November 12, 2012
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TODA CORPORATION
Shunzo Inoue
President and Chief Executive Officer
1860
First Section of Tokyo Stock Exchange andFirst Section of Osaka Securities Exchange
Toshihiro Otomo
Executive Officer and General Manager,
General Affairs Division
Tel.: +81-3-3535-1357

Notice Regarding Revision of Medium-term Management PlanToda Corporation, along with its Group companies, rolled out its Medium-term Management Plan
effective from the current fiscal year ending March 31, 2013, and has been implementing initiatives
aimed at promptly improving earnings and creating new value. The Company, however, expects amajor deterioration in its business performance for this fiscal year, as announced in “Notice Regarding
Reversal of Deferred Tax Assets and Revisions to Earnings and Dividend Forecasts” on October 31,
2012.
Having taken these circumstances seriously, the Company has reassessed the environment and issues
which the Company and its Group companies has been faced with, made adjustments to theperformance targets and revised the Medium-term Management Plan to reinforce priority measures.
The entire Group is committed to implementing structural reforms in accordance with the revised Planand will work to achieve the medium- and long-term management strategy (announced on May 14,2012).

1. Revisions to Performance Targets
The Group will target consolidated net sales of approximately ¥400.0 billion by promoting anappropriate scale for its domestic architectural construction business. The target date is extended one
year to FY2015.
(Billions of yen)
(Reference)
Before revision
After revision
FY2012FY2014FY2015
forecast
Consolidated net sales

500.0 more or less

400.0 more or less

509.8

Operating income ratio

2.0% and higher2.0% and higher-3.8%

2. Reinforcement of Priority Measures(1) Improving profit from construction work—Emergency measures
The Group will ensure profits are recognized in the next fiscal year by improving profitability throughselecting orders, improving construction management structure, and revising cost structure.
(i) Make Selection of Orders More Stringent- Make selection of orders more stringent based on a profitability-oriented policy.
- Set the annual target for orders received in the architectural construction business atapproximately ¥250.0 billion (non-consolidated) for the time being. (Results for FY2011:¥329.4 billion)1

(ii) Improve management structure of construction work
(Management structure at order receipt)- Establish a new Cost Management Control Center by integrating the estimation department
and the purchasing department.
- Establish a Committee for Review on Judgments Taken at Order Receipt to improve theeffectiveness of the approval process.
(Management structure during construction work)- The Architectural Construction Department of Head Office identifies purchasing status, labor
shortages, and other factors on a timely basis and reflects the findings in guidance given tobranches.
- The Accounting Department monitors the status of improvements to profit from construction
work.
(Financial management structure)- Ensure proper cost management at operational sites, clarify unclear matters, and promptly
take the necessary action.
- The Architectural Construction Department of Head Office identifies actual state, guides andimproves analytical skills on financial matters.
(iii) Companywide cost reductions- Promote rationalization of organization and operations, including organizational reforms ofhead office and branches.
- Maintain SG&A expenses at approximately ¥18.0 billion (non-consolidated) in FY2013.
(Results for FY2011: ¥20.9 billion)(2) Groupwide growth strategy—Medium-term measures
The Group will shift from an individual project-oriented approach of pursuing business scale to asolution-oriented approach of deepening relationships with customers to secure earnings continuously
from every stage of the construction lifecycle.
Basic Strategies
Concentrate management resources on medium-sized projects.
Reinforce aftercare business for completed construction (maintenance and management,renovation, and other services).
Build an earnings base to complement the domestic architectural construction business.
(i)

Business structural reform- Focus on attracting orders from medium-size private hospitals, schools, production facilities,and office buildings. Limit large-scale projects to sectors that require involvement fromupstream process (e.g. redevelopment projects).
- Establish a new organization to manage the aftercare business.
- Localize the Brazilian affiliate and promote expansion of business activities. Furthermore,exploit markets (countries and regions) in Southeast Asia and expand earnings base.
- Shorten real estate investment and purchasing processes and promote increased earnings fromthe real estate business.
Performance targets of overseas and real estate businesses (consolidated)(Billions of yen)
(Reference)
FY2012
forecast

Before revision

After revision

FY2014FY2015

Overseas net sales

35.0 more or less30.0 more or less

21.0

Income from real estate etc.

4.0 more or less

4.0 more or less

3.5

2

(ii) Organization and cost reforms- Promote further streamlining and maintain a ¥18.0 billion SG&A expenses structure at the(non-consolidated).
- Revise the personnel system and promote flexible manpower allocation including Groupcompanies.
- Increase centralized purchasing levels by the Cost Control Center and from overseas.
- Reduce costs in collaboration with subcontractors.
(iii) Governance reforms- Revise authority standards for orders received, and promote involvement from the Board of
Directors and the management committee.
- Rebuild a matrix management mechanism by branch and by business.
- In addition to the current system of employee performance assessments, implement
multidimensional and 360-degree evaluation system for managerial staffs.

3. Promotion Structure
The Company establishes a Structural Reform Committee headed by the President in an effort toexecute various measures in a timely manner under a top-down approach.

4. Reducing Compensation of Directors and Executive Officers
The Company has decided to reduce the compensation of corporate officers as follows in conjunction
with the revised annual dividend (reduction of annual dividend per share of ¥1 from initial forecast to¥5) and considerable downward revision of business performance (deficit) announced as of October 31,
2012.
- Reduction of up to 40% in the monthly compensation of directors and executive officers (fora period of four months starting in December 2012)

Note: The presentation material (Results Briefing) regarding the contents described herein will be madeavailable on the Company’s website on Wednesday, November 14, 2012.

(End of document)3