ICHIKEN BUSINESS REPORT2023 Full-year: April 1, 2022 March 31, 2023
VIERRA Maita (Kanagawa) *ZEB-Ready certification acquired

BRANCHERA Sapporo Higashi Kuyakusho-mae

Photograph : SS Co., Ltd.
Joshin Nipponbashi Store (Osaka)

NITORI Kobe Distribution Center (Hyogo)

Bringing the future to you through innovative living spaces

Stock Exchange Code:1847

June 28, 2023

Top message
Summary of business operations
Toward the centennial anniversary of foundation

Bringing the future to you
through innovative living spaces

Greetings
Thank you for your continued support
and patronage.
We hereby report on the summary of
our business operations
for the 97th fiscal year (April 1, 2022 toMarch 31, 2023).
June 2023
Representative Director & President

Hiroyuki Hasegawa

Net sales
Full-year

Operating profit(Unit: Millions of yen)
(Forecast)

83,77688,05990,000Full-year

In the social environment surrounding ICHIKEN for the current fiscal
year, although there were signs of a recovery in business conditions
with measures to prevent COVID-19 being implemented alongside theeconomic activities taking place at the same time, the pace of recovery has been moderate due to factors such as rising consumer prices
caused by sharp rises in material prices and the rapid deprecation of
the yen. In the results for the current fiscal year, the final year of themedium-term business plan, net sales increased by 5.1% year on year
to 88,059 million yen, but the final result was an extremely harsh one,with the impact of sharp rises in the prices of construction materials
and soaring labor costs causing net profit for the current fiscal year
to plummet to 1,708 million yen (57.2% compared with the previous
fiscal year).
In our forecasts for the next fiscal year, COVID-19 was downgraded to a Class 5 infectious disease under the Act on the Preventionof Infectious Diseases and Medical Care for Patients with Infectious
Diseases in May 2023 and social and economic activities have increasingly returned to normal. While the construction industry willneed to be mindful of increasing project costs caused by rises in raw
material costs, fuel and transport costs, and wages, we believe thatthe resumption of projects that had been disrupted or postponed by
the pandemic and the expansion of environment-related investments,
such as decarbonization and energy-saving responses, will turn out tobe favorable conditions for the construction market.
It was amid this kind of business environment that we formulated
our long-term business plan, “Vision 2030” that sets out our vision for
the kind of company that we want to be in 2030. In addition, we will
have a new medium-term business plan for the three years from our
98th fiscal year (2023-2025). The major themes for the new medium-term business plan are the “stability” of the construction business,with commercial facilities at its core, and the “enhancement” of initiatives to expand business domains aimed at sustainable growth, as weseek to achieve our management goals.
Another pressing challenge for ICHIKEN will be our responses tothe restrictions on the upper limit of overtime hours that will be applied
from April next year. We will promote the digitalization of our operations with the aim of improving productivity and continue to invest ininitiatives aimed at digital transformation. Moreover, with the growing
diversity of our personnel, we will promote management that focuses on human capital, such as training to encourage our employees’
growth and the development of our next-generation leaders, which wewill connect to the further enhancement of corporate value.

Ordinary profit(Unit: Millions of yen)

4,674

Full-year

4,636

2,667

(Unit: Millions of yen)

(Forecast)(Forecast)

3,000

96th fiscal year 97th fiscal year 98th fiscal year
(FY2021)(Current fiscal year) (Next fiscal year)(FY2022)(FY2023)

Full-year

2,985(Forecast)

96th fiscal year 97th fiscal year 98th fiscal year
(FY2021)(Current fiscal year) (Next fiscal year)(FY2022)(FY2023)

Profit(Unit: Millions of yen)

2,585

2,900

96th fiscal year 97th fiscal year 98th fiscal year
(FY2021)(Current fiscal year) (Next fiscal year)(FY2022)(FY2023)

2,000
1,708

96th fiscal year 97th fiscal year 98th fiscal year
(FY2021)(Current fiscal year) (Next fiscal year)(FY2022)(FY2023)

C

Top message
Summary of business operations
Toward the centennial anniversary of foundation

Bringing the future to you
through innovative living spaces

Greetings
Thank you for your continued support
and patronage.
We hereby report on the summary of
our business operations
for the 97th fiscal year (April 1, 2022 toMarch 31, 2023).
June 2023
Representative Director & President

Hiroyuki Hasegawa

Net sales
Full-year

Operating profit(Unit: Millions of yen)
(Forecast)

