Margins rise as building volumes dip
Kajima Corporation (TSE: 1812) reported consolidated results for the first half of FY3/2027, April 1 to September 30, 2026, on November 11, 2026. Parent civil engineering sales rose 4.7% to ¥217.6 billion as several large projects reached their peak, with a gross margin of 23.5%, but segment operating profit fell 6.9% to ¥35.7 billion on higher personnel and R&D costs. Parent building sales fell 10.5% to ¥499.7 billion, but contract changes lifted the gross margin to 13.1% from 11.3%, and the impact of the Middle East situation was slight; segment operating profit slipped 3.7% to ¥37.4 billion. Real estate development at the parent made ¥2.7 billion after handing over a property.
Consolidated construction orders slipped 1.4% to ¥1,173.4 billion as domestic orders fell while overseas orders rose. Domestic subsidiaries' operating profit fell 18.5% to ¥10.6 billion. Overseas, warehouse developments sold in the United States lifted development earnings, but construction in Oceania and Europe weakened; Kajima now expects to sell fewer overseas development properties because of higher interest rates and a stalled property market. Net profit attributable to owners fell 7.7% to ¥71,337 million, and the equity ratio rose to 40.4%.
Profit forecast raised, net target held
Kajima kept its FY3/2027 sales forecast at ¥2,900,000 million (-5.5%) but raised operating profit 17.0% to ¥234,000 million and ordinary profit 9.2% to ¥225,000 million, citing better performance in its parent construction business and cost increases within the range it assumed at the start of the year. Net profit attributable to owners is held at ¥170,000 million because of fewer overseas property sales. The ¥146 dividend forecast (¥73 interim, ¥73 year-end) is unchanged.
| Metric | H1 FY3/2027 | H1 FY3/2026 | Change |
|---|---|---|---|
| Net sales (¥ million) | 1,333,904 | 1,372,922 | -2.8% |
| Operating profit (¥ million) | 101,786 | 108,672 | -6.3% |
| Ordinary profit (¥ million) | 101,093 | 105,377 | -4.1% |
| Net profit attrib. to owners of parent (¥ million) | 71,337 | 77,328 | -7.7% |
| Comprehensive income (¥ million) | 67,998 | 84,448 | -19.5% |
| EPS (¥) | 154.33 | 165.29 | -6.6% |
| Construction orders received (¥100 million) | 11,734 | 11,900 | -1.4% |
| Net sales — Civil Engineering, parent (¥100 million) | 2,176 | 2,079 | +4.7% |
| Net sales — Building Construction, parent (¥100 million) | 4,997 | 5,580 | -10.5% |
| Total assets (¥ million) | 3,467,792 | 3,624,341 | -4.3% |
| Net assets (¥ million) | 1,420,919 | 1,436,220 | -1.1% |
| Equity ratio | 40.4% | 39.0% | +1.4 pt |
| FY3/2027 guidance — revenue (¥ million) | 2,900,000 | — | -5.5% |
| FY3/2027 guidance — operating profit (¥ million) | 234,000 | — | -2.8% |
| FY3/2027 guidance — ordinary profit (¥ million) | 225,000 | — | -6.4% |
| FY3/2027 guidance — net profit (¥ million) | 170,000 | — | -4.1% |
| Annual dividend per share (¥) | 146.00 | 146.00 | unchanged |
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