Consolidated Financial Results
for the Nine Months Ended May 31, 2023 [JGAAP]
July 7, 2023
Company Name: GIKEN LTD.
Stock Code: 6289 (URL https://www.giken.com)
Stock Exchange Listing: Tokyo
Representative: Shinnosuke Moribe, Representative Director and President
Contact: Yusei Morino, Director
Phone: +81-88-846-2933
Scheduled date to submit the quarterly securities report: July 14, 2023
Scheduled date to commence dividend payments: –Availability of supplementary material on quarterly financial results: Yes
Holding of quarterly financial results briefing session: No(Figures are rounded down to the nearest million yen)
1. Consolidated Financial Results for the Nine Months Ended May 31, 2023 (from September 1, 2022 to May 31, 2023)(1) Consolidated Results of Operations

Nine months ended May 31, 2023
Nine months ended May 31, 2022

(Note) Comprehensive income:(% indicates changes from the same period of the previous financial year)
Profit attributable to
Net sales
Operating profit
Ordinary profit
owners of parent
Millions of yen% Millions of yen% Millions of yen%
Millions of yen%
21,1962.1
2,176 (31.4)
2,253(32.0)
223 (89.9)
20,768
5.9
3,174
6.2
3,315
6.7
2,200
5.5
Nine months ended May 31, 2023: ¥149 million [(93.3)%]
Nine months ended May 31, 2022: ¥2,234 million [(1.6)%]
Profit per share

Fully diluted profit per share
Yen
8.11
80.05

Nine months ended May 31, 2023
Nine months ended May 31, 2022

Yen
–
80.02

(2) Consolidated Financial Position
Total assets
Millions of yen
Nine months ended May 31, 2023
54,13754,694
Fiscal year ended August 31, 2022
(Reference) Equity:
As of May 31, 2023: ¥39,397 million

Net assets
Equity ratio
Millions of yen
39,894
41,256
As of August 31, 2022: ¥40,741 million

%
72.8
74.5

2. Dividends
Annual cash dividends per share
End of Q1

End of Q2
Yen

End of Q3
Yen

Fiscal year ended August–
35.00
31, 2022
Fiscal year ending August–
20.00
31, 2023
Fiscal year ending August
31, 2023 (forecast)
Note: Revisions to the forecast of cash dividends most recently announced: None

Year-end
Yen–

Annual
Yen

Yen

35.00

70.00

20.00

40.00

–

3. Earnings Forecast of Consolidated Financial Resultsfor Fiscal Year Ending August 31, 2023 (from September 1, 2022 to August 31, 2023)(% indicates changes from the previous corresponding term)
Profit attributable to
Net sales
Operating profit
Ordinary profit
Profit per shareowners of parent
Millions of yen% Millions of yen% Millions of yen% Millions of yen%
Yen
28,400(6.5)
3,200(30.6)
3,250(32.7)
670(79.3)
24.36
Full year
Note: Revision of the forecast of consolidated financial results most recently announced: None-1-

* Notes(1) Changes in significant subsidiaries during the nine months period ended May 31, 2023 (changes in specific subsidiaries
involving changes in the scope of consolidation): None
(2) Application of special accounting for preparing quarterly consolidated financial statements: Yes(3) Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial statements
1) Changes in accounting policies due to revisions to accounting standards and other regulations: Yes
2) Changes in accounting policies other than 1): None
3) Changes in accounting estimates: None
4) Restatement of prior period financial statements: None
(4) Number of issued shares (common shares)
1) Total number of issued shares at
As of May 31, 2023
the end of the period (including
treasury shares)
As of May 31, 2023
As of May 31, 2023

28,194,728 shares As of August 31, 2022 28,194,728 shares
693,118 shares As of August 31, 2022
27,501,664 shares As of May 31, 2022

693,034 shares
27,488,808 shares

2) Number of treasury shares at theend of the period
3) Average number of shares during the period (cumulative from the beginning of the fiscal year)* Quarterly financial results reports are exempt from quarterly review conducted by certified public accountants or an audit
corporation.

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Table of Contents of Appendix
1.

2.

Qualitative Information on the Quarterly Financial Results ...........................................................................................

