DAITO TRUST CONSTRUCTION CO.,LTD.

Business Details

The company enters into construction contracts for rental housing and other buildings with landowners, and undertakes design and construction. The mainstay is rental housing (residential construction completion revenue of ¥501,088 million, accounting for 86.4% of total construction completion revenue), with commercial and other buildings also handled. Group companies such as DAITO KENSETSU CO., LTD. handle materials supply and construction support, and the company is also focusing on supplying environmentally conscious properties such as ZEH Rental Housing. Against a backdrop of soaring construction costs, the company is optimizing its sales areas, and orders are on a declining trend.

Recent Overview

Construction progressed smoothly, but operating profit declined 4.2% year on year due to rising labor costs

In FY2026 (ending March 2026), construction progressed smoothly, with construction completion revenue of ¥579,662 million (up 0.6% year on year) and a gross profit margin on completed construction of 25.4% (up 0.1 percentage point year on year), a slight improvement. On the other hand, selling, general and administrative expenses increased due to rising labor costs and other factors, and operating profit declined to ¥45,148 million (down 4.2% year on year). On the order side, due to sales area optimization in light of soaring construction costs and tenant placement conditions, orders received fell to ¥570,514 million (down 4.4% year on year), and the order backlog also contracted to ¥783,634 million (down 2.3% year on year). The plan for FY2027 (ending March 2027) calls for revenue of ¥545,000 million (up 0.1% year on year) and operating profit of ¥47,000 million (up 4.1% year on year).

Key Products

Growth Drivers

• Stable recording of construction completion revenue through progress on the order backlog of ¥783,634 million
• Maintenance and improvement of gross profit margin on completed construction (25.4% in FY2026 (ending March 2026), 26.1% planned for FY2027 (ending March 2027))
• Increase in orders received in the Tokyo metropolitan area (¥154,901 million in FY2026 (ending March 2026), up 2.5% year on year), shifting toward higher-profitability areas
• Expansion of maintenance and repair construction (¥55,820 million in FY2026 (ending March 2026), up 23.4% year on year), accumulating recurring stock-type revenue in line with the increase in managed buildings
• Improved order efficiency through appropriate allocation of construction sales staff and sales area optimization
• Differentiation through environmentally conscious properties such as ZEH Rental Housing, strengthening proposal capabilities toward landowners

Risks

• Downward pressure on gross profit margin on completed construction and operating profit margin from soaring materials prices and labor costs (operating profit margin of 8.3% in FY2026 (ending March 2026), down 0.4 percentage point year on year)
• Deterioration in the order environment due to the sluggish trend in new rental housing construction starts (cumulative rental housing starts of 281,228 units from April 2025 to February 2026, down 10.5% year on year)
• Risk of continued decline in orders received and orders received (buildings) due to sales area optimization in light of soaring construction costs and tenant placement conditions (orders received (buildings) of 3,671 buildings, down 18.3% year on year)
• Impact on future construction completion revenue from the contraction of the order backlog (¥783,634 million, down 2.3% year on year)
• Risk of increased costs related to efficiency improvements in the construction system and securing human resources
• Risk of quarterly earnings volatility due to the second-half weighting of scheduled construction completions