FY03/2024

The First Half
Financial Results Briefing
November 16, 2023

FY03/2024

Overview of First Half
FY03/2024 Financial Results
The First Half FY03/2024 Financial Results Briefing

First Half FY03/2024 Financial Highlights
Orders fell due to a reactionary decrease from large-scale construction orders in the same period of the previous year, but the firm demand was steadily taken
in and the business progressed as planned.
Net sales increased due to steady progress in carryover construction projects at the beginning of the period, and profit increased due to the recovery in theperformance of subsidiaries. Mostly as expected at the beginning of the period.
The Company revised its full-year forecasts upward due to the improved profitability of some individual construction projects and lower exit costs for long-term
development projects.

OperatingincomeProfit (loss)
attributable to ownersof parent

billion yen

billion yen

billion yen+ 4.5 ％――

OrdersNet Sales

125.2

134.6

Y oY

Y oY

（non-consolidated

billion yen－ 14.9 ％External
environment

2.0
Y oY

2.5
Y oY

• Demand remained steady. The industry’s carryover construction volume has risen to ahigh level, and the competitive environment has been improving.
• Prices for materials and equipment remained high. Going forward, there are concerns
about price increases due to a labor shortage ahead of a busy season for the entire
industry.

Building
construction• The gross profit margin of completed construction decreased in the second quarter due to a higher percentage of
unprofitable construction projects. The level of about 6.9% at the beginning of the period is expected for the full year.

Civil
engineering• Profit increased as the gross profit margin of completed construction increased due to the improvement in
profitability of some construction projects. Full-year gross profit was revised up.
• The gross profit margin of completed construction increased due to the improvement in profitability of some
civil works. There was an improvement in business performance of subsidiaries after a temporary
deterioration in the same period of the previous year.

International

Real estate• Gross profit from the real estate business, etc. increased due to a review of costs associated with the withdrawal
from long-term development projects recorded in previous years. Full-year gross profit was revised up.
Copyright(C) Tokyu Construction. All rights reserved.

1

Consolidated Financial Results
Net sales increased due to the contribution of an increase in completed construction sales of theCompany’s non-consolidated businesses.
The interim dividend per share is 18 yen.

（Millions of yen）

1H
FY03/2023

Ratio

1H
FY03/2024

Ratio

YoY

Orders(nonconsolidated)

147,145―

125,275―(14.9%)（21,870）

Net Sales

128,842―

134,682―+4.5%+5,840Gross profit

8,267

6.4%

10,7938.0%+30.5%+2,525

Selling, general andadministrative
expenses

8,101

6.3%

8,749

6.5%

+8.0%
+647

Operating income

166

0.1%

2,043

1.5%

―
+1,877

Ordinary income

294

0.2%

2,843

2.1%

+867.0%+2,549Profit (loss) attributableto owners of parent(284)(0.2%)

2,510

1.9%

―
+2,794

Interim dividend per
share

18yen

―

18yen

―

―
Copyright(C) Tokyu Construction. All rights reserved.

2

Factors Affecting Net Income
The gross profit margin of completed construction increased, as there was an improvement in business performance ofsubsidiaries after a temporary deterioration in the same period of the previous year.
Gross profit from the real estate business, etc. increased due to a review of costs associated with the withdrawal from longterm development projects.
（Millions of yen）

＋2,794

+194
+771

+223

ー647

Increase incompleted
Construction
gross profit
Profit attributable toowners of parent

1H FY03/23―284

Increase inreal estate
incomeOthers+352+146+1,754

Profit attributable toowners of parent

Increase in
SG&A
expense

Foreignexchange
profit/loss

Decline intax expenses
Increase inequity-method
investment
gain・ Increases in labor costs and expenses
・ We recorded R&D, digital and innovation costs

1 H FY0 3 / 2 3

1 H FY0 3 / 2 4

8,101

8,749

1H FY03/24

2,510
Copyright(C) Tokyu Construction. All rights reserved.

3

Non-consolidated Financial Results
Completed construction sales increased due to the steady progress in carryover construction projects at the
beginning of the period for both building construction and civil engineering.
Operating income was higher year on year, despite an increase in selling, general and administrative expenses.
1H
FY03/2023

1H FY03/2024

Rate of
Change（Millions of yen）

Results

Results

Net Sales

117,868

124,952

100％

+6.0%

+7,083

117,012124,284―+6.2%+7,271

Bu ild ing c o n s tr uc tio n

89,57095,713

76.6％

+6.9%

+6,143

Civ il engineering

27,442

28,570

22.9％

+4.1%

+1,127

Real estate sales

856

667

0.5％

(22.0%)

(188)

8,772

9,392

（Profit rate）7.5％

+7.1%

+619

8,380

8,149

6.6%

(2.8%)(231)

Bu ild ing c o n s tr uc tio n

6,694

5,708

6.0％

(14.7%)(986)

Civ il engineering

1,685

2,440

8.5％

+44.8%+754

R ea l es t a te gr o s s p r o f it

1,242

186.1％

S e l ling, g e n e ral anda d minist rat ive e x p e nse s

391+217.1%

+851

7,536

8,069

6.5％

+7.1%

+532

Operating income

1,235

1,322

1.1％

+7.0%

+86

Ordinar y income

1,678

2,020

1.6％

+20.4%+341

Net income

(204)

1,779

1.4％

―

+1,983Completed
construction sales

Gross profit
Co m p let ed c o n s tr u c tio n
gr o s s p r o f it

Ratio

YoY

Copyright(C) Tokyu Construction. All rights reserved.

4

Non-Consolidated ／ Building construction（Completed
construction sales・Completed construction gross profit）
Completed construction sales increased due to the steady progress centered on carryover of large construction projects at the
beginning of the period.
The gross profit margin of completed construction is estimated to be 6.9% for the full year, a decrease year on year.

