1st section of Tokyo stock exchange : 1959

KYUDENKO CORPORATIONFY ending March 2022 2nd Quarter
Results briefing

Nov. 11th ,2021

All Rights Reserved. Copyright KYUDENKO CORPORATION

0Table of contents
Overview of business results

2

Plan for fiscal year

20

Highlights

3

Key measures for the second year (FY2021)

21

P/L

4

Plan for fiscal year

22

Factors of change in OP

5･6

Orders/sales by department

23

Trend of dividends

24

Mid-term management plan・growth strategy

25

Numerical targets

26

Road map of sales plan

27

Development of new business areas
Green Innovation Business Unit

28

M&A and capital alliances

29

Promoting Diversity

30

Appendix

31

Sales, Orders and Works on hand
1. Orders received/sales by department

7

2. Orders received/sales by customer

8

3. Orders received/sales by region
4. Year-end amount of works on hand

9・10

11

Actual results of works

12

B/S

13

C/F

14

Capital Investment

15

Power generation business

All Rights Reserved. Copyright KYUDENKO CORPORATION

16～19

1

Overview of business results

All Rights Reserved. Copyright KYUDENKO CORPORATION

2High lights
Sales¥158,194

million2nd-on-2nd

87.8%

2nd-on-2nd103.7%

2nd-on-2nd

107.2%

Operating profit¥11,658

million

Orders¥180,271

millionAll Rights Reserved. Copyright KYUDENKO CORPORATION

3

Outline of P/L March 2022, 2nd quarter(Million yen)March 2021,
2Q Result

March 2022, 2Q
Increase
Result/decrease2nd-on-2nd

180,101

158,194▲21,906

87.8%

Gross profit

23,36923,546＋177

100.8％

Operating profit

11,244

11,658＋413

103.7％

Ordinary profit

12,533

13,579＋1,045108.3％

8,286

9,843

＋1,556118.8％￥116.97￥138.94

Sales

Net profit

Net profit per share

All Rights Reserved. Copyright KYUDENKO CORPORATION(100.0%)(13.0%)(6.2%)(7.0%)(4.6%)(100.0%)(14.9%)(7.4%)(8.6%)(6.2%)

4

Factors of change in OP
15:Increase（Billion Yen）

:DecreaseＤ

Improvement inProfit margin

A

Increase in fixed costs included
in construction costs

▲0.7
10

11.2

Ｅ

＋0.2
B

Decrease in
SG&A
expenses

Operatingprofit inMarch, 2021
2Q end

▲0.4

▲2.4
Ｃ
Decrease in
sales

＋3.9

Power
distribution
line work▲0.2
Ｆ

Other business

11.6
Operatingprofit inMarch, 2022
2Q end5

All Rights Reserved. Copyright KYUDENKO CORPORATION

5

Breakdown of construction sales and Factor of gross profit ratio Sep.2021(Kyudenko individual : excluding power distribution line work)
Average profit ratio

25.7
23.7

27.0

24.7

25.5

22.5

18.8

Construction sales

17.5
15.8

16.3
Sales fromNot delivered
items

Total 123,930

Total 120,951

Total 142,645

Project Not delivered（Percentage of completion method）

59,03548%

63,884

Sales fromdelivered items

18%

19,10516%

37,96231%

Project delivered（Completed-contract method）

42,4382017’0934%

2018’09

All Rights Reserved. Copyright KYUDENKO CORPORATION

78,04155%

53%

Project delivered（Percentage-of-completion method）

22,45726.0
200,000

18.7

18.1

25.8

25,901

18%

38,70327%

2019’09

150,000

14.8

Total 135,645
76,11356%

26,24233,2892020’09(Million yen)

Total 116,006
100,000

55,96648%

19%

21,981

19% 50,000

25%

38,05933%

2021’0906Order received / Sales by department Sep. 2021

(Million Yen)

Sales of each department(Million Yen)

Orders of each department■2019.9■2019.9

120,000

120,000■2020.9■2020.9■2021.9■2021.9

86,194

84,581
73,26073,19664,88562,512 60,903
55,86570,50966,05258,414

48,972
23,64922,58821,01130,181
26,353 20,140

22,82424,607
21,495
13,614
12,774
8,141

0

0

Power
Electrical work HVAC work
distribution
line work

All Rights Reserved. Copyright KYUDENKO CORPORATION

Solar plant
construction
work

Power
Electrical work HVAC work
distribution
line work

Solar plant
constructionwork

7Order received / Sales by customer Sep. 2021

(Million Yen)

