KATO WORKS CO.,LTD.
6390・Prime Market・Machinery
Japan
Core domestic manufacturing and sales segment, the flagship business accounting for approximately 90% of consolidated group sales
| Period | Current | Previous | Change |
|---|---|---|---|
| Segment sales | ¥51,899 million | ¥46,653 million | ↑ |
| Segment profit (loss) | △¥2,231 million | ¥621 million | ↓ |
| Segment assets | ¥87,395 million | ¥91,942 million | ↓ |
| Depreciation and amortization | ¥1,636 million | ¥1,216 million | ↑ |
| Increase in property, plant and equipment and intangible assets | ¥970 million | ¥1,404 million | ↓ |
Business Details
This is the domestic manufacturing and sales segment operated directly by Kato Works Co., Ltd. It manufactures and sells Construction Cranes (rough terrain cranes, etc.), Hydraulic Excavators, etc., and other construction machinery. In addition to domestic sales, it also handles exports to Asia and the United States. In FY2026 (ending March 2026), domestic crane sales increased significantly due to the resumption of sales of large rough terrain cranes, but the segment fell into a loss due to a decline in factory utilization rates associated with inventory adjustments, rising material and logistics costs, and the recording of valuation losses on long-term inventory of spare parts, among other factors.
Recent Overview
Sales increased due to resumption of large crane sales, but the segment fell into a loss due to inventory adjustments and rising costs
Japan segment sales for FY2026 (ending March 2026) increased to ¥51,899 million (111.2% year-on-year). The resumption of sales of large rough terrain cranes, following the resolution of supply constraints on key components, drove the increase in domestic crane sales. On the other hand, a decline in factory utilization rates associated with inventory adjustments, a rise in the cost of sales ratio due to increased material and logistics costs, and the recording of a one-time valuation loss on long-term inventory of spare parts, etc., combined to result in a segment loss of ¥2,231 million (compared to segment profit of ¥621 million in the prior period). Overseas, sluggish sales of hydraulic excavators to the United States due to the impact of tariffs also had an effect.
Key Products
Growth Drivers
- Expansion of sales through the introduction of a new hydraulic excavator series in the domestic market
- Development of new markets through the commencement of operations of the Indian joint venture 'ACE KATO Pvt. Ltd.'
- Expected recovery in demand in the U.S. market, which had been sluggish in recent years
- Improvement in profitability through optimization of product and parts pricing
- Improvement in the cost of sales ratio through recovery of factory utilization rates following completion of inventory optimization
- Promotion of the 'Further Improvement of Profitability' initiative under the medium-term management plan
Risks
- Risk of prolonged high cost of sales ratio due to further increases in material prices and logistics costs
- Risk of deteriorating profitability due to continuation of the flexible sales strategy aimed at improving the financial structure
- Continued weakness in demand for hydraulic excavators in the United States (impact of U.S. tariff policy)
- Weak domestic construction machinery demand due to soaring construction material and labor costs and stagnant private investment
- Risk of price declines in the domestic hydraulic excavator market due to intensifying competition
- Risk of delays in the launch of the India business
- Continued risk of breaching financial covenants (net asset maintenance clause)
Last updated: June 24, 2026