83,77688,05990,000Full-year

In the social environment surrounding ICHIKEN for the current fiscal
year, although there were signs of a recovery in business conditions
with measures to prevent COVID-19 being implemented alongside theeconomic activities taking place at the same time, the pace of recovery has been moderate due to factors such as rising consumer prices
caused by sharp rises in material prices and the rapid deprecation of
the yen. In the results for the current fiscal year, the final year of themedium-term business plan, net sales increased by 5.1% year on year
to 88,059 million yen, but the final result was an extremely harsh one,with the impact of sharp rises in the prices of construction materials
and soaring labor costs causing net profit for the current fiscal year
to plummet to 1,708 million yen (57.2% compared with the previous
fiscal year).
In our forecasts for the next fiscal year, COVID-19 was downgraded to a Class 5 infectious disease under the Act on the Preventionof Infectious Diseases and Medical Care for Patients with Infectious
Diseases in May 2023 and social and economic activities have increasingly returned to normal. While the construction industry willneed to be mindful of increasing project costs caused by rises in raw
material costs, fuel and transport costs, and wages, we believe thatthe resumption of projects that had been disrupted or postponed by
the pandemic and the expansion of environment-related investments,
such as decarbonization and energy-saving responses, will turn out tobe favorable conditions for the construction market.
It was amid this kind of business environment that we formulated
our long-term business plan, “Vision 2030” that sets out our vision for
the kind of company that we want to be in 2030. In addition, we will
have a new medium-term business plan for the three years from our
98th fiscal year (2023-2025). The major themes for the new medium-term business plan are the “stability” of the construction business,with commercial facilities at its core, and the “enhancement” of initiatives to expand business domains aimed at sustainable growth, as weseek to achieve our management goals.
Another pressing challenge for ICHIKEN will be our responses tothe restrictions on the upper limit of overtime hours that will be applied
from April next year. We will promote the digitalization of our operations with the aim of improving productivity and continue to invest ininitiatives aimed at digital transformation. Moreover, with the growing
diversity of our personnel, we will promote management that focuses on human capital, such as training to encourage our employees’
growth and the development of our next-generation leaders, which wewill connect to the further enhancement of corporate value.

Ordinary profit(Unit: Millions of yen)

4,674

Full-year

4,636

2,667

96th fiscal year 97th fiscal year 98th fiscal year
(FY2021)(Current fiscal year) (Next fiscal year)(FY2022)(FY2023)

96th fiscal year 97th fiscal year 98th fiscal year
(FY2021)(Current fiscal year) (Next fiscal year)(FY2022)(FY2023)

Full-year(Unit: Millions of yen)

2,985

2,585

To be a construction business operator that is capable of not only
providing buildings that offer high customer satisfaction for both
quality and price but also considering the global environment for asustainable society.

Vision 2030 and Medium-term Business Plan (2023-2025)

In 2023, ICHIKEN formulated its long-term business plan “Vision 2030” to take the company into 2030, the 100th anniversary of
its foundation. That vision is to become “a company that steadily grows while contributing to sustainable development of society.”

INCREASE
CORPORATE VALUE

Through our approaches to our ESG Materiality announced in 2021, we are promoting initiatives that are conscious of realizing asustainable society, aiming for the international targets stated in the 2030 Agenda for Sustainable Development.

Long-term Business Plan “VISION 2030”

Stability and enhancement

Previous Medium-term Business Plan
(FY2020-2022)

Establish foundation
We rolled out priority measures with “ensuring differentiation and dominance” as the basic strategy for ourcore construction business. Issues that arose in theprocess of implementing the plan will be passed onto
the next medium-term business plan.

Elements required for future businessplans from a recognition of the business environment
Expansion of core competencies(commercial-facility construction)

Basic Policies
Stabilize and enhance the core construction business, expand the real estate and overseas businesses
as strategic businesses, and aim for the expansion of business operations, including new businesses

Basic Policies
Strive for the stability of the construction business and the expansion
and enhancement of business areas
Stability of the construction business that is the core of ourbusiness
Expansion of business areas for sustainable growth
Implementation of ESG (Environmental, Social, and Governance) management

Management
Targets

Net sales
ROE

Investment
Plan

93.0 bn¥

At least

8%

Operating profit
marginAchieve steady growth with the business of construction of commercial spaces at the corePursue quality, safety, environment, cost, and productivity as a group of engineers
Strive for the enhancement and stability of our financial basePursue comfortable workplaces and elevate the abilities and sense of reward in the work of eachindividual employee
Always respond to society’s needs and become a company that will stand up to environmental changes
AroundDividend payout
ratio
Around5%30%

Invest ¥10.0 bn

Management
Targets(FY2030)

Investment
plan

100.0 bn

Operating profit
margin90.0 bn

Number of workforce(End of FY2030)

Net sales¥

Total assets

Around ¥Invest a total of ¥30.0 bn*From total ¥30.0 billion investment category of VISION 2030

Business Measures

Responses to a sustainable society
Construction
Business

Investment in human capital(digitalization, human resources education)

2,900

96th fiscal year 97th fiscal year 98th fiscal year
(FY2021)(Current fiscal year) (Next fiscal year)(FY2022)(FY2023)

VISION 2030

(Forecast)

2,000

Strategic Business/New Business

Strengthen earning capacity from commercial facilities
Promote digital transformation
Continue to consider capital and operational allianceswith operating companies in the construction and construction-adjacent sectors

Real EstateBusiness

Increase rental income

Overseas
Business

Demonstrate the feasibility of Vietnam business(full-scale business activities, strengthen collaboration with IKVC)

Expand sale and purchase transactions

1,708

96th fiscal year 97th fiscal year 98th fiscal year
(FY2021)(Current fiscal year) (Next fiscal year)(FY2022)(FY2023)IKVC : ICHIKEN Vietnam Construction Co.,Ltd.

