Slide 1: FY ending March 2019 2nd Quarter Results briefing
1st section of Tokyo stock exchange : 1959 KYUDENKO CORPOREATION FY ending March 2019 2nd Quarter Results briefing Nov. 1st ,2018 All Rights Reserved. Copyright KYUDENKO CORPORATION 0
Slide 2: Table of contents
Table of contents Overview of business results 2 Plan for fiscal year 20 Highlights 3 Plan for fiscal year 21~25 P/L 4 Orders/sales by department 26 Factors of change in OP 5~7 Power distribution line work 27 Sales, Orders and Works on hand Trend of dividends 28 1. Orders received/sales by departmen
Slide 3: Overview of business results
Overview of business results All Rights Reserved. Copyright KYUDENKO CORPORATION 2
Slide 4: Highlights
High lights Orders HVAC, Solar plant construction increased. Electrical, expecting large project in 2 nd half. ¥216,986million Exceeded 2017’ 1 half result by order increased in Kyushu. st 2nd-on-2nd 103.2％ Sales By newly consolidated subsidiaries, HVAC increased. ¥165,111million Steady increase bac
Slide 5: Outline of P/L March 2019, 2nd quarter
Outline of P/L March 2019, 2nd quarter (Million yen) March 2018, March 2019, 2Q 2Q Result Result 2nd-on-2nd Plan (2018.4.27) Progress Sales 159,378 165,111 103.6% 165,000 100.1% (100.0%) (100.0%) (100.0%) Gross profit 24,410 23,033 94.4% 26,000 88.6% (15.3%) (14.0%) (15.8%) Operating profit 13,274 1
Slide 6: Factors of change in OP
Factors of change in OP 14 （Billion Yen） Sales of Electrical and HVAC was decreased excluding impact of sales Refer P6 increased by newly consolidated 13 13 company and solar power plant A construction. Bonus Impact of increase newly B consolidated subsidiaries 12 Increase of Sales other fixed C dec
Slide 7: Increase of fixed cost and factor of gross profit ratio depression
Increase of Fixed cost（Over head cost） and factor of gross profit ratio depression (Million Yen, composition ratio) Impact of newly Increase of Increase of other fixed cost (overhead cost) in consolidated Bonus SG&A and Gross Cost subsidiaries A B C Sales of construction work 5,099 Sales of other bu
Slide 8: Factor of gross profit ratio depression
Factor of gross profit ratio depression Breakdown of construction sales （Kyudenko individual：excluding power distribution line work） Whole construction sales decreased 3.0billion yen. Construction sales（Million yen） Sales from projects delivered decreased 7.8billion yen. 150,000 Sales from projects
Slide 9: Order received / Sales by department Sep. 2018
Order received / Sales by department Sep. 2018 The decrease in parent company's sales of Electrical resulted in a decline as a whole. Sales of HVAC & Solar plant construction increased steadily. (Million Yen) (Million Yen) Sales of each department Orders of each department ■2016.9 Impact of newly ■2
Slide 10: Order received / Sales by customer Sep. 2018
Order received / Sales by customer Sep. 2018 Both Private and Public increased, and Keeping high level. (Million Yen) (Million Yen) Sales of each customer Orders of each customer 169,801 ■2016.9 ■2016.9 168,331 170,000 170,000 166,906 ■2017.9 ■2017.9 ■2018.9 ■2018.9 123,094 116,535 107,258 23,815 22
Slide 11: Order received / Sales by region Sep. 2018
Order received / Sales by region Sep. 2018 (Electrical & HVAC work excluding Solar plant construction work) Orders in Kyushu region increased, especially HVAC. Steadily share up. (Million yen) (Million yen) Sales of each region Orders of each region ■2016.9 ■2017.9 ■2018.9 ■2016.9 ■2017.9 ■2018.9 13
Slide 12: Order received / Sales by region Sep. 2018 (Solar)
Order received / Sales by region Sep. 2018 (Solar plant construction work) Order from huge project in Nagoya Area. (Million yen) (Million yen) Sales of each region Orders of each region ■2016.9 ■2017.9 ■2018.9 ■2016.9 ■2017.9 ■2018.9 50,000 50,000 28,816 26,715 17,018 11,648 8,188 8,021 6,058 8,028
Slide 13: Situation of works on hand Sep. 2018
Situation of works on hand Sep. 2018 Order stock increase due to steady order. Solar construction, Tokyo area and Kyushu area. (Million yen) New orders in FY ended Sep. 2018 Order stock of each department ■2016.9 ■2017.9 ■2018.9 170,000 154,339 Image 140,171 140,277 121,714 114,495 110,200 84,366 82
Slide 14: Actual results of works Sep. 2018
