SANKO METAL INDUSTRIAL CO., LTD.

Business Details

The core segment, engaged in Long-Span Roofing Construction, R-T Construction, Hi-Tuff Construction, Solar Construction, Painting Construction, and Long-Span Molded Products Sales. Primary materials are Nippon Steel products, surface-treated by Nittetsu Steel Sheet, and procured through Nippon Steel Trading. The segment has built a vertically integrated system in which a substantial portion of processing work is outsourced to non-consolidated subsidiaries. Its main customers are non-residential steel-frame buildings such as factories and warehouses, and it captures not only new construction work but also renovation demand from buildings that have been in service for 20 years or more since completion.

Recent Overview

Net sales increased, but profit declined 8.6% year on year due to higher construction costs and increased administrative expenses

In FY2026 (ending March 2026), segment net sales increased to ¥43,728 million (up 4.3% year on year), but segment profit decreased to ¥3,662 million (down ¥342 million, or 8.6%, year on year). The main cause was a 1.2-point decline in the gross profit margin on completed construction contracts, as rising construction costs and increased expenses for strengthening manufacturing and construction capabilities weighed on profit. On the other hand, the order backlog carried forward reached a record high of ¥36,462 million (up 2.5% year on year), driven by Long-Span Molded Products Sales and Hi-Tuff Construction orders. Amid a continuing downward trend in nationwide non-residential steel-frame construction floor area (factories and warehouses), down 11.9% year on year, order levels were maintained through the capture of renovation construction demand.

Key Products

Growth Drivers

• Expansion of renovation construction orders by capturing renovation demand from buildings 20 years or more past completion
• Sharp expansion of Long-Span Molded Products Sales (net sales up 33.7% year on year, orders received up 41.6% year on year in FY2026 (ending March 2026))
• Sharp increase in Hi-Tuff Construction orders and sales (orders received up 36.7% year on year, net sales up 40.3% year on year)
• Stable securing of construction volume backed by a record-high order backlog carried forward (¥36,462 million)
• Introduction of competitive products and construction methods through strengthened sales activities incorporating design considerations
• Improved construction quality and enhanced customer trust through the establishment of a new Quality Control Department in April 2026

Risks

• A continuing downward trend in nationwide non-residential steel-frame construction floor area (factories and warehouses) (down 11.9% year on year from March 2025 to February 2026)
• Rising construction costs and a decline in the gross profit margin on completed construction contracts due to persistently high material prices (down 1.2 points in the current period)
• Impact on construction progress from delays in preceding processes caused by labor shortages
• Risk of construction plan cancellations or postponements due to soaring construction costs
• Risk of supply chain disruption, difficulty in material procurement, and rising crude oil prices stemming from the situation in the Middle East
• Decline in sales contribution from Solar Construction due to a sharp drop in orders received (down 86.2% year on year in FY2026 (ending March 2026))
• Risk that increased labor costs from manufacturing and construction reinforcement measures and employee hiring will continue to pressure profit