Prime Market of Tokyo stock exchange : 1959

KYUDENKO CORPORATIONFY ending March 2024
Results briefing
May 16 th ,2024

All Rights Reserved. Copyright KYUDENKO CORPORATION

0Table of contents
Overview of business results

2

Plan for fiscal year

Highlights

3

Plan for fiscal year

P/L

4

Factors of change in OP

5～7

Sales, Orders and Works on hand

19
20・21

Difference between numerical targets at thetime of formulation of the FY2020 Mid-Term
Management Plan and the FY2025 Plan

22

Road map of sales plan

23
24

1. Orders received/sales by department

8

4 th Year’s Summary and Final Initiatives for
Medium-Term Management Plan

2. Orders received/sales by customer

9

Trend of dividends

25

Appendix26

3. Orders received/sales by region
4. Year-end amount of works on hand
Actual results of works
Power generation business

10・11

12
13
14・15

B/S

16

C/F

17

Capital Investment

18

All Rights Reserved. Copyright KYUDENKO CORPORATION

1Overview of business results

All Rights Reserved. Copyright KYUDENKO CORPORATION

2High lights
Orders¥440,864

millionYear-on-year

100.1%

millionYear-on-year

118.5%

Year-on-year

118.5%

Sales¥469,057
Operating profit¥38,016

All Rights Reserved. Copyright KYUDENKO CORPORATION

million3

Outline of P/L March 2024
(Million yen)March 2024

March 2023
ResultResult395,783

469,057(100.0%)(100.0%)Gross profit

57,88964,632(14.6%)(13.8%)

Operating profit

32,08338,016(8.1%)(8.1%)

Ordinary project

35,46242,362(9.0%)(9.0%)Net profit

26,34928,017(6.7%)(6.0%)

Sales

Net profit per share¥371.93

All Rights Reserved. Copyright KYUDENKO CORPORATION

Year-onyear

Plan (2023.4.28)

118.5%

460,000

111.6%

64,500118.5%

35,500119.5%

38,000106.3%

26,500¥395.87(100.0%)(14.0%)(7.7%)(8.3%)(5.8%)

Progress

102.0%

100.2%

107.1%

111.5%

105.7%¥374.054

Factors of change in OP March 2024
（billion yen）

45

:IncreaseA
Increase in
sales

Decrease in
Profit margin

▲2.7

40

:Decrease

B

+9.6
35

C
Power
distribution
line work▲0.2

D
Other business

+0.1

E

Increase in SG&A
expenses

▲0.8

38.0
Operatingprofit inMarch,2024

30

32.0
Operatingprofit in25

March,2023

20

All Rights Reserved. Copyright KYUDENKO CORPORATION

5

Breakdown of construction sales and average profit margin(Kyudenko individual : excluding power distribution line work)

Average profit ratio

26.0

25.5

25.6
22.4

25.1
19.5

17.8

17.9
15.7

Total 315,566

Sales fromNot delivered
items

116,00437%

95,302 33%

16.5
15.0
Total 274,526

86,575500,000

21.4
400,000
Total 354,127
Construction sales

14.9

Project Not delivered Total 289,434（Percentage of completion method）

25.6

32%

Total 284,059（Million yen）

121,90112.4

42%300,000

98,429 35%
200,000

Project delivered（Percentage-of-completion method）

Sales fromdelivered items

109,690 35%

104,440 36%

Project delivered（Completed-contract method）

89,872 28%

89,692 31%

88,33032%

87,615 31%

132,949 32%
100,000

99,621

36%

98,015 34%

99,277 26%
02020’032021’03

All Rights Reserved. Copyright KYUDENKO CORPORATION

2022’032023’032024’036

Breakdown of construction sales and average profit margin(by quarterly accounting period)(Kyudenko individual : excluding power distribution line work)

Average profit ratio

150,000

40.9

Total 115,756

27.8

26.3

16.0

15.2

29.9

26.3

16.7

25.7

Construction sales

20.5（Million yen）

15.4

Total 87,477

Total 86,611

57,06658,02051,228

56% 100,000

12.8

Total 64,283
Sales from
Sales fromNot delivered items delivered items

Project Not delivered（Percentage of completion method）

67%

54%
41,613（Percentage of completion method）

6,605

10%

16,06425%（Completed-contract method）

2023’1Q

14% 50,000

65%

Project delivered

Project delivered

22,124

9,779

12%

8,413

10%

20,63034%

20,17723%

42,40430%

02023’2Q

All Rights Reserved. Copyright KYUDENKO CORPORATION

2023’3Q

2023’4Q
7

Order received / Sales by department(Million yen)

