UNICON Holdings FY2026 Full-Year Financial Results: Record-High Order Backlog and the Strategic Roadmap Toward the '80 Billion Yen Revenue' Long-Term Vision

Executive Summary

UNICON Holdings Co., Ltd. (Securities Code: 407A) reported its financial results for the fiscal year ended June 30, 2026, achieving revenue of 18,808 million yen (+6.7% YoY) . While the company secured top-line growth, operating profit landed at 1,504 million yen (-12.1% YoY) , marking a decline. Although the lack of snowfall due to a mild winter impacted snow-removal-related revenue and caused profits to fall short of initial projections, the company recorded exceptionally strong figures in orders received at 22,371 million yen (+19.8% YoY) and an order backlog of 20,611 million yen (+20.9% YoY) , both exceeding internal expectations.

Furthermore, to drive future expansion, the company has formulated "Long-Term Vision 2036," with the fiscal year ending June 2036 as its final year. By scaling its unique "Regional Consortium General Contractor" model—established in the Southern Tohoku region—nationwide and combining organic growth with aggressive M&A, the company has outlined a grand strategy to achieve 80 billion yen in revenue, an operating profit margin of 8% or higher, and an ROE of 20% or higher within a decade.

This report provides a detailed analysis of the performance drivers, the company's unique competitive advantages, future earnings outlook, and its mid-to-long-term growth story.

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1. FY2026 Full-Year Performance Analysis: Revenue Growth Offset by Weather-Related Profit Decline

The consolidated results for the fiscal year ended June 2026 presented a contrast between top-line expansion and a decline in bottom-line profitability.

The following slide provides key data on the trends of major financial indicators and their performance against the plan for the full fiscal year 2026.

Analysis and Significance of the Slide

This slide serves as the fundamental basis for understanding the overall performance of FY2026. Revenue grew steadily from 17,620 million yen in the previous fiscal year to 18,808 million yen (+6.7% YoY) , reaching 96.5% of the plan (19,485 million yen) , which was largely in line with expectations. However, gross profit was 2,875 million yen (-8.2% YoY) , and the gross profit margin declined from 17.8% in the previous year to 15.3% . Operating profit stood at 1,504 million yen (-12.1% YoY) , achieving 89.2% of the full-year target (1,685 million yen).

Analysis of Profitability Shortfall

The primary factor behind the operating profit shortfall was the low snowfall during the winter season . In the group's business domain, snow-removal operations in heavy-snow regions typically contribute to earnings as high-margin projects. However, due to significantly less snowfall compared to an average year, high-margin snow-removal revenue fell well below initial projections.

While the lack of snow allowed for an earlier resumption of construction work in the spring, which helped recover top-line revenue as projects progressed, the increased composition of lower-margin general public works led to a deterioration in the product mix , thereby compressing profit margins.

On the other hand, Selling, General and Administrative (SG&A) expenses were successfully contained at 1,410 million yen (-3.1% YoY) , with the SG&A-to-revenue ratio improving from 8.3% in the previous year to 7.5% . This reflects the absence of one-time listing-related expenses incurred in the previous year and the effectiveness of disciplined cost control.

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2. Order Trends and Progress in Priority Areas (Defense and Large-Scale Projects)

In contrast to the temporary dip in profitability, the leading indicator of orders received shows extremely robust growth.

Significant Expansion in Orders and Backlog

Orders received for the fiscal year reached 22,371 million yen (+19.8% YoY) , and the year-end order backlog hit 20,611 million yen (+20.9% YoY) , both reaching record highs that exceeded internal forecasts. The strategy of proactively securing orders from the beginning of the fiscal year —anticipating risks such as rising material costs due to heightened tensions in the Middle East and potential delays in public works orders following the dissolution of the House of Representatives and the general election—proved successful.

Progress in Priority Areas: Defense and Large-Scale Projects

In recent years, the company has focused on securing Ministry of Defense-related projects as a new growth area. Defense projects are a high-barrier-to-entry field requiring complex estimation and a proven track record. As a result of leveraging the expertise cultivated over many years by the group subsidiary Yamawa Construction, cumulative orders reached 2.6 billion yen by the end of June 2026.

Furthermore, the company successfully secured the following large-scale projects in both private and infrastructure sectors:

• Racehorse Training Center : Contract value of 4,033 million yen (utilizing reconstruction subsidies for areas affected by the Fukushima nuclear disaster).
• Sayama Parking Area Rest Facility Construction : Contract value of 2,225 million yen (a complex project spanning both sides of the highway, awarded based on the company's track record at the Kunimi SA).

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3. UNICON Holdings' Business Model and Structural Strengths

The background to the company's ability to maintain sustainable growth even in a challenging environment lies in its unique business model within the construction industry.

Combining "Local Advantage" and "Economies of Scale" through a Consortium of Local Contractors

General mid-sized contractors often face declining profit margins when attempting to scale, as they get caught in excessive price competition and are forced to accept low-profit projects. In contrast, UNICON forms a "Regional Consortium General Contractor" model by acquiring high-quality local contractors (Yamawa Construction, Ononakamura, Minamiaizu Seibu Construction Corporation, and Nansoken) through M&A.