Sales of each customer■2019.9■2019.9■2020.9■2020.9

180,000(Million Yen)

Orders of each customer
180,000■2021.9

147,952

164,305■2021.9

145,917
141,822130,202123,725

23,352

22,24724,03821,00912,79722,76121,806

16,64215,1505,742

5,356 7,902
00Kyushu ElectricPower Co,

Govermment/Public

All Rights Reserved. Copyright KYUDENKO CORPORATION

Privatecompanies

Kyushu ElectricPower Co,

Govermment/Public

Privatecompanies

8Order received / Sales by region Sep. 2021
(Electrical & HVAC work excluding Solar plant construction work)(Million yen)

Sales of each region■2019.9 ■2020.9 ■2021.9(Million yen)Orders of each region■2019.9 ■2020.9 ■2021.9

130,000

130,000

103,417

105,047

86,55887,82578,04377,51239,78835,81833,63433,44931,39924,293
11,1450

KyushuTokyo Tohoku
and Chubu Areas

8,715
8,554
8,130 4,782

9,200
3,324
6,354
2,109
1,678

Osaka Area

All Rights Reserved. Copyright KYUDENKO CORPORATION

Overseas

0

KyushuTokyo Tohoku
and Chubu Areas

Osaka Area

3,820
744

Overseas9Order received / Sales by region Sep. 2021
(Solar plant construction work)(Million yen)

Sales of each region■2019.9 ■2020.9 ■2021.9(Million yen)Orders of each region■2019.9 ■2020.9 ■2021.9

24,211

14,028
11,434

10,401 9,850

7,204

6,770
5,752

4,818

3,519

6,099

2,000

1,596

141
0

KyushuTokyo Tohoku andChubu Areas

Osaka Area

All Rights Reserved. Copyright KYUDENKO CORPORATION

451

1,592
889

446

0

KyushuTokyo Tohoku andChubu Areas

Osaka Area

10

Situation of works on hand Sep. 2021

(Million yen)Order stock of each department■2018.9 ■2019.9 ■2020.9

197,976

New orders in FY ended Sep. 2021
Image

166,209

170,000

142,377

130,246
125,934
127,513 131,025
115,81483,725

Image

1,859

1,798
1,751
0

Power
Electrical work HVAC work
distribution
line work

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Solar plant
construction
work

11

Actual results of works Sep. 2021

Image

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12

Outline of balance sheet(Million Yen, composition ratio)

End of Mar.
2021
Current assets
Fixed assets
Total assets
Current liabilities
Fixed liabilities
Total liabilities
Total net assets
Total liabilities
and net assets

End of Sep.
2021

212,574

183,413

153,957

158,008

366,532

341,421

125,361

95,237(58.0%)(42.0%)(100.0%)(53.7%)(46.3%)(100.0%)(34.2%)(27.9%)

19,42919,079144,790

114,317

221,741

227,104

366,532

341,421(5.3%)(39.5%)(60.5%)(100.0%)All Rights Reserved. Copyright KYUDENKO CORPORATION(5.6%)(33.5%)(66.5%)(100.0%)

Increase/decrease

Main factors behindincrease/decrease▲29,160

Trade notes and accounts receivable▲38,139

4,050

Goodwill ＋2,037
Asset for retirement benefits＋1,894▲25,110▲30,124▲349

Trade notes and accounts payable▲19,821
Unpaid consumption tax ▲6,399
Electronically recorded obligations ▲5,056

Long-term debt ▲724

▲30,4735,362

Retained earnings +6,223▲25,11013

Outline of C/F(Million Yen)

Sep. 2020

Sep. 2021

Details of statement to
Sep. 2021
Profit before income taxes ＋14,248

Cash flow from operating activities

12,096

9,510

Decrease in notes and accounts receivable
on completed construction contracts+39,232
Decrease in notes and accounts payable on
construction contracts ▲26,108

