Takamatsu Construction : Summary of Consolidated Financial Results For the First Quarter of Fiscal Year Ending March 31, 2023

August 9, 2022

Summary of Consolidated Financial Results

For the First Quarter of the Fiscal Year Ending March 31, 2023 [Japan GAAP]

Company: Takamatsu Construction Group Co., Ltd.

Stock exchange listing: Tokyo Stock Exchange

Stock code: 1762

URL: https://www.takamatsu-cg.co.jp/

Representative: Hirotaka Takamatsu, President and Representative Director of the Board

Contact: Masahiro Shimabayashi, Senior Director, Group Finance Division

Contact: 06-6303-8101,[e-mail]

Date of filing of quarterly securities report:	August 9, 2022
Date of commencement of dividend payment:	―
Supplementary explanatory documents:	Yes
Earnings presentation:	No

(Yen in millions, rounded down, figures in parentheses indicate negative amounts or percentages)

1. Financial results for the first quarter of the fiscal year ending March 2023 (April 1, 2022 - June 30, 2022)
(1) Consolidated result of operations (year-to-date)		(Percentage figures represent year on year changes)
	Net sales		Operating profit	Ordinary profit	Profit attributable to
		owners of parent
	Million yen	%	Million yen	%	Million yen	%	Million yen	%
First quarter ended June 2022	60,427		(1.5)	390	(72.8)	468	(68.0)	69	(91.8)
First quarter ended June 2021	61,377		(7.2)	1,437	2.1	1,464	5.8	847	38.7

Note: Comprehensive income: First quarter of FYMar.2023: 188million yen, (84.5%) vs. last year First quarter of FYMar.2022: 1,216million yen, 51.4% vs. last year

	Earnings per share	Earnings per share
		(diluted)
	Yen	Yen
First quarter ended June 2022	1.99	－
First quarter ended June 2021	24.33	－
(2) Consolidated financial position
	Total assets	Net assets	Equity ratio
	Million yen	Million yen	%
As of June 30, 2022	215,543	120,266	55.8
As of March 31, 2022	236,719	121,471	51.3

(Reference) Shareholders' equity: As of June 30, 2022: 120,231 million yen As of March 31, 2022: 121,433 million yen

2. Dividends

											Dividend per share
					End of		End of			End of				End of			Annual
						1Q		2Q				3Q				FY
						Yen	Yen					Yen	Yen			Yen
FY3/22					－				23.00			－				40.00			63.00
FY3/23					－
FY3/23 (Est.)									23.00			－				40.00			63.00
Note: Change in the estimation of divided from the latest announcement: No
3. Consolidated forecast for the fiscal year ending March 31, 2023 (April 1, 2022 - March 31, 2023)
										(Percentage figures represent year on year changes)
		Orders received	Net sales	Operating profit			Ordinary profit	Profit attributable to	Earnings
				owners of parent	per share
		Million yen	%	Million yen	%	Million yen	%	Million yen	%		Million yen	%	Yen
First half	164,000	14.3	136,000	8.0	3,600		15.1	3,600		14.4		1,600		(4.9)	45.95
Full year		360,000	15.1	300,000	13.7	12,000		6.9	12,000		4.4		6,800		1.1	195.30

Note: Change in the forecast from the latest announcement: No

• Notes
• 1. Changes in significant subsidiaries (Changes of specific subsidiaries that accompanies scope change of consolidation): No

Included －

(company name) Excluded － (company name)

1. Use of accounting methods specifically for the preparation of the quarterly consolidated financial statements: No
2. Changes in accounting principles and estimates, and retrospective restatement
3. 1. Changes due to revision of accounting standards: Yes

(b) Changes other than (a):	No
(c) Changes in accounting estimates:	No
(d) Retrospective restatement:	No

(4) Number of shares outstanding (ordinary shares)
(a) Shares outstanding (including treasury shares)
As of June 30, 2022:	34,818,578	As of March 31, 2022:	34,818,578
(b) Treasury shares
As of June 30, 2022:	－	As of March 31, 2022:	－
(c) Average number of shares (quarterly cumulative period)
Period ended June 30, 2022:	34,818,578	Period ended June 30, 2021	34,818,632

• Auditing of financial statements by CPA and/or CPA firm is not conducted to this summary of financial results.
• Cautionary statement regarding forecasts and special notes

(Note on forward looking statements)

Forward-looking statements in this material are based on the information available to management at the time this report was prepared. Actual results may differ significantly from these statements for number of reasons.

