Tokyu Construction Co., Ltd. · TSE:1720
Tokyu Construction — FY2025 Earnings Presentation
46 slides from Tokyu Construction's earnings presentation, May 20, 2025
Slide 1: FY03/2025 Financial Results Briefing
TSE：1720 FY03/2025 Financial Results Briefing May 20, 2025
Slide 2: Key points to communicate today
Key points to communicate today • The results for FY03/2025 exceeded the beginning of period profit forecasts, mainly due to improved profitability in the domestic construction business. ROE was 6.6%. To aim for even higher profitability, we will continue to thoroughly ensure safety and quality in c
Slide 3: Overview of FY03/2025 Financial Results
Overview of FY03/2025 Financial Results FY03/2025 Financial Results Briefing
Slide 4: FY03/2025 Financial Highlights
FY03/2025 Financial Highlights • Demand remained strong, the industry's backlog of construction volume reached high External levels, and the competitive environment improved. environment • The prices of materials and equipment have remained high, while the increase in labor costs was within the expe
Slide 5: FY03/2025 Financial Results
FY03/2025 Financial Results Net sales exceeded the previous year's performance due to steady progress in ongoing construction projects, increased revenue from construction renewal projects, and real estate business. Although SG& A increased, operating profit increased due to the growth in gross prof
Slide 6: Factors Affecting Net Income
Factors Affecting Net Income Although completed construction gross profit increased, net income decreased due to factors such as the increase in SG& A and foreign exchange loss. （Millions of yen） ー635 Change in completed construction gross profit non-consolidated: +3,256 subsidiary*: -182 *includes
Slide 7: Non-Consolidated / Building construction (Completed construction sales, gross profit)
Non-Consolidated ／ Building construction（Completed construction sales・Completed construction gross profit） Completed construction sales continued to progress smoothly for ongoing projects from the previous term. Completed construction gross profit increased from the previous term due to a favorable
Slide 8: Non-Consolidated / Building construction (Orders)
Non-Consolidated ／ Building construction（Orders） The order volume significantly increased, supported by a favorable order environment, such as steadily securing target projects in key focus areas. In the general private sector, several large-scale projects were received, including the redevelopment
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 exceeded the previous term due to steady progress in on-hand projects. Completed construction gross profit increased, driven by the growth in completed construction vol
Slide 10: Non-Consolidated / Civil engineering (Orders)
Non-Consolidated ／ Civil engineering（Orders） Domestically, amidst solid demand such as measures for national resilience, we steadily secured orders for public works such as water supply and sewerage, tunnel construction, and disaster recovery projects. In the Tokyu Group and the private sector, rail
Slide 11: Consolidated Balance Sheets
Consolidated Balance Sheets The equity ratio was at 37.0％, decrease of 0.8 percentage points compared with March 31, 2024. D/E ratio was 0.26 times due to a decrease in borrowings. Incre as e / d e c r e as e factors As of March As of March YoY （Millions of yen） 31, 2024 31, 2025 − Curren t as s ets
Slide 12: Consolidated Statements of Cash Flows
Consolidated Statements of Cash Flows Free cash flow turned positive due to the increase in cash flows from operating activities. . FY03/2024 FY03/2025 FY03/202 5 remarks （Millions of yen） Cash increased due to notes receivable, accounts Cash flows from operating receivable from completed constructi
Slide 13: Results of rebuilding our earning capacity
Results of rebuilding our earning capacity FY03/2025 Financial Results Briefing