Sales of each department

March 2024

■2022.3■2022.3■2023.3■2023.3■2024.3■2024.3

201,381

153,104

159,783
152,495(Million yen)Orders of each department

214,668 213,481

155,087

161,659
154,647

131,872

134,156
119,51148,53048,25346,65949,88539,787

46,62845,774

48,40942,86845,64622,782
17,194Power
Electrical work
distribution line
work

HVAC work

All Rights Reserved. Copyright KYUDENKO CORPORATION

Solar plant
construction
work

Power
Electrical work
distribution line
work

HVAC work

Solar plant
constructionwork

8Order received / Sales by customer March 2024

(Million yen)

Sales of each customer■2022.3(Million yen)Orders of each customer■2022.3

373,938■2023.3■2024.3■2023.3

358,746 359,881■2024.3

304,577
300,437

290,21349,773
46,743
46,42827,798 29,034
Kyushu ElectricPower Co, ※47,50947,25528,912Govermment/Public

Privatecompanies※Including Kyushu Electric Power transmission and distribution
All Rights Reserved. Copyright KYUDENKO CORPORATION

50,338

Kyushu ElectricPower Co, ※27,526 34,504

30,645Govermment/Public

Privatecompanies※Including Kyushu Electric Power transmission and distribution9Order received / Sales by region March 2024
(Electrical & HVAC work excluding Solar plant construction work)(Million yen)

Sales of each region■2022.3■2022.3■2023.3 ■2024.3■2023.3 ■2024.3

257,048
243,203200,263
186,123(Million yen)Orders of each region

243,391

199,689

97,81983,67875,432

78,11965,36063,854
15,236 18,360
12,437
KyushuTokyo Tohoku
and Chubu Areas

Osaka Area

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9,244
6,791
5,806
Overseas

16,792

KyushuTokyo Tohoku andChubu Areas

26,303
16,56017,587
7,627
5,117

Osaka Area

Overseas10Order received / Sales by region March 2024
(Solar plant construction work)(Million yen)

Sales of each region■2022.3■2023.3 ■2024.3(Million yen)Orders of each region■2022.3■2023.3 ■2024.3

32,542
28,81725,396
20,362
20,20318,764

14,82912,956
9,532

12,585

9,480

6,433

660
KyushuTokyo Tohoku and Chubu
Areas

Osaka Area

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3,513

864

793 716 725
KyushuTokyo Tohoku and Chubu
Areas

Osaka Area

11

Year-end amount of works on hand(Million yen)Order stock of each department

New orders in FY ended March 2024

■2022.3 ■2023.3 ■2024.3

174,417

178,975
166,875
141,706
110,767

150,262

121,216

156,189

123,499

Image

3,0293,306
1,247
Power
Electrical work
distribution line
work

HVAC work

All Rights Reserved. Copyright KYUDENKO CORPORATION

Solar plant
constructionwork
12Actual results of works FY March 2024

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13

Investment in Power Operations
Solar Power Plants
Deals operated by group

Deals through investment in equity(make capital investment and record the entire operation to other operations
sales)
Depreciated at the declining balance method(acquire investment securities and record an amount equal to the equity to non-operating
Depreciated at the straight line method
revenues)

Generation capacity(that equal to theequity)Number of
power plants

Generation capacity(the entire operation)

Number of
power plants

In operation

49

92MW

87MW

In operation

53

746MW

211MW

Under
construction

-

-

-

Under
construction

2

575MW

103MW

Plan

-

-

-

Plan

-

-

-

Total

49

92MW

87MW

Total

55

1,321MW

314MWWind Power Plants

Generation capacity(the entire operation)

Generation capacity(that equal to the equity)

Deals through investment in equity

Deals operated by group(make capital investment and record the entire operation to other operations
Depreciated at the Mainly declining balance method
sales)(acquire investment securities and record an amount equal to the equity to nonDepreciated at the Mainly declining balance method
operating revenues)

Generation capacity(that equal to theequity)Number of
power plants

Generation capacity(the entire operation)

Generation capacity(that equal to the equity)

Number of
power plants

Generation capacity(the entire operation)

