February 14, 2024

Consolidated Financial Results
for the Nine Months Ended December 31, 2023
<Japanese GAAP>
Listed company:
SANKI ENGINEERING CO., LTD.
Listed stock exchange: Tokyo
Securities code:
1961
URL:
https://www.sanki.co.jp/
Representative:
Hirokazu Ishida, President and Representative Director
Contact:
Yoshio Kawabe, Director, Managing Executive Officer, General Manager of the Accounting
Division
TEL: +81-3-6367-7084
Scheduled date to file quarterly securities report: February 14, 2024
Scheduled date to commence dividend payments: Preparation of explanatory materials for quarterly financial results: Yes
Holding of a briefing on quarterly financial results: None
(Amounts of less than 1 million yen are truncated)

1. Consolidated Financial Results for the Nine Months Ended December 31, 2023
(April 1, 2023 to December 31, 2023)(1) Consolidated operating results (Cumulative)(% figures show year-on-year change)
Net sales
Nine months ended

Operating profit

Millions of yen

Profit attributable toowners of parent

Ordinary profit% Millions of yen% Millions of yen% Millions of yen%

December 31, 2023

149,611

19.0

5,998

449.0

6,980

260.4

4,861

394.0

December 31, 2022

125,713

(7.4)

1,092

(77.9)

1,937(65.1)

983(73.3)(Note) Comprehensive income:Nine months ended December 31, 2023: ¥8,665 million [－%]
Nine months ended December 31, 2022:
Profit per
share – diluted

Profit per share
Nine months ended¥121 million [(97.3%)]

Yen

Yen

December 31, 2023

89.53

89.23

December 31, 2022

17.68

17.62

(2) Consolidated financial position
Total assets
As of

Net assets

Shareholders’ equity ratio

Millions of yen

Millions of yen%

December 31, 2023

173,112

94,202

54.3

March 31, 2023

172,305

90,913

52.6(Reference) Shareholders’ equity: As of December 31, 2023: ¥94,012 million

1

As of March 31, 2023: ¥90,714 million

2. Dividends
Annual dividends
First quarter-end

Second quarter-end

Third quarter-end

Fiscal year-end

Yen

Yen

Yen

Yen

Yen

Fiscal year ended March 31, 2023



35.00



40.00

75.00

Fiscal year ending March 31, 2024



35.00


35.00

70.00

Fiscal year ending March 31, 2024
(Forecast)

Total(Note) Amendment to forecasts of dividends recently announced: None
Breakdown of end-FY3/23 dividend: Ordinary dividend ¥35; Extraordinary dividend ¥5
3. Forecast of Consolidated Financial Results for the Fiscal Year Ending March 31, 2024
(April 1, 2023 to March 31, 2024)(% figures show year-on-year change for the full year)
Net sales

Full year

Operating profit

Profit attributable toowners of parent

Ordinary profit

Profitper share

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

Yen

220,000

15.3

11,000103.3

11,500

84.1

7,500

57.9

138.48(Note) Amendment to forecasts of consolidated financial results recently announced: Yes

2

* Notes(1) Changes in significant subsidiaries during the nine months ended December 31, 2023 (changes in specified subsidiaries
resulting in the change in scope of consolidation): None
New: (Company name:)
Excluded: (Company name:)(2) Application of specific accounting for preparing quarterly consolidated financial statements: None
(3) Changes in accounting policies and estimates, and retrospective restatements(i) Changes in accounting policies in accordance with revision of accounting standards: None(ii) Changes in accounting policies other than item (i) above: None(iii) Changes in accounting estimates: None(iv) Retrospective restatements: None
(4) Number of shares issued (common stock)(i) Number of shares outstanding at the end of the period (including treasury shares)
As of December 31, 2023

56,661,156 shares

As of March 31, 2023

58,161,156 shares(ii) Number of treasury shares at the end of the period
As of December 31, 2023

2,968,795 shares

As of March 31, 2023

3,722,458 shares(iii) Average number of shares during period
For the nine months ended December 31, 2023

54,298,011 shares

For the nine months ended December 31, 2022

55,645,488 shares* Quarterly financial results are not subject to quarterly review by a certified public accountant or audit corporation.
* Proper use of earnings forecasts, and other special matters
We have amended the consolidated and non-consolidated earnings forecasts announced on November 10, 2023. For
details, please refer to 1. (3) “Qualitative information on consolidated earnings forecasts” on page 4 of the Attached
Materials.
The forward-looking statements such as earnings forecasts contained in these materials are based on the information
available at the time they were prepared, and the actual results could differ from forecasts depending on a variety offactors.