Actual results of works Sep. 2018 Image Image All Rights Reserved. Copyright KYUDENKO CORPORATION 13
Slide 15: Outline of balance sheet
Outline of balance sheet （百万円、下段は構成比） End of Mar. End of Sep. Increase Main factors behind 2018 2018 /decrease increase/decrease 178,884 154,465 Current assets ▲24,419 Trade notes and accounts receivable ▲24,488 (55.1%) (50.5%) 146,034 151,441 Fixed assets 5,407 Investment securities +6,851 (44.9%)
Slide 16: Outline of C/F
Outline of C/F (Million Yen) Details of statement to Sep. 2017 Sep. 2018 Sep. 2018 Income before income taxes and minority interests +11,977 Cash flow from operating activities 18,464 8,771 Decrease in trade notes and accounts receivable +24,479 Decrease in trade notes and accounts payable ▲25,133 P
Slide 17: Capital Investment
Capital Investment FY2018 Mar. FY2019 Sep. Capital investment 4.2 billion yen 1.6 billion yen 1.7 billion yen 1.1 billion yen Replacement of corporate Replacement of business offices dormitories’ facilities and of Kyudenko reconstruction of business offices of Kyudenko Facility work EMS demonstratio
Slide 18: Investment in Power Operations (Solar Power Plants)
Investment in Power Operations (Solar Power Plants) Mega solar power plant Miyagi Fukushima Ishikawa Okayama Gotou Hiroshima Deals operated by group - In Operation - Under construction Chiba - Preparing for construction Projects for equity investment - In Operation Amami Aichi - Under construction N
Slide 19: Investment in Power Operations (Solar Power Plants)
Investment in Power Operations (Solar Power Plants) Deals operated by group Deals through investment in equity (make capital investment and record the entire operation to other (acquire investment securities and record an amount equal to the equity to non- operations sales) operating revenues) Depre
Slide 20: Investment in Power Operations (Wind Power Plants)
Investment in Power Operations (Wind Power Plants) Wind power plant Deals operated by group (make capital investment and record the entire operation to other operations sales) Depreciated at the Mainly declining balance method Generation capacity Generation capacity Number of (the entire (that equal
Slide 21: Plan for fiscal year
Plan for fiscal year All Rights Reserved. Copyright KYUDENKO CORPORATION 20
Slide 22: Plan for March 2019
Plan for March 2019 (Million yen) March 2018 Plan for March 2019 Result March 2019 Year-on-Year 2Q Result Progress 360,872 385,000 106.7% 165,111 42.9% Sales (100.0%) (100.0%) (100.0%) 56,659 63,000 111.2% 23,033 36.6% Gross profit (15.7%) (16.4%) (14.0%) 34,726 38,000 109.4% 10,886 28.6% Operating
Slide 23: Background of full year plan
Background of full year plan (Million Yen) Mar.2018 Mar.2019 備 考 Result Plan Assume progress of abundant works on hand. (next page) Sales of construction work 346,403 375,000 2nd half plan 220 billion yen. 1st half result 151 billion yen. (exclude newly subsidiaries’ sales result 5 billion yen) Sale
Slide 24: Basis of sales plan
Basis of sales plan Analysis of works on hand（Kyudenko individual） Amount of construction works on hand by Works on hand（Billion yen） delivery schedule timing （Billion yen） 400 Sep. Sep. Sep. Increase/ 361 2016 2017 2018 Decrease 350 319 Deliver on after 284 300 next FY 105 157 132 △ 25 250 200 Deli
Slide 25: Progress of construction work (Accounting for sales)
Correlation of passage of passage and progress of work (Kyudenko individual) In percentage of completion method, construction work progress rapidly after half of the construction period has passed. Standard progress curve of construction in percentage of completion method 100% Progress of constructi
Slide 26: Analysis by scale of order
Analysis by scale of order (Kyudenko individual : excluding power distribution work） Orders from small-scale projects less than 300 million yen for one project contract which are short construction period and relatively high profit margin. Orders from small size projects were steady in 1st half. (Mi
Slide 27: Orders & Sales plan by department
Orders & Sales plan by department The orders of the solar plant construction expects gradual decrease. The sales amount greatly spreads by the abundant amount of works on hand. (Million yen) (Million yen) Sales of each department Orders of each department ■2017.3 ■2018.3 ■2019.3（plan） ■2017.3 ■2018.
