agreed with customers but the construction contract has not been revised to update thecontract amount in a timely manner, the total construction
revenue may be revised using the estimated contract
amount based on amendments mutually agreed with customers (the “estimated contract amount”). Management’s
estimate of the total construction may affect the accuracyof the construction revenue.
(2) Estimating total construction costs
It may be necessary to modify total construction costs due
to unexpected events, changes in market conditions suchas materials and subcontracting costs, and accelerating
construction in response to potential delays during construction. If total construction costs are not updated in atimely manner, or if management’s estimate is not reasonable, it may affect the accuracy of the construction
revenue and the allowance for losses on construction contracts.
We determined applying revenue recognition over time to bea key audit matter because of the possible significant impactof accounting estimates of total construction revenue andtotal construction costs on the consolidated financial statements.

How the Key Audit Matter Was
Addressed in the Audit
In addition, we assessed the reasonableness of the construction revenue recognized over time by performing an analysisof the quarterly progress of revenues and gross profits
against the business plan in each branch office. Such analysis
identified branch offices with significant fluctuations in revenues and profit margins near the end of the period. We also
inspected related documents, performed inquiries with construction managers, performed site observations forconstruction projects that possessed characteristics such as
those with significantly higher or lower profit margins ratio,
large fluctuating profit margins ratio, deficit projects, projects
with large estimated contract amounts, or large-scale projects.
Specifically, for the estimate of total construction revenue
and total construction costs, we performed the following:(1) Estimated total construction revenue
We tested the estimated contract amount by inspection of
documents underlying the estimate, inspection of meeting
minutes with customers, and inquiries with construction
managers.
In addition, for construction projects that contained estimated contract amounts in the prior year, we inspected
the revised construction contracts signed in the current
year and compared the updated total contract amounts inthe contracts with total construction revenue, including
the estimated contract amount estimated in the previous
year.
(2) Estimated total construction costs
For samples of construction projects selected, we compared total construction costs with the original estimate
to identify the reason for the changes, inspected the orderconfirmation for purchase orders issued, quotation orunderlying documents prior to the order, performed inquiries with the construction managers, and inspected thevendor invoices, as necessary.

Other Information
Management is responsible for the other information. The Audit and Supervisory Committee is responsible for overseeing the
Directors’ execution of duties relating to the design and operating effectiveness of the controls over the other information. The
other information comprises the information included in the annual report, but does not include the consolidated financial
statements and our auditor’s report thereon.
Our opinion on the consolidated financial statements does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or
our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, weare required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and the Audit and Supervisory Committee for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance withaccounting principles generally accepted in Japan, and for such internal control as management determines is necessary to enable
the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability to continue
as a going concern, disclosing, as applicable, matters related to going concern in accordance with accounting principles generally accepted in Japan and using the going concern basis of accounting unless management either intends to liquidate theGroup or to cease operations, or has no realistic alternative but to do so.
The Audit and Supervisory Committee is responsible for overseeing the Directors’ execution of duties relating to the designand operating effectiveness of the controls over the Group’s financial reporting process.

41

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are freefrom material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with auditing
standards generally accepted in Japan will always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of these consolidated financial statements.
As part of an audit in accordance with auditing standards generally accepted in Japan, we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:42• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks. The procedures selected depend on the auditor’s judgment. In
addition, we obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion,forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain, when performing risk assessment procedures, an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on theeffectiveness of the Group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on theGroup’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’sreport. However, future events or conditions may cause the Group to cease to continue as a going concern.
• Evaluate whether the overall presentation and disclosures of the consolidated financial statements are in accordance withaccounting principles generally accepted in Japan, as well as the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying
transactions and events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within theGroup to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision andperformance of the group audit. We remain solely responsible for our audit opinion.
We communicate with the Audit and Supervisory Committee regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during
our audit.
We also provide the Audit and Supervisory Committee with a statement that we have complied with relevant ethicalrequirements regarding independence, and communicate with it all relationships and other matters that may reasonably bethought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied.
From the matters communicated with the Audit and Supervisory Committee, we determine those matters that were ofmost significance in the audit of the consolidated financial statements of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matteror when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because theadverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
<Fee-Related Information>
Fees for audit and other services for the year ended March 31, 2024, which were charged by us and our network firms to
Okumura Corporation and its subsidiaries were ¥60 million and ¥2 million, respectively.
Interest Required to Be Disclosed by the Certified Public Accountants Act of Japan
Our firm and its designated engagement partners do not have any interest in the Group which is required to be disclosed pursuant to the provisions of the Certified Public Accountants Act of Japan.