Completed construction sales

Gross profit（Millions of yen）

（Millions of yen）
Overseas

Profit margin ratio

Tokyu group
General private

193,000

Domestic public

65,35489,57060

10,053

76,341

95,713676

12,39014,00014,000ー1.5pt8,000
156,000

6,000

7.5%

10.0%

5.8%

6,694

4,605

8.0%

8.0%

10,000

6.0%

5,708

6.9%

8,000

6.0%

6.0%

6,000
4.0%

4,000

79,066

13,30012,00010,000

512

12.0%

10.0%

12,000＋6.9%

10,99312.0%
16,0001,000

26,00079,426

16,000

4.0%

4,000

2.0%

2,000

3,017

2,498

3,743

10,0001H
FY03/2022

1H
FY03/2023

1H
FY03/2024

FY03/2024(Forecast)

0

2.0%

2,000

0.0%

1H
FY03/2022

1H
FY03/2023

1H
FY03/2024

00.0%

FY03/2024(Forecast)

Copyright(C) Tokyu Construction. All rights reserved.

5Non-Consolidated ／ Building construction（Orders）
Domestic public projects increased due to the orders received for multiple construction projects including large-scale ones, despitea reactionary decline in orders for large-scale private sector construction projects in the same period of the previous year.
We will steadily capture solid demand to meet the full-year target of 210 billion yen.

OrdersMain orders（Millions of yen）

Ordered byOverseas210,000

Tokyu group0

General private

Tokyo Institute ofTechnology

30,000

Domestic public

Clean Authority of
TOKYO

ー7.4%

94,047705

104,424
5,261

303

Fukushima
Prefecture

96,7025,373

50

150,000

24,39995,30966,0996,471

1H
FY03/2022

30,0003,550

1H
FY03/2023

1H
FY03/2024

FY03/2024(Forecast)Place ofconstruction

Construction work for a new schoolbuilding and other constructions ofTokyo Tech High School of Scienceand Technology (Ookayama)

Tokyo

Construction work for thedevelopment of a central
breakwater non-combustible andbulky waste disposal facility
Construction work of architecture
for a new training building of theintegrated school of Shirakawa
Jitsugyo High School and Hanawa
Technical High School

Mitsubishi Estate
Residence Co., Ltd./ New construction under the
project for Azabu-Nagasaka-cho,
SOTSU
Minato Ward
CORPORATION/
Chitose Corporation

Tokyo
Fukushima
Prefecture

Tokyo

Japan Association
for the 2025 World
Exposition

2025 World Exposition Facility
Development Project PWSoutheast Construction District(construction work)

Osaka
prefecture

ITOEN, LTD.

Construction work for the new
construction of the second Kobe
plant of ITOEN, LTD. (tentative
name)

Hyogo
Prefecture

62,47025,178Name of construction

TOKYU
CORPORATION/
TOKYU LANDCORPORATION

Construction work for new
construction project of Kamata 5chome, Ota Ward (tentative name)Tokyo

Copyright(C) Tokyu Construction. All rights reserved.

6

Non-Consolidated ／ Civil engineering（Completed
construction sales・Completed construction gross profit）

Completed construction sales increased due to the steady progress in carryover construction projects at the beginning of theperiod. Things went according to plan.
We upwardly revised our full-year forecast as the gross profit margin of completed construction increased due to the initiatives
to improve profitability.

Completed construction sales

Gross profit（Millions of yen）

（Millions of yen）
Overseas

Profit margin ratio

Tokyu group75,000General private
Domestic public

9,000
8,000

＋4.1%

17,000＋2.4pt

9,000

12.0%

9,000

6.1%

7,000

24,475
2,268
1,773

800
1,332

7,348

5,461

14,9711H
FY03/2022

17,9601H
FY03/2023

28,570
4,193
1,945
6,048

3,000

-1,00041,0001,685

1H
FY03/2024

FY03/2024(Forecast)

1H
FY03/2022-3,000-5,00016,382

7.0%

7,000

5,000

1,000

27,4428.5%-7,000-21.9%-5,3501H
FY03/2023

2,440

12.0%

9.3%

7,000

7.0%

2.0%
5,000

2.0%

-3.0%
3,000

-3.0%

-8.0%
1,000

-8.0%

1H
FY03/2024-1,000FY03/2024(Forecast)-13.0%-13.0%-18.0%-3,000-18.0%-23.0%-5,000-23.0%-28.0%-7,000-28.0%

Copyright(C) Tokyu Construction. All rights reserved.

7

Non-Consolidated ／ Civil engineering（Orders）
Although orders decreased due to a reactionary decrease from large overseas construction projects
in the same period of the previous year, those for all of public, private and Tokyu Group projects
were strong in Japan.

OrdersMain orders（Millions of yen）
Overseas

66,000Tokyu group
General private

ー33.1%

Domestic public

42,72019,641

25,723

5,219

13,6251H
FY03/2022

5,000

1,875
6,957

Name of construction

Ministry of Land,
Infrastructure,
Transport andTourism

FY2023 construction workfor Kidani Tunnel on the
Akitsu Bypass

Hiroshima
Prefecture

Tokyo

Karabori River upstream
rainwater trunk line
construction workTokyo

Uedadentetsu Co.,Ltd.

Chikuma River bridge
reinforcement construction
work (P3 Bridge Piers)

NaganoPrefecture

14,00028,572
1,852

916

5,962

7,000

3,789
6,880

14,246

16,0501H
FY03/2023

1H
FY03/2024

40,000FY03/2024(Forecast)Place ofconstruction

Ordered by(Tentative name)Construction work forresidential land and roaddevelopment under the
Harmony TMK
development project (Parcel
10a-B) in 5 banchi-5
Hanazono, Kutchan-cho andothersConstruction work to
reinforce the retaining walls
TOKYU Corporation, between Yoga Station and
TOKYU Railways
Futakotamagawa Station on
the Den-en-toshi Line (civilengineering work)

Hokkaido
PrefectureTokyo

Copyright(C) Tokyu Construction. All rights reserved.

