The 1st Quarter FY2021
Summary of Financial Results
August 6, 2021

The 1st Quarter FY2021 Financial Summary☆Key Points of Financial Results
With regard to orders received and net sales, although figures exceeded the previous fiscal year due to favorable figures forEnvironmental Systems and a recovery in small-scale maintenance and repairs projects, which was impacted by the COVID19 pandemic last fiscal year, there was a decline in profit and as a result of sales of profitable large-scale projects in the samequarter of the previous fiscal year and selling, general and administrative expenses also declined<Orders received > 56.023 billion yen (47.660 billion yen in the same period of the previous fiscal year)● Orders received for large-scale Electrical and Environmental Systems projects were up year on year
● Orders received for Industrial HVAC declined due to the impact of orders received for large-scale projects in the same
period of the previous fiscal year
< Net sales> 38.737 billion yen (38.253 billion yen in the same period of the previous fiscal year)● Net sales were up year on year due to favorable sales of large-scale environmental systems construction● Net sales in the Facilities Construction Business were steady year on year
<Gross profit> Gross profit amounted to 4.661 billion yen (5.120 billion yen in the same period of the previous fiscal year)● Gross profit declined due to the impact of sales of profitable large-scale projects in the same quarter of the previous
fiscal year
● With regard to selling, general and administrative expenses, costs such as those relating to responses to COVID-19
pandemic, which arose in the same period of the previous fiscal year, declined, while the amount by which operating
income declined was reduced<FY2021 consolidated results forecasts>● Orders received of 200 billion yen, net sales of 200 billion yen, and ordinary income of 10 billion yen (no change frominitial forecast)* Although, at this stage, results have been incorporated, which take into account the impact of the COVID-19 pandemic
on the Group’s business, business results may be further impacted due to altered circumstances in the future<Shareholder returns>● Forecast interim dividend: 35 yen, year-end dividend: 35 yen, annual dividend: 70 yen (no change from initial forecast)● 1,000,000 shares of treasury stock to be acquired by the end of fiscal 2021.
● Forecast payout ratio: 56.8%, forecast total return ratio: 79.1%

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Contents

12345

The 1stQuarter
FY2021Results

The 1st Quarter
FY2021
Balance Sheetand Statementof Cash FlowsFY2021
Forecast

ShareholderReturns

Supplementary
Materials

P4-10

P11-13

P14-16

P17-18

P19-253©2021 SANKI ENGINEERING CO., LTD. All Rights Reserved.

FY2021 1Q RESULTS

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【Overall Results】
FY2021 1Q Results (Consolidated)(Millions of yen)June
FY2019June
FY2020June
FY2021

Year on year

Rate ofChange (%)

Orders received

46,69747,66056,023

8,363

17.5

Balance carried forward

155,644

145,569

158,962

13,392

9.2

Net sales

40,882

38,25338,737483

1.3

Completed construction
contracts

40,27037,654

38,121466

1.2Real estate and others

612

599

616

16

2.8

5,305

5,120

4,661(458)(9.0)

Completed construction
contracts

5,028

4,8754,381(493)(10.1)

Real estate and others

277

244

280

35

14.6

Gross profit margin (%)

13.0

13.4

12.0(1.4)pt.

―

Selling, general and administrative
expenses

4,983

5,274

4,940

(334)

(6.3)

Operating income (loss)

322

(154)

(278)

(123)

―

Non-operating income (loss)

225

221

264

43

19.5

Ordinary income (loss)

547

66

(13)

(80)

－Extraordinary income (loss)

24(82)(1)

81―

Profit attributable to owners of parent (loss)

428

11(35)(47)―

Gross profit

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【Overall Results】
Quarterly Results (Consolidated)(Millions of yen)

FY2019FY2020

FY2021

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

1Q

Orders received

46,69754,20450,031

43,08547,66055,575

43,21149,13256,023

Net sales

40,88250,962

51,83364,00638,25342,611

48,35160,851

38,737Gross profit

5,305

7,862

7,460

11,482

5,120

5,637

7,414

10,582

4,661

Gross profit margin (%)

