TOA ROAD CORPORATION
1882・Prime Market・Construction
Business
Toa Road Corporation was founded in 1930 and comprises two core pillars: the construction business centered on paving works (approximately 61% of group revenue) and the manufacturing/sales of asphalt emulsion and mixtures plus environmental business (approximately 39%). The construction business operates nationwide across diverse work areas including paving, civil engineering, landscaping, sports facilities, ground improvement, river improvement, and specialized dredging, serving a broad customer base from government bodies such as the Ministry of Land, Infrastructure, Transport and Tourism, expressway companies, and local governments to private developers. The manufacturing/sales and environmental business handles the manufacturing and sale of modified asphalt, asphalt mixtures, and recycled aggregates, as well as environmental operations such as intermediate treatment of construction waste and contaminated soil purification. The group operates through a 26-company structure including 24 subsidiaries and 2 affiliated companies.
Business Model
In the construction business, the company adopts a contract-based revenue model in which contracted work (paving and civil engineering) is recognized as completed construction revenue, aiming for stable order acquisition through an order composition of 62% negotiated contracts and 38% competitive bidding. In the manufacturing and sales business, the company sells in-house manufactured asphalt emulsion, asphalt mixture, and crushed stone to external customers, while also supplying them to the group's construction business, forming a vertically integrated structure. Through the collaboration between the two businesses, the company achieves stabilized material procurement and more sophisticated cost management, while building a stable earnings base with public investment as its primary demand source.
Company Strengths
A vertically integrated model combining construction operations and manufacturing/sales operations enables stable procurement and internal supply of asphalt mixtures, emulsions, and other materials. In FY2026 (ending March 2026), segment profit from manufacturing/sales, environment, and other businesses reached ¥3,835 million (up 10.7% year on year), which together with construction segment profit of ¥4,413 million forms a dual earnings structure.
The construction business's order backlog to be carried forward at the end of FY2026 (ending March 2026) reached ¥36,864 million (up 31.4% year on year), while orders received also expanded significantly to ¥83,105 million (up 17.9% year on year). The backlog includes large-scale projects from East Nippon Expressway, West Nippon Expressway, Central Nippon Expressway, and the Ministry of Land, Infrastructure, Transport and Tourism, among others, indicating that a substantial amount of revenue recognition is expected in subsequent periods.
With R&D expenditure of ¥274 million, the company holds multiple advanced technologies in the paving field, including selection for a demonstration trial of the solar road technology "Wattway," development and operation of a mobile deflection measurement device (MWD Plus), and joint research on a plant-derived binder (Bio Binder). Construction efficiency has also progressed through the establishment of an ICT Paving and DX Promotion Department, positioning technological capability as a foundation for competitive advantage.
ENVALITH's Perspective
Performance Trend
Revenue over the past five fiscal periods trended as follows: ¥112,118 million (FY2022) → ¥118,721 million (FY2023) → ¥118,060 million (FY2024) → ¥126,575 million (FY2025) → ¥121,327 million (FY2026), with FY2026 (ending March 2026) representing a 4.1% year-on-year decline. Meanwhile, operating profit reached ¥5,788 million, the highest level in the five-period span, aided by a reduction in cost of sales (gross margin improved from 11.4% to 12.0%). Amid ongoing effects from asphalt material costs linked to crude oil price fluctuations as an external factor, intensifying order competition and persistently elevated material and labor costs continue to constrain the earnings environment. Net income came to ¥3,426 million, below the prior period's ¥4,127 million, due to the recognition of an impairment loss of ¥681 million.
Growth Strategy
Under the medium-term plan "TOA ROAD Sustainable Plan 2026," the company is transitioning to CSR-oriented management and building a sustainable growth foundation.
In light of the highly uncertain business environment, the company aims to focus on growth areas such as PPP business, overseas business, and sports facility business, in addition to its traditional public pavement construction work, thereby establishing a sustainable growth foundation through expansion of its business domains.
Response to the overtime work cap regulations that came into full effect from FY2024 is taking hold operationally, and the company is promoting operational efficiency and labor savings through DX adoption. It is working on appropriate management of working hours, securing human resources, training and development, and improving employee engagement.
The road surface solar power generation technology handled by the company, along with in-motion wireless charging technology being promoted as joint research, was selected for a demonstration project in FY2025. The company is also advancing the development of pavement longevity technology, preventive maintenance-type repair methods, and a road asset management system utilizing digital technology, in pursuit of new possibilities for the "pavement of the future."
The company aims to stabilize its production and supply systems through proactive capital investment, while also expanding sales channels by developing new materials for other industries. It is promoting the renewal of manufacturing equipment with consideration for the global environment and the DX transformation of factory equipment including the supply chain, striving to improve labor savings, quality, and safety. Appropriately and promptly passing on rising raw material prices and energy costs to sales prices is a key challenge.
Last updated: July 19, 2026