In operation

5

45MW

44MW

In operation

5

144MW

48MW

Under
construction

-

-

-

Under
construction

1

15MW

4MW

Plan

-

-

-

Plan

-

-

-

Total

5

45MW

44MW

Total

6

159MW

52MW

●In this fiscal year, a total of 132 controls on output were issued by Kyushu Electric Power Company.
（In the same period of the previous year, it was 80 controls.）●The number of issued orders has approximately 1.6 times compared to the same period last year, and our power plants havealso been affected by the output curtailment.
All Rights Reserved. Copyright KYUDENKO CORPORATION

14

Investment in Power Operations
Deals operated by group■Solar Power Plants ■Wind Power Plants(Million yen)(Non-operating income)

2,205 2,260■ Operating profit

1,449 1,556

Deals through investment in equity■Solar Power Plants ■Wind Power Plants

1,748 1,734(Million yen)

Total 5,124
Total 4,878
Total 5,060
Total 5,089
Total 4,822
Total 4,692

Total 1,593
Total 1,538

Total 1,583
Total 1,450

4,205

4,191
4,031 4,050

Total 1,469

Total 1,024

3,970

3,917

1,447
1,412

1,280

1,749

1,685

-156

-147

2023'032024'03

1,066

38
883

790

828

2019'032020'032021'03775
2022'03933
2023'03

135

189
-42

1,090

2024'03

All Rights Reserved. Copyright KYUDENKO CORPORATION

2019'032020'032021'032022'0315

Outline of balance sheet（Million yen, composition ratio）

End of Mar.

End of Mar.

2023

2024

278,220

324,418(62.3%)(64.4%)

168,189

178,865(37.7%)(35.5%)

446,410503,284(100.0%)(100.0%)141,691

195,527(31.7%)(38.9%)

41,702

16,630(9.3%)(3.3%)

183,393

212,158(41.1%)(42.2%)

263,017

291,125(58.9%)(57.8%)

Total liabilities

446,410503,284

and net assets(100.0%)(100.0%)Current assets
Fixed assets
Total assets
Current liabilities
Fixed liabilities

Total liabilities
Total net assets

All Rights Reserved. Copyright KYUDENKO CORPORATION

Increase/decrease46,197

10,675Main factors behindincrease/decrease
Cash on hand and in banks+31,013
Trade notes and accounts receivable+15,985

Consumption tax receivable▲4,420

Investments in securities+9,150
Asset for retirement benefits +4,383

56,87353,836▲25,071

Electronically recorded debt+19,118
Short-term debt+26,469
Accrued consumption tax+6,105
Long-term debt ▲27,578
Allowance for loss on business of
subsidiaries and affiliates+2,260

28,764
28,108

Shareholders' equity+19,446
Net unrealized gains on available-forsale securities+5,381

56,87316

Outline of C/F(Million yen)Mar.2023

Mar.2024

Details of statement toMar. 2023
Profit before income taxes＋41,158

Cash flow from operating activities

17,38643,969

Increase in trade payables+20,767
Income taxes paid ▲11,103
Purchase of property, plant and equipment▲1,836

Cash flow from investment activities▲3,113▲2,314Purchase of investments in securities ▲2,105

Proceeds from sales of investments insecurities +3,354

Free cash flow

14,27341,655

Cash flow by financial activities

11,615▲11,032

26,06030,73737,791

63,851

63,851

94,588

Increase/decrease of cash andcash equivalents
Cash and cash equivalents at the

beginning of the period
Cash and cash equivalents at theend of the period
All Rights Reserved. Copyright KYUDENKO CORPORATION

Repayments of long-term debt ▲1,231

Cash dividends paid ▲8,148

17

Capital Investment
FY2023 Mar.
Capital investment

Facility work

FY2024 Mar.

3.4 billion yen

3.0 billion yen

3.0 billion yen

2.8 billion yen

Replacement of branches ,business offices and sanatoriumof Kyudenko

Replacement of branches , businessoffices and sanatorium of
Kyudenko

Machinery and equipment, etc.
for constructions

Machinery and equipment, etc. forconstructions

Lease contracts on specialized
vehicles for construction

Lease contracts on specialized
vehicles for construction

0.4 billion yen
Others

Machinery etc.

Depreciation

All Rights Reserved. Copyright KYUDENKO CORPORATION

0.2 billion yen
Machinery etc.