4(1) Explanation of Operating Results ...............................................................................................................................

4(2) Explanation of Financial Position ...............................................................................................................................

5(3) Explanation of Consolidated Earnings Forecasts and Other Forward-looking Statements .........................................

5

Quarterly Consolidated Financial Statements and Principal Notes .................................................................................

6(1) Quarterly Consolidated Balance Sheet .......................................................................................................................

6(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income ..

8

Quarterly Consolidated Statements of Income
For the nine months ended May 31 .....................................................................................................................

8

Quarterly Consolidated Statements of Comprehensive Income
For the nine months ended May 31 .....................................................................................................................

9(3) Principal Notes for Quarterly Consolidated Financial Statements ..............................................................................

10(Notes on Going Concern Assumption) ......................................................................................................................

10(Notes on Significant Changes in the Amount of Shareholders’ Equity) ....................................................................

10(Application of Special Accounting for Preparing Quarterly Consolidated Financial Statements) ............................

10(Changes in Accounting Policies) ...............................................................................................................................

10(Revenue Recognition) ...............................................................................................................................................

10(Segment Information) ...............................................................................................................................................

11

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1. Qualitative Information on the Quarterly Financial Results(1) Explanation of Operating Results
Aiming for a dramatic growth, the Giken Group has set in the Mid-Term Management Plan (for the period from September
2021 to August 2024) a long-term target sales of 100 billion yen for the fiscal year ending August 2031. In the consolidated
fiscal year ending August 2023, the middle year of the Mid-Term Management Plan, we announced the Long-Term Roadmap
Giken Goals 2031, which includes numerical targets and strategies to achieve the 2031 goal. Specific initiatives by eachdepartment are underway.
With regard to the business environment surrounded the Group in the nine months under review, domestic public investment
and private sector construction investment remained firm, and thus customers' capital investment was strong. However, against
the backdrop of soaring prices of steel and other materials, the proportion of material costs in public works expenses increased,
and this resulted in a downward trend in the amount of construction work. Accordingly, there are concerns that sales of products
and parts used for the construction of permanent structures might be impacted.
In our activities to expand the domestic press-in market, we focused on proposing the Implant Method*1 mainly for recovery
and reconstruction from natural disasters, prevention and mitigation of future disasters, and the strengthening of national land
resilience. As a result, the number of the construction work that adopted the Implant Method remained steady as it was adopted
for earthquake-resistant construction of aging fishing ports and harbor roads, bridge scouring countermeasures, constructionof new seawalls, restoration of cut slopes that collapsed due to heavy rain disasters, and other construction work.
*1 A construction method to build Implant Structures, which are resistant to earthquakes, tsunamis, floods, and otherexternal forces, by pressing deeply into the ground structural members with high rigidity and quality.
In overseas market, with the goal of achieving an overseas net sales ratio of 70% (50% for the fiscal year ending August2031), we worked to continuously develop the press-in market by focusing on the European and Asian regions, where market
formation is getting on track, while in North America and other regions we proceeded with restructuring, including a reviewingof its strategy. In the European region, G-Kracht B.V., in which our group company Giken Europe B.V. (Headquartered in
Netherland) has a stake, completed the press-in process for demonstration construction in March in a “project to develop newtechnologies to improve revetment of the world heritage-listed canal” of Amsterdam, the Netherlands. The construction work
was highly evaluated by the City of Amsterdam as the owner of the project, and discussions on the subsequentcommercialization phase*2 started. For the Asian region, the operation of the Asian version of the GIKEN Total Support System(GTOSS) in Singapore increased customer loyalty, causing the number of inquiries about this support system to increase.
GTOSS helps improve the productivity at site by providing its users with know-how of technical and other services while
supporting product sales. We will also provide support services tailored to local needs in other regions.
*2 In the commercialization phase, construction orders for a total of 3.3 km section over an 8-year period are guaranteed.
In the overseas business, where the restructuring of strategies are underway, the dissolution of the joint venture relationshipwith J Steel Group Pty Limited (headquartered in Australia), which was a consolidated subsidiary, was agreed upon on May
24 due to differences in management policies*3. This is a developmental dissolution under the notion that each side canmaximize their corporate value with their business operation based on their respective growth strategy. Even after the
dissolution of the joint venture relationship, J Steel Group Pty Limited will operate its business as a user of our products andservices in the Oceania market.
We also started a personnel exchange program with the Itochu Group from April with the aim to further promote global
development. We have proceeded with the development of overseas business foundation utilizing the Itochu Group’s extensive
and powerful global channel. In addition, we worked on the expansion of the press-in market in the European region together
with Seika Sangyo GmbH*4, with which Giken Europe B.V. concluded a business partnership agreement, and the environment
for the press-in business is improving.
*3 On June 7, which belongs to the fourth quarter, the transfer to the Bertrams Trading Pty Limited of the shares in J SteelGroup Pty Limited owned by the Company was completed. Accordingly, J Steel Group Pty Limited was excluded fromthe scope of consolidation.
*4 It is a group company (headquartered in Germany) of the Seika Corporation. The Company concluded a business
partnership agreement with it on popularization activities of the press-in method as of June 2022.
As part of our initiatives to disseminate the press-in technology to the world, we opened a center for disseminating thepress-in technology called RED HILL 1967 in Akaoka-cho, Konan city, Kochi Prefecture in May. This center exhibits “actual”
machines, construction methods, and structures based on the concept of “seeing is believing” and has received many visitors
and won popularity since its opening. We are determined to continuously promote a revolution in construction methods-4-

