Tokyu Construction Co., Ltd. · TSE:1720
Tokyu Construction — FY2024 Earnings Presentation
39 slides from Tokyu Construction's earnings presentation, May 20, 2024
Slide 1: FY03/2024 Financial Results Briefing
FY03/2024 Financial Results Briefing May 20, 2024
Slide 2: Overview of FY03/2024 Financial Results
Overview of FY03/2024 Financial Results FY03/2024 Financial Results Briefing
Slide 3: FY03/2024 Financial Highlights
FY03/2024 Financial Highlights Orders exceeded the previous period as the firm construction demand in the focus area was steadily taken in. Building construction and civil engineering projects on hand progressed steadily. The gross profit margin of completed construction improved, contributing to op
Slide 4: Consolidated Financial Results
Consolidated Financial Results Sales achieved the previous fiscal year’s level thanks to steady progress centered on large-scale construction work. Operating profit grew, despite an increase in selling, general and administrative expenses. An increase of 1 y e n p e r s h a r e b a s e d o n t h e d
Slide 5: Factors Affecting Net Income
Factors Affecting Net Income Profit grew due mainly to an increase in gross profit margin of completed construction, foreign currency gains, and an increase in equity method return on investment. ＋2,020 （Millions of yen） （ subsidiary ＋1,700） Decrease in gain on sale of Investment securities +4,505 ー
Slide 6: Non-consolidated Financial Results
Non-consolidated Financial Results Completed construction sa les increa sed due to the stea dy progress in construction projects. The gross profit margin of completed construction rose due to a n improvement in the profitability of civil engineering. Profit wa s up, a bsorbing a n increa se in selli
Slide 7: Non-Consolidated / Building construction (Completed construction sales, gross profit)
Non-Consolidated ／ Building construction（Completed construction sales・Completed construction gross profit） Steady progress in large-scale projects on hand from the previous period contributed to completed construction sales. Although many of the construction projects were ordered amid severe competi
Slide 8: Non-Consolidated / Building construction (Orders)
Non-Consolidated ／ Building construction（Orders） We received orders for targeted projects in our strong area steadily, considering our construction capacity. Domestic public projects increased due to the orders received for multiple construction projects including large-scale ones. Orders Main order
Slide 9: Non-Consolidated / Civil engineering (Completed construction sales, gross profit)
Non-Consolidated ／ Civil engineering（Completed construction sales・Completed construction gross profit） Completed construction sales increased due to the steady progress in construction projects on hand at the beginning of the period. The gross profit margin rose thanks to the improved profitability
Slide 10: Non-Consolidated / Civil engineering (Orders)
Non-Consolidated ／ Civil engineering（Orders） Overseas sales fell due to a reactionary decrease from the previous year when there were sales from large- scale ODA-related construction. With firm domestic demand due mainly to the measures for disaster prevention/mitigation and National Resilience, and
Slide 11: Consolidated Balance Sheets
Consolidated Balance Sheets The equity ratio was at 37.8％, decrease of 0.4 percentage points compared with March 31, 2023. D/E ratio was 0.54 times due to an increase in borrowings. I n c r e a s e /assets − Current decrease factors As of March As of March YoY ー26,591 （Millions of yen） 31, 2023 31,
Slide 12: Consolidated Statements of Cash Flows
Consolidated Statements of Cash Flows Operating cash flow was negative due to the advanced payment of construction charges. FY03/2023 FY03/2024 F Y 0 3/ 2 02 4 re ma rks （Millions of yen） Cash flows from operating Cash decreased due to an increase in trade 20,392 ー54,023 receivables and a decrease i
Slide 13: Full-year Forecast for FY03/2025
Full-year Forecast for FY03/2025 FY03/2024 Financial Results Briefing
Slide 14: Consolidated Financial Results Forecast
Consolidated Financial Results Forecast Orders received and net sales will remain steady. We expect operating profit to decrease due to lower gross profit margin and increased selling, general and administrative expenses associated w i t h h u m a n r e s o u r c e i n v e s t m e n t , e t c . Divi
Slide 15: Non-consolidated Financial Results Forecast
Non-consolidated Financial Results Forecast Sales will increase as large-scale construction work is expected to progress. Gross profit will decrease as construction work that was ordered amid severe competition progresses. In addition, due to increased selling, general and administrative expenses du
Slide 16: Non-consolidated Forecast / Building construction
Non-consolidated Financial Results Forecast／ Building construction Co m p let ed c o n s tr u c tio n s a les w ill b e b o o s t e d b y t h e p r o g r e s s o f la r g e -s c ale c o ns tr u c tio n w o r k o n h a nd . C o ns tr u c tio n w o r k o r d er ed a m id s ev er e c o m p etit io n m
Slide 17: Non-consolidated Forecast / Civil engineering
Non-consolidated Financial Results Forecast／ Civil engineering L a r ge-s c a le c o ns tr uc tio n c a r r ied o v e r f r o m p r e v io us y e ar s w ill p r o g r e s s a n d c o m p le te d c o ns tr u c tio n s a le s w ill in c r e as e. W e ex p ec t h igh er p r o f it d u e t o a n in c r
Slide 18: Non-Consolidated Order Forecast
Non-Consolidated Order Forecast In building construction, we will strive to secure our target projects. In civil engineering, we will aim to acquire orders mainly for overseas ODA projects and domestic governmental projects. Keenly aware of the impor tance of appropriate profit levels, considering o
Slide 19: Construction Renewal
Construction Renewal The construction renewal market will continue to expand. Demand is increasing from inbound projects such as hotels and commercial facilities, and schools, etc. We will continue to secure our target projects. • Desire for investment is strong, due partly to the recovery of inboun
Slide 20: International
International Place ODA projects as a core business. Strive to expand the business area to both upstream and downstream of the value chain by participating in TOD *1. • Know-how and technology we cultivated Net Sales /Gross Profit ※2 Future through urban development along the policy Tokyu Line, and
Slide 21: Real estate
Real estate Targeting environment-conscious customers, provide environmenta lly friendly properties with added value, such a s leasing, development, a nd renewa l of old properties by levera ging synergy with construction business. Increase capita l efficiency through cyclica l rea l esta te busines
Slide 22: Shareholder returns
Shareholder returns The Long-term Management Plan announced in May 2021 set the basic dividend policy as DOE of 4.0% or higher. Year-end dividend per share will be 37 yen for FY03/2024, up 1 yen, and 38 yen for FY03/2025. Dividend per share （yen） 38 Year-end 19 36 37 25 Interim 19 FY03/2022 FY03/202
Slide 23: Long-Term Management Plan "To zero, from zero."