8

Consolidated Balance Sheets
The equity ratio was at 40.2%, increase of 2.0 percentage points compared with March
31, 2022. D/E ratio was 0.48 times due to an increase in borrowings.

（Millions of yen）

As of March 31, As of September
2023
30, 2023

YoY

Current assets

187,892

178,645(9,247)

Non-current
assetsInvestments andother assets

28,70028,540(160)

32,571

32,764+193

Total assets

249,164

239,950(9,213)Liabilities

144,743

125,968(18,774)

8,400

16,816+8,415

Total net assets

96,02097,165+1,145

Total liabilities
and net assets

249,164

239,950(9,213)Equity ratio(%)

38.2

40.2

+2.0ptInterest-bearing
debt
D/E ratio（times）

21,97047,019+25,049

0.23

0.48

+0.25

Net Cash

36,743(15,028)(51,772)

Non-current
liabilities

Increase/decrease factors− Current assets• Cash and deposits• Notes receivable, accounts
receivable from completed
construction contracts andother

ー26,722＋19,330− Liabilities• Notes payable, accounts
payable for construction
contracts and other• Advances received on
construction contracts in• Progress• Electronically recorded
obligations – operating

ー11,243
ー8,329ー5,372• Deposits received• Provision for loss on
construction contracts

ー2,950• Short-term borrowings＋15,240

ー2,406− Non-current liabilities• Long-term borrowings＋9,809− Total net assets• Retained earnings• Total accumulated othercomprehensive income

Copyright(C) Tokyu Construction. All rights reserved.

＋597
＋351

9

Consolidated Statements of Cash Flows
Operating cash flow was negative due to the advanced payment of construction charges.

（Millions of yen）

1H
FY03/2023

1H
FY03/2024

1 H F Y 0 3 / 20 24 re ma rks

Cash flows from operating
activities

8,977(49,852)

Cash decreased due to an increase in tradereceivables and a decrease in trade payables,
etc.

Cash flows from investing
activities

5

(333)

Cash decreased due to the payment for theacquisition of property, plant and equipment,
intangible assets, etc.

8,983

(50,185)―

Free cash flow
Cash flows from financing
activities(651)

23,256

Cash increased due to an increase in short-termborrowings, income from long-term borrowings,
etc.

Net increase (decrease) incash and cash equivalents

8,581(26,722)―

Cash and cash equivalents at
beginning of period

38,64858,714―

Cash and cash equivalents at
end of period

47,22931,991―
Copyright(C) Tokyu Construction. All rights reserved.

10Full-year Forecast for
FY03/2024

The First Half FY03/2024 Financial Results BriefingConsolidated Financial Results Forecast
Orders are expected to achieve the initial plan on the back of strong demand.
The Company revised its full-year forecasts upward due to individual factors in the second quarter.
We will increase investment in human resources to improve corporate value.
FY03/2023
Results

Ratio

Orders(nonconsolidated)

267,792

Net Sales

FY03/2024

Differencecompared
to previous
Forecast

YoY

Previous

RevisedRatio―

276,000

276,000―+3.1%+8,207―

288,867―

307,000

299,000―+3.5%+10,132(2.6%)（8,000）Gross profit

21,8797.6%

23,30025,2008.4%+15.2%+3,320+8.2%+1,900

Selling, generaland administrative
expenses

16,771

5.8%

18,00019,000

6.4%+13.3%+2,228+5.6%+1,000Operating income

5,107

1.8%

5,300

6,200

2.1%

+21.4%+1,092+17.0%+900

Ordinary income

5,020

1.7%

6,200

7,600

2.5%

Profit (loss)
attributable toowners of parent+51.4%+2,579+22.6%+1,400

5,245

1.8%

4,000

5,700

1.9%

+8.7%
+454

+42.5%+1,700

Dividend per
share

36yen

―

36yen

36yen

―

―

―

（Millions of yen）

Copyright(C) Tokyu Construction. All rights reserved.

11Non-consolidated Financial Results Forecast

Completed construction sales will increase from the previous fiscal year due to the steady progress in carryover construction
projects at the beginning of the period.
Net sales will decrease 6 billion yen from the beginning-of-period forecast due to delays in receiving orders for new building
construction projects.
Full-year forecasts are revised upward due to improved profits in civil engineering and real estate in the second quarter.

FY03/2023
Results

FY03/2024
YoY

Differencecompared
to previous
Forecast

Previous

RevisedRatio

261,529

275,000

269,000

100％+7,470252,377

274,000

268,000―+15,622(6,000)

192,052

196,000

193,000

71.7％

+947

(3,000)

Civ il en gineering

60,32578,00075,00027.9％＋14,674(3,000)Real estate sales

9,151

1,000

1,000

0.4％

(8,151)―

20,063

20,10021,800+1,736+1,700C o m p let ed c o n s tr u c tio n
gr o s s p r o f it

17,22919,60020,3008.1％
7.6%+3,070+700

Bu ild ing c o n s tr uc tio n

13,77813,70013,300

6.9％

(478)

(400)

Civ il en gineering

3,450

5,900

7,000

9.3％

+3,549+1,100R ea l es t a te gr o s s p r o f it

2,833

500

1,500

150.0％(1,333)+1,000S e l ling, g e n e ral anda d minist rat ive e x p e nse s

15,665

16,80017,7006.6％+2,034+900

Operating income

4,398

3,300

4,100

1.5％

(298)

＋800

Ordinar y income

4,426

3,500

5,100

1.9％

＋673

＋1,600Net income

3,825

2,300

3,700

1.4％

(125)

＋1,400（Millions of yen）

Net Sales
Completed
construction sales
Bu ild ing c o n s tr uc tio n

Gross profit（Profit rate）(6,000)

Copyright(C) Tokyu Construction. All rights reserved.