Cash flow from investment activities

Free cash flow

Cash flow by financial activities
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▲3,163▲4,903

8,932

4,606

▲4,494▲5,076

4,369

▲416

54,96449,80059,33349,550

Payments for acquisition of shares insubsidiaries resulting in change in scope of
consolidation▲2,871
Payments for acquisition of tangible fixed
assets▲1,853

Cash dividends paid ▲3,554
Repayments of long-term debt ▲87414

Capital Investment
End of Mar. 2021
Capital investment

End of Sep. 2021

3.6 billion yen

1.8 billion yen

3.3 billion yen

1.7 billion yen

Replacement of branches ,business offices and sanatoriumof Kyudenko

Replacement of branches andbusiness offices of Kyudenko

Machinery and equipment, etc. forconstructions

Machinery and equipment, etc. forconstructions

Lease contracts on specialized
vehicles for construction

Lease contracts on specialized
vehicles for construction

Facility work

0.3 billion yen
OthersSoftwareDepreciation

All Rights Reserved. Copyright KYUDENKO CORPORATION

0.1 billion yen
Machinery

5.9 billion yen

etc.

2.8 billion yen
15

Investment in Power Operations (Solar Power Plants)
Mega solar power plant

Ishikawa

Miyagi
Fukushima

Okayama Hyogo

Gotou
Hiroshima

Deals operated by group- In Operation

Chiba- Under construction- Preparing for construction
Projects for equity investment- In Operation- Under construction

Amami

Nara Mie

Aichi- Preparing for construction

All Rights Reserved. Copyright KYUDENKO CORPORATION

16

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 otheroperations sales)(acquire investment securities and record an amount equal to the equity to nonoperating revenues)
Depreciated at the straight line method

Depreciated at the declining balance method

Number ofpower
plantsGeneration
capacity(the entire
operation)

Generation
capacity(that equal tothe equity)

Number ofpower
plantsGeneration
capacity(the entire
operation)

Generation
capacity(that equal to theequity)In operation

49

92MW

87MW

In operation

49

540MW

152MW

Under
construction

-

-

-

Under
construction

5

687MW

139MW

Plan

-

-

-

Plan

-

-

-

Total

49

92MW

87MW

Total

54

1,227MW

291MW

From April to September, a total of 44 controls on output were issued by Kyushu Electric Power Company.
The average number of controls at our power plants was 15.
The total amount of lost profits for the group was about 365.0million yen.

All Rights Reserved. Copyright KYUDENKO CORPORATION

17

Investment in Power Operations (Wind Power Plants)
Deals operated by group

風力発電所
Fukui

Miyagi
Fukushima(make capital investment and record the entire operation to otheroperations sales)
Depreciated at the Mainly declining balance method
Number of
power plants

Generation capacity(the entire
operation)

Generation capacity(that equal to theequity)In Operation

4

37MW

37MW

Under
construction

-

-

-

Plan

-

-

-

Total

4

37MW

37MW

Deals through investment in equity
Gotou

Deals operated by group- In Operation
Projects for equity investment- In Operation- Under construction- Preparing for construction

All Rights Reserved. Copyright KYUDENKO CORPORATION(acquire investment securities and record an amount equal to the equity to
non-operating revenues)
Depreciated at the Mainly declining balance method

Aichi

Number of
power plants

Generation capacity(the entire
operation)

Generation capacity(that equal to theequity)In Operation

5

145MW

50MW

Under
construction

1

7MW

2MW

Plan

1

15MW

3MW

Total

7

167MW

55MW
18

Investment in Power Operations

Mar.2022 2nd quarter end

Deals operated by group■Solar Power Plants ■Wind Power Plants■ Operating profit

Deals through investment in equity(Non-operating income)(Million yen)

■Solar Power Plants ■Wind Power Plants

1,119 1,097 1,087
906

971

Total 2,896

705

Total 2,730

Total 700

Total 2,624
Total 2,478

Total 2,468
Total 2,297

2,530
1,894

(Million yen)

2,154

Total 653
Total 606

Total 392
2,370

2,263

720

2,159

706

593

Total 120

Total 210

423
245

217
403

314

366

360

361

318

2016'092017'092018'09

2019'09

2020'092021'09

All Rights Reserved. Copyright KYUDENKO CORPORATION-97
2016'09-31
2017'09-20
2018'09-53
2019'0913
2020'09-35
2021'0919

