1. Overview of Operating Results, etc.

(1) Overview of Operating Results for the Three Months Ended June 30, 2026
The Japanese economy has maintained a gradual recovery trend and, with improved business sentiment, stock prices remain strong, and business confidence shows signs of rebounding. On the other hand, the outlook for the Japanese economy still remains uncertain due to factors such as the depreciation of the yen, increasing interest rates, and labor shortages caused by rising demand for labor, as well as the emergence of risks related to the situation in the Middle East amid an unstable international situation, which have led to soaring energy prices, including crude oil and natural gas, and rising logistics costs, further driving up domestic prices.
The business environment in which the Group operates has generally remained firm, although attention needs to be paid to issues including soaring equipment and materials prices and longer procurement periods caused by this deteriorating external environment, as well as chronic labor shortages. This has been driven by capital investments in decarbonization-related markets and toward the resumption of nuclear power plant operations, as well as capital investments to meet growing electricity demand, particularly for new data centers resulting from expanded use of generative AI. However, there seems to be no end in sight to the situation in the Middle East, and we need to continue closely monitoring its effects.
In these circumstances, the Group, in FY2026, the final year of the FY2024 mid-term management plan (FY2024-FY2026), addressed key issues based on the basic policy of “creating a strong and flexible Q’d with people at the core.” By optimizing our business portfolio based on accurate market analysis and further reinforcing the investment cycle with people at the core, we have been striving to achieve our numerical targets.
Especially, in the nuclear power market, where the implementation of safety measures has progressed toward the resumption of operations at nuclear power plants across Japan; in the general industry market, where capital investment aimed at decarbonization and energy conservation is strong; and in the renewable energy-related market, where the commercialization of biomass power plants and grid-connected storage batteries is advancing through the use of long-term decarbonized power source auctions, we are expanding our nationwide network of construction sites through our six regionally based branches and three regional offices, while also increasing permanent staffing at our customers’ facilities.

As a result, total orders received were ¥24,050 million (up 30.4% year-on-year), owing mainly to the receiving of orders for the installation of new facilities for substations, extra high-voltage substation projects for recycling plants aiming for decarbonization and the realization of a circular economy, construction projects to establish a liquefied hydrogen supply chain, and increased maintenance and repair work resulting from permanent staffing at oil refineries.
Net sales were ¥20,594 million (up 31.6% year-on-year), owing mainly to progress in the decommissioning work of the Fukushima Daiichi Nuclear Power Plant, maintenance work at a thermal power plant, installation of new and additional facilities for substations in response to growing electricity demand, and solar power facility and construction work for on-site PPA, among others.
The amount of projects carried forward to the next period was ¥148,386 million (up 19.5% year-on-year).
As for profits, operating profit was ¥960 million (up 73.8% year-on-year), as a result of the steady implementation of our continued initiative of selective order taking that emphasizes profitability and efforts to improve productivity, as well as an increase in net sales. Ordinary profit was ¥1,277 million (up 176.9% year-on-year) due to the recording of gain on valuation of derivatives on the outstanding balance of foreign exchange forward contracts, which had been entered into to mitigate foreign exchange risks associated with fuel purchases amid the effects of a depreciating yen. Profit attributable to owners of parent amounted to ¥870 million (up 12.9% year-on-year), due to the recording of extraordinary income from the compensation for damage received relating to natural disasters.

On another note, an employee of the Company who was arrested on June 16, 2026 in connection with a construction bid commissioned by Uenomura, Gunma Prefecture, was indicted on July 3, 2026.
We truly regret that such an incident has occurred, and we would like to once again offer our sincere apologies to all of our stakeholders, including our customers, for the considerable concern and inconvenience it may have caused.
We are taking this matter seriously and we will continue to cooperate fully with the investigation by the authorities and subsequent legal proceedings. We have established a “Special Investigative Committee” within the Company to verify the facts, and we are working to further reinforce compliance in an effort to prevent a recurrence and to restore trust in the Company.

Business results by segment were as follows.

(Facilities Construction)
Total orders received were ¥22,551 million (up 32.9% year-on-year) due to increases in the Energy Division.
Net sales were ¥19,235 million (up 35.0% year-on-year) due to increases in the Energy Division and the Green Energy Business Division.
Segment profit was ¥2,007 million (up 48.4% year-on-year).

(Other Businesses)
Total orders received were ¥1,521 million (up 3.3% year-on-year).
Net sales were ¥1,382 million (down 1.4% year-on-year).
Segment loss was ¥1 million (compared to segment profit of ¥54 million for the same period of the previous fiscal year).

(2) Overview of Financial Position for the Three Months Ended June 30, 2026
Total assets amounted to ¥110,078 million as of June 30, 2026, a decrease of ¥9,250 million from the end of the previous fiscal year. This was mainly due to a decrease in notes receivable, accounts receivable from completed construction contracts and contract assets.
Total liabilities amounted to ¥38,163 million as of June 30, 2026, a decrease of ¥8,713 million from the end of the previous fiscal year. This was mainly due to decreases in income taxes payable and accounts payable for construction contracts.
Net assets amounted to ¥71,914 million as of June 30, 2026, a decrease of ¥537 million from the end of the previous fiscal year. This was mainly due to a decrease in retained earnings.

(3) Explanation of Consolidated Financial Results Forecast and Other Forward-looking Information
The consolidated financial results forecast for the fiscal year ending March 31, 2027, announced on May 12, 2026, remains unchanged.