12Non-Consolidated Order Forecast
In building construction, we will aim to achieve a level of orders in excess of 200 billion yen by securing the target projects.
In civil engineering, there will be a reactionary decrease from the previous fiscal year’s large overseas projects, but we will aim
to acquire orders centered on domestic government projects.

（Millions of yen）

FY03/2023
Results

FY03/2024
Previous

Revised

YoY

Differencecompared
to previous
Forecast

Domestic public

9,730

21,00030,000+20,269

Domestic private

173,476

189,000

180,000＋6,523(9,000)162,823

159,000

150,000(12,823)(9,000)10,65230,00030,000+19,347

―

343

―

―

(343)

―

183,550

210,000

210,000+26,449―

Domestic public

37,64440,00040,000+2,355―

Domestic private

24,141

19,00019,000(5,141)―

19,32814,00014,000(5,328)

―

4,812

5,000

5,000

+187

―

Overseas22,456

7,000

7,000

(15,456)―

Civil engineering

84,24266,00066,000(18,242)―

267,792

276,000

276,000

8,207―

General private
Tokyu Group
Overseas
Building construction

General private
Tokyu GroupTotal+9,000

Copyright(C) Tokyu Construction. All rights reserved.

13

Non-consolidated Financial Results Forecast／
Building construction

There will be good progress in works carried over at the beginning of the fiscal year.
We will work to further improve profits while closely monitoring labor shortages and trends inequipment and material costs.
Completed construction sales

Construction work

/Gross Profit

carried forward（Millions of yen）
400,000

10.0%

Overseas

ー0.3pt350,000
Tokyu group300,000
General private

6.9%

200,000
Profit margin ratio＋0.5%

192,052
20,012897

5.0%

193,000
26,0001,000

150,000

100,000

0.0%

165,936

5,205
FY03/2023

Amount brought
forward272,428

263,926

Orders183,550

210,000

Completed
construction sales

192,052

193,000

Amount carriedforward263,926

280,926

156,000

50,0000FY03/2024
Forecast（Millions of yen）

7.2%

250,000
Domestic public

FY03/2023

10,000FY03/2024(Forecast)-5.0%

Copyright(C) Tokyu Construction. All rights reserved.

14

Non-consolidated Financial Results Forecast／
Civil engineering

Large-scale construction carried over from past fiscal years will progress and completed construction sales will
increase.
In addition to improving the profitability of some construction projects, we will increase profit margins by acquiring
additional construction projects and through originality and ingenuity at the site going forward.
Completed construction sales

Construction work

/Gross Profit

carried forward（Millions of yen）
140,000+3.6pt120,000
Tokyu group100,000
Generalprivate＋24.3%

Domestic public
80,000
Profit margin ratio
60,00040,00020,000

0

9.3%

5.7%

8.0%

3.0%

75,00060,325
4,521
5,036
13,68637,080FY03/2023

9,000
8,000

-2.0%

FY03/2023

FY03/2024
Forecast

90,404

114,321

Orders84,24266,000Completed
construction sales

60,32575,000

Amount carriedforward114,321105,321（Millions of yen）
Amount brought
forward

軸ラベル

Overseas

17,00041,000FY03/2024(Forecast)-7.0%-12.0%

Copyright(C) Tokyu Construction. All rights reserved.

15

Forecast／ Construction Renewal
The number of business inquiries will tend to increase, and both net sales and orders will recover topre-COVID-19 levels.

External environment• Desire for investment is strong, due partly to the recovery of inbound arrivals
and a reaction to the suppression of investment during the COVID-19 pandemic.

Future policy• We will aim for certain orders for targeted projects and to improve profitability.
16.0%

80,00014.0%

Orders
70,00012.0%

60,00010.0%

50,0008.0%

40,0006.0%

30,00020,000

4.0%

20,00010,0002.0%

10,0000

0.0%

080,000Net
70,000Sales /Gross Profit
ー1.7pt（Millionsof yen）
60,000Net Sales
50,000

10.0%

11.7%

Gross Profit Margin＋6.9%

40,00030,00024,300FY03/2023

25,980（Millions of yen）

FY03/2024(Forecast)※ Each of the numbers for the construction renewal business is a simple sum of numbers from Tokyu Renewal Co., Ltd.
and Token Industry Co., Ltd., subsidiaries engaged in the business, and no elimination was taken into account.

＋8.3%

23,083

FY03/2023

25,000FY03/2024(Forecast)
Copyright(C) Tokyu Construction. All rights reserved.

16

Forecast／ International ・ Real estate
International

Real estateBusiness performance of subsidiaries will improve after a
temporary deterioration in the previous fiscal year. The
improvement in profitability of some civil engineering works willcontribute to exceeding the initial forecast of profit.
External
environment

Futurepolicy•Needs for infrastructure development in Southeast and South
Asia will increase.

•

Using our track record in railway and road-related business in Japan asa strength, we will work on transportation infrastructure-related ODA
projects centered on Southeast and South Asia.

•

We will focus on TOD-type*1 community development in collaboration
with partner companies in various countries.

（Millions of yen）

50,000Gross Profit
45,000Margin△23.4%

11.8%

40,00035,000＋78.8%

30,00025,00017,30320,00015,00010,0009,680

FY03/2023

Futurepolicy•Environmental real estate needs will expand.

•We will use our strengths in general construction to promote
environmental real estate initiatives and in-house “TQ” branding toincrease value.

•

We will continuously promote the replacement of assets in the Tokyo
metropolitan area, where we have our strengths.

