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Investor RelationsManagement's Message

 

April , 2020   

Having Achieved the Fourth Mid-Term Management Plan with Record Results, New Challenges Will Begin

The NEXT 30 Years of Sekisui House will go into action, while confronting a variety of social issues.

   We will first report to our shareholders that we have achieved the Fourth Mid-Term Management Plan, on which we have been working for the past three years, by setting the core policy of Building the foundation for the residential-related business toward BEYOND 2020, with strong results including record net sales and operating income.

   While we achieved solid results under the new management setup toward a new stage, the NEXT 30 Years, in addition to the break-even point management and cooperation within the Group, which we have been moving forward without change, the mission and social responsibilities of the housing industry as it confronts various social issues continue to expand. As it approaches the 60th anniversary of its founding, Sekisui House is prepared to continue executing its assigned tasks sincerely by reconfirming its corporate philosophy that describes how we should be, including the underlying philosophy of “Love of Humanity” and our stance “Truth and Trust,” throughout the entire Group. We ask for your continued support for the Sekisui House Group, which will embark on a new era as a concerted group effort.

   The Built-to-Order Business in Japan is seeing growth in its net zero energy houses (ZEHs) that employ environmental technologies exceeding expectations, accounting for 85% of new custom detached houses,and boasting the largest cumulative number of buildings in the world. We will continue to promote ZEHs because they also play a role in achieving the national policy of reducing CO2 emissions in the household sector. The Family Suite, which proposes a new living room concept with a large area that will bring happiness to families, is also performing strongly. This has been a driving force in increasing the unit price per building. In rental housing, which has been focusing on bolstering the area marketing strategy and expertise, orders are increasing, particularly for three- and four-story houses in urban areas. Another prominent trend has been for larger houses.

   In the Supplied Housing Business, based on the world’s largest customer base, there has been strong support for proposal- and environment-based remodeling that meets the needs of the times and society, including the Family Suite Renovation that changes lifestyles. The Real Estate Management Fees Business also continues to grow steadily, backed by the steadily increasing number of managed units and high occupancy rates. In the Development Business and the Overseas Business, the sale of properties has been completed without problem. Particularly in the United States, sales and profits increased significantly by selling all properties in rental housing development as planned.

   In addition, initiatives to enhance the power of diversity in the Group and unify it, including reorganization associated with changing the trade name from Sekiwa Real Estate to Sekisui House Real Estate and establishing a new company that sells the second brand SEKISUI HOUSE noie, also made progress. The environment has been established, allowing the NEXT 30 Years, which anticipates the next three decades, to go fully into effect.

The key words in the core policy are “further strengthening core businesses and embarking on new businesses.”
We will promote business development with our sights set on the world.

   Based on our recognition that 2020 will be a turning point in our business activities, given the international political and economic situations and the market trends in Japan, we have set the core policy for the Fifth Mid-Term Management Plan as “further strengthening core businesses and embarking on new businesses,” based on its management direction of “deployment of growth strategies focused on the residential business domain.” We will delve deeply into the existing businesses by refining our accumulated technologies and overwhelming organizational power. Also, we will expand and develop new businesses, making the best use of the comprehensive strength of the existing businesses.

   Looking back at the history of Sekisui House over the last 60 years, we pursued the safety, security and basic performance of houses in the first phase, and took on the challenge of increasing and improving their comfort and environmental performance in the second phase. We are now entering the third phase to provide happiness in the era of the 100-year life. Our global vision is to “make home the happiest place in the world” by incorporating AI and IoT technologies. As a specific action, we announced the development of HED-Net, the world’s first in-home early detection network, at CES 2020, one of the world’s largest consumer technology expos, held in Las Vegas, the United States in January 2020. Based on the concept of a health nurturing home, a demonstration experiment will start involving residents, aiming to provide services to address acute illness, a pressing issue in an aging society.

   Looking at the Overseas Business, we released a concept home using systems of the wooden-frame SHAWOOD system in time for the opening of CES 2020. ZEH specifications equipped with seismic capacity, technical capabilities including the earthenware exterior wall Bellburn, and three batteries (solar, fuel and storage batteries) that enable energy self-sufficiency even during a power outage also attracted great interest from attendees.We will proceed with new global development from the perspective of transplanting Sekisui House technologies, such as environmental technologies and construction capabilities overseas, making them the global housing standard in the future. Through the three-year plan to lay the foundation for the next 30 years, we are determined to devote all of our energy to further strengthening core businesses and embarking on new businesses in all business domains as a concerted Group effort.

With Innovation & Communication as a slogan in relationships with partners in Japan and overseas, as well as colleagues within the Company

   Needless to say, we will accelerate our initiatives to become a leader in ESG management. Our ideal is to become a good company that cherishes all stakeholders. Ikumen Leave, a childcare leave system for male employees that lasts one month or more, which we promote as a kids-first company playing a leading role in society that supports childcare, has been taken by all eligible employees in the year since its launch. We successfully demonstrated a leading model for workstyle reform in society by setting a day to think about childcare leave on September 19, which was registered as a public anniversary by Japan Anniversary Association, among other measures. The career enhancement of female employees and their appointment to managerial positions have also made progress. In addition, we have established a skills training facility in Vietnam for the first time as a Japanese housing manufacturer. This is an initiative to recruit foreign human resources and advance diversity management, in addition to ensuring our construction capabilities.

   In the governance reforms, on which we embarked for six items in 2018, we have been advocating 17 items by strengthening and evolving them. We will continue with reforms both at the senior management level and the business management level. We will also focus on strengthening the Group governance systems, involving overseas subsidiaries.

   Major preconditions for further strengthening the core businesses and embarking on new businesses are our ESG perspective and the social significance. In the Platform House Concept, our symbolic project, we aim to provide services that c l o s e l y s t a n d b y customers who live in an aging society, with connectedness and learning as the themes in addition to health. In our strategic solutions for the CRE (corporate real estate) and PRE (public real estate) businesses that will lead to the resolution of issues that companies and public institutions are facing, we will also participate in reproducing public housing equipped with community disaster prevention functions with strong awareness of the response to natural disasters caused by climate change.

   Everything we do is for the benefit of society and customers. It is also our mission to play a role in facilitating improvements in housing quality, including the new quake-resistance standards and the energy saving standards established by the government. We will use well-balanced, ambidextrous management to further strengthen core businesses and embark on new businesses, while increasing contact points with society.

   To that end, alliances between different industries, cooperation between companies and organizations in various fields, and the wide-ranging power of society, in addition to the power of diversity in the Sekisui House Group, will be important. Therefore, “Innovation & Communication” will be a popular expression in relationships with our partners in Japan and overseas, as well as our fellow colleagues in the Company.

   We aim to integrate “hardware,” namely houses, with software and equip them with value or services. To realize this goal, we will deepen our connection with business fields and the world’s markets that will create synergies and actively invest in foundations for growth, including M&A, that will enhance our corporate value. We hope you look forward to the NEXT 30 Years of Sekisui House, which will move forward with outstretched, ambidextrous arms toward achieving the new goal.