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Securities code: 1414

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代表取締役社長 石原 一裕

To our shareholders

In the first three quarters of the fiscal year (July 1, 2017 to March 31, 2018), orders received increased ¥4,166 million from one year earlier to ¥52,879 million. Continuing growth in orders from expressway companies was the main reason for the increase in orders. Sales increased ¥4,646 million year on year to ¥44,968 million because of completions of expressway company projects and completions of most of the backlog at the beginning of the fiscal year of national government orders. As a result, the order backlog at the end of March was ¥40,279 million, ¥6,806 million more than one year earlier. Operating profit was up 4.2% year on year to ¥9,198 million, ordinary profit increased 4.5% to ¥9,392 million and profit attributable to owners of parent increased 4.1% to ¥6,253 million.

There was a large volume of orders from expressway companies in the third quarter of the fiscal year (January to March). We have received eight new orders including a large order where we are part of a joint venture with other companies. As of March 31, 2018, the backlog of orders from expressway companies was ¥23,980 million, ¥8,540 million more than one year earlier, increasing to about 60% of total backlog. New orders include a number of large projects that will require several years to complete. These orders are enabling us to start building up a backlog of work that will be performed after the 2020 Tokyo Olympics and Paralympics. Orders and sales in the current fiscal year are increasing amid a favorable environment for capturing orders. However, a change that reflects the characteristics of new orders is occurring in the composition of the sources of our orders. Our goal is to maintain an optimal balance for new orders and ongoing projects. Due to current changes in market conditions, implementing a strategy for new orders that achieves the proper balance regarding sources of orders, the length and location of projects, and other characteristics will become increasingly important.

June 4, 2018 is the 60th anniversary of the foundation of SHO-BOND CORPORATION, which is the predecessor and primary subsidiary of SHO-BOND Holdings. We are very grateful for the understanding and support of shareholders and all other stakeholders that made this accomplishment possible. To express our appreciation to shareholders and commemorate our 60th anniversary, we have decided to pay a commemorative dividend of ¥10 per share at the end of the fiscal year ending June 30, 2018. Consequently, the annual dividend will be ¥124 per share, ¥20 more than one year earlier and the expected payout ratio is 45.7%.

“Inheriting and passing on social infrastructure to the next generation in good condition” is the mission that underlies all our activities. As a leading company in the infrastructure maintenance business, we have a firm commitment to working even harder to meet the high expectations of our society. We sincerely ask for your continued understanding and support as we take the actions needed to accomplish our goals.

Tatsuya Kishimoto
President and Representative Director
SHO-BOND Holdings Co., Ltd.