16,000△20.0%

14,000Margin△50.0%

12,000△80.0%△110.0%FY03/2024(Forecast)Gross Profit

10,000
8,000

31.0%

ー89.1%

4,000
2,000

△200.0%0

150.0%

9,151

6,000

△170.0%（Millions of yen）

＋119.0pt

Net Sales

10.0%△140.0%5,000
0External
environment

Net Sales /Gross Profit ※3

Net Sales /Gross Profit ※2
Net Sales

The real estate rental business, which provides environmental value,
will make steady progress.
Gross profit will increase due to cost review of long-term development
projects we withdrew from.

1,000
FY03/2023

FY03/2024(Forecast)200.0%
170.0%
140.0%
110.0%
80.0%
50.0%
20.0%
△10.0%△40.0%△70.0%△100.0%△130.0%△160.0%△190.0%△220.0%△250.0%△280.0%△310.0%△340.0%△370.0%△400.0%*1 Abbreviation of “Transit Oriented Development.” Urban development aimed at a society based on public transportation that does not rely on cars.
※2 Each of the numbers for Overseas is a simple sum of numbers from overseas subsidiaries and from non-consolidated overseas business of the Company, and no elimination was taken into account.
（Overseas subsidiaries ：TokyuConstructionIndonesia,GoldenTokyuConstruction,IndochineGroup,TokyuPacificConstruction）※3 Numbers for the real estate business are the values of the sales and gross profit of the real estate business on the Company’s non-consolidated statement of income.

Copyright(C) Tokyu Construction. All rights reserved.

17

Shareholder returns
We plan to pay an annual dividend of 36 yen per share. While recognizing the importance of capitalefficiency, we will continue our basic policy of paying dividends with a dividend on equity ratio (DOE) of
at least 4.0%, emphasizing stable and continuous profit returns to shareholders.

Dividend per share（yen）（Forecast）

36

Year-end(Forecast)25

10
FY03/2021 ※1[Reference]
ROE and payout ratio

FY03/2022

18
Interim18

FY03/2023

FY03/2024(Forecast)

A “DOE of at least 4.0%” is set in the basic policy of paying dividends, as a balance between themedium to long-term results targets of an ROE of at least 10% and a consolidated payout ratio ofat least 40%.

72.0%

（yen）
ROE
Payout ratio

36

65.2%

40.1%

2.6%
FY03/2021 ※1-7.6%
FY03/2022 ※2※ 1 Total number of shares of treasury stock for FY03/2021: 1,965,100 shares(total value of acquisition: 999,976,175 yen)
※ 2 Dividend payout ratio for the FY03/2022 is not shown due to the net loss for the year.

5.6%

6.0%

FY03/2023

FY03/2024(Forecast)
Copyright(C) Tokyu Construction. All rights reserved.

18

Our Strength：Town Planning～The Technology, Expertise, and Teamwork That Keep Urban Functions
Running～

The First Half FY03/2024 Financial Results Briefing

Strengths of Tokyu Construction Group
Since its founding, the Company has accumulated know-how and human resource capabilities by continuing to takeon the challenge of community development conscious of consumers. By deepening and fusing these using digitaltechnology, we have established unique “technology, know-how, and teamwork that keep urban functions running.”

Strengths of
Tokyu Construction Group

Tokyu Toyoko Line Shibuya
Station to Daikanyama Station
track switchover

Redevelpment of the areaaround Shibuya Station

Tokyo Metro Ginza Line
Shibuya Station railway
track diversion projectType 1 urban
redevelopment project in
the Itabashi Station
Itabashi-guchi area

Copyright(C) Tokyu Construction. All rights reserved.

19

Achievements in Urban Development
By taking advantage of our strength in construction around stations and near railroads, we have become involved with various
projects in Japan and overseas.
We will further hone our strengths--the technology, expertise, and teamwork that keep urban functions running--throughexperience gained in difficult construction projects.

Participation in redevelopment byleveraging our strengths inconstruction around stations andnear railroads

High levels of technology and construction knowhow are required for the construction work aroundthe station and near the railway, which is notallowed to have any affect on the railway businessline in operation.

Shin-Tsunashima Station Area
Type 1 Urban Redevelopment
Project

Railroad improvement construction
projects without affecting users’
daily lives
Having completed various overnight construction projects
to convert aboveground tracks to underground, such as
the tracks between Tokyu Toyoko Line Shibuya andDaikanyama Station (2013), we are enhancing ourrailroad
construction capabilities by adding the latest technology to
our strengths in railroad construction we have developed
to the date.

We are contributing to the development of social
infrastructure in Southeast and South Asia throughODA by leveraging our achievements in railwayrelated construction works, etc. in Japan.

Construction of Mass
Rapid Transit, Jakarta
Tokyo Metro Ginza Line
Shibuya Station
improvement work (anew station building
offered for use in 2019)

Itabashi Station Itabashi Exit Area
Type 1 Urban Redevelopment
Project (JR Itabashi Station)

Kakoicho East District Type 1 Urban
Redevelopment Project (JR andTokyo Metro Nakano Station)

Application of our experience indomestic construction to assist in theeconomic development of Asian
countries

Metropolitan Manila
Subway Project (Phase 1)
CP104 Construction Area
Dhaka Mass Rapid
Transit Development
Project (LINE-1)

We were highly praised to have completed
construction work under severe conditions and within alimited time using BIM/CIM and VR technologies, andwere awarded the 2019 i-Construction Grand Prize of
the Ministry of Land, Infrastructure, Transport andTourism and the 3rd Civil Engineering Prize at theJapan Federation of Construction Contractors Awards.

Construction of a depot
for railcars in Dhaka

Copyright(C) Tokyu Construction. All rights reserved.

20

Urban Development in Shibuya
We have executed difficult construction projects in Shibuya, leveraging our technology, expertise andteamwork.
Shibuya has huge future potential with numerous redevelopment projects planned.
■Major construction projects of
Tokyu Construction■Ongoing redevelopment projects (otherthan the Company)■Announced redevelopment projects, etc.