6.0 billion yen

6.0billion yen
18Plan for fiscal year

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19

Plan for March 2025
(Million yen)March 2024

Plan for March 2025

March 2025

ResultYear-on-Year

469,057

500,000(100.0%)(100.0%)64,63270,500(13.8%)(14.1%)

38,01639,500(8.1%)(7.9%)

42,36243,000(9.0%)(8.6%)

28,01729,000(6.0%)(5.8%)

Orders440,864

452,000

Current net profit per stock¥395.87¥410.02

120円

¥130

Sales
Gross profit
Operating profit
Ordinary profit
Current (quarter) net profit

Dividends
All Rights Reserved. Copyright KYUDENKO CORPORATIONInterim ¥55

Year-end ¥65

Interim ¥65

106.6％
109.1%
103.9%
101.5%
103.5%
102.5％

Year-end ¥65

20

Orders & Sales plan by department(Million yen)

Sales of each department■2023.3 ■2024.3

240,000■2025.3（plan）■2023.3 ■2024.3
240,000

204,500
201,381

159,783(Million yen)Orders of each department■2025.3（plan）

214,668
221,000
213,481

161,659
161,000
154,647

153,104160,000
134,156

50,00048,253
46,62870,50049,88539,7870

PowerElectrical work HVAC work
distribution
line work

All Rights Reserved. Copyright KYUDENKO CORPORATION

Solar plant
construction
work

50,00048,53048,40922,782
17,19420,0000Power
distribution
line work

Electricalwork

HVAC work

Solar plant
construction
work

21

Difference between numerical targets at the time of formulationof the FY2020 Mid-Term Management Plan and the FY2025 Plan
(Million yen)

Numerical targets
at the time offormulating the
FY2020 Mid-Term
Management Plan

Sales

Ordinary
profitROIC

500,000

The FY2025
Plan

500,000

increaseanddecrease

Note±0・Decrease in sales in FY2024 due topostponement of orders for large wind
power projects ▲50,000
・Due to postponement of full-scaleconstruction of Ukushima Solar,Increasein sales in FY2024 ＋50,000
・Difference in profit margins between
large wind projects and other large solar
projects ▲4,000
・Increase in personnel expenses due tocompensation improvements,
etc,Increase in property costs due to DXrelated expenses, etc. ▲3,000

50,00043,000▲7,000More than
10%

－

－

All Rights Reserved. Copyright KYUDENKO CORPORATION

22

Road map of sales plan
planned value(Billion yen)

500
460
429
392
Renewable energy business

67.8

61.5

396

377
45.8

54.4

Electrical

193.9

construction

149.1

157.7

148.4

195.0

155.9

HVAC
129.9

78.0

61.9

126.1

139.3

148.0

116.0

108.9

45.8
19.5

45.7
18.9

46.6

48.2

50.0

21.2

25.7

29.0

Mar.2021

Mar.2022

Mar.2023

Mar.2024

Mar.2025

Power distribution line

※

46.9

Others 26.7
※Including overseas

Mar.2020

The period of the new mid-term management plan(2020－2024）

ROIC

11.7％

10.0％

All Rights Reserved. Copyright KYUDENKO CORPORATION

9.4％

8.1％

8.6％
23

4th Year’s Summary and Final Initiatives for Medium-Term
Management Plan
Issues for Final Year
Small, Medium Sized
Construction

Rise inCost(Labor)
Reorganization
Pressing
Matters

Human CapitalManagement
Staff Shortage
Recruit, Retention
Diversity

Largest-Ever
Ongoing
Construction

Productivity Enhancement

Upper limit
Staffing
on Overtime
Optimization
Hours

Work Efficiency
Workload Reduction
ＤＸ
Upskilling of More Onsite Clerical Staff

We were working on the above matters in the 4th (FY2023) year but did not solve them at their roots.

These initiatives need to continue to be focused on the 5th (the final) year!!
All Rights Reserved. Copyright KYUDENKO CORPORATION

24

Trend of dividends
・The year-end dividend for the fiscal year ending March 31, 2024, is resolved at 65 yen per share, an increase of
10 yen per share from the latest dividend forecast.
・The annual dividend for the fiscal year ending March 31, 2025 is planned to be 130 yen per share.
Dividend Policy and Reason for Dividend Increase
With regard to distribution of profits, we seek to keep appropriate financial strength and appropriately return profits toshareholders with an awareness of the cost of capital with strengthening management base for improving operating results
and securing internal reserve necessary for further business expansion.
To satisfy expectations of shareholders, we continuously pay a stable dividend with the use of consolidated payout ratio 25%
as a guide, comprehensively taking into account business environment, operating results and financial position.
Based on this basic policy, the year-end dividend for the current fiscal year will be increased from the previously announced
55 yen per share to 65 yen per share from the perspective of business performance and shareholder return for the fiscal year
ending March 31, 2024.
For the fiscal year ending March 31, 2025, we plans to pay an annual dividend of 130 yen per share (including an interim
dividend of 65 yen per share) based on the current earnings forecast and other factors.