August 2, 2024

Member of
Deloitte Touche Tohmatsu Limited

Breakdown of Orders (Nonconsolidated)
Okumura Corporation
Year Ended March 31, 2024

Okumura Corporation Annual Report 2024

Construction Orders Awarded

2024

Millions of
Yen

Civil engineering:
Domestic:
Public sector
Private sector
Overseas
SubtotalArchitectural construction:
Domestic:
Public sector
Private sector
Overseas
Subtotal
Total:
Domestic:
Public sector
Private sector
Overseas
Total

68.6

22,961
170,159(1,073)
192,047

100 %

71,263
196,924
11,730¥279,917

Composition
ratio

Millions of
Yen

37.6%

¥ 64,975
26,587
5,724
97,28660.2

28,004
111,098261
139,363

97.8
2.2
100 %

92,979137,685
5,985
236,649
5,617¥242,266

Composition
ratio

Millions of
Yen

41.5%

¥101,991
66,47022,591
191,052

58.5

46,003161,072—
207,075

100 %

147,994
227,542
22,591¥398,127

116,664
205,644
14,575¥336,883
2024

Millions ofYen¥ 61,492
32,744
8,919
103,155
23,088142,098—
165,186
84,580174,842
8,919
268,341
6,119¥274,460

Year-end Backlog¥104,511
60,98928,248
193,748
75,567
197,355—
272,922180,078
258,344
28,248¥466,670

Composition
ratio

Thousands of
U.S. Dollars

31.4%$ 422,803
180,072
96,269699,14468.6

347,763
1,178,212—
1,525,975

100 %

770,566
1,358,284
96,269$2,225,119

Composition
ratio

Thousands of
U.S. Dollars

40.2%$ 406,158
216,272
58,909681,33957.5

152,493
938,563—
1,091,056

97.7
2.3
100 %

558,651
1,154,835
58,9091,772,395
40,420$1,812,815

Composition
ratio

Thousands of
U.S. Dollars

48.0%$ 690,294
402,837
186,576
1,279,707

52.0

499,124
1,303,532—
1,802,656

100 %

1,189,418
1,706,369
186,576$3,082,363

2024

2023

2024

Millions of
Yen

Civil engineering:
Domestic:
Public sector
Private sector
Overseas
SubtotalArchitectural construction:
Domestic:
Public sector
Private sector
Overseas
Subtotal
Total:
Domestic:
Public sector
Private sector
Overseas
Total

31.4%

¥ 48,302
26,76512,80387,87052,652
178,381—
231,033

Net Sales

Construction business
Civil engineering:
Domestic:
Public sector
Private sector
Overseas
SubtotalArchitectural construction:
Domestic:
Public sector
Private sector
Overseas
Subtotal
Subtotal:
Domestic:
Public sector
Private sector
Overseas
Subtotal
Real estate investment, development business and other
Total

Millions ofYen¥ 64,012
27,263
14,575
105,850

2024

2023

Composition
ratio

2024

2023

43

Network

Head and Branch Offices

44

Consolidated Subsidiaries

Head Office
2-2-2, Matsuzaki-cho, Abeno-ku,
Osaka 545-8555, Japan
TEL: +81-6-6621-1101 FAX: +81-6-6627-5295

Hokuriku Office2-3-26, Higashi Ohdori, Chuo-ku,
Niigata 950-0087, Japan
TEL: +81-25-241-6160 FAX: +81-25-241-6364

Tokyo Head Office
5-6-1, Shiba, Minato-ku,
Tokyo 108-8381, Japan
TEL: +81-3-3454-8111 FAX: +81-3-5427-8103

Nagoya Branch
29-8, Takebashi-cho, Nakamura-ku,
Nagoya 453-8555, Japan
TEL: +81-52-451-1101 FAX: +81-52-452-4331