Long-Term Management Plan “To zero, from zero.” （Rolling the plan in May 2024） Introduced a management cycle with a ten-year long-term plan and a one-year short-term strategy. With a long-term target, implement rolling plan flexibly. Respond to severe changes in business environment and strengthen h
Slide 24: Restructuring of our earning power (Problem-solving skills)
Restructuring of our earning power (Problem-solving skills ) Acquire and develop human resources which are the key to our future competitive edge, while reconstructing earning power based on a policy defined for each individual strategy. Strengthen the problem-solving skills and continue to meet cus
Slide 25: Take actions to realize management conscious of capital cost and stock prices
Take actions to realize management that is conscious of capital cost and stock prices FY03/2024 Financial Results Briefing
Slide 26: Measures for the recognition and improvement of current situation from a PBR perspective
Measures for the recognition and improvement of current situation from a PBR perspective PBR has improved since the announcement of the Long-term Management Plan in May 2021 Promote capital-efficiency-conscious management to improve the current PBR which has fallen below 1.0. Current status of the C
Slide 27: Expansion of human capital investment
R e d u ce I mp rov e R O E ca p i tal cos t s Expansion of human capital investment Reallocate FY2030 business portfolio to 75% for the core business and 25% for the strategic business. Expand human capital investment to accelerate the revision of personnel portfolio including shifting the necessar
Slide 28: Promotion of Human Capital Management (Instilling Philosophy and Vision)
R e d u ce I mp rov e R O E ca p i tal cos t s Promotion of Human Capital Management (Instilling Philosophy and Vision) Vision Dialogue throughout the year, an opportunity for management and a small number of employees to communicate online (all employees are eligible) By sharing the Philosophy, Vis
Slide 29: Acquisition of Market Opportunities by Leveraging Our Strength
R e d u ce I mp rov e R O E ca p i tal cos t s Ac q u i s i t i o n o f M a r k e t O p p o r t u n i t i e s b y L e ve ra g i n g O u r S t r e n g t h 1)Our Strengths Resident-minde dness, a keen a wa reness of the community a nd visitors which we have fostered through years of urban pla nning a
Slide 30: Urban Development in Shibuya
R e d u ce I mp rov e R O E ca p i tal cos t s Urban Development in Shibuya We have executed difficult construction projects in Shibuya, leveraging our technology, expertise and teamwork. Shibuya has huge future potential with numerous redevelopment projects planned. ■Major construction projects of
Slide 31: Acquisition of Market Opportunities: Three Values
R e d u ce I mp rov e R O E ca p i tal cos t s Ac q u i s i t i o n o f M a r k e t O p p o r t u n i t i e s b y L e ve ra g i n g O u r S t r e n g t h 2 ) T h r e e va l u e s Acquire market share in the strategically impor tant three areas of our value: decarbonization, zero waste, and disaster
Slide 32: Initiatives for Working Style Reform and Productivity Improvement
R e d u ce I mp rov e R O E ca p i tal cos t s Initiatives for Working Style Reform and Productivity Improvement Realize a more productive and satisfactory working style, taking the overtime work cap restriction as an opportunity for change Continue to improve our construction technology and know-ho
Slide 33: Transformation to BIM-Driven Construction and Production Systems
R e d u ce I mp rov e R O E Transformation to BIM-Driven ca p i tal cos t s Construction and Production Systems We are accelerating construction production system reform centered on BIM/CIM to provide solutions to a labor shortage and working time cap, etc. We strengthen training to improve the digi
Slide 34: Efforts to Prevent Recurrence of Quality Problems
R e d u ce Efforts to Prevent Recurrence of Quality I mp rov e R O E ca p i tal cos t s Problems, Improve Construction Quality, and Restore Trust Regarding the past quality problems, we have reviewed the structure, system and organizational culture to prevent their recurrence thoroughly. Strictly en
Slide 35: Improve Dialogue with the Stock Market and Information Disclosure
R e d u ce I mp rov e R O E Improve Dialogue with the Stock ca p i tal cos t s Market and Information Disclosure We strive to reduce any asymmetric information between the Company and investors through constructive dialogue with shareholders and investors, and active disclosure. We report opinions r
Slide 36: Appendix
【Appendix】 FY03/2024 Financial Results Briefing
Slide 37: Reduction of Low-Performing Assets (Strategic Shareholdings)
R e d u ce I mp rov e R O E Reduction of Low-Performing Assets ca p i tal cos t s (Strategic Shareholdings) We judge the appropriateness of holdings based on capital efficiency and strategic significance (as to business synergy and securing stable profit, etc.). We will reduce our strategic sharehol
Slide 38: Business model and business overview
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
Slide 39: Notes
[Inquiries] Nishida/Morita/Hashimoto 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 the company’s results contained in this document are based on information available as of the dat