globally by prompting customers to visit RED HILL 1967 from all over the world and making them understand and convincing
them of the superiority of the press-in technology.
Under such circumstances, for the nine months under review, net sales were 21,196 million yen (up 2.1% YoY), operating
profit was 2,176 million yen (down 31.4% YoY), and ordinary profit was 2,253 million yen (down 32.0% YoY). In responseto the dissolution of the joint venture relationship with the consolidated subsidiary, we posted an extraordinary loss of 1,367
million yen as a loss on the liquidation of subsidiaries and associates. As a result, profit attributable to owners of parent for
the nine months under review was 223 million yen (down 89.9% YoY).
The performance by segment is as follows:(i)

Construction Machinery Segment
Replacement of general-purpose machines progressed smoothly, sales of “Flywheel-Type Pile Auger”, which improves the
excavation capacity and construction efficiency of the auger equipment at the time of pressing steel sheet piles into hardground, were strong, and Silent Piler F112, the successor of Silent Piler F111 (with specifications for hard ground) equippedwith the abovementioned attachment as standard, was released into the market. As a result, net sales were 14,648 million yen(up 6.9% YoY). Meanwhile, due mainly to slow sales of large-scale models with high gross margin including Gyro Piler andan increase in SG&A expenses such as testing and research expenses, segment profit was 3,317 million yen (down 15.3%
YoY).
(ii) Press-in Work Segment
While the press-in method was steadily adopted, construction work also progressed steadily as evidenced by coastal
embankment repair as a countermeasure against the Nankai Trough megathrust earthquake (Kochi), reinforcement of bankprotection in the Hijikawa River basin affected by the heavy rain in July 2018 (heavy rain in Western Japan)(Ehime),
reinforcement of dilapidated fishing port revetment (Hokkaido), retaining wall construction for highway extension (Kyoto),soil retaining work for new construction of fish ladders accompanying the restoration of industrial water facilities (Aichi) andother construction work. However, due mainly to the completion of overseas construction work carried out in the prior fiscal
year and a decrease in high-margin construction projects, net sales were 6,548 million yen (down 7.4% YoY) and segment
profit was 831 million yen (down 12.1% YoY).
(2) Explanation of Financial Position(Assets)
Total assets as of May 31, 2023 decreased by 557 million yen compared to the end of the previous consolidated fiscal year
to 54,137 million yen. This was the result of a decrease of 941 million yen in current assets such as notes receivable, accounts
receivable and contract assets and an increase of 384 million yen in non-current assets such as investment securities.
(Liabilities)
Liabilities as of May 31, 2023 increased by 804 million yen compared to the end of the previous consolidated fiscal year to
14,243 million yen. This was the result of an increase of 926 million yen in current liabilities such as provision for loss on
liquidation of subsidiaries and associates and a decrease of 121 million yen in non-current liabilities such as long-term loans
payable.
(Net assets)
Net assets as of May 31, 2023 decreased by 1,361 million yen compared to the end of the previous consolidated fiscal year
to 39,894 million yen. This was the result of a decrease in retained earnings, etc.
(3) Explanation of Consolidated Earnings Forecasts and Other Forward-looking Statements
There is no change in the full-year earnings forecast announced on May 19, 2023.