100th anniversaryof foundation

Growth and expansion

The medium-term business plan (FY2023-2025)(FY2023 – FY2030)(Forecast)

3,000

ICHIKEN’s Purpose

Real EstateBusiness

AroundAround5%800 people

GrowthInvestments

Real EstateBusiness

Overseas
Business

Use M&A, etc.

Complement income fromconstruction business

Promote roll-out ofVietnam business

Human
Resources
Development

Digitalization¥10.0 bn

Secure profitable properties (increase real estate lease business)
Create construction subcontracting projects that combine real estate development and sale/purchase¥10.0 bn

Overseas
Business

Promote Vietnam business

New Business

Consider approaches to construction-adjacent sectors, including
strengthening of existing businesses¥3.0 bn

Expand human capital Respond to digitalized society¥4.0 bn

Profit(Unit: Millions of yen)

(Forecast)

LOSE UP¥3.0 bnWORKS PICKUP!
ICHIKEN Vietnam Initiatives

Established ICHIKEN Vietnam Construction Co., Ltd.
In 2018, we opened a representative office with a staff of two in Hanoi, Vietnam’s capitalcity. Since then, this office has been investigating and verifying the potential for operating
a business in Vietnam. We determined that the business could lead to an expansion of ouroperations, taking into account a growing trend in demand in Vietnam for construction ofcommercial facilities, which we have positioned as the core of our building construction business, as well as Vietnam’s potential as a new source of personnel where we could anticipate
recruiting outstanding people amid the continuing decline in the working population in Japan. We strengthened our business structure by establishing a local subsidiary in April 2022
as our business base for Vietnam, including for conducting sales activities in the country.

Overview of IKVC (subsidiary)
Trade name:Answer

Let me give you the details.

ICHIKEN VIETNAM CONSTRUCTION
CO., LTD.

Company logo:

ICHIKEN Vietnam Construction (IKVC) will pursue contracted
construction management, design and construction contract, andcontracted BIM (3D modeling) operations, with the aim of becoming
a base that will contribute to the further advancement of ICHIKENIKVC President
from both quality and price perspectives.
Ikuhisa Okuda
Under a Memorandum of Understanding for Comprehensive Cooperation with AZB* that has continued since 2018, we have been undertaking project
management on a continuous basis for FujiMart, a Japanese supermarket chain for which
we have been providing technical support, and we have now started preparations for a
project for nine new stores. We are also involved in design and construction work for thisclient, handing over the fourth FujiMart store at theend of April. In April 2023, two Vietnamese nationals who had been undergoing training in the Technical Division of ICHIKEN’s Tokyo Headquarters
were transferred to IKVC and have begun working
in BIM operations. With their addition, the Vietnam
business is now operated by a staff of eight.

Address:

Room B2, 9th Floor, CDC Building,
25 Le Dai Hanh, Hai Ba Trung,
Hanoi,Vietnam

Telephone:+84-24-3215-1958

Representative:

Ikuhisa Okuda

Business:

Contracted construction management
work, contracted BIM work, construction contract and related services

Investment ratio:

wholly owned by ICHIKEN Co., Ltd.

Start of Business: April 1, 2022

*AZB: AZB JOINT STOCK COMPANYICHIKEN

TOPICS

Actions on SDGs and ESG Materiality

Forest preservation volunteer activities
Recently, led by President Hasegawa, 40 members including employees working in ICHIKEN’s Tokyo office and their families took partin “Tokyo Greenship Action,” a natural environmental protection activities project conducted under an agreement between the Tokyo Metropolitan Government, a non-profit organization, and ICHIKEN. Learning
what to do from instructors, the participants began with a tour of thewoods, after which they swept up fallen leaves, pruned branches,and planted new trees. We will continue to expand this activity to ourbranches all over Japan.

Let’s make a start! ICHIKEN’s SDGs and ESG

Certificate of Appreciation from Midori no Bokin(Green Donation)/ Forestry Agency Director-GeneralAs part of our “Support for environmental protection,” one of ICHIKEN’s ESG materiality issues, we endorsed and made a donation to theMidori no Bokin (Green Donation) activity conducted by the National
Land Afforestation Promotion Organization. Our donation will go toward
the invigoration of various forest development and people development
activities in our local communities and in other parts of Japan andoverseas. Recently, we were presented with a certificate of appreciation for our donations by Forestry Agency Director-General Orita, at theForestry Agency. We will continue
to endorse this fund’s intentions
and donate toward it into the future.

