We would like to sincerely thank our shareholders for their continued support.

While in October 2018 we integrated our management and launched a new Group structure, our roots stretch back a century, and this year we will celebrate our 100th anniversary. To mark this milestone, on April 1, 2024, our Group united and took a new step toward the future by establishing our social purpose, which we call “VERTEX Purpose.” To help us realize this purpose, we have systematically organized our “VERTEX Policy.” This acts as a guiding principle, indicating the shared values and direction for all of our employees.
The Vertex Group will grow together with its diverse employees, while striving to realize our purpose and remaining a company that helps build a sustainable society

“VERTEX Vision 2034” reflects how we envision the Company in 2034, 10 years from now. This long-term vision will also help us realize the “VERTEX Purpose.” Our third medium-term management plan, which we used backcasting to formulate, covers the three-year period from the fiscal year ending March 31, 2025 to the fiscal year ending March 31, 2027.
The period of the third medium-term management plan is the first one covered by “VERTEX Vision 2034.” During it, we will invest in growth to strengthen our business portfolio. We see it as a period for re-establishing the growth of core businesses with a solid foundation, while nurturing new businesses that will serve as pillars for long-term growth.
Specific key measures are as follows.

1. Strengthening our business portfolio
We will strengthen our business portfolio by investing in growth, promoting the revitalization of core businesses with a solid foundation—concrete and disaster prevention—while developing new businesses as pillars for long-term growth. These include infrastructure maintenance, railroads, hydraulic hose maintenance, and defense.

2. Advancing human capital, R&D, and DX initiatives
To grow our various businesses, we will actively work to enhance human capital, research and development, and digital transformation (DX).

3. Promoting sustainability
We aim to enhance sustainable corporate value while advancing initiatives tied to the materialities the Company has identified.

As part of our medium-term management plan, our Group has set organic growth targets for the fiscal year ending March 31, 2027. These focus on key management indicators of 43 billion yen in sales, 6.5 billion yen in operating profit, and a return on equity (ROE) of 14.0%.

Moving forward, the industry’s business environment remains uncertain due to unclear prospects regarding construction investment and public works budgets. In recent years, the circumstances surrounding our industry continue to undergo major changes against a backdrop of a shortage of skilled workers due to a decline in the working population and increasingly frequent and severe natural disasters, along with the aging of social infrastructure built during Japan’s period of high economic growth. There has also been growing demand for products and maintenance technologies related to disaster prevention, mitigation, and national resilience, as well as demand for increased efficiency of construction due to workplace work style reforms and projects towards realizing a sustainable society.
Our Group will further consolidate the technological capabilities and expertise we have cultivated over the years, responding to new demand by developing innovative ideas and new technologies, and improving our ability to adapt to changes in approaches to business.
We will also work towards the development and acquisition of new businesses that will further drive our growth over the next 10 to 20 years.

While the outlook is uncertain in the face of factors like high raw material and energy prices, domestic inflation, geopolitical risks resulting from unstable international conditions, and rapid exchange rate fluctuations, the Japanese economy appears to be recovering gradually as social and economic activities normalize.
The industries to which the Group belongs are expected to remain strong. These will incorporate public construction investment, centered on national resilience, disaster prevention and mitigation, and measures to maintain and update aging infrastructure, and private-sector construction investment, primarily driven by corporate capital expenditures.
We will strive for security and further enhance corporate value moving forward. To that end, our Group has formulated its third medium-term management plan, which covers the period through the end of March 31, 2027. We will continue to make the most of the Group’s tangible and intangible assets, including those related to technology, research and development, human resources, and equipment. We will work diligently to develop and deliver innovative products that help solve challenges faced by the construction industry and Japan as a nation.

We kindly ask our shareholders for their continued support and cooperation.

Akihide Tsuchiya, President and CEO,
May 2024