3

(Reference) Forecast of Non-consolidated Financial Results for the Fiscal Year Ending March 31, 2024
(April 1, 2023 to March 31, 2024)(% figures show year-on-year change for the full year)
Net sales

Full year

Operating profit

Ordinary profit

Profitper share

ProfitMillions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

Yen

195,000

15.3

8,500

142.1

10,500

86.7

7,700

59.4

142.18(Note) Amendment to forecasts of non-consolidated financial results during the quarter under review: Yes

Disclaimer: This is a Japanese–English translation of the summary of financial statements of the Company produced foryour convenience. Officially, only the Japanese version is assumed to be the summary of financial statements of theCompany. This summary does not constitute any guarantee and the Company will not compensate any losses and/or damage
stemming from actions taken based on these statements. In the case that there is any discrepancy between the Japanese andEnglish versions, the Japanese version is assumed to be correct.

4

[Attached Materials]
Index
1. Qualitative Information on the Quarter under Review ........................................................................................................... 2(1) Qualitative information on consolidated operating results ................................................................................................ 2(2) Qualitative information on consolidated financial position ............................................................................................... 3(3) Qualitative information on consolidated earnings forecasts .............................................................................................. 4
2. Consolidated Financial Statements and Related Notes........................................................................................................... 5(1) Quarterly consolidated balance sheets ............................................................................................................................... 5(2) Quarterly consolidated statements of income and comprehensive income........................................................................ 7(3) Quarterly consolidated statements of cash flows............................................................................................................... 8(4) Notes on premise of going concern ................................................................................................................................... 9(5) Segment information, etc................................................................................................................................................... 9(6) Notes regarding significant changes in shareholders’ equity [if any] .............................................................................. 10

1

1. Qualitative Information on the Quarter under Review
The Group aims to be the “Company of Choice” for even more stakeholders by further enhancing quality and reliability throughour long-term vision “Century 2025.” The consolidated fiscal year under review is the second year of the four-year medium-term
management plan “Century 2025” Phase 3, which is the final phase of the long-term vision “Century 2025.” Continuing its efforts
from FY2022, the Group will strive to remain the enduring company of choice by pushing forward with Phase 1 initiatives focusedon improving quality and Phase 2 efforts to enhance reliability, while also implementing new measures, including initiatives tocontribute to the sustainability of society, accelerate work-style reforms, and invest toward the next generation. In addition, we willcontinue building a corporate structure that can flexibly respond to changes in the environment, while developing new technologies,
strengthening corporate governance, and achieving sustainable growth and increased corporate value over the medium to long term
based on thorough compliance.
The Board of Directors is continuing to discuss the requests issued by the Tokyo Stock Exchange under “Action to Implement
Management that is Conscious of Cost of Capital and Stock Price” and considering how the Group will respond to these requests
and engage in disclosure.
The Group’s operating results and financial position for the nine months ended December 31, 2023, are as follows.