Shibuya Ward
Office, etc.
Shibuya Upper
West Project(Site of Tokyu Department
Store Main Store)

2) SHIBUYA STREAM©SHIBUYA STREAM

Bunkamura

Shibuya109
Toyoko Line/Fukutoshin Line
Shibuya Station

SHIBUYA
CAST

Site of Aoyama
Hospital

Aoyama Park Tower
4) Tokyo Metro Ginza Line
Shibuya Station
improvement construction
project
Miyamasuzaka
QFRONT
district
Shibuya 2chome West
area
SHIBUYA AXSH

3) SHIBUYA SCRAMBLE SQUARE

Dogenzaka 2chome South
District

SHIBUYASCRAMBLE SQUARE
Station Town
SHIBUYA District Central and
MARK CITYWest Wings
CERULEAN TOWER

4) Tokyo Metro Ginza Line Shibuya
Station1) SHIBUYA HIKARIE
3) Shibuya Scramble
Square East Building2) SHIBUYA STREAM
Shibuya Sakura
Stage

Urban
Regeneration
Emergency
Development Area

SHIBUYA BRIDGE

1) SHIBUYA HIKARIE©TOKYU CORPORATION

National Route 246 Shibuya
Station East Exit Footbridge

The buildings and infrastructure highlighted in the aerial photos are our construction
projects. The map was created by the Company based on published data.
Copyright(C) Tokyu Construction. All rights reserved.

21

Commitment to Problem-Solving Skills (QCDSE*)
The entire Company is working together to implement the impending “Overtime Work Cap Regulations” to take effect in April 2024.
Strengthening problem-solving skills for the medium to long term, including utilization of digital technology, human resource
development, and collaboration with cooperating companies.
※QCDSE: An acronym for quality, cost, delivery, safety, and environment,
the five elements that form the basis of construction management.

Measures for Overtime Work Cap
Regulations
 Focus on core operations by work site
engineers• Support from head office departments• Use of dispatch and outsourcing
 Introduction and expansion of ICT tools andlabor-saving methods
 Strengthening and support for quality
management systems
 Improvement in employee awareness offlexible workstyles
 Construction plans based on the premise ofclosing work sites for a total of eight days outof every four weeks

Continuous
improvement

Percentage of closing
work sites for a
total of eight days outof every four weeks
Ratio of employees
complying withovertime work cap
regulations

 Change from “support” to“sharing”
 Eliminate lost profits throughthorough awareness of quality,
safety and security
 Utilization of digital technology
and human resource
development with a view to themedium to long term

■ TQ-BUDDY, a job site for subcontractors, in cooperation with
our organization of cooperating companies in construction work.

Creating with cooperating companies Strengthening cooperation with cooperative
associations
 Holding events to present good practices andimprovement cases at the work site (heldevery year) Support for human rights education
 Support for hiring of cooperating companies

https://www.tokyu-cnst.co.jp/co-creation/
Copyright(C) Tokyu Construction. All rights reserved.

22

Efforts to Prevent Recurrence of Quality Problems,
Improve Construction Quality, and Restore TrustIn fiscal year 2021, the 3 points below were discovered

The response

Temporary structures left in civilengineering works in past fiscal
years

3

Defects in building work in pastfiscal years

Investigation of the cause and prevention of reoccurrence

2021
July 26

Defects in the tips offoundation piles inconstruction work
( 1 Official announcement)

November 8

Revision of results forecast( 1 - 3 Recording of losses
and expenses)

November 18

2

Defects in the tips offoundation piles inconstruction work
( 1 Follow-up report)

2022
May 19Disclosure of initiatives for theprevention of reoccurrence

Subsequently► Continuation of measures
for the prevention ofreoccurrence► Deepening of reform of theorganizational culture

Cause

1

Defects in the tips of foundation
piles and the falsification of data
during station improvement work

Prevention of reoccurrence

Overview of
the quality
problems

Regarding the past quality problems, we have reviewed the structure, system and organizational culture to prevent
their recurrence thoroughly.
Continuing to have zero serious quality accidents. Sharing awareness through dialogue between management and all
employees.

• Lack of awareness and managementof special construction conditions• Dilution of quality awareness andsense of ethics

Improvement ofconstruction quality
management system(Civil Engineering)

Information sharing &Improvement of training
programs for worksite
engineers• Gaps in intergenerational communication in
the field• Lack of on-site support by Head Office andbranches• New establishment of the quality control division of Head Office• Building of a human and technical support system for the field• Introduction of preliminary reporting by e-mail of accidents andproblems directly linked to management• Expansion of the internal reporting system• Review of construction management education and training
programs

Accountability
clarification• Voluntary return of remuneration by Directors and Executive Officers• Of remuneration for directors, the portion of variable compensation,
which is linked to short-term performance, has not been paid tothem in FY03/2023

Reforming
corporate culture• Compliance education for all officers and employees• Launch of measures that make communications more frequent andeffective

Copyright(C) Tokyu Construction. All rights reserved.

23

Progress of Long-Term
Management Plan
The First Half FY03/2024 Financial Results Briefing

TOPICS Decarbonization
We have newly entered the power storage facility business in order to achieve both adaptation and contribution to a
decarbonized society and profit generation.
We will continue to take various initiatives to reduce GHG emissions in our construction and production processes.

Main investments
Storage Depot Scheduled for FY2024 Launch

Trial of Hydrogen Fuel Cell
Generators to Supply Power at
Shibuya Construction Site

We are working to stabilize the supply and demand of electric power in Japan and to make effective
use of renewable energy. Current efforts include the launch of an energy storage facility (gridstorage batteries) business at our own plant in Sagamihara City, Kanagawa Prefecture. By
connecting large-scale storage batteries directly to the power grid, the facility will absorb surplus
power from renewable energy sources, provide supply and demand balancing, and discharge power
when power supply and demand are tight in various power markets. The project is scheduled to
begin the installation of large-scale storage batteries in January 2024 and begin operation in April
2024.