This establishes a high-profitability model that achieves two goals simultaneously:

1. Local Advantage : Maintaining bidding advantages and customer bases rooted in the region to secure niche, high-margin projects with little competition.
2. Economies of Scale : Enhancing cost efficiency through centralized material procurement, consolidated management systems, and the sharing of technical expertise across the group.

Optimizing Engineer Allocation via the "Corporate Group System"

The construction industry is subject to legal regulations requiring engineers with national certifications to be stationed at each site. A single company typically faces the dual challenges of "fixed cost burdens during off-seasons" and "opportunity losses during sudden peak seasons." UNICON operates a "Corporate Group System," rare for a company of its size, which allows for the cross-deployment and secondment of engineers among group companies, thereby minimizing engineer idle time and opportunity losses .

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4. Future Growth Strategy and "Long-Term Vision 2036"

The company aims to transcend the framework of a mere regional general contractor and become an entity that solves Japan's social issues (aging infrastructure, labor shortages, and disaster response).

The following slide illustrates the growth image of the newly formulated "Long-Term Vision 2036."

Analysis and Significance of the Slide

This slide serves as a roadmap showing the scale at which UNICON Holdings aims to grow over the next decade. Toward the fiscal year ending June 2036, the company has set ambitious targets of "80 billion yen in revenue," "operating profit margin of 8% or higher," and "ROE of 20% or higher" by scaling its business model nationwide. The vision represents a plan to more than quadruple profit levels in 10 years by combining "organic growth" (strengthening individual entities) with continuous M&A (non-linear growth).

Advantages in M&A and PMI (Post-Merger Integration) Expertise

The cornerstone of this long-term vision is the company's M&A execution and integration (PMI) capabilities . Approximately 40% of construction companies nationwide face succession issues, and there are about 17,000 mid-sized businesses with capital between 50 million and 1 billion yen. For UNICON, the opportunities for roll-up acquisitions are vast.

The following slide shows the changes in gross profit margins before and after M&A for the company's past acquisitions and its approach to valuation.

Analysis and Significance of the Slide

This slide demonstrates that the company's M&A strategy is not merely about scale, but is high-quality growth accompanied by dramatic improvements in profitability . By dispatching management personnel, introducing financial management formats, and optimizing project allocation using the corporate group system, the gross profit margins of acquired companies have improved significantly:

• Yamawa Construction : 7.9% pre-acquisition ➔ 17.0% in FY2025
• Ononakamura : 9.6% pre-acquisition ➔ 12.4% in FY2025
• Minamiaizu Seibu Construction : 21.0% pre-acquisition ➔ 23.3% in FY2025
• Nansoken : 14.0% pre-acquisition ➔ 22.9% in FY2025

Furthermore, in executing M&A, the company adheres to a cautious and disciplined acquisition style that does not place excessive burden on the balance sheet , carefully assessing recoverability based on the "standalone enterprise value" of the target company. In December 2025, the company established a Corporate Planning Department directly under the President to further accelerate the development of sourcing routes and the speed of M&A evaluation.

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5. FY2027 Earnings Forecast: Return to Revenue and Profit Growth

For the upcoming fiscal year ending June 2027, the company has announced a plan to return to a growth trajectory of increasing revenue and profit .

Key Earnings Forecast (FY2027)

• Revenue : 20,699 million yen (+10.1% YoY)
• Gross Profit : 3,146 million yen (+9.4% YoY)
• Operating Profit : 1,697 million yen (+12.9% YoY)
• Operating Profit Margin : 8.2% (+0.2pt YoY)

Background and Outlook for Earnings Forecast

In the first half of the fiscal year ending June 2027, some delays in public works orders are expected due to the late start of the Diet session and rising material costs. Therefore, while new order acquisition is likely to be weighted toward the second half, the company plans to cover first-half revenue by steadily executing the abundant order backlog of 20,611 million yen secured at the end of FY2026 .

Additionally, in parallel with the expansion of revenue scale, the company expects to control the SG&A ratio, improving the operating profit margin from 8.0% in the previous year to 8.2% .

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Conclusion

UNICON Holdings' FY2026 full-year results were impacted by weather-related factors, specifically the decline in snow-removal revenue due to a mild winter, leading to a shortfall in profits. However, the fact that both orders received and the order backlog reached record highs speaks to the extreme robustness of the company's core project-acquisition capabilities.

Based on the unique competitive advantages of the "Regional Consortium General Contractor model" and the "Corporate Group System," the expansion into high-value-added fields such as defense, the re-acceleration of M&A strategy by the newly established Corporate Planning Department, and the formulation of the ultra-long-term "Long-Term Vision 2036 (80 billion yen revenue target)," the company's mid-to-long-term growth foundation is steadily evolving into something even more solid.