Value Report 2023
SEKISUI HOUSE

Long-Term Vision andMaterial Issues

Contents

Mechanisms andCatalysts for Creating Value

ESG Management

Mid-Term Management Plan for
Sustainable Growth

G: Governance E: Environment S: Social

Financial Data, Company
Information and Share Information

39

Management Resources (Four Types of Capital)
People (Human capital/Investment in human resources)

Tangibles (Manufactured capital and natural capital)

Based on our Corporate Philosophy of love of humanity, we have formulated and published the Sekisui HouseGroup Human Rights Policy, and we aim to create workplaces where all employees can practice a culture ofinnovation and communication. In line with our belief that the growth of employees is essential to the growth of
the Sekisui House Group, we are proactively hiring and developing diverse human resources, providing support
for skill enhancement through in-house certification programs, and working to appropriately allocate humanresources Group-wide. Through these measures, and by maximizing the value of our human resources by sharing
a common vision, we aim to increase corporate value.

Manufactured capital

Natural capitalIn our domestic businesses, we have production
bases (factories) with production lines that are thekey to production of homes with individual specifications in the built-to-order business, as well as distribution bases that deliver materials to construction
sites nationwide. We are working to reduce the environmental impact of our inter-factory distribution
through a modal shift to rail transport. In addition, weare carrying out capital investment in component
production facilities to improve production efficiency
and in the development business.

1

Consolidated employees:

29,052

Incl. overseas employees: 1,417• Sales representatives:• Technical staff:
Female employees inmanagerial positions:

7,108
8,442

First-class architects:2
Employeeswith major
nationalqualifications

302

Employment rate of persons
with disabilities (Group basis):1

2.86%

Take-up rate for eligible male
employee childcare leave:100%

1 Rate at 33 domestic consolidated companies subject to statutory requirements to hire persons with disabilities (including theCompany)

Employeeswith internal
certifications3

3,417First-class building operationand management engineers:2

2,904

Second grade financial
planners:2

4,560

Registered real estatetransaction agents:2

8,170

Chief Architects:
Chief Constructors:
Structural Planning Specialists:
Platinum Specialists:
CS Meisters:

3191432144563

2 Sekisui House and Major Domestic Group Companies (excluding Konoike Construction)
3 As of April 1, 2023; Sekisui House (non-consolidated)

P.41 The Sekisui House Group’s Human Capital Management
P.86 Human Resources Strategy  P.191 In-house certification programs

FY2022

We conduct sustainability-conscious CSR procurement. In addition to our FairWood procurement practices and acquiring forest certification, we pursue
sustainability on the basis of coexistence andco-prosperity with our suppliers through measures
including due diligence in procurement and promotion of local production for local consumption ofdomestic lumber. In addition, we are advancing proprietary initiatives to reduce energy consumption andenvironment burden.

2

Capital expenditure:¥95.3 billion

1 2   Productionbases:

6

5 in Japan, 1 overseas
Distribution bases:
P.51 Value Chain
P.175 Factory Site Report
Production system (Japanese only)

40

3

3 Sustainable wood procurement rate:  497.1%

Eco-friendly landscaping and greening

19,003 thousand trees
CO emissions:
82 thousand t-COSupplier science-based target-setting rate: 31.9%
RE100 achievement rate
(Sekisui House Owner Denki):
55.1%
Waste emissions:
1,069 thousand tonnes   Resource Recycling Centers: 23 across Japan(Gohon no Ki Project):2

4P.136 Contributing to a Decarbonized Society
P.146 Biodiversity Conservation
P.154 Initiatives to Realize a Circular Economy
P.216 Supply Chain Management

2

Value Report 2023

Long-Term Vision andMaterial Issues

Contents

SEKISUI HOUSE

Mechanisms andCatalysts for Creating Value

ESG Management

Mid-Term Management Plan for
Sustainable Growth

G: Governance E: Environment S: SocialFinancial Data, Company
Information and Share Information

40

Management Resources (Four Types of Capital)

Funding (Financial capital)

Intellectual and Social Assets (Intellectual capital and social/relationship capital)
Intellectual capital

To support sustainable growth, we must establish a strong financial base, prepare for various risks in the market
environment, and maintain the investment capacity to make swift and flexible investment decisions. We emphasize credit ratings as a standard for evaluating financial health and appropriate levels of financial leverage andhave set the targets of a D/E ratio of about 0.5 times and a debt repayment term (net debt/EBITDA) of less thanabout 1.5 years, premised on maintaining an AA rating in Japan and A rating overseas. By applying these guidelines, we will maintain a balance between aggressive investment for growth and financial soundness.
Equity CapitalInterest-Bearing Debt

(Billions of yen)
2,000

1,326.5(Billions of yen)
800

1,632.8

1,473.9

600

562.9

549.8

2020

2021

607.1

Social/relationship capital

The Sekisui House Group advances cutting-edge
research and development in multifaceted areas.
These encompass quality enhancements and newtechnologies for our detached houses, rental housing
and other buildings, as well as development related
to happiness, comfort and the environment. We arealso working to foster a culture of innovation, proactively promoting technological development andinnovation to power the sustainable growth of theSekisui House Group.

A solid customer base boasting the industry’s highest
cumulative number of dwellings built together withthe construction capabilities required to achieve it—these are two of our core competencies, which areintegral to the Sekisui House Group’s connection
with society. We have built a framework for construction in which the Sekisui House Construction companies and partner building constructors are united by
the spirit of “a community with a common destiny,”
and established an after-sales service systemthrough our Customer Service Centers, which are
key to long-term relationships with homeowners.

400

1,000

200
002020

2021

2022

(FY)

D/E ratio(Times)
0.5
0.4
0.3
0.2
0.1
02022

(FY)

Free Cash Flow
0.420.37(Billions of yen)
100

0.37

196.4

FY2022      Research and50development expenses:
4.30

Equity capital:
Interest-bearing debt:

20212022(FY)¥1,632.8 billion¥607.1 billion

D/E ratio:
Free cash flow:
P.74 Financial and Capital Strategy
P.78 Financial Analysis

0.37 times-¥39.9 billion(39.9)
2020

2021

2022

(FY)

           Realestate investment:
Fifth Mid-Term Management¥9.5 billion

Patents held:

-50
2020

2Results (three-years)¥1,977.4 billion

Long-term credit ratings:

AA
AA- (Rating and Investment Information)
A (S&P Global Ratings)	 (Japan Credit Rating Agency)

Debt repayment term
(Net debt/EBITDA):

0.93 years

Design rights held:

787359Platform House Concept•H ED-Net in-home early detection network for acute illnesses• PLATFORM HOUSE touch smart home service• SUITE CONCIER website introducing lifestyle services
12

Comprehensive Housing R&D Institute

Human Life R&D InstituteTomorrow’s Life Museum (TLM)
Research centers (Konoike Construction: Osaka, Tsukuba)
P.51 Value Chain
P.87 Technology and R&D Strategy
Research and development (Japanese only)
Display houses and hands-on exhibits (Japanese only)

3

4Cumulative dwellings built (global):

2.62 millionPartner building constructors involved inessential construction processes forSekisui House:  
3 Domestic educational training centers
and training schools:
Overseas technical training centers:
4 Customer Service Centers:  2,595
31100 (at 30 offices)
1,462 staff

P.51 Value Chain
P.206 Training centers and training schools
P.207 Customer Initiatives
P.210 Coexisting with Local Communities  Sekisui House educational training centers and trainingschools (Japanese only)