To Valued Shareholders and Investors,

We would like to express our sincere gratitude to our shareholders for your continued support.

In the 61st fiscal year, there were some moves to expand capital investments in line with the economic recovery trend in the private-sector construction investments; on the contrary, in the public construction investments, the peak of reconstruction projects after the Great East Japan Earthquake has passed, and orders for large-scale construction projects have entered the off-season, resulting in a reactionary decline compared to the previous fiscal year. Therefore, the construction industry faced a difficult business environment due to intensifying competition for orders, as well as persistently high labor costs and rising construction material prices.

Under such a circumstance, in the first half of the 61st fiscal year, there was an unexpected loss of orders for large-scale construction projects, in addition to a delay in the expected timing of construction orders, and a significant delay in the construction timing of some large-scale projects for which orders were received, which could not be made up for in the second half of the year. Furthermore, due to small number of projects carried over from the previous year, net sales and operating income fell far short of the plan, resulting in a loss for the fiscal year. Although we have decided not to pay a year-end dividend in consideration of the capital needs for future business development, all directors and employees will work together to recover our business performance and aim to resume dividend payments as soon as possible so that we can meet the expectations of our shareholders.

In the 62nd fiscal year, we are committed to expanding orders and securing profits by focusing on the promotion of "i-Construction," which we have been working on continuously, and the accompanying realization of ICT at workplaces to improve productivity, as well as the development of internal work systems to improve operational efficiency.

Please be noted that we have prepared a mid-term business operation plan setting a duration from 2022 (62nd fiscal year) to 2024 (64th fiscal year) as an initiative for growth of the company, improvement of its values and contributions to society.

We will appreciate further support and encouragement from our shareholders.



Koichi Hanaoka

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