Plan for fiscal year

All Rights Reserved. Copyright KYUDENKO CORPORATION

20Key measures for the second year (FY2021)
Matters to be focused on[Excerpt]

Theme for FY2021

Strengthen and expand the order base『Application to environmental
changes and realization of recovery』•Secure orders and construction of large-scale projects
in Japan•Expansion of small and medium-sized projects

Group sales:

Deepen measures to improve profitability

500 billion•Re-enforcement of measures to improve profit margin•Strengthen cost management and construction support
by the Engineering Management Department

yen

Strengthen human resource development•Strengthen OJT (on-the-job training) for young
employees•Introduction of digital education support tools

Promotion of DX•Improvement of operations and review of processes•Research and study of BIM and advanced technologies

Strengthen governance•Ensuring the implementation of measures to prevent
recurrence in order to eradicate fraudulent activities•Further enhancement of compliance education

All Rights Reserved. Copyright KYUDENKO CORPORATION

21

Plan for March 2022
(Million yen)

Plan for March 2022

March 2021
ResultMarch 2022

Year-on-Year

2Q Result

Progress

391,901

410,000

104.6%

158,194

38.6%

Gross profit

56,63160,000105.9%

23,546

39.2%

Operating profit

32,99835,000106.1%

11,65833.3%

Ordinary profit

35,90637,700105.0%

13,57936.0%

Current (quarter)
net profit

25,04225,500101.8%

9,843

38.6%

Current net profit
per stock¥353.48

Sales

Dividends(100.0%)(14.5%)(8.4%)(9.2%)(6.4%)¥100

Interim ¥50

All Rights Reserved. Copyright KYUDENKO CORPORATION(100.0%)(14.6%)(8.5%)(9.2%)(6.2%)¥359.94(100.0%)(14.9%)(7.4%)(8.6%)(6.2%)¥138.94¥100

Interim ¥50

22

Orders & Sales plan by department(Million yen)

Sales of each department■2020.3 ■2021.3

240,000■2022.3（plan）(Million yen)Orders of each department■2020.3 ■2021.3■2022.3（plan）

240,000

180,000

165,000

166,344
153,773

176,545

156,104
142,575

134,955 132,000
123,199

118,699

59,306
46,90046,00045,793

126,801 137,000

55,00054,56447,57446,00045,65430,00018,2290

PowerElectrical work HVAC work
distribution
line work

All Rights Reserved. Copyright KYUDENKO CORPORATION

Solar plant
construction
work

0

Power
distribution
line work

Electricalwork

HVAC work

Solar plant
construction
work

23

Trend of dividends
For the fiscal year ending March 31, 2022,
we plan to pay an annual dividend of 100 yen per share.
130

Dividend policy

120
With
regard to distribution of profits, we seek to keep appropriate
financial strength and appropriately return profits to shareholders with110strengthening
management base for improving operating results andsecuring internal reserve necessary for further business expansion.
To100satisfy expectations of shareholders, we continuously pay a stabledividend with the use of consolidated payout ratio 25% as a guide,90
comprehensively
taking into account business environment, operating
results and financial position.

100

100

100

100

Mar,2019

Mar,2020

Mar,2021

Mar,2022

90

10

80

70

70
10

■ Special■ Memorial

60

45

50

40

30

10

13
3

Mar,2013

Mar,2014

20

10

25
2
7

15

0

Mar,2011

Mar,2012

All Rights Reserved. Copyright KYUDENKO CORPORATION

Mar,2015

Mar,2016

Mar,2017

Mar,2018

24

Mid-term management plan

(Published on April 28,2020.)

All Rights Reserved. Copyright KYUDENKO CORPORATION

25

New mid-term management plan(2020～2024）

Main theme

Establish a management foundation for sustainable growth～Realization of the three reforms～
Numerical target
Final year（Mar.2024）
Sales
Ordinary profit
margin

ＲＯＩＣ（Breakdown of construction sales）

500 billion yen
50 billion yen
Over 10.0 ％Power distribution line work
Electrical･HVAC work

50 billion yen
334 billion yen

Renewable Energy Business,etc.