200
190
180

■ special■ Consolidated dividend payout ratio

29.6

30.3

31.7

110

120

130

170
160
150

25.2

140
130

26.7

27.0

28.3

27.0

21.4

120
110
100
90

10

80
70
60

10

50
40
30

60

80

100

100

100

100

2019/32020/32021/32022/320
100

2017/3

2018/3

All Rights Reserved. Copyright KYUDENKO CORPORATION

2023/32024/32025/3(Plan)

25

Appendix

All Rights Reserved. Copyright KYUDENKO CORPORATION

26

Corporate profile

Company name

Kyudenko Corporation

Established

December 1, 1944

Capital￥12,561 million

Listed market
Code

Prime Market of Tokyo Stock Exchange, Fukuoka Stock Exchange
1959

Head office

1-23-35 Nanokawa, Minamiku, Fukuoka city

Tokyo head officeSunshine 60 3-1-1 Higashi-Ikebukuro, Toshima-ku, Tokyo

Bases

Head office, Tokyo head office, 13 branches in Japan, 105 sales
offices, / 5 overseas subsidiaries

Approval for
construction

Approved by Minister of Land, Infrastructure, Transport and Tourism(Sp. 29) No. 1659

Number of
employees

Consolidated: 10,687persons (March 31, 2024)

All Rights Reserved. Copyright KYUDENKO CORPORATION

27

Sales and gross profit (quarterly accounting period)(Sales , gross profit：million yen)(Gross profit ratio：％)

200,000

Sales

Gross profit

Gross profit ratio

20.0

Full-year results Full-year results Full-year results Full-year results Full-year results Full-year results
Sales
Gross profit
Gross profit ratio

408,143
60,56114.8％

428,939
60,09314.0％

391,901
56,631
14.5％

376,563
57,36115.2％

150,000

469,057
64,632
13.8％

395,783
57,889
14.6％

18.0

16.9
16.5

15.6

15.6

15.8

16.0

14.8 14.9

14.7

100,000

15.8

13.7

13.6

13.0

13.8 13.9

13.4
13.1
12.5

14.0 14.1

14.0

13.3

13.3

13.5

14.0

12.4

50,000
12.0

0

10.0

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q

2019’32020’3

All Rights Reserved. Copyright KYUDENKO CORPORATION

2021’32022’32023’32024’328

Analysis of works on hand
（Kyudenko individual : excluding power distribution work）
Opening amount of construction works on hand by delivery schedule timing and
Gross profit ratio for each year

Gross profit margin
14.5

Works on6,000
hand

15.2

（Billion yen）

14.6

Total 426.9

Total 415.2
Deliver on after next FY

14.0

Total 363.6

Total 377.8
558

10.0

13.8

5,000

Total 408.7（▲963）

4,000

615
1,578

2,279

3,000

1,837

1,744
2,089

1,131

（＋613）
2,000

Deliver on next FY

701

792

Deliver on FY
1,173
0.0

1,006

1,131

1,560

1,728

1,000

（+168）
0

FY2020

FY2021All Rights Reserved. Copyright KYUDENKO CORPORATION

FY2022

FY2023

FY2024(Plan)
29

Scheduled delivery amount by quarterly accounting period [Opening time](Kyudenko individual : excluding power distribution work)
Opening amount of construction works on hand of quarterly accounting period（Billion yen）

Scheduled delivery amountFY2020

FY2021

FY2022

FY2023

FY2024

Total
117.3

Total
100.6

Total
113.1

Total
156.0

Total
172.8

66.1

55.0
47.948.9
39.3

39.0
34.0

29.5

28.3

26.9
24.1

23.6
19.3

30.6

30.5

31.5

27.0

22.8

19.1
16.4

First quarter

Second quarter

Third quarter

Fourth quarteraccounting period

accounting period

accounting period

accounting period

All Rights Reserved. Copyright KYUDENKO CORPORATION

30

Orders received for small and medium-sized projects (less than 100 million yen)
(Kyudenko individual: excluding power distribution work)◼ Orders for small- and medium-sized projects (contract amounts of less than 100 million yen), which haveshort construction periods and relatively high profit margins, are shown.

