Facts and Data
Financial Section
Report of Operating Results and Financial Position for the 54th Business Period
(November 1, 2017 ‒ October 31, 2018)
Matters Concerning the Corporate Group
Summary of consolidated fiscal year operating results
In the fiscal year under review, Japan’s economy maintained a moderate recovery trend, with continuous improvements in employment and income environments supported by strong corporate earnings. However, circumstances requiring attention, such as uncertainty with regards to foreign economies and fluctuations in financial capital markets accompanying
international trade policies of the United States, have persisted.
In the construction industry where the Kanamoto Group belongs, public sector investments remained solid, and favorable private capital investments were seen in the redevelopment projects in major metropolitan
areas, and the like.
In such circumstances, the Group has focused on expanding domestic bases for operations for achieving the “BULL55” long-term vision, while putting forth efforts to expand regional strategies in areas where we are yet to open branches, to the Kanto Region and westward, as well as in Kyushu Region and to possess optimal machines and enrich the machine line-up for rental equipment suitable to both construction demands and customer needs. The Group also has strived to strengthen its system, with the aims to increase work efficiency and improve productivity by utilizing IT through the full-scale operation of new systems.
Furthermore, we transferred all of the equity interests in Shanghai Jinheyuan Engineering Construction Co., Ltd., which was our consolidated subsidiary.
Consequently, in the fiscal year ended October 31, 2018 net sales rose 6.2% from the prior consolidated fiscal year level to ¥168,188 million. On the earnings front, operating profit increased 5.6% year on year to ¥17,599 million, ordinary profit rose 4.3% to ¥17,925 million, and profit attributable to owners of parent rose 10.4% to ¥11,857 million.
Summary of consolidated operating results by business segment
Business related to the Construction Equipment Rental Division
n the construction-related business, which is Kanamoto’s core business, differences in construction demand were seen in some regions, but rental demand for construction equipment was solid as a whole, with transportation infrastructure refurbishment related to the Tokyo Olympics and Paralympics and large-scale redevelopment construction. Further, the Group has worked to develop our response capabilities by reconfiguring our existing rental equipment and augmenting our assets in order to strengthen our support system for restoration and recovery from the natural disasters that have been occurring one after another over recent years, such as the 2018 Osaka earthquake, 2018 West Japan floods, and 2018 Hokkaido Eastern Iburi earthquake. As a result, sales by region in this business were up 8.9% in the Hokkaido Region, down 4.5% in the Tohoku Region, up 10.5% in the Kanto & Koushinetsu Region, up 11.0% in the Nishi-nihon Region, and up 6.7% in the Kyushu & Okinawa Region.
Used construction equipment sales were steady against the backdrop of an excellent market environment from the beginning of the period, as prices were pushed higher by growing demand in China and Southeast Asia.
Reflecting these factors, the Kanamoto Group posted net sales in the construction-related businesses of ¥150,542 million, an increase of 5.7% year-on-year, and operating profit of ¥16,358 million, an increase of 6.1%.
Other Businesses
In the Company’s other businesses, net sales were up 10.2% from the same period of the previous consolidated fiscal year to ¥17,646 million because of steady demand in Kanamoto’s steel productsrelated, information and telecommunications-related, and welfare-related businesses.
Operating profit from these operations slipped 1.2% to ¥846 million, however, reflecting a decline in net sales from steel-related works and
expenses in conjunction with the Company’s push into the Kanto area in its welfare-related operations.
Consolidated Operating Results
Scroll to the right, to see the following columns →
|
Fiscal Year Ending
October 31, 2017 |
Fiscal Year Ending
October 31, 2018 |
| Net Sales |
158,428（9.4） |
168,188（6.2） |
| Operating Profit |
16,665（10.1） |
17,599（5.6） |
| Ordinary Profit |
17,193（19.4） |
17,925（4.3） |
| Profit attributable to owners of parent |
10,744（32.7） |
11,857（10.4） |
| Net Income per Share |
304.05円 |
335.54円 |
(Millions of yen; % change from prior year)
Divisional Sales (Consolidated)
Scroll to the right, to see the following columns →
|
Fiscal Year Ending
October 31, 2017 |
Fiscal Year Ending
October 31, 2018 |
| Construction Equipment Rental Business |
142,414（8.5） |
150,542（5.7） |
| Other Businesses |
16,013（17.2） |
17,646（10.2） |
| Total |
158,428（9.4） |
168,188（6.2） |
(Millions of yen; % change from prior year)
Outlook for the Next Fiscal Year (Fiscal year ending October 2019)
In the next fiscal year, the Group expects public-sector and private-sector capital investments to remain strong, with numerous plans for large projects, such as construction related to the Tokyo Olympics and Paralympics, infrastructure refurbishment construction, and redevelopment projects, primarily in urban areas.
However, there are likely concerns such as unsuccessful bids or delays in the commencement of construction, due to not only the further widening of regional differences accompanying decreases in public construction in some regions of Japan and the concentration of construction projects in urban areas, but also the normalization of skilled worker shortages.
While continuing to provide support for quick recovery in disaster-stricken areas and enhance and expand domestic operations bases, the Group focuses on establishing the structure to increase earnings primarily in the Tokyo Metropolitan Area, the greater Kanto Region, and Kyushu and Okinawa Regions, in consideration of the medium- to long-term demand prospects.
In addition, as a long-term growth engine, Kanamoto aims to systematically and strategically move forward with the establishment of an overseas base for operations, mainly in China and Southeast Asia, where strong underlying demand is a potential.
In addition, Kanamoto will proactively participate in innovation fields, such as METI’s i-Construction project as well as the utilization of AI to raise productivity on construction sites, while aiming to build a management system that will facilitate sustainable growth in the long term by further improving its earnings management and strengthening its corporate governance system.
The Kanamoto Group aims for net sales of ¥175,700 million, a growth of 4.5% year-on-year, operating profit of ¥18,400 million, an increase of 4.5%, ordinary profit of ¥18,700 million, a rise of 4.3%, and profit attributable to owners of parent of ¥12,000 million, an improvement of 1.2%.
Projected Operating Results for the Fiscal Year Ending October 31, 2019
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|
Consolidated full-year projection |
Non-consolidated full-year projection |
| Net Sales |
175,700（4.5） |
118,100 （3.6） |
| Operating Profit |
18,400（4.5） |
ー |
| Ordinary Profit |
18,700（4.3） |
13,000 （0.2） |
Consolidated：Profit attributable to owners of parent
Non-consolidated：Net income |
12,000（1.2） |
9,100（△ 4.5） |
| Net Income per Share |
309.37円 |
234.60円 |
(Millions of yen; % change from prior year)