Slide 14: Rebuilding of our earning capacity (Problem-solving skills)
Rebuilding of our earning capacity (Problem-solving skills ) Simultaneously addressing the acquisition and development of human resources, which will be a source of future competitive advantage, while defining policies for each strategic item and rebuilding earning capacity. Strengthen problem-solvi
Slide 15: Prevention of reoccurrence
Effor ts to Prevent Recurrence of Quality Problems, Improve Constructi on Quality, and Restore Trust 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. Shari
Slide 16: Full-year Forecast for FY03/2026
Full-year Forecast for FY03/2026 FY03/2025 Financial Results Briefing
Slide 17: FY03/2026 Financial Forecast Highlights
FY03/2026 Financial Forecast Highlights Net sales increased due to the progress of large-scale projects ordered in previous years. Although SG& A is increasing due to human resources and DX investment, operating profit is increasing due to the increase in gross profit. • Domestic construction invest
Slide 18: Non-Consolidated Order Forecast
Non-Consolidated Order Forecast In building construction, we will continue to focus on acquiring orders with an emphasis on construction capacity and profitability, ensuring that key projects are secured. In civil engineering, due to the decline following large overseas projects from the previous te
Slide 19: FY03/2026 Financial Results Forecast
FY03/2026 Financial Results Forecast Net sales are expected to reach a record high due to progress in large-scale construction projects, particularly in building construction. An increase in net sales is projected to lead to higher operating profit. Consolidated Non-consolidated FY03/2025 FY03/2026
Slide 20: Non-consolidated Financial Results Forecast / Building construction
Non-consolidated Financial Results Forecast／ Building construction Completed construction sales are expected to increase significantly as large-scale projects in hand progress. Due to the impact o f l o w- p r o f i t p r o j e c t s o r d e r e d i n p a s t y e a r s a n d e x p e c t e d l a b o
Slide 21: Non-consolidated Financial Results Forecast / Civil engineering
Non-consolidated Financial Results Forecast／ Civil engineering In progress construction projects ordered in previous years domestically are expected to advance, leading to an increase in completed construction sales. We aim to achieve further improvement in profit margins by securing additional desi
Slide 22: Construction Renewal
Construction Renewal For FY03/2025, the focus on high-productivity projects has been successful amid strong renewal demand. For FY03/2026, we anticipate an increase in order volume and net sales, supported by a favorable order environment. • Investment enthusiasm remains active, particularly for inb
Slide 23: 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. • The expertise and technology cultivated through urban development along the Tokyu Line and railway and Net Sales /Gross Profit ※2 B
Slide 24: Real estate
Real estate Targeting environment-conscious customers, provide environmentally friendly properties with added value, such as leasing, development, and renewal of old properties by leveraging synergy with construction business. Increase capital efficiency through cyclical real estate business using r
Slide 25: Growth of strategic business
Growth of strategic business Promote efforts in strategic businesses (international, real estate, new businesses) steadily, based on synergies with domestic construction business and the three core values of our strategy: “Decarbonization," “Zero waste," and “Disaster prevention." [International] Re
Slide 26: 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 38 yen for FY03/2025, up 1 yen, and 39 yen for FY03/2026. Dividend per share （yen） 39 Year-end 20 36 37 38 Interim 19 FY03/2023 FY03/202
Slide 27: Long-Term Management Plan "To zero, from zero."
