ENVALITH
クワザワホールディングス株式会社 logo

KUWAZAWA Holdings Corporation

8104・Standard Market・Wholesale Trade

Official website
クワザワホールディングス株式会社 logo
KUWAZAWA Holdings Corporation8104

Business

Kuwazawa Holdings Co., Ltd., founded in 1933, transitioned to a holding company structure in 2020, and is a Hokkaido-based comprehensive construction-related group. It comprises 17 consolidated subsidiaries and 2 equity-method affiliates, and operates in Construction Materials (procurement/sale and manufacturing/processing of cement, ready-mixed concrete, steel, housing equipment, etc.), Construction Works (Materials-related Construction, Specialized Construction, renovation, Large-scale Renovation Works), Materials Transport (transport, warehousing, and heavy machinery for cement and construction materials), Real Estate Leasing, and peripheral services such as Solar Power Generation Business, insurance agency, and Vehicle Maintenance Business. Its main customers are housing manufacturers, general contractors, local construction firms, and building materials retailers, with its principal demand base being public and private investment in Hokkaido. Consolidated net sales for FY2026 (ending March 2026) were ¥64,802 million.

Business Model

With the wholesale/sale and manufacturing/processing of Construction Materials (approximately 54% of net sales) at its core, the company achieves vertical integration with construction works (approximately 40%) and logistics (Materials Transport, approximately 5%) to provide clients with consistent, end-to-end service. The Materials Transport and Real Estate Leasing segments within the group support internal demand, forming a stable earnings base. Real Estate Leasing is highly profitable, with a segment profit margin of approximately 77%, complementing profits across the group as a whole.

Company Strengths

Founded in 1933, listed on the Sapporo Securities Exchange in 1973, and designated to the TSE First Section in 2019, the company has operated in the Hokkaido construction industry for many years. Through 17 consolidated subsidiaries, it has built a network of bases for Construction Materials sales, construction, and transport centered on Do-o and Do-nan (Central and Southern Hokkaido), giving it a regionally embedded customer base and sales network that competitors cannot easily replicate in a short period.

Cash and cash equivalents at the end of FY2026 (ending March 2026) stood at ¥9,314 million, with a net cash balance after deducting interest-bearing debt of ¥7,490 million, maintaining effectively debt-free management. The equity ratio remains stable at 38.8%, providing a financial base that allows flexible responses to M&A investments and capital expenditures. Long-term borrowings decreased by ¥1,375 million during the fiscal year, and financial soundness continues to improve.

The company has a business structure that allows everything from Construction Materials sales to construction, transport, and Real Estate Leasing to be completed within the group. The Materials Transport segment secures stable internal demand through coordination with the group's Construction Materials and Construction Works segments, while the Real Estate Leasing segment maintains a high profit margin (approximately 77%) by providing warehouses and offices to the group's businesses.

ENVALITH's Perspective

Net income attributable to owners of parent for FY2026 (ending March 2026) increased significantly to ¥1,078 million (up 44.2% year on year), but this was mainly due to a special factor: impairment losses, which had been ¥537 million in the prior fiscal year, plummeted to ¥2 million in the current fiscal year. Operating profit, which reflects the earning power of the core business, declined to ¥1,378 million (down 5.8% year on year), affected by an increase of ¥651 million in selling, general and administrative expenses from ¥7,691 million to ¥8,342 million (temporary costs such as PC replacement and core system analysis expenses). The operating profit margin remained at a low level of 2.1%.

As an external factor, new housing starts continue their medium- to long-term declining trend, further compounded by prolonged review periods due to the mandatory energy conservation standards and the reduction of the No. 4 exemption. In the Construction Works segment, a decrease in large-scale projects in Hokkaido pushed sales down 4.7% year on year to ¥25,725 million, while the Materials Transport segment fell into a segment loss of ¥28 million due to sluggish winter demand and rising expenses. The continued rise in labor costs and material prices is expected to keep construction costs elevated, remaining an impediment to margin improvement for the foreseeable future.

The dividend per share for FY2026 (ending March 2026) was raised from the initially planned ¥18 to ¥26 (payout ratio of 36.0%), with a further increase to ¥30 planned for FY2027 (ending March 2027) (payout ratio of 38.6%). Share buybacks are also continuing (¥110 million in the current fiscal year), clearly strengthening the stance on shareholder returns. On the other hand, the structural risk of regional concentration, with the majority of sales concentrated in Hokkaido, remains unchanged, and the vulnerability of business performance being heavily influenced by public investment trends and the regional economy in Hokkaido persists.

Growth Strategy

Aiming for sustainable growth through three pillars: strengthening the profitability of existing businesses, expanding business domains through M&A, and investing in human capital

In response to the mid- to long-term contraction of the housing market, the Company is strengthening its sales and construction systems for the civil engineering/steel field, where public investment remains solid, and for the reform/renewal market, where demand for renovation of existing stock is expected. Efforts continue across both the Construction Materials and Construction Works segments, and Construction Materials segment sales in FY2026 (ending March 2026) increased 1.9% year on year.

Ohno Asano Concrete Co., Ltd. was added to the scope of equity-method application from FY2026 (ending March 2026). Investment income under the equity method rose sharply to ¥162 million (from ¥51 million in the previous fiscal year), contributing to the expansion of the Group's earnings base. By strengthening collaboration in the concrete products field, the Company is building a stable procurement and supply system for Foundation Materials.

In response to changes in the working environment, the Company continues to restructure its sales organization and implement measures to secure and develop human resources. FY2026 (ending March 2026) is in a phase of upfront investment accompanied by increased SG&A expenses (PC replacement, core system analysis costs, etc.), positioned as foundational groundwork toward achieving the FY2027 (ending March 2027) operating profit forecast of ¥1,650 million (+19.7% year on year).

The dividend per share for FY2026 (ending March 2026) was raised from the initially planned ¥18 to ¥26 (total dividends of ¥384 million, payout ratio of 36.0%). For FY2027 (ending March 2027), a further increase to ¥30 is planned (payout ratio of 38.6%). Share buybacks are also continuing (¥110 million in FY2026 (ending March 2026)), clarifying a policy of expanding shareholder returns in line with profit growth.

Last updated: July 19, 2026