X Innovation Center
2-7-2, Marunouchi, Chiyoda-ku,
Tokyo 100-7022, Japan
TEL: +81-50-3828-0270 FAX: +81-50-3828-0271

Kansai Branch
26F ABENO HARUKAS,1-1-43 Abenosuji,
Abeno-ku, Osaka 545-6026, Japan
TEL: +81-6-6621-1101 FAX: +81-6-6621-1921

Technical Research Institute387, Ohsuna, Tsukuba 300-2612, Japan
TEL: +81-29-865-1521 FAX: +81-29-865-1522

Nara Office38-3, Takama-cho, Nara 630-8241, Japan
TEL: +81-742-22-5001 FAX: +81-742-27-0192

East Japan Branch Office
5-6-1, Shiba, Minato-ku,
Tokyo 108-8381, Japan
TEL: +81-3-3454-8111 FAX: +81-3-5427-8105

Kobe Office2-2-16, Isobe dori, Chuo-ku,
Kobe 651-0084, Japan
TEL: +81-78-221-9355 FAX: +81-78-251-3374

West Japan Branch Office
2-2-2, Matsuzaki-cho, Abeno-ku,
Osaka 545-8555, Japan
TEL: +81-6-6621-1101 FAX: +81-6-6623-7692

Hiroshima Branch
1-7-22, Kokutaiji-machi, Naka-ku,
Hiroshima 730-0042, Japan
TEL: +81-82-241-2246 FAX: +81-82-243-1416

West Japan Branch Office (HARUKAS Office)
26F ABENO HARUKAS,1-1-43 Abenosuji,
Abeno-ku, Osaka 545-6026, Japan
TEL: +81-6-6621-1101 FAX: +81-6-6621-1921

Shikoku Branch
2-3-11, Kotobuki-cho,Takamatsu 760-0023, Japan
TEL: +81-87-851-9008 FAX: +81-87-822-9286

Sapporo Branch
2-1-18, Kita Yojo Nishi,
Chuo-ku, Sapporo 060-0004, Japan
TEL: +81-11-261-9261 FAX: +81-11-251-5345

Kyushu Branch
2-19-1, Sanno, Yahata Higashi-ku,
Kitakyushu 805-8531, Japan
TEL: +81-93-671-3131 FAX: +81-93-661-1543

Tohoku Branch
2-11-18 Chuo,
Aoba-ku, Sendai 980-8482, Japan
TEL: +81-50-3495-2020 FAX: +81-50-3495-2030

Fukuoka Office
1-13-8, Yakuin, Chuo-ku,
Fukuoka 810-0022, Japan
TEL: +81-92-741-4431 FAX: +81-92-741-4740

Tokyo Branch
5-6-1, Shiba, Minato-ku,
Tokyo 108-8381, Japan
TEL: +81-3-3454-8111 FAX: +81-3-5427-8116

Taiwan Branch
16F-2, No.2, Sec 1, Chengde Rd,
Datong Dist, Taipei City 103022, Taiwan(R.O.C.)TEL: +886-2-2311-7080 FAX: +886-2-2311-7076

Higashikanto Office18-14, Shinmachi, Chuo-ku,
Chiba 260-0028, Japan
TEL: +81-43-241-2255 FAX: +81-43-244-5911
Yokohama Office
60, Nihon Ohdori, Naka-ku,
Yokohama 231-0021, Japan
TEL: +81-45-662-1361 FAX: +81-45-641-3502

Singapore Branch
175A Bencoolen Street, #05-06 Burlington
Square, Singapore 189650
TEL: +65-6884-6830 FAX: +65-6884-6831