13.0

15.4

14.4

17.9

13.4

13.2

15.3

17.4

12.0

Selling, general andadministrative expenses

4,983

4,992

5,063

6,396

5,274

4,976

5,064

5,939

4,940

Operating income (loss)

322

2,869

2,396

5,085(154)

660

2,350

4,642(278)

0.8

5.6

4.6

7.9(0.4)

1.5

4.9

7.6(0.7)

Ordinary income (loss)

547

2,955

2,644

5,076

66

776

2,527

4,826(13)Extraordinary income (loss)

248449(269)

(82)

(243)

(40)

(33)

(1)

Profit attributable toowners of parent (loss)

428

2,057

1,815

3,276

11809

1,647

3,431(35)

Operating profit margin (%)

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【Orders Received】
Orders Received by Segment (Consolidated)(Millions of yen)June
FY2019Segment

June
FY2020June
FY2021

Year on year

Rate ofChange (%)

HVAC and Plumbing for
Buildings

13,018

14,235

13,889(346)(2.4)

Industrial HVAC

11,052

18,054

11,228(6,826)(37.8)

Electrical Systems

7,469

3,125

10,756

7,630

244.1

Facility Systems

2,921

2,645

2,147(498)(18.8)

34,46138,06238,022(39)(0.1)

Machinery Systems

2,257

2,016

3,096

1,080

53.6

Environmental Systems

9,451

7,066

14,3937,327

103.7

Total of Plant & Machinery
Systems Business

11,7099,082

17,490

8,408

92.6

46,17047,14455,512

8,368

17.8

Real Estate Business

525

582

595

122.2

Others

195

133

128

(5)

(4.0)

Adjustments*(193)

(200)

(213)

(12)

―

46,69747,66056,023

8,363

17.5

Total of Facilities Construction
Business

Sub-totalTotal* “Adjustments” eliminate internal transactions included in each segment.

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【Net Sales】
Net Sales by Segment (Consolidated)(Millions of yen)June
FY2019SegmentJune
FY2020(Millions of yen)June
FY2021

Year on year

Rate ofChange (%)

HVAC and Plumbing for
Buildings

15,253

10,847

10,792(54)(0.5)

Industrial HVAC

13,615

14,288

13,956(332)(2.3)

Electrical Systems

3,958

5,068

5,037(30)(0.6)

Facility Systems

1,867

2,016

2,034

17

0.9

34,69532,22031,820(400)(1.2)

Machinery Systems

2,601

2,262

2,192(70)(3.1)

Environmental Systems

3,143

3,298

4,120

822

24.9

Total of Plant & Machinery
Systems Business

5,745

5,560

6,312752

13.5

40,44037,781

38,1333520.9

Real Estate Business

525582595

122.2

Others

233

170

114

(55)

(32.7)

Adjustments*(317)

(280)

(106)

174

―

40,882

38,25338,737483

1.3

Total of Facilities Construction
Business

Sub-total

Total* “Adjustments” eliminate internal transactions included in each segment.

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【Profit】
Gross Profit by Segment (Consolidated)
June
FY2019Segment

Gross Profit by segment

HVAC and Plumbing for
Buildings/Industrial HVAC
/Electrical Systems

June
FY2020(Millions of yen)June
FY2021

Year on year

Rate ofChange (%)

4,152

4,103

3,526(577)(14.1)

Facility Systems

240

183

255

72

39.8

Total of Facilities
Construction Business

4,393

4,286

3,782(504)(11.8)

Machinery Systems

541

427

331(95)(22.3)

Environmental Systems

113

248

313

65

26.4

Total of Plant & Machinery
Systems Business

654

675

645

(29)

(4.4)

5,048

4,962

4,428(534)(10.8)

Real Estate Business

192

232

259

27

11.6

Others

94

44(0)

(7.6)

Adjustments

(29)

(78)

(29)

