DAIICHI KENSETSU CORPORATION
1799・Standard Market・Construction
Construction Business
An integrated civil engineering and building construction business, and the core segment accounting for approximately 98% of net sales
| Period | Current | Previous | Change |
|---|---|---|---|
| Net sales (completed construction contracts) | ¥58,885 million | ¥56,929 million | ↑ |
| Segment profit (operating profit) | ¥6,825 million | ¥6,957 million | ↓ |
| Segment profit margin | 11.6% | 12.2% | ↓ |
| Orders received | ¥73,906 million | ¥61,771 million | ↑ |
| Backlog of contracts in progress (period-end) | ¥44,383 million | ¥29,362 million | ↑ |
Business Details
This segment handles order intake and construction management for civil engineering and building construction work in general. East Japan Railway Company (JR East) is the segment's principal customer, and railway infrastructure work forms its foundation. Amid solid demand for both public and private construction investment, the segment is advancing improvements in technical capabilities and rigorous cost management. In FY2026 (ending March 2026), orders received increased substantially by 19.6% year on year to ¥73,906 million, and the backlog of contracts in progress also grew by 51.2%.
Recent Overview
Orders received expanded substantially, up 19.6% year on year, and the backlog of contracts in progress grew by 51.2%
In FY2026 (ending March 2026), orders received in the Construction Business increased substantially to ¥73,906 million (up 19.6% year on year). In particular, orders received for building construction works surged to ¥30,928 million (up 42.2% year on year). Net sales increased to ¥58,885 million (up 3.4% year on year), but segment profit declined slightly to ¥6,825 million (down 1.9% year on year). An increase in cost of completed construction contracts (higher outsourcing costs and personnel expenses within expenses) pressured the profit margin. The period-end backlog of contracts in progress increased substantially to ¥44,383 million (up 51.2% year on year), providing a solid sales base for subsequent periods.
Key Products
Growth Drivers
- Rapid expansion in orders received for building construction works, up 42.2% year on year, with a 66.5% increase in backlog (¥29,138 million) supporting sales in the coming period
- Backlog for civil engineering works also increased 28.5% year on year (¥15,246 million), forming a stable sales base
- Continuation of solid demand conditions for both public and private construction investment
- Stable earnings base from continued order intake for railway infrastructure works for JR East
- Strengthening of construction capacity through capital investment in large-scale track maintenance machinery and other equipment
- Promotion of enhanced dynamic capabilities and growth strategy under the medium-term management plan "Transformation 2030," whose initial year is FY2026
Risks
- Risk of sales concentration with East Japan Railway Company (which accounts for a high proportion of completed construction contract sales)
- Risk of reduced profitability due to chronic shortages of skilled construction workers and rising labor costs and construction material prices
- Risk of unstable procurement of certain materials and equipment due to tight supply-demand conditions for petrochemical products, among other factors
- Risk of increased costs and constraints on construction capacity in responding to overtime work cap regulations
- Uncertainty in estimates of total construction costs used in revenue recognition based on percentage of completion
- Impact on domestic construction demand from trends in international economic policy and instability in the global situation
Last updated: June 24, 2026