The successful trial evaluated reductions ofnoise and carbon dioxide (CO2) emissions
achieved by using hydrogen fuel cell
generators instead of conventional gasoline
generators. Tokyu Construction will promote
the feasibility and benefits of using hydrogenfuel cell power generators at construction
sites to reduce environmental impacts.

 Sagamihara Plant

 Role of Storage Depot
 Hydrogen fuel cell generator in use as power source

PlannedConstruction
Site

Copyright(C) Tokyu Construction. All rights reserved.

24

TOPICS Initiatives to utilize digital technology
We will utilize BIM/CIM to improve the efficiency and sophistication of construction and production
and management systems, promote the development of DX human resources for transformation,and expand the potential for community development.

Main investments
Transformation of construction andproduction systems by utilizing BIM
The transformation of construction and production
systems, including the value chain, is progressing
with a view to digitizing cities. Against thisbackdrop, the Company has developed and started
operating an energy simulation tool “Tokyo
Construction - Building Energy Simulator (TCBES)” for buildings. Through the use of BIM, we
conduct various case studies in a short period oftime at the initial stage of design, examine ZEB,
and make optimal proposals. In addition, we havedeveloped BIM solutions for earth retaining,underground construction, and ground temporary
planning, and are promoting DX with digital twinsthat are integrated from the planning stage toapplication at the actual site.

Promotion of initiatives to reduce
environmental impact using BIM as aplatform
We have jointly developed the collaboration
method between the BIM model and thecomputational fluid dynamics simulator with theresearch group of Prof. Nobuyoshi Yabuki of the
Graduate School of Engineering, Osaka University.
By incorporating this method into the Building OS*,
we aim to achieve indoor environmental control,
which has been difficult in the past. This includes
estimating the temperature and humidity in areas
where sensors are not installed, and predicting thestate of the thermal environment after 30 minutes
to control air conditioning by looking ahead.

*Building OS
A building operating system jointly developed by theCompany and Graduate School of Engineering, Osaka
University in April 2023. Building OS is a digital platformthat helps improve the environmental value andproductivity of buildings by utilizing data such as room
temperature and CO2 concentration read by sensors toenable comfortable and energy-saving automatic
adjustment of air conditioning and lighting and control ofrobots working in buildings.

Promotion of DX human resource
development
More than 250 people passing IT
Passport exams
As part of our efforts to develop DX humanresources, we have been recommending that
employees of the entire Company take the “IT
Passport
Examination”
conducted
bytheInformation-technology Promotion Agency (IPA)
since FY2022. At the end of September 2023,
more than 250 applicants had passed theexamination.
This exam is recommended throughout theCompany because it provides comprehensive
knowledge in a wide range of fields, including
general management and management knowledge,in addition to IT knowledge. Aiming to have acumulative total of 500 people pass the exam by
the end of FY2023, we have established a support
system for active learning to help employees tackle
challenges by providing e-learning that all
employees can take, analyzing and sharing exam
information, and subsidizing exam costs for those
who have passed exams, etc.

TC-BES, a primary energy simulation tool for building construction
Copyright(C) Tokyu Construction. All rights reserved.

25

TOPICS Initiatives for Public-Private Partnerships(PPP) , Innovation

We promote public-private partnership projects and venture investments to create new businesses and pursue
growth opportunities.
We continue to hold “Vision Dialogue” and “MOON SHOT CONTEST” to encourage behavior change to “Challenge andChange.”Main investments
PPP

Todoroki Ryokuchi
Redevelopment Project PublicPrivate Partnership (PPP)In April 2023, we became part of the Kawasaki
City Todoroki Ryokuchi redevelopment project. The
project will be managed by Kawasaki Todoroki Park
Corporation, which was established by ninecompanies, including Tokyu Corporation and ourCompany. The plan is to redevelop the stadium,
arena, and other facilities in the area, maintaining
and managing the entire green space for 30 years
through March 2053. We will contribute to thecommunity and society through the town planning
expertise we gained through our past construction
work and PFI projects。

Artist’s conception of the Todoroki Ryokuchi after redevelopment(courtesy of Kawasaki Todoroki Park Corporation)

I n nov ation

Investment of Branch
Technology, a 3D printermanufacturer and seller ofbuildings
Branch Technology is a venture company that
manufactures and sells facades, monuments, andother structures of various designs using its
proprietary technology that enables them to 3D
print lattice structures of any design. Branch
Technology has already delivered several structures,
including commercial facilities, which were built
according to building codes in the United States.
Through investment in Branch Technology, ourCompany will accumulate expertise in 3D printerconstruction to increase productivity at construction
sites and accelerate initiatives to achieve some of
the core goals of the long-term management plan,
including "decarbonization“ and "zero waste."I n nov ation

Promotion of behavioral change
to “Challenge and Change”
through management leadership
In order to be able to think and act autonomously
in an uncertain business environment, we continue
to hold “Vision Dialogue” for people to think about
the future of the Company through dialogue withthe management and “MOON SHOT CONTEST,” acontest for new business ideas.
We encourage behavioral changes to “Challenge
and Change.”

Vision Dialogues

MOON SHOT CONTEST
Copyright(C) Tokyu Construction. All rights reserved.