(1) Qualitative information on consolidated operating results
Q3 FY2022

Q3 FY2023

YoY change

Orders received

181,663

187,1635,499

Balance carried forward

206,687

225,977

19,290Net sales

125,713

149,61123,897Gross profit

16,70821,929

5,220

13.3%

14.7%

1.4%

1,092

5,998

4,905

Margin (%)
Operating profit
Margin (%)
Ordinary profit
Margin (%)
Profit attributable to ownersof parent
Margin (%)

0.9%

4.0%

3.1%

1,937

6,980

5,043

1.5%

4.7%

3.2%

983

4,861

3,877

0.8%

3.2%

2.4%

(Millions of yen)
Main factors behind YoYYoY change (%)
changeAsstatedinthe next
3.0%
section, “Operating
9.3% results of major
segments”
19.0%
31.2%
449.0%
260.4%

394.0%(Note) Profit margins are the rate of return on net sales.
<Operating results of major segments>〇Facilities Construction BusinessThis business includes HVAC and Plumbing for Buildings, Industrial HVAC (centered on air-conditioning systems for factories),
Electrical Systems and Facility Systems businesses, etc.
While orders received decreased year on year, due mainly to a fallback from orders for large projects in HVAC and Plumbing for
Buildings in Q3 FY2022, increases were recorded in both net sales and profit due largely to progress on projects that were carriedforward from FY2022.

Orders received
Net sales
Segment profit

Q3 FY2022
158,316
101,841912

Q3 FY2023
149,462
122,944
5,709

2

YoY change(8,854)
21,103
4,796(Millions of yen)
YoY change (%)(5.6%)
20.7%
525.7%

〇Machinery Systems BusinessThis business mainly includes conveyance systems and manufacturing and sales business related to transportation equipment.
Orders received grew strongly, and net sales also increased due largely to progress in the projects that were carried forward fromFY2022. Segment loss improved due to the increase in net sales, but profitability was low.
Q3 FY2022
7,320
5,228
(943)

Orders received
Net sales
Segment profit (loss)

Q3 FY2023
8,043
7,421
(679)

YoY change
722
2,193
263

(Millions of yen)
YoY change (%)
9.9%
41.9%
－

〇Environmental Systems BusinessThis business mainly includes operations related to water and sewage facilities and waste treatment facilities ordered bygovernment agencies.
Orders received increased with orders received for large-scale waste treatment facilities. Net sales and segment profit bothincreased.
Q3 FY2022
14,48916,943141

Orders received
Net sales
Segment profit

Q3 FY2023
27,902
17,475373

YoY change
13,412
531
231(Millions of yen)
YoY change (%)
92.6%
3.1%
163.5%〇Real Estate BusinessThis business mainly includes leasing operations for real estate holdings and building management.
Tenant rental income increased, resulting in higher sales and profits.
Q3 FY2022
1,852
1,852
605

Orders received
Net sales
Segment profit

Q3 FY2023
1,861
1,861
693

YoY change
8888(Millions of yen)
YoY change (%)
0.5%
0.5%
14.6%

(2) Qualitative information on consolidated financial position(Millions of yen)
End-FY2022
Current
assetsNon-current
assetsTotal assets
Current
liabilities
Non-current
liabilities
Total
liabilities
Total net
assetsEnd-Q3 FY2023

YoY change
YoY change(%)

115,512112,212(3,299)(2.9%)

56,79360,899

4,106

7.2%

172,305

173,112806

0.5%

69,64965,060(4,588)(6.6%)

11,742

13,849

2,107

17.9%

81,392

78,910(2,481)(3.0%)

90,913

94,202

3,288

3

3.6%

Main factors behind YoY change
Cash and deposits decreased due to thepurchase of treasury shares anddividends paid, while investment
securities increased due to a rise inmarket prices
Repayment of borrowings and decreasein contract liabilities due to progress on
construction contracts

Retained earnings decreased due todividends paid, while valuationdifference on available-for-salesecurities increased due to a rise inmarket prices

(3) Qualitative information on consolidated earnings forecasts
We have amended the full-year consolidated and non-consolidated earnings forecasts announced on November 10, 2023, as follows,
based on recent performance trends.
・Full-year earnings forecast for the fiscal year ending March 31, 2024 (April 1, 2023 to March 31, 2024)

Operating profit(Millions of yen)
Profit attributable toowners of parent(profit for the nonProfit per
consolidated forecast) share (yen)Ordinary profit

Net sales
AmountMargin(%)

AmountMargin(%)

AmountMargin(%)