(Million yen)

94,962

93,20882,570FY2018FY2019All Rights Reserved. Copyright KYUDENKO CORPORATION

93,333

95,337

83,574FY2020 201903 FY2021

FY2022

FY202331

Key measures◼ "Promotion of Environmental Management" was added as a new issue to be addressed.
While incorporating environmental management and CSV management into our management strategy,
we will adapt to an environment that is changing at an unprecedented pace.

Three reforms
Reform of construction capability
・Strengthen hiring of engineers based on a long-term workforce plan
・Reduce the turnover rate of young engineers by reviewing technical education
・Establish a system to ensure the timely and optimal deployment of all technicians
・Review the construction management system by strengthening and utilizing theTechnology Management Department
・Promote multifunctional workers

Issues continuing from the previous Mid-term Plan
・Deepen measures to improve profit margins
・Strengthen and expand the order base of the domestic facility work industry
・Strengthen the profitability of power distribution line work
・Develop new business areas
・Create an attractive workplace environment
・Increase in corporate value

New Issues to be addressed
Reform of productivity
・Review the company-wide and departmental training systems
・Achieve optimal personnel rotation for the entire company
・Promote rationalization and labor saving through the use of cutting-edge
technology and IT
・Realize business reforms

・Promotion of Sustainability Management
・Thorough management of progress in major projects

Reform of governance・Strengthen and thoroughly implement a governance system

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32

Actual results of recruitment of human resources (Kyudenko individual)
and actual number of personnel at the end of the fiscal year
≪ Comparison in actual results of recruitment
for April 2024 with other companies≫≪ Actual results of periodic recruitment of engineers andskilled persons≫2017 2018 2019 2020 2021 2022 2023 2024
Total
engineers andskilled persons

344

High
schoolgraduates

248

271

253

253

263

225

187

196

University
graduates

96

113

89

83

124

81

72

96

384

342

336

387

306

259

Kyudenko

Large electricalconstruction
companies

Large HVAC
companies

Super general
constructors

Total in all
professions329

330～42050～130360～430Highschoolgraduates

205

Around240

Around10

Around60

University
graduates

124

90～19040～130340～400

292≪ Actual number of personnel at the end of the fiscal year through March 31, 2024 ≫Mar. 2020

Mar. 2021

Mar. 2022

Mar. 2023

Mar. 2024

Electrical work department

2,274

2,359

2,468

2,519

2,563

HVAC work department

1,138

1,188

1,212

1,202

1,216

Year-end workforce of electricaland HVAC

3,411

3,547

3,680

3,721

3,779

Power distribution line
department

1,642

1,566

1,519

1,471

1,437

Other

1,446

1,469

1,508

1,516

1,514

Employees of single
Kyudenko

6,500

6,582

6,707

6,708

6,730

Employees of group10,018

10,198

10,528

10,626

10,687◼ Total 8,700 employees in technical field of total 10,700(Kyudenko)(Subsidiaries)

Number ofsite
technicians

About 2,100+

About 2,100=

About 4,200

Number of
construction
managers

About 3,200+

About 1,300=

About 4,500

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33

Acceleration of Work Style Reform■ In April 2023, "Work Style Reform Department" was established as an organization directed by the President.
⑴Based on the Workplace Reform Action Plan, scrutinize the contents of the implementation plans and manage some progress.
⑵Establish a support system for construction personnel belonging to sales offices.
⑶Plan and execute staffing some administrators to large job sites.

＜ Work Style Reform Action Plan（excerpt）＞
項目

対策

実施内容

Personnel Measures①-1 Deploy technicians①Deploy staff to large job sites①-2 Deploy administrators②Assign staff to sales offices (tohandle small and mediumsized construction projects)②-1 Deploy technical staff②-2 Deploy, train, and hire clericalemployees③-1 Work location selection③Revise the policy to secure personnel ③-2 Contract rehiring③-3 Mid-career hiring

Work Improvement④Transfer task④-1 Transfer construction manager’s
tasks to other departments⑤Reduce workload⑤-1 Engineer’s workload⑤-2 Administrator’s workload⑥Improve productivity (ex. paperless,⑥-1 Operational efficiency through DX
etc.)