48―

5,305

5,120

4,661(458)(9.0)

Sub-totalTotal

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【Profit】
Initiatives to Improve Productivity and Construction Quality for
Increased Profit● Enhancement of the company-wide system to divide labor through promotion ofthe Smile Site Plan*● Enhancement of design review and active roll-out of construction processes● Reduction in number of accidents through comprehensive health and safety
management, including for partner companies
2018: 1 accident; 2019: 11 accidents; 2020: 3 accidents● Enhancement of quality control and prevention of problems and complaints byswiftly sharing information about problems and complaints
FY2018: 98 cases; FY2019: 67 cases; FY2020: 47 cases● Digitalization of procurement tasks for increased business efficiency and reduced
purchase costs
FY2018: 85%; FY2019: 88%; FY2020: 91%● Reduction in unprofitable construction through comprehensive construction
management
Balance of provision for loss on construction contracts
FY2018: 480 million yen; FY2019: 50 million yen; FY2020: None
* A specialist committee that was established in fiscal 2017 to reduce the burden on construction managers and promote businessefficiency

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FY2021 1Q
BALANCE SHEET AND
STATEMENT OF CASH
FLOWS

11

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【Financial Conditions】
Balance Sheet (Consolidated)(Millions of yen)

End of
FY2020Current assets

June
FY2021

Rate ofChange(%)

Year onyear

June
FY2020116,054

105,256(10,798)(9.3)

99,983

Notes receivable, accounts receivable fromcompleted construction contracts and other

65,598－(65,598)―

48,530Notes receivable, accounts receivable fromcompleted construction contracts and other, and contract assets－47,492

47,492－―55,25855,441182

0.3

51,71028,81628,91195

0.3

25,77067,88259,545(8,336)(12.3)

55,363

Notes payable

―

―

―

―

99

Electronically recorded obligations operating

873

956

82

9.5

952

Accounts payable on construction
contracts

40,83633,844(6,991)(17.1)

33,754

Noncurrent liabilities

11,731

11,883151

1.3

11,095

Total net assets

91,69989,268(2,431)(2.7)

85,235(3,859)(3,804)55―(4,071)

Total assets

171,313160,697(10,616)(6.2)

151,693Book-value per share (yen)1,611.76

1,568.48(43.28)(2.6)

1,472.82

53.4

55.4

2.0pt.

―56.0

10,595

9,472(1,122)

10.6

9,600

Noncurrent assets
Investment securities
Current liabilities

Treasury stock

Equity ratio (%)
Interest-bearing liabilities (consolidated)

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【CF】
Statement of Cash Flows (Consolidated)○The balance of cash and cash equivalents increased year on year
・The increase in cash flows from operating activities is due to the continued recovery of receivables, whichmore than offsets the decline in accounts payable
・ The decrease in cash flows from investment activities is mainly due to the acquisition of property, plantand equipment
・ The decrease in cash flows from financing activities is mainly due to the purchase of short-term and longterm loans payable and the payment of dividends(Millions of yen)

FY2017FY2018FY2019FY2020June
FY 2021June
FY 2020

Cash flows from operating
activities

6,306

6,786

11,940

(483)

7,939

(3,694)

Cash flows from investing
activities(2,510)(3,775)(303)(1,423)(390)(1,579)Cash flows from financing
activities

1,814(5,215)(8,955)(6,974)(3,724)(4,629)Cash and cash equivalents atend of period

44,866

42,61245,94637,08740,951

36,00913©2021 SANKI ENGINEERING CO., LTD. All Rights Reserved.