215,000

9,500

4.4

10,000

4.7

6,700

3.1

123.02220,000

11,0005.0

11,500

5.2

7,500

3.4

138.48

Increase (B-A)

5,000

1,500

0.6

1,500

0.5

800

0.3

―

Increase (%)

2.3

15.8

―

15.0

―

11.9

―

―

(Reference)
Results for theprevious fiscal
year

190,865

5,409

2.8

6,247

3.3

4,750

2.5

85.80

195,000

7,500

3.8

9,500

4.9

6,900

3.5

126.69195,000

8,500

4.4

10,500

5.4

7,700

3.9

142.18

Increase (B-A)

―

1,000

0.6

1,000

0.5

800

0.4

―

Increase (%)

―

13.3

―

10.5

―

11.6

―

―

(Reference)
Results for theprevious fiscalyear

169,116

3,510

2.1

5,624

3.3

4,830

2.9

87.25

Non-consolidated

Consolidated

Previous forecast(A)
Amended forecast(B)

Previous forecast(A)
Amended forecast(B)

Upon careful examination of the future outlook based on the consolidated financial results for the nine months ended December
31, 2023, we expect higher net sales and profit than in the previous full-year earnings forecast. This is due to factors such as steadyprogress in the projects that were carried forward from FY2022 and an anticipated improvement in the profitability of projects.
We expect full-year consolidated orders received of ¥220,000 million (4.8% higher than under the previous forecast).

4

2. Consolidated Financial Statements and Related Notes(1) Quarterly consolidated balance sheets(Millions of yen)
As of March 31, 2023

As of December 31, 2023

AssetsCurrent assets
Cash and deposits

24,949Notes receivable - trade20,531

407

417

Electronically recorded monetary claims - operating
Accounts receivable from completed construction
contracts and other
Contract assets

4,603

5,163

48,28635,304

23,84338,682

Securities

4,000

Costs on construction contracts in progress

2,801

－
4,959

Raw materials and supplies
Other
Total current assets

711

874

5,908

6,278

115,512112,212

Non-current assets
Property, plant and equipment
Buildings and structures

43,95544,434

Accumulated depreciation(34,672)(35,260)

Buildings and structures, net

9,283

9,173

Machinery, vehicles, tools, furniture and fixtures

2,111

2,234

Accumulated depreciation
Machinery, vehicles, tools, furniture andfixtures, net
Land(1,687)(1,740)

424

493

3,035

3,035

Leased assets

538

532

Accumulated depreciation

(266)

(262)

Leased assets, net

271

270

Construction in progress

22

31

13,037

13,003

Other

2,302

2,094

Total intangible assets

2,302

2,094

28,01032,57664

56

Retirement benefit asset

7,190

7,345

Leasehold and guarantee deposits

1,636

1,762

Insurance funds

1,011

632

Total property, plant and equipment
Intangible assets

Investments and other assets
Investment securities
Long-term loans receivable

Deferred tax assets
Other

849

746

3,026

3,023

Allowance for doubtful accounts

(337)

(342)

Total investments and other assets

41,45345,801

Total non-current assets
Total assets

556,79360,899172,305

173,112(Millions of yen)
As of March 31, 2023

As of December 31, 2023

Liabilities
Current liabilities
Electronically recorded obligations - operating

1,667

3,811

Accounts payable for construction contracts

35,07435,446

Short-term borrowings

6,674

4,878

97

97

Lease liabilities
Income taxes payable

839

882

Contract liabilities

15,027

12,619Provision for bonuses

4,101

1,992

224

149

1,405

1,356

32

506

Provision for directors’ bonuses
Provision for warranties for completed
construction
Provision for loss on construction contracts
Other

4,505

3,321

Total current liabilities

69,64965,060

1,400

1,137

300

302

Retirement benefit liability
Provision for loss on business of subsidiaries andassociates
Deferred tax liabilities

3,861

4,408

440

98

64

2,008

Other

5,675

5,894

Non-current liabilities
Long-term borrowings
Lease liabilities

Total non-current liabilities

11,742

13,84981,392

78,910Share capital

8,105

8,105

Capital surplus

4,189

4,192

Retained earnings

73,051

71,679Total liabilities
Net assets
Shareholders’ equity

Treasury shares(5,335)(4,473)

