To our shareholders and investors

Kazuyuki Inoue

We work to create value that exceeds
expectations and contribute to
a sustainable tomorrow

Shimizu provides value that surpasses the expectations of our customers while aiming for sustained growth and greater enterprise value

I would like to express my appreciation to all our shareholders and investors for your kind regards.

Amid higher corporate revenues and solid gains for hiring and wages, an uptick in private capital spending is one of the signs that the Japanese economy is continuing its gradual recovery. Under these circumstances, in FY2017 the company posted 124.1 billion yen in consolidated ordinary income and 84.9 billion yen in net income attributable to shareholders of the corporation, while raising construction profitability. These and other factors contributed to the company achieving two straight quarters of robust performance with ordinary income in excess of 100 billion yen. We intend to continue providing value that surpasses the expectations of our customers by identifying needs they have yet to realize, as well as by offering engineering solutions that bring added value.

Meanwhile, we must respond to two important long-term issues: the fears of a contraction in new construction projects in Japan, as well as a shrinking pool of skilled construction workers.

To address the potential contraction in new construction projects, we have established the Life Cycle Valuation (LCV) Headquarters to build a revenue base in addition to our Construction Business. We will apply the engineering and knowledge built up in this business to the renovation, maintenance and management of buildings and infrastructure (a business with higher demand projected for the future), as well as to the renewable energy sector as we set our sights on a zero-carbon society. This action will develop businesses for building a sustainable society.

In our response to the shrinking pool of skilled construction workers, we will seek productivity gains by leveraging information and communications technology (ICT) and investing in robotics development, while simultaneously making persistent efforts as an industry leader to reform the way employees work for us and our subcontractors.

Furthermore, we have established a new SDGs & ESG Promotion Department to realize an inclusive society through our business. The SDGs and ESG are also in line with "The Analects and the Abacus," on which the basic principles of our management are based. We therefore see the SDGs and ESG as not merely a demand on us by society, but as a business opportunity for which we shall make a proactive effort to implement in our management and business activities.

By taking these kinds of actions, we will work to give greater depth to our Construction Business and expand in peripheral businesses, while at the same time we seek sustained growth and greater enterprise value by helping to solve social issues through our business activities.

I hope we may receive the continued support of all our shareholders and investors as you observe the company's process of growth and development with a view to the long term.

Kazuyuki Inoue
President and Director
Shimizu Corporation