81 billion yen

Other business

35 billion yen

Over 10.0 ％※ROIC is used as an accurate measure of a company's capital eﬃciency.

All Rights Reserved. Copyright KYUDENKO CORPORATION

26

Road map of sales plan
Goals for the(Billion yen)

final year

500
429
392

Renewable energy business

81.0

410

Solar plant
construction(17.0）

Solar plant

67.8 construction (59.3）

61.5 Solar plant

construction (54.5）

Electricalconstruction

191.0

149.1

157.7
HVAC

143.0

129.9

116.0

Power distribution line

46.9
Others 26.7

ROIC

50.0

45.8
19.5

Mar.2020

Mar.2021

11.7％

10.0％

35.0
Mar.2022

Mar.2023

Mar.2024

Mar.2025

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

All Rights Reserved. Copyright KYUDENKO CORPORATION

27

Development of new business areas
Green Innovation Business Unit
Strategy1 Strengthen energy services

Strategy2 Deployment for PPA solar●In addition to urban redevelopment projects, the company
will strengthen its proposals for hospitals and factories.

●Proposals for large private sector electricity consumers●By winning orders for ES, the company will be able to win
subsequent orders for electrical and air conditioning andsanitation work.

■Image of the business scheme（SPC）
Energy Supply
kyudenko

Company Ａ■ Image of the business scheme
Customer

Customer（Large private sector electricity consumers
Local governments etc.）

urban
redevelopment
projects

Electricity, city gas, etc.
Implementing a highly
efficient system

SPC

hospitals（Customer・Kyudenko・Etc）

EV CarCharging
centerAll Rights Reserved. Copyright KYUDENKO CORPORATION

etc.

Off-siteand maintenance

PPA

factories

On-siteEquipment operation

Kyudenko
EMS

Heat source equipment, powerreceiving and transforming
equipment, etc.

Energy management

Company Ｃ●Proposal for the introduction of Kyudenko EMS

PPACompany Ｂ●Proposals to local governments to convert public facilities
to renewable energy

28

M&A and capital alliances
CENTRAL GENERALCHUORIKA KOUGYO Co.,Ltd.

DEVELOPMENT

Company Profile

Company Profile

Company Profile

・Location: Idabashi, Chiyoda-ku, Tokyo

・Location: Sugamo, Toshima-ku, Tokyo
・Business activities: Construction of disaster prevention
equipment, etc.
・Capital: 99 million yen

・Business activities: Real estate sales

・Number of employees: Approximately 160 (Group total)
・Business locations: Kanto area and nationwide
・Shareholding ratio: 100% (subsidiary)

・Location:Kawasaki-City,Kanagawa
・Business activities:
Recycling businessbusiness, etc.

Technology licensing business・Capital: 1,008 million yen

Environmental Consulting

・Establishment: 1959
・Number of employees: Approximately 160

・Establishment: 1948

JEPLAN,INC.

CO.,LTD.

(Group total)

Business
・Business locations:
Kitakyushu Hibikinada Factory

・Business locations: Expand to the wholecountry

Kawasaki Plant
・Establishment: 2007

・Shareholding ratio: 20.0%(Affiliates accounted for by the equity method)

Purpose of share acquisition

 Expansion of the Group's business domain（Acquisition and utilization of know-how in the disaster prevention field）
 Creation of new order opportunities through mutual collaboration（Synergy effects）
 Prevention of outflow of disaster prevention-related costs in the Company（Maintenance orders placed with target companies for properties constructedby the Company）

Purpose of share acquisition Purpose of share Tie-up of the residential portion of urban redevelopment
acquisition（Participation in PFI projects and other development
projects）


Expansion of orders and accumulation of construction
know-how in the condominium fieldProposing environmentally friendly new equipment forexisting condominiums undergoing large-scale repairs（Proposals for the introduction of the latest equipment,
including solar power generation, air conditioning control
equipment, information and communications

 Expansion of the Group's business（Contribution to the achievement of the goals of the medium-term

infrastructure, and disaster prevention equipment）



The company's efforts are in line withthe direction of "promoting
environmentally friendly urban
development," a key issue in our midterm management plan.