Total shareholders’ equity

80,011

79,504

10,58314,081

101

328

Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Share acquisition rights
Total net assets
Total liabilities and net assets

6

17

97

10,702

14,507

199

190

90,913

94,202

172,305

173,112(2) Quarterly consolidated statements of income and comprehensive income
Third quarter of consolidated fiscal year
(Millions of yen)
For the nine months ended
December 31, 2022
Net sales
Net sales of completed construction contracts
Net sales in real estate business and otherTotal net sales
Cost of sales
Cost of sales of completed construction contracts
Cost of sales in real estate business and otherTotal cost of sales
Gross profit
Gross profit on completed construction contracts
Gross profit on real estate business and otherTotal gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Construction repair expenses
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sale of non-current assets
Gain on sale of investment securities
Gain on liquidation of subsidiaries and associates
Total extraordinary income
Extraordinary losses
Loss on retirement of non-current assets
Loss on valuation of investment securities
Settlement payments
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
Profit(Breakdown)
Profit attributable to owners of parent
Profit attributable to non-controlling interests
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests

7

For the nine months ended
December 31, 2023

123,786
1,927
125,713

147,677
1,934
149,611

107,8121,192
109,005

126,541
1,140
127,682

15,973734
16,70815,615
1,092

21,135793
21,92915,930
5,998

12
598
465
1,076

13
685
558
1,256

74
3
154
232
1,937

77
67
129
274
6,980

22
58
－
80

－
332
25
358

73
31
139
244
1,772
347
441
788
983

86
52
－
139
7,198
1,864
472
2,337
4,861

983
－

4,861
－

(1,157)
5
164
125
(862)
121

3,497
－
227
79
3,804
8,665

121
－

8,665
－

(3) Quarterly consolidated statements of cash flows
For the nine months ended
December 31, 2022
Cash flows from operating activities
Profit before income taxes
Depreciation
Loss on retirement of non-current assets
Office relocation expenses
Increase (decrease) in provision for loss on businessof subsidiaries and associates
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in retirement benefit liability
Increase (decrease) in provision for loss on construction contracts
Interest and dividend income
Interest expenses
Loss (gain) on sale of property, plant and equipment
Loss (gain) on sale of investment securities
Loss on valuation of investment securities
Gain on liquidation of subsidiaries and associates
Decrease (increase) in trade receivables and contract assets
Decrease (increase) in costs on construction contracts
in progress
Increase (decrease) in trade payables
Increase (decrease) in contract liabilities
Increase (decrease) in other current liabilities
Settlement payments
Other
SubtotalInterest and dividends received
Interest paid
Income taxes paid
Income taxes refund
Office relocation expenses paid
Settlement paid
Cash flows from operating activities
Cash flows from investing activities
Purchase of securities
Proceeds from redemption of securities
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Payments for retirement of property, plant and equipment
Purchase of investment securities
Proceeds from sale of investment securities
Proceeds from liquidation of subsidiaries and associates
Proceeds from collection of loans receivable
Purchase of intangible assets
Proceeds from maturity of insurance funds
Other
Cash flows from investing activities
Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Repayments of long-term borrowings
Purchase of treasury shares
Proceeds from exercise of share options
Repayments of lease liabilities
Dividends paid
Cash flows from financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

8(Millions of yen)
For the nine months ended
December 31, 2023

1,772
1,117
73
－

7,198
1,423
86
24

－

(342)

(6)
(2,154)
641
63
(611)
74
(22)
(58)
31
－
6,762

2
(2,108)
502
473
(698)
77
0
(323)
52
(25)
(2,315)(1,994)(2,135)218
1,658(3,177)139(2,255)
2,273
612
(78)
(4,146)6－(139)(1,471)

2,462(2,430)(1,173)
－
(870)
(119)
699
(80)
(1,797)0(12)－(1,310)(15,000)
16,000
(588)
76
(67)
(271)
153
－
9
(1,086)
535
(162)
(400)