FY2021 FORECAST

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【Overall Forecast】
FY2021 Full-Year Forecast (Consolidated)
FY2017FY2018FY2019FY2020

FY2021
forecast(Initialforecast)
A(Millions of yen)
FY2021forecast(Interim forecastfrom August 6)

Increase/Decrease
B–A

Rate ofChange(%)

B

Orders received

191,113217,096

194,018

195,580

200,000

200,000――

Balance carried forward

144,712

149,495

136,163

141,676

141,676

141,676――

Net sales

170,157

212,314207,684

190,067

200,000

200,000――

Gross profit

25,06031,684

32,11028,75432,00032,000

―

―

14.7

14.9

15.5

15.1

16.0

16.0

―

―

Operating income

6,593

10,637

10,674

7,498

9,500

9,500

―

―

Ordinary income (loss)

7,434

11,204

11,224

8,196

10,00010,000――

Profit attributable toowners of parent

3,906

9,046

7,576

5,901

7,000

7,000

―

―

Gross profit margin(%)* Although results have been incorporated, which take into account the impact of COVID-19 pandemic on the Group’s business at this point, business results may befurther impacted due to future spread of the virus

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【Forecast of Orders Received and Net Sales】
FY2021 Forecast of Orders Received andNet Sales by Segment (Consolidated)
FY2021
Orders Received ForecastSegment(Millions of yen)

FY2021
Net sales Forecast

HVAC and Plumbing forBuildings

63,00066,000Industrial HVAC

57,00058,000Electrical Systems

25,00025,000

Facility Systems

12,00012,000157,000

161,000

Machinery Systems

12,00010,000

Environmental Systems

29,00027,000Total of Plant & Machinery
Systems Business

41,00037,000198,000

198,000

2,400

2,400

Others500500Adjustments*

(900)

(900)

200,000

200,000

Total of Facilities Construction
Business

Sub Total
Real Estate Business

Total* “Adjustments” eliminate inter-segment transactions included in each segment.

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SHAREHOLDER
RETURNS17©2021 SANKI ENGINEERING CO., LTD. All Rights Reserved.

【Shareholder Returns】Dividends and Others
・Conducted shareholder returns according to medium-term management plan “Century 2025” Phase 2 financial and capital
policies
・Forecast interim dividend: 35 yen, year-end dividend: 35 yen, annual dividend: 70 yen (no change from initial forecast)
・1,000,000 shares of treasury stock to be acquired by the end of fiscal 2020.
・Forecast payout ratio: 56.8%, forecast total return ratio: 79.1%
FY2017FY2018FY2019FY2020

FY2021(Forecast)

Earnings per share (yen)63.02

150.02128.51103.12

123.34

Cash dividends per share:
regular dividends (yen)20407070

70

Cash dividends per share:extra dividends (yen)

1520

2510―

Cash dividends per share (yen)

3560

9580

70

Payout ratio (consolidated) (%)

55.5

40.0

73.9

77.6

56.8

Total return ratio (%)

148.9

52.9

111.4

97.3

79.1

Number of shareholders at end of FY

3,243

3,381

4,216

14,861―

Stock price at end of FY (yen)

1,188

1,210

1,211

1,453

―

Acquisition of treasury stock(thousand shares)

3,000

1,000

1,958

1,000

1,000

Retirement of treasury stock(thousand shares)

3,000

1,000

2,000

1,000―

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SUPPLEMENTARY
MATERIALS

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【Orders Received】
Orders Received by Type(Millions of yen)June
FY2020AJune
FY2021B

FY2018Full-year

FY2019Full-year

FY2020Full-year

Orders received (Non-consolidated: Facilities
Construction Business)

173,553

147,191

149,278

36,35635,938(418)

Orders received from general contractors(Non-consolidated: Facilities ConstructionBusiness)

78,304

48,23863,54413,900

13,105(795)

45.1

32.8

42.6

38.2

36.5

(1.7)

Rate of orders received from generalcontractors (Non-consolidated: Facilities
Construction Business) (%)
Orders received (Consolidated)
Orders received from overseas projects(Consolidated)
Rate of orders received from overseas
projects (Consolidated) (%)

Diff.
B–A

pt.

217,096

194,018

195,580

47,66056,023

8,363

2,379

3,143

2,789

736

989

253

1.1

1.6

1.4

1.5

1.8

0.3
pt.

