HAZAMA ANDO CORPORATION
1719・Prime Market・Construction
Business
Ando Hazama is a general contractor formed in 2013 through the merger of Ando Corporation (founded 1873) and Hazama Corporation (founded 1889). Its core operations are civil engineering (tunnels, dams, underground structures, etc.) and building construction (logistics facilities, factories, hospitals, commercial facilities, etc.), supplemented by peripheral businesses conducted through group companies, including construction materials sales, leasing, real estate, and overseas construction. Major customers range widely from public-sector entities such as the Ministry of Land, Infrastructure, Transport and Tourism and expressway companies, to major private developers such as Mitsui Fudosan and Tokyo Tatemono, and the company also undertakes overseas construction projects in North America, Southeast Asia, Latin America, and other regions. Listed on the Prime Market of the Tokyo Stock Exchange.
Business Model
The core of revenue is a construction contracting model in which the company receives orders from customers and recognizes net sales of completed construction contracts according to the percentage of completion. Order backlog at the end of FY2026 (ending March 2026) reached ¥688,190 million (civil engineering: ¥273,971 million; building construction: ¥414,219 million), providing high visibility into sales recognition for subsequent periods. In the group business, stock-type revenues such as sales of construction materials, leasing, and real estate rental are also accumulating as a complementary source of income.
Company Strengths
Order backlog at the end of FY2026 (ending March 2026) stood at ¥688,190 million (up 23.3% year on year). Building construction alone surged to ¥414,219 million (up 44.5% year on year), underpinning the FY2027 (ending March 2027) building construction completion plan of ¥310,000 million. The buildup in order backlog reflects an accumulation of customer base and trust relationships that is difficult to replicate in the short term.
In FY2026 (ending March 2026), the non-consolidated gross profit margin on completed construction contracts was 16.2% for civil engineering (up 1.2 percentage points year on year) and 13.7% for building construction. The operating margin in the civil engineering business reached 11.0%, supported by construction technology capabilities and project management expertise cultivated through large-scale, technically demanding projects such as mountain tunnels and dams.
The company developed two new AI-roadheader models for its integrated mountain tunnel excavation management system "i-NATM®" and began long-term field verification testing at actual construction sites. At the Kasumigaura Water Diversion Ishioka Tunnel construction project, autonomous operation of construction machinery was stably maintained for approximately two months. Its proprietary digital twin platform has also been confirmed effective in a large-scale land development project, advancing the practical application of productivity-enhancing technologies.
ENVALITH's Perspective
Performance Trend
Consolidated results for FY2026 (ending March 2026) showed net sales of ¥439,615 million (up 3.4% year on year), marking the fifth consecutive year of sales growth. On the other hand, operating profit declined to ¥33,618 million (down 4.6%) and ordinary profit fell to ¥33,257 million (down 2.3%). The main cause was a substantial increase in SG&A expenses to ¥30,341 million (up 18.0% year on year). Profit attributable to owners of parent increased to ¥29,746 million (up 12.5%), though this was aided by the recording of a gain on sale of investment securities of ¥10,388 million (extraordinary income). ROE declined slightly to 15.7% (from 16.3% in the previous period). The equity ratio improved to 50.6% (from 46.0% in the previous period), indicating stronger financial soundness. Looking at the trend over the past five fiscal years, profit bottomed out in FY2024 (ending March 2024) and recovered sharply thereafter; following a large improvement in FY2025 (ending March 2025) (operating profit up 89.6%), profit has remained at an elevated level. As external factors, steady government and private-sector construction investment has supported sales, while elevated labor costs and material prices have capped the upside for margins.
Growth Strategy
The Medium-Term Management Plan 2028 sets forth five areas of value creation, advancing deeper construction business strategies and strategic investments.
The company will launch its "Medium-Term Management Plan 2028" starting April 2026. It targets consolidated ordinary profit of ¥365 million, ROE of 12% or higher, and dividend per share of ¥80 or more (progressive dividend policy) by FY2029 (ending March 2029). The plan aims to deepen strategies across seven business segments—domestic civil engineering, building construction, LCS, energy, overseas, group companies, and non-construction businesses—while strengthening five management foundations: human capital, technology development, DX, business partners, and sustainability.
Through QXY Resources Pte. Ltd. (Singapore), which became a wholly owned subsidiary in January 2026, the company is establishing a business foundation in Southeast Asia in the renewal construction field. In the current fiscal year, only the balance sheet was consolidated (profit and loss not yet reflected), with profit and loss contribution expected to begin from FY2027 (ending March 2027). Southeast Asia is positioned as a priority region for overseas business, with a focus on long-term business growth.
The Medium-Term Management Plan 2028 explicitly states a progressive dividend policy of ¥80 or more per share annually. The annual dividend for FY2026 (ending March 2026) was ¥80 (an increase from ¥70 in the previous fiscal year), and the forecast for FY2027 (ending March 2027) is ¥84, planning for a further dividend increase. The dividend payout ratio for FY2026 (ending March 2026) was 42.2%. The policy of maintaining dividend increases even amid a forecast decline in net profit demonstrates a strong commitment to shareholder returns.
In the final year of the Medium-Term Management Plan 2025, the company achieved results by promoting automation and labor-saving in construction through technology development related to ICT and AI. To address the industry-wide challenge of a shrinking and aging skilled construction labor force, this initiative will continue under the Medium-Term Management Plan 2028 as part of its technology development strategy and DX strategy. The aim is to improve profitability through productivity gains and maintain competitive advantage.
The company is promoting a transformation of its business portfolio from flow-type business (construction contracting) to stock-type business, through initiatives such as the commencement of commercial operations at the Sakaide Biomass Power Plant and continued efforts in solar power PPA business. Under the Medium-Term Management Plan 2028, energy business and non-construction business are positioned as independent strategic areas, aiming to diversify the company's stable earnings base.
Last updated: July 19, 2026