NIKKEN KOGAKU CO., LTD.
9767・Standard Market・Services
Business
Nikken Kogaku Co., Ltd. is a civil engineering materials group company established in 1964, specializing in disaster prevention and mitigation (with 3 consolidated subsidiaries). Its core business consists of two pillars: the leasing of steel formwork for manufacturing wave-dissipating armor blocks (formwork leasing business), and the sale of secondary concrete products such as revetment blocks, interlocking natural stone products, and civil engineering sheet products manufactured at partner factories (product sales business). Its main customers are public civil engineering projects in the fields of ports, fishing ports, coasts, rivers, and erosion control, with national resilience and disaster prevention/mitigation measures serving as its primary demand base. The company adopts an asset-light model that leverages a network of contract manufacturers rather than owning its own factories. It transitioned to the Tokyo Stock Exchange Standard Market in 2022.
Business Model
In the formwork leasing business, the company leases steel formwork to wave-dissipating block manufacturers and earns rental income. In the product sales business, it sells precast concrete products and civil engineering sheet products manufactured under outsourcing arrangements with partner factories, targeting public works projects. By adopting an outsourced manufacturing model without owning its own factories, the company keeps fixed costs down while managing profit margins through rationalization and efficiency measures across group companies. In FY2026 (ending March 2026), the sales mix is expected to be 24.6% from formwork leasing and 75.4% from product sales.
Company Strengths
Since developing the "3-Ren Block" in 1964, the company has continuously developed numerous proprietary products and construction methods, including wave-dissipating blocks such as Grasp and Lacna IV, as well as multi-natural type revetment construction methods. It has established company-wide systems supporting the acquisition of Professional Engineer qualifications and working adult doctoral degrees, as well as paper presentations, systematically enhancing engineers' expertise. The construction method development capability and product lineup, which are difficult for competitors to imitate in a short period, are the source of competitive advantage.
Through an outsourced manufacturing model in which production is entrusted to partner factories, the company has built a supply system that can flexibly respond to demand fluctuations while suppressing the burden of fixed assets. Against total assets of ¥6,358 million at the end of FY2026, net assets stood at ¥4,937 million, indicating high financial soundness, with cash and cash equivalents of ¥2,549 million. The company has explicitly identified the maintenance and strengthening of its partner company network, which respects the independence of capital and management, as a management priority.
"KAISO BANK," a project to expand blue carbon ecosystems through seaweed beds, was selected for NEDO's Green Innovation Fund program from FY2022, and from FY2026 it will transition from a commissioned project to a subsidized project. Alongside the promotion of environmentally active concrete (EVICon) and low-carbon concrete, the company is advancing the expansion of its business domain into the environment and ecosystem fields beyond the scope of disaster prevention and mitigation, as a demonstrated achievement.
ENVALITH's Perspective
Performance Trend
Net sales, which had declined for four consecutive periods after peaking at ¥8,317 million in FY2022 (ended March 2022), rebounded to ¥6,211 million in FY2026 (ending March 2026), up 12.6% year on year. The main driver was an increase in shipment volumes of riverbank revetment blocks and civil engineering sheet products. Operating profit rose only modestly to ¥353 million (up 3.1% year on year), while the operating margin declined slightly to 5.7% (from 6.2% in the prior period). This reflected a sharp drop in operating profit from the formwork rental business, which fell to ¥59 million (from ¥223 million in the prior period). As an external factor, a gradual decline in disaster-recovery projects related to typhoons and concentrated heavy rainfall weighed on demand for formwork. Profit attributable to owners of parent decreased slightly to ¥281 million (down 0.9% year on year). Comprehensive income increased substantially to ¥393 million (from ¥259 million in the prior period), aided by an expansion in valuation gains on investment securities.
Growth Strategy
Centered on demand for disaster prevention and mitigation, the company is driving the revival of its existing business growth model and the deployment of products for the resilience enhancement of public civil engineering facilities.
Driven by increased shipment volumes of river revetment blocks and civil engineering sheet products, product sales business revenue for FY2026 (ending March 2026) reached ¥4,684 million (up 21.3% year on year), with operating profit of ¥294 million (up 145.0% year on year). Capturing demand for the resilience enhancement of public civil engineering facilities, the product sales business is functioning as the main pillar of consolidated results.
In FY2026 (ending March 2026), capital expenditure in the formwork leasing business amounted to ¥163 million (a substantial increase from ¥84 million in the previous fiscal year), increasing the steel formwork balance to ¥8,126 million (from ¥7,970 million in the previous fiscal year). Due to the gradual decline in disaster recovery projects, revenue for FY2026 (ending March 2026) came to only ¥1,527 million (down 7.7% year on year), but a recovery to ¥2,000 million (up 31.0% year on year) is expected for FY2027 (ending March 2027).
The company continues to implement efficiency measures while maintaining its fabless model, managing the cost of sales ratio and controlling selling, general and administrative (SG&A) expenses. SG&A expenses for FY2026 (ending March 2026) increased to ¥1,428 million (from ¥1,358 million in the previous fiscal year), but operating profit was secured through the expansion of gross profit to ¥1,781 million (from ¥1,701 million in the previous fiscal year). The equity ratio improved to 77.5%, reflecting progress in strengthening the financial base.
Disaster prevention and mitigation projects addressing waves, torrential rain, and sediment-related disasters in the fields of ports, fishing harbors, coasts, rivers, and erosion control are expected to see continued demand under the government's national resilience policy. Amid a favorable external environment driven by the increasing severity and frequency of natural disasters due to climate change, the Group has set a policy of contributing to a sustainable society by providing products and construction methods adapted to disaster prevention and mitigation.
Last updated: July 19, 2026