26

Long-Term Management Plan “To zero, from zero.”
We promote a long-term management plan with FY2030 as the target year. We will further work tostrengthen our problem-solving skills (overhaul of QCDSE and sales capabilities and therestructuring of our earning power) to return to a growth trajectory.
Business strategy

Three deliverable values
Decarbonization

1

1

disasterprevention

Zero waste

2

Establishment of the Tokyu
Construction brand through thebuilding of competitive
advantages in human resourcesand digital technology and theprovision of three values

3Competitive advantage
humanresources

Profitability
Efficiency
SoundnessNon
financial

44

Digitaltechnology

KPI

Tokyu Construction
brand

5

2

3

Core business

Strengthening of problemsolving skills, construction andproduction systeminnovation, and growththrough alliances and M&A

Human resource andorganizational strategies

5

Creation of results and acceleration of
innovation through the strengtheningof human resources and reform of theorganization and corporate culture

Strategic business

The creation of new growth
opportunities throughinvestments in strategic
business and synergies withcore business

Financial and capital
strategies

Emphasis on capital efficiency and theconstruction of stable financial
foundations by pursuing the optimal
capital structure

03/FY2023
Results

03/FY2024
Revised
Forecast

03/FY2026

03/FY2031

5.1 billion yen

6.2 billion yen

At least 11.0 billion yen

At least 22.0 billion yen

Operating profit margin

1.8%

2.1%

At least 3.0%

At least 5.0%

ROIC（※1）

3.0%

―

―

At least 7.0%

ROE

5.6%

6.0％

At least 7.5%

At least 10.0%

Operating profit

Debt-to-equity ratio

0.23times

0.5 times or less

0.5 times or less

Capital adequacy ratio

38.2%

About 40%

About 45%

Employee engagement
rating（※2）

BB

A

A

AAA

GHG emissions（※3)―

12.5% reduction

17.5% reduction

30.0％ reduction※1 The ROIC of 7.0% or higher is set as a medium- to longer-term target for FY03/2031.
※2 Engagement rating using Link and Motivation Inc.’s “Motivation Cloud.” Subjects are employees of the Group as a whole, including subsidiaries. Rating is divided into a total of 11 stages, and the current “BB” is the fifth rating from the top after “AAA,” “AA,” “A” and “BBB ”※3 The baseline is the emissions in FY03/2019. We are scheduled to get a third-party certification to heighten the data credibility on GHG emissions and are planning to disclose the data for FY03/2023 around July 2023.。

Copyright(C) Tokyu Construction. All rights reserved.

27

【Appendix】

The First Half FY03/2024 Financial Results Briefing

Business model and business overview
We take on construction work en masse from government agencies and private companies, and manage construction work
efficiently in cooperation with numerous suppliers. We realize the maximization of added value by implementing integrated
construction management of everything from quality and costs to safety and the environment.

Business development based on strong relationships of trust

Overseas(ODA/private)

Quality

Cost

Delivery

SafetyEnvironment

Cooperatingcompanies

Specialist construction
companies (subcontractors) andlocal general construction
companies

Engagement

Government
offices

OrdersRailway operators andprivate companies

Integrated and consistentconstruction management

Collaboration

We want to beaccompanied by areliable construction
company with a trackrecord.

High value-addedbuildings and good
infrastructure are
required.

Sharingof needs

Customers

Suppliers of materials andconstruction equipment

Built-to-orderconstruction

Buildingof safe andsecure social
infrastructure

Relationships of trust
Business overview

Core business
Building
Construction

Construction of commercial facilities, hotels,
offices, factories, and distribution centers

Civil
Engineering

Railways, roads, tunnels, bridges, andother construction

Construction
renewal

Building renewal work

Strategic business

SynergyRealestateInternational
New
Business

Real estate rental business
Equivalent exchange business, etc
Railways and roads, construction of high risebuildings and factories, etc
PPP / Concession Business such as airports,
water and sewage systems
Copyright(C) Tokyu Construction. All rights reserved.

28

TOPICS External Evaluations
Our initiatives for climate change, diversity and inclusion, and investor relations earned highevaluation.

Main investments
C l i mate C h ange

D i v e rs it y and I nclusionIR

Winner of eco Test AwardGrand Prize

Winner of the highest gold level in“PRIDE Index 2023” for two
consecutive years

Winner of 2023 IR Award“’Most Liked!’ IR Award”

We won the top prize at the “eco Test Award2023” sponsored by the Tokyo Chamber ofCommerce and Industry. Our goal is to have all
employees become Eco-People (those who havepassed the eco certification test) by FY2026. As of
FY2022, we had achieved a passing rate of 86.7%.
In addition, we were highly appreciated for our
initiatives for renewable energy and for developing
and operating our own tool for calculating CO 2
emissions from building materials, which make up
the majority of Scope 3, by an accumulation
method.

For the second year in a row, we have been
awarded the highest gold award in the “PRIDE
Index,” a measure of workplace sexual minority(LGBTQ+) initiatives developed by a voluntaryorganization “work with Pride,” indicating that wehave achieved all five of the accreditation criteria.
The PRIDE Index is Japan’s first evaluation index
of LGBTQ+ initiatives in the workplace. Our longterm management plan aims to “deepen existingknowledge” in its core domestic construction
business and “search for new knowledge” in new
fields. In order to practice these, it is essential tocreate a work environment in which diverse
human resources can play an active role. We arepromoting “diversity and inclusion” initiatives tofoster a workplace culture that leverages diverse
values.

We were awarded the “’Most Liked!’ IR Award” inthe “2023 IR Award” sponsored by the Japan
Investor Relations Association. This is our second
award after the one in 2021. This year’s “’Most
Liked!’ IR Award” was selected under the theme of“IR Department’s initiatives for staff development
and their power boost,” and 21 companies wereselected from 199 applicants. We received a lot of
empathy, as our financial results briefing for
employees not only helped to strengthen investor
relations but also led to proactive employee
behavior.

Copyright(C) Tokyu Construction. All rights reserved.

29

[Inquiries]
Nishida/Morita
Corporate Planning Department, Corporate Strategy Division
TEL: +81-3-5466-5008
URL: webmaster@tokyu-cnst.co.jp

Notes
Forward-looking statements such as forecasts of thecompany’s results contained in this document are basedon information available as of the date of publication andassumptions made as of the date of publication regarding
uncertain factors that may affect future results.
Except as otherwise provided for by law, the company
shall bear no obligation to update these future
predictions. Actual results may differ from future
predictions due to various factors.