Index for Supplementary Information

1. Qualitative Information on Quarterly Financial Results………………………………………...	2
(1)	Explanation of business results…...……………………………….………………………......	2
(2)	Explanation of Financial Condition……………………………..……………………………..	2
(3)	Explanation of Consolidated Earnings Forecasts and Other Forward-Looking Statements.……..	3
2. Quarterly Consolidated Financial Statements and Major Notes…………………………..……	4
(1)	Quarterly consolidated balance sheet................................................................................	4
(2)	Quarterly consolidated statement of income and consolidated statements of comprehensive income...............	6
	Quarterly consolidated statement of income....................................................................	6
	Quarterly consolidated statement of comprehensive income……………………...………	7
(3)	Notes to consolidated financial statements........................................................................	8
	(Going concern assumptions)...............................................................................................	8
	(Significant change in shareholders' equity).......................................................................	8
	(Changes in Accounting Policies)........................................................................................	8
3. Consolidated Orders Received and Net Sales……………………………………………..............	8

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1. Qualitative Information on Quarterly Financial Results

1. Explanation of business results

During the first quarter of the current fiscal year ended March 2023, as we continued to be under the influence of the COVID-19, the search for a lifestyle with new normal took place. At the same time, the economy remained relatively firm. On the other hand, due to supply chain fragmentation, depreciation of yen, the bad situation in Ukraine, and so on, the trends of economy and business are uncertain.

In the domestic construction market, public construction investment, including National Resilience Plan, is expected to continue to be firm in the current fiscal year. However, with regard to private-sector construction investment, although corporate capital investment is recovering to the level prior to the spread of COVID-19 infections, conditions remain challenging due to weak yen and soaring material prices. At this point in time, TCG group is not seeing material price hikes as a major factor putting pressure on profits, but we will continue to closely monitor price trends and strive to prevent such price hikes from putting pressure on profits. During the first quarter of the current fiscal year ended March 2023, orders received were 78,486 million yen (up 15.0% from the same period of the previous year), continuing the strong performance of the previous fiscal year. Net sales were 60,427 million yen (down 1.5% from the same period of the previous year). As for profits, operating profit decreased by 72.8% to 390 million yen, ordinary profit decreased by 68.0% to 468 million yen, and profit attributable to owners of parent decreased by 91.8% to 69 million yen.

Results by business segment are as follows.

Segment profit is adjusted with operating profit on the quarterly consolidated statements of income. Adjustments to segment profit include -950 million yen in general and administrative expenses that do not belong to any reportable segment and -179 million yen in other adjustments. (Architecture)

Orders received were 38,605 million yen (up 6.5% vs previous Q1) and net sales were 29,400 million yen (up 2.4% vs previous Q1), resulting in the segment profit of 245 million yen (up 32.5% vs previous Q1).

(Civil Engineering)

Orders received were 28,777 million yen (up 20.4% vs previous Q1), while completed construction work were 21,312 million yen (down 13.2% vs previous Q1) due to a decrease in work in hand resulting from weak orders in the previous period, resulting in the segment profit of 666 million yen (down 54.6% vs previous Q1).

(Real Estate)

Net sales from real estate sales and leasing were 9,714 million yen (up 19.9% vs previous Q1), while segment profit were 608 million yen (down 13.5% vs previous Q1).

1. Explanation of Financial Condition (Assets)
   Total assets at the end of the first quarter of the current fiscal year were 215,543 million yen, down 21,176 million yen from the end of the previous fiscal year.
   The main factors were increases of 1,939 million yen in real estate for sale, 1,928 million yen in costs on real estate business, and 1,613 million yen in construction in progress, while cash and deposits decreased by 13,897 million yen and notes receivable, accounts receivable from completed construction contracts and other decreased by 14,126 million yen.
   (Liabilities)
   Liabilities decreased by 19,970 million yen from the end of the previous fiscal year to 95,277 million yen.
   The main factors were increases of 1,713 million yen in advances received on construction contracts in progress and 1,974 million yen in provision for bonuses, while there were decreases of 3,948 million yen in accounts payable for construction contracts, 17,200 million yen in short- term borrowings and 1,676 million yen in income taxes payable.

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(Net Assets)

Net assets decreased by 1,205 million yen from the end of the previous fiscal year to 120,266 million yen.

The main factor was a decrease in retained earnings of 1,323 million yen due to dividend payments of 1,392 million yen, while profit attributable to owners of parent of 69 million yen was recorded.

As a result of the above, shareholders' equity, which is net assets less non-controlling interests, totaled 120,231 million yen, and the shareholders' equity ratio increased 4.5 percentage points from the end of the previous fiscal year to 55.8%.

1. Explanation of Consolidated Earnings Forecasts and Other Forward-Looking Statements

There are no changes to the consolidated earnings forecasts for the first half and full year of the fiscal year ending March 2023, from those announced on May 11, 2022.

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