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・Deploy head office technical staff to branch offices ahead
・Deploy materials staff
・Deploy technical staff
・Deploy safety management staff
・Deploy administrative staff from head and branch
offices to large job sites
・Deploy clerical employees belonging to branch offices totechnical work
・Switch clerical work in branch offices totemporary employees
・Establish area type: new scheme
・Extend reemployment period
・Ease hiring criteria
・Safety (ex. Training, etc.)
・Sales (ex. receive order sheet, and issue invoices, etc.)
・Affairs (ex. manage materials, subcontracting, expenses , etc.)
・Review business processes (ex. Preparing documents, etc.)
・Review the number of meetings and their members
・Review Kyudenko Academy's training programs (ex. enrich andstreamline the contents)
・Review how engagement surveys should be conducted
・Use electronic official seals and review payment process.
・Introduce and utilize P/L management system.
・Digitize construction project documents (including contracts
with subcontractors)

34

Promoting Diversity
Basic Policy on Diversity Promotion
Based on our Corporate Philosophy and Charter of Corporate Behavior, we believe that our greatest management
resource is our human resources. By respecting and utilizing diversity as a strength of our organization, we aim tocreate new value and enhance our competitiveness. We are committed to promoting diversity by setting thefollowing goals. Through these efforts, we will contribute to the achievement of the SDGs (Sustainable
Development Goals).

Corporate Philosophy
1.We contribute to society through providing agreeable environmental solution.
2.We keep challenging for sustainable development through our engineering strength

What we aim for1.We will create a corporate culture that respects and utilizes diversity.
We will create a corporate culture that respects and recognizes diversity interms of gender, age, disability, race, ability, values, sexual minorities, etc.,

and create a new value.
3.We aim to create mutual respecting environment in Kyudenko which utilize
and develop employees’ personality.

and maximizes its use as an organizational strength.
2.Fostering diverse human resources and promoting their activities.
We will promote the hiring, training, and promotion of diverse humanCharter of Corporate Behavior
1.・・・・・・・・
4. By realizing employee comfort and affluence, we will ensure a safe, easy-towork-in, and open workplace environment, and create a bright and energetic
corporate culture that respects the personality, individuality, and diversity of
our employees.

resources, and support diverse career development and skills development.
3.We will create an attractive work environment that is rewarding andchallenging.
We will strive to improve engagement by creating a workplace environment
in which employees want to work and continue to work, including anenvironment in which each employee can maximize his or her abilities and10.・・・・・・・

in which diverse and flexible work styles are possible.

Basic Policy on Diversity Promotion

Relevance to SDGs

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35

Basic Sustainability Policy
Basic Policy
Based on the corporate philosophy, the Kyudenko Group will create a sustainable society and improvethe corporate value of the Group by solving social issues through its business activities.

 Important issues (materialities)

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36

Efforts to Achieve Carbon Neutrality
Medium- and Long-term Objectives for Environmental Management
2030：Reduce CO2 emissions intensity per sales of completed construction by at least 50% (compared to 2013)
2050：Achieve carbon neutrality【Action items toward achieving these goals】
・Introduction of EMS into Kyudenko Academy

・Environmentally friendly capital investment in equipment related to office buildings

・Deployment of EVs and chargers (special vehicles for construction that cannot be replaced are not eligible)
・Utilization of graduate feed-in tariffs (FITs) (assets at the end of project period)
・R&D through industry-academia collaboration

CO2 emissions volume
Unit

FY2013(1)FY2019FY2020

FY2021

FY2022(2)(2) – (1)FY2030

Scope１

t-CO2

9,059

7,670

6,816

6,947

7,454

▲1,605-

Scope２

t-CO2

5,677

5,094

5,163

5,262

6,080

+403

-

Kyudenko (nonconsolidated) / total

t-CO2

14,736

12,764

11,97912,20913,534▲1,202-

Net sales

100 million
yen

2,597

3,651

3,374

3,226

3,330

+733

-

Intensity

t-CO2／100 million
yen

5.67

3.50

3.55

3.78

4.06

▲1.61

2.83

Intensity unit reduction
rate (compared with
FY2013)％－▲38.2％▲37.3％▲33.3％▲28.3％-▲50%