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2. Quarterly Consolidated Financial Statements and Principal Notes(1) Quarterly Consolidated Balance Sheet(Millions of yen)
As ofAugust 31, 2022
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade, and contract assets
Electronically recorded monetary claims-operating
Finished goods
Work in process
Costs on construction contracts in progress
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Machinery, equipment and vehicles
Land
Construction in progress
Other
Accumulated depreciation
Total property, plant and equipment
Intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

-6-

As of
May 31, 2023

12,818
8,365
1,009
2,793
1,890
48
2,757
438
(3)
30,117

11,350
6,336
1,372
3,326
1,596
48
3,359
1,790
(4)
29,176

7,604
12,956
9,722
1,119
1,678
(13,424)
19,656233

8,200
13,085
9,632
1,070
1,805
(14,326)
19,468
196

1,211
1,767
1,724
(17)
4,686
24,57654,694

1,885
1,801
1,627
(18)
5,295
24,96054,137

(Millions of yen)
As ofAugust 31, 2022
Liabilities
Current liabilities
Notes and accounts payable-trade
Electronically recorded obligations-operating
Short-term borrowings
Income taxes payable
Contract liabilities
Provision for bonuses
Provision for loss on liquidation of subsidiaries and associates
Other provisions
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Provisions for maintenance of product’s function
Retirement benefit liability
Other provisions
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or loss on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

-7-

As of
May 31, 2023

1,877
1,261
875
1,053
4,375
746
–
19
1,894
12,103

1,962
1,488
1,827
53
4,083
289
1,367
12
1,945
13,029

393
4
84
0
851
1,334
13,438

306
–
85
3
816
1,213
14,243

8,958
10,135
21,908(305)
40,696

8,958
10,135
20,620(305)
39,408

18
8
14
3
44
514
41,25654,694

0
(6)
(8)
3
(10)
496
39,894
54,137

(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income(Quarterly Consolidated Statements of Income)(For the nine months ended May 31)(Millions of yen)
For the nine months ended
May 31, 2022
Net sales
Cost of sales
Gross profit (loss)
Selling, general and administrative expenses
Operating profit (loss)
Non-operating income
Interest income
Dividend income
Rental income from real estate
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Rental expenses on real estate
Share issuance costs
Other
Total non-operating expenses
Ordinary profit (loss)
Extraordinary losses
Impairment loss
Loss on liquidation of subsidiaries and associates
Total extraordinary losses
Profit (loss) before income taxes
Income taxes-current
Profit (loss)
Profit (loss) attributable to non-controlling interests
Profit (loss) attributable to owners of parent-8-

For the nine months ended
May 31, 2023

20,768
12,573
8,195
5,021
3,174

21,196
13,244
7,951
5,775
2,176

5
10
36
55
49
156

6
11
53
26
53
151

7
3
1
2
15
3,315

56
13
0
4
74
2,253

–
–
–
3,315
1,100
2,215
14
2,200

115
1,367
1,483
770
532
237
14
223

(Quarterly Consolidated Statements of Comprehensive Income)(For the nine months ended May 31)(Millions of yen)

Profit (loss)
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or loss on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests-9-

For the nine months ended
May 31, 2022

For the nine months ended
May 31, 2023

2,215

237

13
(43)
47
1
18
2,234

(18)
(25)
(44)
0
(88)
149

2,175
59

167
(18)

