Slide 1: FY ending March 2019 Results briefing
1st section of Tokyo stock exchange : 1959 KYUDENKO CORPOREATION FY ending March 2019 Results briefing May 10 th ,2019 All Rights Reserved. Copyright KYUDENKO CORPORATION 0
Slide 2: Table of contents
Table of contents Overview of business results 2 Plan for fiscal year 22 Highlights 3 Plan for fiscal year 23~26 P/L 4 Orders/sales by department 27 Factors of change in OP 5~9 Power distribution line work 28 Sales, Orders and Works on hand Trend of dividends 29 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 Exceeded 2017’ result by order increased in Tokyo area. ¥405,903million Over 400 billion yen for the first time. Year-on-year 105.5％ Sales Steady increase backed by increase of human resource and in works on hand (¥331billion). ¥408,143million Over 400 billion yen for the first ti
Slide 5: Outline of P/L March 2019
Outline of P/L March 2019 (Million yen) March 2018 March 2019 Year-on- Result Result year Plan (2018.4.27) Progress Sales 360,872 408,143 113.1% 385,000 106.0% (100.0%) (100.0%) (100.0%) Gross profit 56,659 60,561 106.9% 63,000 96.1% (15.7%) (14.8%) (16.4%) Operating profit 34,726 36,747 105.8% 38,0
Slide 6: Factors of change in OP March 2019
Factors of change in OP March 2019 Refer 40 （Billion Yen） P7･P8 Depression of Sales gross profit 38 Refer increased in ratio in electrical & electrical & HVAC & solar HVAC & solar P6 plant plant construction construction Power Other business ▲1.9 generation 36.7 business ＋0.2 ＋4.4 F ＋0.3 36 G H Oper
Slide 7: Increase of fixed cost and impact of newly consolidated subsidiaries
Increase of Fixed cost（Over head cost） and Impact of newly consolidated subsidiaries C : Impact of newly consolidated subsidiaries (Million Yen, composition ratio) Impact of newly consolidated A & B : Increase of Fixed cost (Million yen) subsidiaries A B Increase Increase of other fixed cost Sales o
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 increased 25.2billion yen. Sales from projects delivered increased 4.4billion yen. Sales from projects Not delivered increased 20.8billion yen
Slide 9: Reasons for decline in profit ratio and measures (1)
Reasons for decline in profit ratio for each project and measures (excerpt)(1) Factor Measures ・Forecasting the peak of busyness in the whole construction A. Forecasting the busyness period, make an input plan for workers early and start the peak of construction arrangement. Review the plan in a tim
Slide 10: Reasons for decline in profit ratio and measures (2)
Reasons for decline in profit ratio for each project and measures (excerpt)(2) Factor Measures H. Promotion of designated ・Sales department promotes sales in cooperation with order by customer and technical department. proposal-based order. Establishing “Infrastructure business department” ・Holding
Slide 11: Order received / Sales by department March 2019
Order received / Sales by department March 2019 The increase in parent company's and newly consolidated subsidiaries sales and orders of HVAC resulted in a increase as a whole. Although Solar plant construction work decreased, it exceeded about 15 billion yen than expected. (Million Yen) (Million Ye
Slide 12: Order received / Sales by customer March 2019
Order received / Sales by customer March 2019 Both Private and Public increased, and Keeping high level. (Million Yen) (Million Yen) Sales of each customer Orders of each customer ■2017.3 ■2017.3 350,000 350,000 321,069 ■2018.3 ■2018.3 311,604 ■2019.3 305,300 ■2019.3 298,116 263,796 249,215 48,652 4
Slide 13: Order received / Sales by region March 2019
Order received / Sales by region March 2019 (Electrical & HVAC work excluding Solar plant construction work) Orders in Kyushu and Tokyo region increased. Steadily share up. (Million yen) (Million yen) Sales of each region Orders of each region ■2017.3 ■2018.3 ■2019.3 ■2017.3 ■2018.3 ■2019.3 250,000
Slide 14: Order received / Sales by region (Solar plant)
Order received / Sales by region March 2019 (Solar plant construction work) Order from huge project in Nagoya Area. (Million yen) (Million yen) Sales of each region Orders of each region ■2017.3 ■2018.3 ■2019.3 ■2017.3 ■2018.3 ■2019.3 50,000 50,000 41,129 40,189 40,232 27,059 26,758 27,365 15,038 13
Slide 15: Year-end amount of works on hand
Year-end amount of works on hand Work on hand of electrical and solar plant construction work decreased due to a decrease in orders and an increase in sales. Work on hand of HVAC work increased due to an increase in orders. (Million yen) New orders in FY ended March 2019 Order stock of each departme
Slide 16: Actual results of works FY March 2019
Actual results of works FY March 2019 Image Image All Rights Reserved. Copyright KYUDENKO CORPORATION 15
Slide 17: Outline of balance sheet
Outline of balance sheet (Million Yen, composition ratio) End of Mar. End of Mar. Increase Main factors behind 2018 2019 /decrease increase/decrease 178,884 206,268 Current assets 27,383 Trade notes and accounts receivable ＋23,011 (55.1%) (57.7%) 146,034 151,002 Fixed assets 4,968 Investment securit
Slide 18: Outline of C/F
