 |
|
|
|
Operating Environment
Japan's economy during fiscal 2002
ended March 31, 2002
continued its phase of contraction, buffeted by a decelerating
world economy, a deflation-induced fall in domestic demand which
resulted in deteriorating corporate earnings, and stagnant personal
consumption in the face of rising unemployment. Negative market
conditions included lackluster movements of stock prices, land
prices that followed a path of steady decline, and a renewed concern
over the stability of our financial system with its yet-to-be-solved
nonperforming-loan problems.
Private-sector construction demand remained depressed overall,
as an increase in non-manufacturing sector demand was offset by
a sharp drop in investments by the manufacturing sector. Governments
at all levels, and especially local governments, are under pressure
to cut back on their spending, resulting in declining levels of
public works orders.
On the overseas front, worsening economic conditions barely affected
the orders received by our Group Companies.
Results
Against this backdrop, the Kajima Group Companies performed during
the period as follows:
Consolidated revenues grew 7.9% over the previous period to
2,060.3 billion. The increase is largely due to the percentage
of completion method that has been used since the previous period.
Consolidated operating income dropped 17.9% from the previous
period to
42.3 billion. Extraordinary losses of
113 billion resulting from real estate development/investment
and dispositions/revaluations of marketable securities forced
the Group to post
41.1 billion in a consolidated net loss for the period.
Medium-Term Management
Plan While there are signs that production levels and corporate
earnings may start to bottom out, Japan's economic recovery is
not immediately in sight as new investments are not picking up
and personal consumption is expected to remain weak.
Fiscal restraint is likely to persist in the public sector and
the downtrend on public works orders will continue. Overall demand
for construction services in the private sector is also likely
to suffer from lack of strength in business investments and in
housing starts.
|
|
| |
 |
The U.S. economy may be actually bottoming out; however,
the pace of its recovery is far from certain, and prospects for
market growth in other overseas regions are also uncertain.
Under these extremely harsh circumstances, the Kajima Group is
now focusing its efforts on the implementation of its medium-term
business plan, the Next Three-Year Plan, which covers the period
from April 2001 to March 2004. The aim of the plan is to boost
earnings capability and enhance the Group's business base in order
to secure necessary profit and growth in the future. The plan
is being proactively implemented in every department and field
of endeavor. The revaluations of real estate development, investments
in affiliated companies and other assets of the Group which took
place in fiscal 2002 were also intended to achieve one of the
main purposes of the plan: to establish a more robust financial
profile.
While the overall size of the Japanese construction market is
likely to shrink, there is still a wide range of fields in which
the Group can play an active part and expand its business operation.
Urban redevelopment projects in the Tokyo metropolitan area have
been accelerated by government policy; renewal works and environmental
engineering are the areas with clear growth prospects; PFI (private
finance initiative) projects planned by local governments are
on the increase; and the potential demand for infrastructure construction
in developing countries is still huge.
Kajima will seek to secure and enhance its profitability in the
construction business by taking on the challenge of these new
fields of demand. At the same time, the Group will seek to diversify
the sources of its profit, being proactive in its pursuit of real
estate development business, and entering the operational and/or
consulting business in areas peripheral to construction.
At the same time, Kajima is bringing the entire strength of the
Group to bear on reducing fixed and payroll costs, innovating
operational systems through the application of information technology,
seeking to improve group company synergies and consolidated profit,
and further enhancing its financial base, in an overall response
to the prevailing constrained business environment.
We thank our stockholders for their support and look forward to
their ongoing endorsement of our activities.
|
|
| |
| |
 |
|
 |
|
Rokuro Ishikawa
Chairman
|
|
Sadao Umeda
President
|
|
|
| |
|