We believe that our technologicalcapabilities and know-how inrenewable energy and energy
conservation can greatly assist thecompany in its efforts to achieve zeroCO2 emissions at its plants and otherfacilities.

management plan）

All Rights Reserved. Copyright KYUDENKO CORPORATION

29

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

Charter 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.

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 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 humanresources, 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

All Rights Reserved. Copyright KYUDENKO CORPORATION

Commitment video by the president

30Appendix

All Rights Reserved. Copyright KYUDENKO CORPORATION

31

Corporate profile

Company name

Kyudenko Corporation

Established

December 1, 1944

Capital￥12,561 million

Listed market
Code

1st Section 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, 10 branches in Japan, 120 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: 10,198 persons (March 31, 2021)

All Rights Reserved. Copyright KYUDENKO CORPORATION

32

Analysis of works on hand

（Kyudenko individual : excluding power distribution work）
Third quarter opening construction works on hand by delivery schedule timing
Works on hand（Billion yen）

500.0

Total 402.5
Total 359.9
Total 318.0
Deliver on after next FY

Total 383.4.0

400.0

Total 316.8
132.4

157.0

110.2

235.4

201.2

300.0

(▲34.2)200.0

Deliver on next FY

148.4

93.3
Deliver on FY
67.7
FY2017 3Q

79.1
FY2018 3Ｑ

All Rights Reserved. Copyright KYUDENKO CORPORATION

123.9

82.7
FY2019 3Ｑ

93.7
73.4
FY2020 3Ｑ

110.5(＋16.8)

100.0

71.6

(▲1.8)

0.0

FY2021 3Ｑ
33

Orders for small and medium-sized projects(Kyudenko individual : excluding power distribution work）
Orders for small and medium-sized projects with short construction periods and relatively high profit margins(Million yen)■2017.9 ■2018.9 ■2019.9 ■2020.9 ■2021.9

100～300 million yen
All Rights Reserved. Copyright KYUDENKO CORPORATION

Under 100 million yen
34

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

200,000

Sales

Gross profit

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

341,771
51,95115.2％

360,872
56,65915.7％

408,143
60,56114.8％

428,939
60,09314.0％

391,901
56,631
14.5％

Gross profit ratio

20.0

2Ｑ results
158,194
23,54614.9％

18.0

150,000

16.0

100,000

14.0

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

2017’32018’3

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2019’32020’32021’32022’335

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

150,000

30.4

27.2

26.4
Construction sales

24.4(Million yen)
100,000

18.6

17.8
Total 65,555

Sales fromNot delivered items

Total 50,451

Project Not delivered（Percentage of completion method）

28,885

Sales fromdelivered items

35,239

54%

8,068

12%

22,24834%

50,00058%

Project delivered（Percentage-of-completion method）

5,755

11%

15,81131%

Project delivered（Completed-contract method）

2021’1Q

2021’2Q

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2021’3Q

2021’4Q

036

Actual results of recruitment of human resources(Kyudenko individual) and workforce planning≪ Comparison in actual results of recruitment
for April 2021 with other companies≫≪ Actual results of periodic recruitment of engineers andskilled persons≫2015 2016 2017 2018 2019 2020 2021

Total
engineersand skilled
persons

2007～
2014

Around
200

241

262

344

384

342

336

387

High
schoolgraduates

Around
150

163

177

248

271

253

253

University
graduates

Around
50

78

85

96

113

89

83

Kyudenko

Large electricalconstruction
companies

Large HVAC
companies

Super general
constructors

Total in all
professions

411

300～390

90～100250～350263

High
schoolgraduates

263

Around200

Around10

Around10

124

University
graduates

148

90～18080～90

190～330

Mar. 2020

Mar. 2021

Mar. 2022

Mar. 2023

Mar. 2024

Mar. 2025

Increase or
decrease inplanElectrical work department

2,274

2,359

2,475

2,599

2,750

2,893

About+550

HVAC work department

1,138

1,188

1,269

1,355

1,435

1,517

About+320

Year-end workforce of electricaland HVAC

3,411

3,547

3,744

3,954

4,185

4,410

About+870

Power distribution line
department

1,642

1,566

1,618

1,632

1,641

1,666

About+50

Other

1,446

1,469

1,407

1,402

1,397

1,408

Employees of single
Kyudenko

6,500

6,582

6,769

6,988

7,223

7,484

About+900

Employees of group10,018

10,19812,000

About+2,000≪ Planned year-end workforce until FY2025 March≫

Total 8,200 employees in technical field of total 10,000(Kyudenko)(Subsidiaries)