Division Director Kotani,

Director-General Orita,

Administration Div., ICHIKEN Co., Ltd.

Forestry Agency

Company Information
Company Profile(As of March 31, 2023)

Status of Shares(As of March 31, 2023)

Trade name:ICHIKEN Co., Ltd.

Total number of authorized shares

Established:

June 1930

Total number of issued shares

Capital:4,329,646,860 yen(Including 24,991 treasury shares)

22,240,000
7,284,400
6,142

Number of shareholders

Listed stock exchange: Tokyo Stock Exchange
Account closing month: March (once a year)
General construction; building lease; housing, commercial facilities development; planning, design andmanagement of complex commercial facilities; planning, design and management of specialty stores

Principal operations:

Number of employees: 644
Hamamatsucho Bldg. 6F, 1-1-1, Shibaura, Minato-ku, Tokyo 105-0023

Headquarters:

Distribution of shares by shareholder type (As of March 31, 2023)
Securities companies

Foreign corporations, etc.

155,595 (2.14%)

595,402 (8.20%)

Financial institutions
845,000 (11.64%)

Office Network
Headquarters and Tokyo Branch
Kansai Branch
Kyushu Branch
Sapporo Branch
Sendai Sales Office
Nagoya Sales Office
Hiroshima Sales Office
Okinawa Sales Office

Overseas subsidiary: Hanoi, Vietnam
ICHIKEN Vietnam Construction
Co.,Ltd.

2,342,800

32.27

The Master Trust Bank of Japan, Ltd. (Trust account)

432,800

5.96

Hiroyuki Hasegawa

Custody Bank of Japan, Ltd. (Trust account)

279,300

3.84

Keiji Isono

Zenkoku Ichieikai Shareholding Association

241,400

3.32

Hiroaki Masakiyo

BBH LUX/BROWN BROTHERS HARRIMAN (LUXEMBOURG) SCA CUSTODIANFOR SMD-AM FUNDS - DSBI JAPAN EQUITY SMALL CAP ABSOLUTE VALUE

150,000

2.06

Mitsuru Kotani

Hisami Hara

96,5001.32

Masato Takeuchi

84,5001.16

Sumitomo Realty & Development Co., Ltd.

74,1001.02

DFA INTL SMALL CAP VALUE PORTFOLIO

72,900

1.00

Takaaki Hara

63,8000.87

MARUHAN Corporation(As of June 28, 2023)

Hiroyuki Hasegawa

Director:

Keiji Isono

Director:

Hiroaki Masakiyo(New election)

Director:

Mitsuru Kotani

Outside Director:

Hideaki Takeuchi

Senior Operating Officer: Akira Hamano

Outside Director:

Shunji Ichiji

Senior Operating Officer: Akiyoshi Toyoshima

Director (Audit and SuperviShiro Yuasa
sory Committee Member):Outside Director (Audit and SuTakashi Hatsuse
pervisory Committee Member):Outside Director (Audit and SuAkiko Inoue
pervisory Committee Member):Outside Director (Audit and Su- Sumihito Kido
pervisory Committee Member): (New election)(As of March 31, 2023)
Number of shares held Shareholding ratio(shares)(%)

Name

Representative Director& President:

Hirotake Kubota

Individuals and other
3,095,295 (42.64%)

Major Shareholders

Company Officers

Outside Director:

Other corporations
2,568,117 (35.38%)

President and Operating
Officer:Managing Executive
Officer:Managing Executive
Officer:Managing Executive
Officer:

Senior Operating Officer: Akira Nakamura
Operating Officer:
Operating Officer:
Operating Officer:
Operating Officer:
Operating Officer:

Shingo Maeda
Ikuhisa Okuda
Kan Akashi
Katsumi Aoi(New election)
Kouichi Narikawa(New election)(Notes)1. The top 10 shareholders are listed.
2. The shareholding ratios were calculated as the ratio of the number of shares held to the total
number of shares outstanding, excluding treasury shares. Percentage figures are rounded
to the second decimal place.
3. Zenkoku Ichieikai Shareholding Association is a shareholding association consisting of theCompany’s business partner companies.

ICHIKEN’s official website
revamped!
Check out
our new
website!
PR Manager

ICHIKEN-kun

Hamamatsucho Bldg. 6F, 1-1-1, Shibaura, Minato-ku, Tokyo 105-0023
Telephone: +81 3 5931 5610
(9:00 a.m. to 6:00 p.m., excluding Saturdays, Sundays, national holidays and year-end and New Year holidays)