Slide 28: Power distribution work: present condition, tasks and actions
Power distribution work Present condition In addition to the two Sendai nuclear power plants, two of the Genkai that had been delayed finally restarted. In the first half, orders decreased sharply. In the second half, expect for order volume increase and unit price revision. Tasks and actions
Slide 29: Trend of dividends
Trend of dividends Following expansion of business results, we plan to increase the dividends for six consecutive years from the fiscal year ended March 2014. 100 100 special 90 90 10 80 special 70 70 10 60 50 special 45 40 Memorial 15 30 special 25 2 special 13 7 20 10 10 3 0 Mar,2011 Mar,2012 Mar,
Slide 30: Mid-term management plan growth strategy
Mid-term management plan growth strategy All Rights Reserved. Copyright KYUDENKO CORPORATION 29
Slide 31: Numerical target
Numerical target ≪ Main theme ≫ Challenge to a Further Growth ～To the next growth stage～ ≪ Numerical target at March 31, 2020≫ (Results in March 2018) S a l e s 400 BillionYen 360 BillionYen Over Gross Profit Ratio ％ 15.7 ％ 15 Over Operating Profit Ratio ％ 9.6 ％ 9 Over R O E ％ 16.8 ％ 14 All Rights R
Slide 32: Road map of sales plan
Road map of sales plan (Billion yen) 400 50 40 45 50 Solar plant construction 48 66 170 184 153 138 Electrical construction 127 111 HVAC 101 120 105 94 75 80 Power distribution line 45 47 47 47 46 47 Others 15 13 15 10 14 0 14 2015.3 2016.3 2017.3 2018.3 2019.3 2020.3 Medium-term management plan（201
Slide 33: Breakdown of sales plan (March 2020)
Breakdown of sales plan （March 2020） Total sales 400 Billion yen Each business lines By region (Electrical and HVAC) Solar plant construction 50 Bilion yen Kyushu 176 Bilion yen Electrical and HVAC 289 Bilion yen Tokyo 73 Bilion yen Power distribution line 47 Bilion yen Kansai/Okinawa 23 Bilion yen
Slide 34: Strengthening of overseas management base in South-East Asia
Strengthening of overseas management base in South-East Asia Example of construction(Singapore) Asia Projects Engineering Pte. Ltd. (Singapore) TUAS Power plant Kyulien Environment Improving Co.,Ltd. (Taiwan) ・By March 2020, Overseas sales ratio will be 5.0% Overseas personnel will be 600 employees
Slide 35: Axes of the growth strategy and key measures
Axes of the growth strategy and key measures Axes of the growth strategy “Establish stable foundation in Kyushu” “Strengthening business in the metropolitan area” “The development of human resources” ≪ Kyudenko’s Four Strategic Policies≫ １ “ Sales force ” to meet trusts and expectations of clients ２
Slide 36: Actual results of recruitment of human resources and workforce planning
Actual results of recruitment of human resources (Kyudenko individual) and workforce planning ≪ Actual results of periodic recruitment of engineers and ≪ Comparison in actual results of recruitment skilled persons≫ for April 2018 with other companies≫ 2006 2007～2014 2015 2016 2017 2018 Large electri
Slide 37: Details of diverse business models (facility work)
Details of diverse business models (facility work) Business model Characteristics Targets Competitors Strengths of Kyudenko Ⓐ Proposal and original ・One-stop construction of Regional mid- and small- Ordinary companies: Engineers’ recommendation ability contract type electricity, air and water facili
Slide 38: Post-2020 Prediction about industry
Post-2020 Prediction about industry Construction demand will be supported by large-scale projects and renovation of aging infrastructure built more than 50 years ago. The labor shortage will accelerate with the decline in the working age population, with a rapid falloff in supply capability. Real co
Slide 39: Kyudenko EMS can distribute renewable energy stably
“Kyudenko EMS” can distribute renewable energy stably Energy management system ○ Movement of the spread of renewable energy accelerates globally, By stable electricity distribution in but there are many electricity instability areas including a remote island Kyudenko EMS, We enlarge an and the dista
Slide 40: Corporate profile
Corporate profile Company name Kyudenko Corporation Established December 1, 1944 Capital ￥12,561 million Listed market 1st Section of Tokyo Stock Exchange, Fukuoka Stock Code Exchange 1959 Head office 1-23-35 Nanokawa, Minamiku, Fukuoka city Tokyo head office Sunshine 60 3-1-1 Higashi-Ikebukuro, Tos