Orders received for renewal construction(Consolidated)

117,619

112,909109,585

26,22322,891(3,332)Rate of orders received for renewal
construction (Consolidated) (%)

54.2

58.2

56.0

55.0

40.9(14.1)<Ref.> Net sales for renewal construction(Consolidated)pt.

116,627

114,208

101,147

18,814

20,2971,483

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【Orders Received】
Orders Received by Industry (Consolidated)(Millions of yen)

18,00016,00014,00012,00010,000
8,000
6,000
4,000
2,000
0

June FY2019
June FY2020
June FY2021

Government Offices

Miscellaneous business services

Wholesale and Retail Trade

Education

Medical Services

Real EstateFinance and Insurance

ChemicalMachinery

Food

Pharmaceutical Industry

Automobile

Electrical Machinery

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【Orders Received / Net Sales 】
Main Large-Scale Projects Received andLarge-Scale Completed Construction Projects〇Main Large-Scale Projects Received
Property nameItem of construction

Type ofconstruction

Location

Futaba Regional Wide Area Municipal Area Association Southern HealthCenter Garbage incineration systems

Waste Treatment Facility

Newconstruction
work

Fukushima

Yamato City North Purification Center Maintenance and Management
Business Consignment

Water and sewage treatmentsystems maintenance andmanagement

Businessconsignment

Kanagawa
2 other projects〇Main Large-Scale Completed Construction Projects
Item of construction

Type ofconstruction

Location

Shimbashi Tamuracho Region Urban Redevelopment Project

HVAC systems

Newconstruction
workTokyo

Kowa Kawasaki Nishiguchi Building HVAC Equipment Renewal

HVAC systems

Renovation

Kanagawa

HVAC, Plumbing and Electricalsystems

Expansion

Hokkaido

Property nameDENSO Hokkaido Expansion Stage II* The property name is the name being used by the Company. This may differ from the name used on the construction contract.

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【Orders Received】
Main Large-Scale Projects Received over 1 Billion Yen (by Industry)
June FY2019

June FY2020

June FY2021

Office―1―Factory

1

1―

Research institute

―

1

―

Other building interiors

1

Water treatment plants
and sewage plants

1

Hospital―

Water treatment plants
and sewage plants

14 Projects（8,884 millionyen）* Orders received from
customers: 3 projects* Orders received fromgeneral contractors:
1 project―
1――4 Projects（7,917 millionyen）

1* Orders received from
customers: 2 projects1* Orders received fromgeneral contractors:
2 projects

14 Projects（15,651 millionyen）* Orders received fromcustomers: 3 projects* Orders received fromgeneral contractors:
1 project

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【Operating Results】
Century 2025 Results (Consolidated)<Orders Received and Net Sales>
Phase 1

Phase 2

(Millions of yen)

200,000

Orders received
Net sales

150,000

Balance carried forward
100,000

50,000

0
2016

2017

2018

2019

2020

2021(Forecast)24©2021 SANKI ENGINEERING CO., LTD. All Rights Reserved.

【Operating Results】
Century 2025 Results (Consolidated)<Profit>Phase2Phase1(Millions of yen)（％）

36,00018.0

32,000

16.0

Gross
profit (left axis)
売上総利益（左軸）
Operatingincome (left axis)
営業利益（左軸）

28,00014.0

Ordinary
income (left axis)
経常利益（左軸）
Grossprofit margin (right axis)
売上総利益率（右軸）24,00012.0

Operatingprofit margin (right axis)
営業利益率（右軸）
Ordinary
profit margin (right axis)
経常利益率（右軸）20,000

10.0

16,0008.0

12,000

6.0

8,000

4.0

4,000

2.00

2016

2017

2018

2019

2020

2021(Forecast)

0.0

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Statements about the future, such as results forecasts included in thesematerials, are based on judgments made according to the information
available to the Company as of August 6. Actual results may differ from thefigures contained herein due to a number of factors.
For inquiries, please contact:
Corporate Communications Department,
SANKI ENGINEERING CO., LTD.

Tel：+81-3-6367-7041

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