(3) Principal Notes for Quarterly Consolidated Financial Statements(Notes on Going Concern Assumption)
There is no relevant information.
(Notes on Significant Changes in the Amount of Shareholders’ Equity)
There is no relevant information.
(Application of Special Accounting for Preparing Quarterly Consolidated Financial Statements)
・Calculation of tax expenses
Tax expenses are calculated by reasonably estimating the effective tax rate after tax effect accounting is applied to the profit
before tax for the consolidated fiscal year which includes the nine months under review and then multiplying the profit before
tax by said estimated effective tax rate.
(Changes in Accounting Policies)
・Application of the Implementation Guidance on Accounting Standard for Fair Value Measurement
We have applied the Implementation Guidance on Accounting Standard for Fair Value Measurement (ASBJ Guidance No.
31, June 17, 2021; hereinafter “Implementation Guidance on Fair Value Measurement Standard”) since the beginning of thethree month period ended November 30, 2022, and determined to henceforth apply the new accounting policies stipulated by
the Implementation Guidance on Fair Value Measurement Standard in accordance with the transitional treatment provided forin Paragraph 27-2 of the same guidance. This does not affect the quarterly consolidated financial statements.
(Revenue Recognition)
The information on the disaggregation of revenue from contracts with customers is shown in the “(Segment information), (3)Principal Notes for Quarterly Consolidated Financial Statements, 2. Quarterly Consolidated Financial Statements and Principal
Notes.”- 10 -

(Segment Information)
I
For the nine months ended May 31, 2022 (September 1, 2021 to May 31, 2022)
1. Information on the Amounts of Net Sales and Profit/Loss by Reportable Segments and Information on the
Disaggregation of Revenue(Millions of yen)
Reportable segments

Posted amount to the

Adjusted
Total

quarterly consolidated
statements of income(Note 2)amount(Note 1)

Construction
Machinery

Press-in WorkJapan

12,520

4,313

16,834–

16,834

Other regions

1,179

2,755

3,934

–

3,934

Revenue from contracts
with customers

13,6997,069

20,768–20,768

13,6997,069

20,768–20,768

726

116

842

(842)

–

Total

14,426

7,185

21,611(842)

20,768Segment profit

3,917

946

4,863

(1,689)3,174

Net sales

Net sales to externalcustomers
Intersegment net sales
and transfer

Notes: 1. The segment profit adjustment of negative 1,689 million yen includes inter-segment transaction eliminationsof 51 million yen and corporate expenses not allocated to any reportable segment of negative 1,740 million
yen. The corporate expenses are mainly general administrative expenses not belonging to any reportablesegment.
2. Segment profit is adjusted with operating profit presented in the quarterly consolidated statement of income.
2.

Information on Impairment Loss for Non-current Assets by Reportable Segment
There is no relevant information.

II

For the nine months ended May 31, 2023 (September 1, 2022 to May 31, 2023)
1. Information on the Amounts of Net Sales and Profit/Loss by Reportable Segments and Information on the
Disaggregation of Revenue(Millions of yen)
Reportable segments

Posted amount to thequarterly consolidated
statements of income(Note 2)Adjusted
amount(Note 1)

Total

Construction
Machinery

Press-in WorkJapan

13,466

4,578

18,044–18,044

Other regions

1,181

1,970

3,151

–

3,151

Revenue from contracts
with customers

14,648

6,548

21,196–

21,196

14,648

6,548

21,196–

21,196

597

235

832

(832)

–

Total

15,245

6,784

22,029(832)

21,196

Segment profit

3,317

831

4,149

(1,972)2,176

Net sales

Net sales to externalcustomers
Intersegment net sales
and transfer- 11 -

Notes: 1. The segment profit adjustment of negative 1,972 million yen includes inter-segment transaction eliminationsof negative 57 million yen and corporate expenses not allocated to any reportable segment of negative 1,915
million yen. The corporate expenses are mainly general administrative expenses not belonging to any
reportable segment.
2. Segment profit is adjusted with operating profit presented in the quarterly consolidated statement of income.
2.

Information on Impairment Loss for Non-current Assets by Reportable Segment(Millions of yen)
Construction
Machinery

Impairment loss

Corporate andelimination

Press-in Work
–

–

115

Total
115

(Note) The amount of "Corporate and elimination" represents an impairment loss on corporate assets, which do notbelong to any reportable segment.

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