(13,000)
17,000
(860)
0
(75)
(7)
591
178
23
(195)
731
(10)
4,376

(961)
(1,042)(1,964)0(78)(4,743)(8,789)75(10,585)
44,77934,193(1,560)(517)(1,392)
0(82)(4,083)(7,636)151(4,418)24,94920,531

(4) Notes on premise of going concern
Not applicable(5) Segment information, etc.
I. Third quarter of fiscal year 2022 (April 1, 2022 to December 31, 2022)
1. Information on net sales and profit (loss) by reportable segment
Reportable segments

Net sales
Net sales to externalcustomers
Intersegment sales ortransfers
Total
Segment profit (loss)

Other(Notes) 1

Adjustments(Notes) 2(Millions of yen)
Quarterly
consolidated
profit/loss andcomprehensive
income posted(Notes) 3

Facilities
Machinery
ConstrucSystems
tion BusiBusiness
ness

Environmental Real Estate
Systems
Business
Business

Total

101,616

5,226

16,931

1,850

125,62489

125,713－

125,713

224

2

12

2

241

279

520

(520)

－

101,841

5,228

16,943

1,852

125,866368

126,234(520)

125,713

912

(943)

141

605

716

(32)

683

1,253

1,937

Total

(Notes) 1. The “Other” category is a business segment that is not included in reportable segments and includes the leasing businessand insurance agency business, etc.
2. The adjustment amount of ¥1,253 million to segment profit/loss includes company-wide profit not allocated to eachreportable segment of ¥832 million, the reversal amount of the interest burden allocated to each segment within thecompany of ¥198 million, and an adjustment amount of ¥222 million due to the recording of loss on retirement of noncurrent assets, loss on valuation of investment securities, and other items attributable to each segment as extraordinary
income and losses. Differences in allocation of company-wide expenses, etc., are the main source of company-wide profit.
3. Segment profit or loss is adjusted with ordinary profit in the quarterly consolidated statements of income andcomprehensive income.
II. Third quarter of fiscal year 2023 (April 1, 2023 to December 31, 2023)
1. Information on net sales and profit (loss) by reportable segment
Reportable segments

Net sales
Net sales to externalcustomers
Intersegment sales ortransfers
Total
Segment profit (loss)

Other(Notes) 1

Adjustments(Notes) 2(Millions of yen)
Quarterly
consolidated
profit/loss andcomprehensive
income posted(Notes) 3

Facilities
Machinery
ConstrucSystems
tion BusiBusiness
ness

Environmental Real Estate
Systems
Business
Business

Total

122,809

7,416

17,447

1,859

149,533

77

149,611－

149,611

134

5

27

2

169

356

526

(526)

－

122,944

7,421

17,475

1,861

149,703434

150,137(526)

149,611

5,709

(679)

373

693

6,097

(24)

6,072

907

6,980

Total

(Notes) 1. The “Other” category is a business segment that is not included in reportable segments and includes the leasing businessand insurance agency business, etc.
2. The adjustment amount of ¥907 million to segment profit/loss includes company-wide profit not allocated to eachreportable segment of ¥479 million, the reversal amount of the interest burden allocated to each segment within thecompany of ¥345 million, and an adjustment amount of ¥82 million due to the recording of extraordinary income andlosses such as loss on retirement of non-current assets attributable to each segment. Differences in allocation of companywide expenses, etc., are the main source of company-wide profit.
3. Segment profit or loss is adjusted with ordinary profit in the quarterly consolidated statements of income andcomprehensive income.

9(6) Notes regarding significant changes in shareholders’ equity [if any]
The Company has implemented the purchase and cancellation of treasury shares based on a resolution passed at the meeting of
the Board of Directors on August 10, 2023. As a result, during the nine months ended December 31, 2023, treasury shares increasedby ¥1,392 million due to purchases, while treasury shares and retained earnings decreased by ¥2,149 million due to the cancellationof treasury shares. The balance of treasury shares as of December 31, 2023, was ¥4,473 million.

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