Intensity: (Scope 1 + Scope 2) / Kyudenko’s non-consolidated net
Scope1: Direct greenhouse gas (GHG) emissions generated by business activities
sales (t-CO2/100 million yen)
Scope2: Indirect emissions resulting from the use of electricity, heat, and steam supplied by external entities
Scope3: Indirect emissions other than Scope 1 and Scope 2 (emissions by other companies related to theactivities of the Company)*The Company will work to expand the scope, including Scope 3

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37

Specific measures to improve the profit margin (excerpt)
FactorMeasures・Forecasting the peak of busyness in the whole construction
period, make an input plan for workers early and start thearrangement. Review the plan in a timely manner andmake adjustments throughout the company.
・Close relationships with construction cooperation companies,
planned order and allocate appropriate personnel, suppress
B. Measures for increase oflabor costs increase.
construction cooperation（Branch executives present annual order amount, andcompanies’ labor costs.
exchange information with cooperation companies
directly.)
C. Establishment of team・Establishment of a team specialized for supporting
supporting construction.
construction by employee technicians.
D. Material ordering linked
・Technical department check whether each branch andto design change andaffiliated company uses Q-mast for purchasing materials, infurther utilization ofcooperation with “Q-mast”. When utilization does not”Q-mast” which affiliatedadvance, technical department and Q-mast investigate thecompany specialized forcause and solve.
purchasing material.
E. Approach to・Make design changes possible based on budget by building a“Front Loading”
good relationship with design office.
・For additional work, the sales representative and theF. Sales representative’s
construction manager cooperate, and before starting
help to construction site
construction, be sure to submit each estimate and negotiate
after construction starts.
the price・Confirming the delay in building construction work process
G. Dealing to delays inwould be happen at the first construction study meetingthe progress of building
after receiving an order, and teaching the method whichconstruction work
make the facility construction possible in advance ofbuilding construction.
A. Forecasting the busyness
peak of construction

１.Cost increase causedby exceeding the plannedlabor and material cost
after receiving an order.

２.Cost increase due tothe compression of facility
construction
process causedby building construction
delay.

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38

Front-loading initiatives
Benefits of being involved from the design stage・[Design Phase] Design changes can be made from the initial design stage(Effective suggestions and cost savings can be anticipated.)・[Contract Stage] Orders can be received with cost savings factored in・[Construction Phase] It allows for a smooth handover to the field<Image in our company><The Concept of Front Loading>（conventional）

Ease of change／
Cost

Aim to participate inprojects at the basic andimplementation design
stage

Ease ofchangeEarly in the projectstage, design changes
are easy

A design processthat incorporates
front-loading

Ahead ofschedule

Cost ofchangeImplementing designchanges at the end of a
project is time-consuming
and costly.

Traditional Design
Processinvestigati
onPlanning and
Designbasic
designdetailed design

procurement

construction（Use of front-loading）

investigation

design office

investigation

design officePlanning and
Designdesign officePlanning and
Designdesign officebasic design

design officeorder strategy

Kyudenkodetailed design

design officebasic design

design office・Kyudenko※Technical Proposal

order strategy

Kyudenkodetailed design

design office・Kyudenko※Technical Proposal

construction

Kyudenko

construction

Kyudenkoadministration

Project Progress
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39

Details of diverse business models (facility work)business
model
item

Ⓐ Proposal and originalcontract type(Local based）Ⓑ Sub-contract type

Ⓒ Capital participation type・Capital participation in a project・Mainly small- and med-

① Feature

sized deals
・Order directly from the owner（prime contractor)

・Large sized deals
・Subcontractor of a generalof collaboration with different
industries, and receiving an orderfor construction
・Construction profit + Business

contractor

profit according to the amount ofinvestment

Mainly Kyushu② Business
area

Urban areas such as
Kanto and Kansai
Fukuoka urban area

To Kanto and Kansai by M & A

Nationwide development

Business area expansion
to the whole country③ Sales④ Profit rate

⑤ Differentiation
strategy⑥ Rival⑦ Composition
ratio

Sales by project are small

Sales by project are large

Relatively higher

Relatively lower（Order directly from the owner）（Mainly subcontracted）

Sales by project are large
Different for each project

By having 110 sales offices throughout Overwhelming ability to collect

By participating from the project

Kyushu and Okinawa, we develop

workforce and ability of directplanning stage, we definitely

local-based sales by engineersconstruction

receive an order for construction

Local small and mediumsized enterprises
about４０％

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Major competitors
about５０％

General contractor
and developer
about１０％40