Okumura Machinery Corporation
3-5-26, Himejima, Nishiyodogawa-ku,
Osaka 555-0033, Japan
TEL: +81-6-6472-3461 FAX: +81-6-6477-6801
Business line:Design, manufacture, sales, andrepair of construction/industrial machines anddevices
Taihei Real Estate Corporation
5-16-7, Shiba, Minato-ku,
Tokyo 108-0014, Japan
TEL: +81-3-5439-5401 FAX: +81-3-5439-5402
Business line: Real estate, land and building
management
ISHIKARI BIO ENERGY GODO KAISHA
2-763-3, Shinko, Chuo,
Ishikari 061-3242, Japan
TEL: +81-133-77-5318 FAX: +81-133-77-5319
Business line: Power generation using renewable energy and sales of electricity
HIRATA BIO ENERGY GODO KAISHA
23-8 Tsubouchi, Tonoko, Hirata-mura,
Ishikawa-gun, Fukushima-ken 963-8204 Japan
No.1 Power planet
TEL: +81-247-57-7351 FAX: +81-247-57-7352
No.2 Power planet
TEL: +81-247-57-6562 FAX: +81-247-57-6563
Business line: Power generation using renewable energy and sales of electricity

Board of Directors

Investor Information(As of June 27, 2024)(As of March 31, 2024)

Directors

Corporate Data

President and Representative Director
Takanori Okumura
Representative Director
Masahiro Kaneshige
Hiroyuki Matsushima

Head Office
OKUMURA CORPORATION
2-2-2, Matsuzaki-cho, Abeno-ku, Osaka 545-8555, Japan
TEL: +81-6-6621-1101 FAX: +81-6-6627-5295
EstablishedFebruary 22, 1907

Directors
Tamotsu Tsuchiya
Kunitake Konishi
Masanari Kashiki
Yasuyuki Nakatani
Rieko Ueda

Capital¥19.8 billion

Director (Audit and Supervisory Committee Member)
Tetsuo Kodera

Group Employees
2,344

Director (Full-time Audit and Supervisory Committee Member)
Akira Sasaki

Stock Information

Directors (Audit and Supervisory Committee Member)
Kenji Nishihara
Eiji Maeda
Kyoko Hirose

Stock Exchange Listings
Tokyo

Note: Rieko Ueda,Tetsuo Kodera,Kenji Nishihara,Eiji Maeda and Kyoko Hirose areoutside directors.

Executive Vice President
Hajime Kosaka
Senior Managing Executive Officers
Toru Osumi
Masahiro Kaneshige*
Wataru Onishi
Kazutoshi Yuyama
Managing Executive Officers
Tamotsu Tsuchiya*
Takanori Hayashi
Akira Okada
Kunitake Konishi*Takami Nakada
Masanari Kashiki*
Yasuyuki Nakatani*
Hiroyuki Matsushima*
Executive Officers
Naoki Magoori
Hirohide Taniguchi
Yoshinori Yasui
Hiroki Machida
Kazuyoshi Okuma
Koji Furusawa
Junichi Hori
Kenichi Abe
Yuji Yamamoto

Transfer Agent
Sumitomo Mitsui Trust Bank, Limited
Major Shareholders
Shareholder

Executive Officers

Hiroyuki Tamamura
Kazuya Takekuni
Yuichi Umezawa
Shinya Kimura
Yoshihiro Kadotani
Kazutaka Kuno
Fumitaka Nozaki
Yoshifumi Machida
Hitoshi Mimura

Note: Those officers marked with an asterisk (*) work as directors.

45

Shares held Shareholding(thousands)
ratio

The Master Trust Bank ofJapan, Ltd. (Trust Account)

5,200

14.02%

Okumura Employees’
Shareholding Association

1,948

5.25

Custody Bank of Japan,
Ltd. (Trust Account)

1,602

4.32

Resona Bank, Limited.

1,214

3.27

Sumitomo Realty &Development Co., Ltd.

1,210

3.26

Nippon Life Insurance Company

643

1.73

Sumitomo Mitsui Banking Corporation

556

1.50

State Street Bank andTrust Company 505001

528

1.42

JP Morgan Chase Bank 385781

495

1.34

Takanori Okumura

471

1.27

Note:
1. The Company holds 1,562,409 shares of treasury stock, which are excluded
from the above.
2. Shareholding ratio is computed excluding treasury stock.
3. The number of shares held by Mr. Takanori Okumura does not include hisownership interest in the Okumura officers’ shareholding association.

2-2-2, Matsuzaki-cho, Abeno-ku, Osaka 545-8555, Japan
TEL: +81-6-6621-1101 FAX: +81-6-6627-5295
https://www.okumuragumi.co.jp

Printed in Japan