Number ofsite
technicians

About 2,000+

About 2,000=

About 4,000

Number of
construction
managers

About 3,100+

About 1,100=

About 4,200

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37

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 generalcontractor

of collaboration with different
industries, and receiving an orderfor construction
・Construction proﬁt + Businessprofit 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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General contractor

Major competitorsand developer

about５０％

about１０％38
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

Project Progress
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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

construction

Kyudenkodetailed design

Kyudenko

construction

design office・Kyudenko※Technical Proposal

Kyudenkoadministration

39

Specific measures to improve the profit margin (excerpt)
Factor

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.

Measures・Forecasting the peak of busyness in the whole construction
A. Forecasting the busyness
period, make an input plan for workers early and start thepeak of construction
arrangement. 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.

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40

【Positional relationship】
Fukuoka Waterfront Next, Tenjin Big Bang, Hakata Connected

Relaxation of height restriction
380,000 ㎡ in the waterfront area (70m→100m)
193,000 ㎡ in Tenjin area (67m→115m at maximum)
Request for relaxation of height restriction
Hakata Station area (50m→60m)

Sanyo Shinkansen line

Waterfront area

空港まで10
10 minutes by
分 tohighway
the airport

Fukuoka urban expressway
10 minutes
15 minutes by
空港まで10highway to分the airport

5 minutes

Hakata Station area

Showa Street
Meiji Street

Tenjin area
Fukuoka City Subway Airport Line
Nishi-Nippon Railroad
Fukuoka(Tenjin)station

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10 minutes
to theairport5 minutes
Fukuoka City Subway Nanakuma Line41

【Project contents】
Fukuoka Waterfront Next, Tenjin Big Bang, Hakata Connected

Project

Purpose

Period and scale①Tenjin Big Bang・By promoting theredevelopment of the Tenjin
area, which is the center of
Fukuoka, enhance the roleand function as a hub city in
Asia and create jobs

・Through 2026
・About 193,000㎡ of about
500ｍ in radius from
Tenjin intersection
・Total floor area
About 800,000㎡
・Reconstruction ofbuildings in Tenjin
area (30 buildings)②Fukuoka
Waterfront Next

・Create bustle around Hakata
Port, the gateway to Kyushu
・Improved urban functions tomeet MICE and cruisedemand③Hakata Connected

・Connect the vitality andbustle of Hakata Station, thegateway to Kyushu, to thesurrounding area.

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・Over 10-20 years
・Cruise terminal, MICE,
commercial facilities,
hotels※Policy to scale back due to
COVIT-19・Through 2028
・About 800,000㎡ ofabout 500m in radiusfrom Hakata Station
・Reconstruction ofbuildings around
Hakata Station (20 buildings)

42

Post-2020 Prediction about industry
Construction demand will be supported by large-scale projects and renovation of aging infrastructure
built more than 50 years ago. The labor shortage will accelerate with the decline in the working age
population, with a rapid falloff in supply capability.
Real construction
investment(Trillions of yen) 非住宅建設
90
80

Past construction
investment amountNo. of constructionindustry employees

住宅建設

No. of constructionindustry employees(Thousands)

Tokyo Olympic (2021)

Correspondence to earthquake resistant structure ·Rebuilding / renewal demand of buildings
over 50 years after construction
Tenjin Big Bang Project (through 2024)
Waterfront Next (over 20-30 years)

民間土木
政府土木

70

70
700

Linear Shinkansen Line 60
600
opened to Osaka(2045)

60

50
500

50

40
400

40

Supported by redevelopment demand
Buildings constructed during the period of higheconomic growth have passed their useful lives

30

30
300
20
200

20

Working age population Working age population Working age population
Base: 74.1 million
77.28 million
Peak: 87.26 million

10(2015)(1995)(2020)

0

年1960

80
800

1970

1980

1990

2000

2010

2020

2030

Working age population
Forecast: 45.29 million(2065)

2040

10
100
00

2050

度
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43