Investor Relations

Construction

BASIC GROWTH STRATEGY

Further raising our competitiveness by refining our planning, technical, and sales capabilities without being bound by conventional thinking

REMODELING−SHINCHIKU SOKKURISAN

KEY FEATURES

· Sales engineer system: Most of our sales personnel have engineering qualifications.
· Carpenters: We employ carpenters who work exclusively for Sumitomo Realty.
· Fixed price: We provide the customer with a fixed price per unit of floor area, so there are no concerns about additional construction charges.
· No need for temporary moves: We remodel homes while the customers continue to live in them, which is a major advantage.
· Earthquake resistance: We incorporate earthquake-resistance strengthening measures based on a computerized analysis of the home as well as measures to prevent damage from termites and moisture.

CUSTOM HOMES

KEY FEATURES

· Advanced performance: We have developed proprietary earthquake-resistant technologies, namely the New Power Column, New Power Cube and Super Power Wall construction methods, and are actively incorporating these technologies in all our products.
· Top-class equipment and specifications: Leveraging our strengths in the form of our track record in condominiums and economies of scale as a comprehensive developer, we employ high-grade condominium interior materials as a standard specification.
· Complete after-sales support: Our homes are backed by a 30-year guarantee, and we have a dedicated contact line for customers.

OVERVIEW OF THE FISCAL YEAR

The number of units contracted during the year grew to record levels, at both the Shinchiku Sokkurisan remodeling business, with a 15.6% increase, to 8,454 units, and for custom homes operations, with a 17.4% increase, to 2,882 units. With this turnaround to growth in the number of units and in revenue, segment results rebounded from the negative effect of the increase in the consumption tax rate and revenue and profit rose for the first time in two years.
To maintain this revenue and profit growth, both businesses are proactively expanding their product lineups and strengthening the structure of their marketing operations. The Shinchiku Sokkurisan business is strengthening its condominium remodeling operations, where high future growth is expected, and custom homes operations is adding a new wood panel construction method to its existing two-by-four method.

OUTLOOK

We are aiming for a return to a solid trajectory of revenue and profit growth from the March 2017 fiscal year. Both the Shinchiku Sokkurisan remodeling business and custom homes operations will continuously strive to expand and enhance their product lineups as well as strengthen the structure of their marketing operations.
Our March 2017 fiscal year projections are for a 0.4% increase in revenue from operations, to ¥200.0 billion, with a 1.3% increase in operating income, to ¥15.5 billion.