Medium-Term Management Plan

NKG Building Resilience 2024（2021.7-2024.6）

Goals of Nippon Koei Group

The vision of our Nippon Koei Group is ‘To be group of consultants and engineering companies that are overwhelmingly No.1 in Japan and top class worldwide’.
In the Medium Management Goals NKG Building Resilience 2024, we will use 3 years to solidify the foundation of 100-year-old company aim, follow the 3 resilience policies and develop sustainable growth to grow into a ‘Global corporate company with cooperation and resilience as one team ’.

3 resilience policies

Resilience policy 1: Boosting business through three independent domains(Consulting, Urban & Spatial, Energy)

In order to reinforce business axis, the previous five business segments changed to three business segments (Consulting, Urban & Spatial, Energy)

Consulting Business	Evolve into an organization that can compete in the world by integrating the domestic and international consulting operations and R&D Center.
Urban & Spatial Development Business	By integrating architecture and civil engineering and comprehensively produce urban and regional revitalization projects in Japan and abroad.
Energy Business	Construct foundations for power generation and energy management businesses, such as battery storage and aggregation through internal and external collaboration.

Resilience policy 2: Group management structure that realizes matrix management across businesses and regions

Transitioning to a holding company and ensuring comprehensive management for each region that realize matrix management.

Organizational Strategy	Based on a group of operating companies centered on a holding company and transitioning comprehensive management for each region that realize matrix management, autonomy and collaboration of group company, faster decision-making for coexistence of diversity.
Sales Strategy	“Think Globally, Act Locally” to accommodate the needs of regions with world-class technologies, realization of one-stop services and support for autonomous management of the region.

Resilience policy 3: Manifesting the NKG brand and NKG quality

As a technology strategy, we will increase investment in technology development with digital transformation as the core and strive to create new customer value for the evolution of digital technology.
In addition, for human resource strategy, launching NKG Global Academy to develop world-class human resources.
Additionally, promote well-being management by developing health management, work-style transformation & work-place transformation etc.

Human Resource/Technology Strategy	Increasing investment in technology development with DX(digital transformation) as the core and strive to create new customer value for the evolution of digital technology (NKG brand). Launching NKG Global Academy to develop world-class human resources (NKG quality). Promoting well-being management by developing health management, work-style transformation & work-place transformation (employees’ physical, emotional well-being, motivation for work and management that enhances commitment to initiatives).

Human Resource/Technology Strategy

Increasing investment in technology development with DX(digital transformation) as the core and strive to create new customer value for the evolution of digital technology (NKG brand).
Launching NKG Global Academy to develop world-class human resources (NKG quality).
Promoting well-being management by developing health management, work-style transformation & work-place transformation (employees’ physical, emotional well-being, motivation for work and management that enhances commitment to initiatives).

Numerical Targets (IFRS)

FYE June 2024 Numerical Targets (IFRS)	Revenue 155 billion yen	Operating profit 11.5 billion yen	Operating profit margin 7%	ROE 9%

Numerical Targets (IFRS)

	FYE 2021/6 Results	FYE 2024/6 Plan	Amount	%
Orders	133,304	150,000	16,695	112.5%
Revenue	117,859	155,000	37,140	131.5%
Operating profit	7,128	11,500	4,371	161.3%
Operating profit margin	6.0%	7.4%	1.4pt
Profit before tax	7,176	11,000	3,823	153.3%
Profit attributable to owners of parent	4,531	7,100	2,569	156.7%
ROE	6.7%	9.0%	2.3pt

Numerical Targets by Segment (IFRS)

	FYE 2021/6 Results	FYE 2024/6 Plan	Amount	%
Orders	133,304	150,000	16,695	112.5%
Consulting Business	97,769	92,000	-5,769	94.1%
Urban & Spatial Development Business	21,457	39,000	17,542	181.8%
Energy business	13,991	19,000	5,008	135.8%
Revenue	117,859	155,000	37,140	131.5%
Consulting Business	80,098	88,000	7,901	109.9%
Urban & Spatial Development Business	20,274	40,000	19,725	197.3%
Energy business	16,621	26,000	9,378	156.4%
Real Estate Leasing and Other	865	1,000	134	115.6%
Operating profit	7,128	11,500	4,371	161.3%
Consulting Business	7,981	8,200	218	102.7%
Urban & Spatial Development Business	2,266	3,200	933	141.2%
Energy business	-1,061	3,300	4,361	-
Real Estate Leasing and Other	-2,058	-3,200	-1,141	-

*Figures in three segments for FYE 21/6 are simple aggregations before intercompany eliminations.

Management Plan

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