Long-Term Management Plan “To zero, from zero.” （Rolling the plan in May 2025） We aim to enhance corporate value sustainably by setting three deliverable values as strategic pillars and positioning human resources and digital as sources of our competitive advantages. Three deliverable values Busines
Slide 28: Initiatives for medium- to long-term growth
Initiatives for medium- to long-term growth By thoroughly ensuring construction safety and quality and continuously working to improve productivity, we aim for higher revenue potential. We will further expand human capital investment and strategically strengthen our human resources capabilities to s
Slide 29: Efforts towards management with awareness of cost of capital and stock price
Efforts towards realizing management with awareness of the cost of capital and stock price FY03/2025 Financial Results Briefing
Slide 30: Recognition of cost of shareholders' equity and profitability
Recognition of cost of shareholders' equity and profitability The cost of shareholders' equity based on CAPM is recognized as 6-7%. Promote improvement measures from short-term and medium-to-long-term perspectives, aiming for an ROE of 10% or more in FY2030, which is a KPI of the long-term managemen
Slide 31: Recognition and improvement of current situation from a PBR perspective
Recognition and improvement of current situation from a PBR perspective We take the current situation of PBR below 1 very seriously, and we will focus on improving ROE and reducing the cost of capital through growth initiatives, such as managing human capital and leveraging our strengths to capture
Slide 32: Reduction of Low-Performing Assets (Strategic Shareholdings)
Reduc e Improv e RO E Reduction of Low-Performing Assets capital cos ts (Strategic Shareholdings) We will determine the appropriateness of holding based on capital efficiency and strategic significance (such as business synergy and securing stable revenue). Some assets were sold in FY24 based on the
Slide 33: Cash Allocation (FY2021 to FY2030)
Cash Allocation(FY2021 to FY2030) We will invest 183.0 billion yen by FY03/2031 as part of a growth investment to reform our business portfolio. Operating cash flows and proceeds from the sale of strategic shareholdings will be allocated to fund growth investments and maintain stable dividends, targ
Slide 34: Reforming Business Portfolio and Expanding Human Resource Investment
Reduce capital Improv e RO E costs Reformi ng Business Por tfoli o and Expanding Human Resource Investment To achieve synergy with the construction business and secure stable revenue, we will grow our strategic businesses and transform the business portfolio for FY2030 to a 75% core business and 25%
Slide 35: Urban development along the Tokyu line and in Shibuya: Progress and strengths
Reduce capital Acquisition of Market Opportunities by Leveraging Our Strength Improv e RO E costs Urban development along the Tokyu line and in Shibuya: Progress and strengths As a m em ber of the Tokyu Group, we have develope d a consum e r - o rie nt e d m indset with a strong focus on the com m u
Slide 36: Urban Development in Shibuya: Future potential
Reduce capital Improv e RO E costs Acquisition of Market Oppor tuni ti es by Leveragi ng Our Strengt h Urban Development in Shibuya“Fut ure potenti al ” We have executed difficult construction projects in Shibuya, leveraging our technology, expertise and teamwork. Shibuya has huge future potential w
Slide 37: Urban Development in Shibuya: Towards the Second Phase
Acquisition of Market Opportunities by Leveraging Our Strength Urban Development in Shibuya: "Toward s the Second Phase" Utilizing our unique track record, technology, expertise, and teamwork, we aim to enhance the value of Shibuya and our corporate value in preparation for the opening of station fu
Slide 38: Appendix
【Appendix】 FY03/2025 Financial Results Briefing
Slide 39: Initiatives for Working Style Reform and Productivity Improvement
Reduc e Improv e RO E capital cos ts 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-how, while u
Slide 40: Transformation to BIM-Driven Construction and Production Systems
Reduc e Improv e RO E Transformation to BIM-Driven capital cos ts 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 digital litera
Slide 41: Promotion of Human Capital Management
Reduc e Improv e RO E capital cos ts 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, Vision, and L
Slide 42: Improve Dialogue with the Stock Market and Information Disclosure
Reduc e Improv e RO E Improve Dialogue with the Stock capital cos ts 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 received th
Slide 43: Three values, Digital Technology
Reduce capital Improv e RO E costs Acquisition of Market Oppor tuni ti es by Leveragi ng Our Strengt h Three values, Digital Technol ogy Enhance our presenc e in the three strategi c ally im portan t areas where we provide value: decarb o niza ti o n, zero waste, and disaster preventi on and m itiga
Slide 44: Performance trends
Performance trends Since the Company split in 2003, we have steadily built up the equity amount, reaching a level of 100 billion yen. ROE has been on a downward trend since FY2015. We aim to achieve over 10% by FY2030, the final year of the long-term management plan. （Millions of yen/％） Equity amoun
Slide 45: Business model and business overview
Business model and business overview Undertake custom-order construction projects commissioned by public offices and private companies, completing them in collaboration with numerous specialized construction companies. Oversee and manage the construction process over a long term, ensuring safety, qu
Slide 46: 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