Outline of C/F (Million Yen) Details of statement to Mar. 2018 Mar. 2019 Mar. 2019 Income before income taxes and minority interests +39,260 Cash flow from operating activities 30,016 26,054 Increase in trade notes and accounts receivable ▲23,007 Increase in trade notes and accounts payable ＋10,751
Slide 19: Capital Investment
Capital Investment FY2018 Mar. FY2019 Mar. Capital investment 4.2 billion yen 4.3 billion yen 1.7 billion yen 3.7 billion yen Replacement of branches , business Replacement of business offices offices and sanatorium of of Kyudenko Kyudenko Facility work EMS demonstration facilities in Sumba Island M
Slide 20: Investment in Power Operations (Solar Power Plants)
Investment in Power Operations (Solar Power Plants) Mega solar power plant Miyagi Fukushima Ishikawa Okayama Hyogo Gotou Hiroshima Deals operated by group - In Operation - Under construction Chiba - Preparing for construction Projects for equity investment - In Operation Amami Aichi - Under construc
Slide 21: 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 22: 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 23: Plan for fiscal year
Plan for fiscal year All Rights Reserved. Copyright KYUDENKO CORPORATION 22
Slide 24: Plan for March 2020
Plan for March 2020 (Million yen) March 2019 Plan for March 2020 Result March 2020 Year-on-Year 408,143 418,000 102.4% Sales (100.0%) (100.0%) 60,561 62,700 103.5% Gross profit (14.8%) (15.0%) 36,747 38,000 103.4% Operating profit (9.0%) (9.1%) 39,924 40,700 101.9% Ordinary profit (9.8%) (9.7%) 26,6
Slide 25: Analysis of works on hand
Analysis of works on hand （Kyudenko individual : excluding power distribution work） Opening amount of construction works on hand by delivery schedule timing and Gross profit ratio for each year Works on hand 15.7％ （Billion yen） Total 315.0 15.2％ Total 302.1 Total 266.6 77.8 81.3 (▲3.5） Total 221.6 8
Slide 26: Scheduled delivery amount by quarterly accounting period
【Reference】 Scheduled delivery amount by quarterly accounting period [Opening time] （Kyudenko individual : excluding power distribution work） Opening amount of construction works on hand of quarterly accounting period Scheduled delivery amount FY2016 FY2017 FY2018 FY2019 （Billion yen） total 95.6 tot
Slide 27: 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 current year.
Slide 28: Orders & Sales plan by department
Orders & Sales plan by department The orders of the solar plant construction expects gradual decrease. The sales amount spreads by the abundant amount of works on hand. (Million yen) (Million yen) Sales of each department Orders of each department ■2018.3 ■2019.3 ■2020.3（plan） ■2018.3 ■2019.3 ■2020.
Slide 29: Power distribution work: present condition, tasks and actions
Power distribution work Present condition In addition to the two Sendai nuclear power plants, the two Genkai nuclear power plants also restarted in the first half of 2018. Tasks and actions A cost cut by our technology development and efficiency is important, for Electricity Systems Reform , we
Slide 30: Trend of dividends
Trend of dividends With regard to dividends for the fiscal year ending March 2020, we plan to pay an annual dividend of ¥ 100 per share, based on a consolidated payout ratio target of 25%. 100 110 100 100 special 90 90 10 80 special 70 70 10 60 special 50 45 40 Memorial 15 30 special 25 2 20 special
Slide 31: Mid-term management plan growth strategy
Mid-term management plan growth strategy All Rights Reserved. Copyright KYUDENKO CORPORATION 30
Slide 32: 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 2019) S a l e s 400 BillionYen 408 BillionYen Over Gross Profit Ratio ％ 14.8 ％ 15 Over Operating Profit Ratio ％ 9.0 ％ 9 Over R O E ％ 15.6 ％ 14 All Rights R
Slide 33: Road map of sales plan
Road map of sales plan (Billion yen) 400 48 50 45 50 Solar plant construction 48 170 166 66 153 138 Electrical construction 127 111 127 136 HVAC 94 101 75 80 Power distribution line 45 47 47 48 48 47 Others 15 13 15 20 15 0 14 2015.3 2016.3 2017.3 2018.3 2019.3 2020.3 (plan) Medium-term management p
Slide 34: 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 35: 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 36: 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 37: 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 2019 with other companies≫ 2007～2014 2015 2016 2017 2018 2019 Large electri
Slide 38: 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 39: 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 40: Kyudenko EMS can distribute renewable energy stably
“Kyudenko EMS” can distribute renewable energy stably Energy management system By stable electricity distribution in オフグリッド ○ Movement of the spread of renewable energy accelerates globally, but there are many electricity instability areas including a remote island Kyudenko EMS, We enlarge an and th
Slide 41: Axis of preventive measures
＜As regards to scandal of employee concerning Chikujyo town water and waste sewage treatment facility＞ ・ Axis of preventive measures The Group has formed an investigative committee, which includes outside directors and lawyers, and has thoroughly investigated the causes, such as opportunities and mo
Slide 42: 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