Housing CompanyLast updated: Oct 19, 2017

President’s Policy

The Housing Company has established a unique position in Japan in new housing construction as a specialist in the Unit Construction Method, an advanced factory-built approach that enables short construction periods and delivers functions in accordance with design plans.

Responding to the increasingly sophisticated needs of customers, the Housing business has moved high-performance housing forward, guided by the concepts of environment, reliability, and comfort. It was in particular an early mover in housing with solar-power generation systems, going back to 1997 when it first scaled up such initiatives, and its cumulative sales of such residences exceeded 180,000 units as of the end of Fiscal 2016.

The company achieved another milestone in April 2012 with the release of its Smart Heim models with standard features such as built-in storage batteries and the Smart Heim Navi Home Energy Management System (HEMS).

In the Renovation business, it draws on the features of its factory-built housing products and its database of the housing stock it has constructed to offer renovation proposals best suited to the life stage of each homeowner.

In the Frontier (Domestic) business, we are also developing our management of existing home sales, leasing and management, and other housing asset management operations as well as the construction and operation of housing with support services for senior citizens. In addition, the company is expanding its new construction housing operation overseas.

Press Releases on Housing Company’s Topics

Apr. 2016
G Series, a Commemorative Product to Celebrate the 45th Anniversary of Sekisui Heim Launched1
June 2016
20th Anniversary of Sekisui FamiS, the Second Phase of GREENSHIFT Remodeling! Launch of “V to Heim Renovation”
June 2016
Renewal Work on the New Sekisui Heim Factory (Kyushu Area) Completed
Aug. 2016
Started Demonstration Tests of Virtual Power Plant in Conjunction with Household Storage Batteries at Smart Heim City Research Academy in Tsukuba City, Ibaraki Prefecture2
Dec. 2016
“Smart Power Station ‘100% Edition’” Launched
Mar. 2017
Merged and Unified Operations of Housing Production Companies in Japan’s Three Major Metropolitan Areas
Mar. 2017
Merged and Unified Operations of Real Estate Companies in Tokyo, Nagoya and Osaka
May 2017
Renewal Work on the Sekisui Heim Factory (Chugoku and Shikoku Areas) Completed
July 2017
70th Anniversary Commemorative Product “Smart Power Station GR” Launched

Performance Highlights

Performance Highlights
Performance Highlights

* Please see the presentation materials for the most recent business plan and results.

Summary of the Previous Medium-term Management Plan and Fiscal 2016 Performance

Buffeted by changes in market conditions, profit over the period of the previous Medium-term Management Plan was sluggish

Over the three-year period of the previous Medium-term Management Plan “SHINKA!-Advance 2016,” trends in the number of orders and houses sold were sluggish. Despite generating record-high profit in fiscal 2014, this downturn in performance was largely attributable to changes in market conditions which included the hike in Japan’s consumption tax and issues relating to the renewable energy feed-in tariff (FIT) scheme. As a result, the Housing Company reported a slight decline in net sales and operating income in fiscal 2016, the final year of the previous Medium-term Management Plan, compared with fiscal 2013. On a positive note, orders in the fiscal year under review recovered on a year-on-year basis while profit also rebounded exhibiting an upward trajectory. This mainly reflected successful efforts to implement measures in anticipation of changes in the market environment.

Comparing the profits of each business in fiscal 2016 with fiscal 2013, the Housing Company’s new housing construction business was especially affected by the hike in Japan’s consumption tax. Owing to the downturn in both orders and sales, and an inability to fully compensate through measures aimed at reducing costs and controlling fixed expenses, operating income by business declined from 31.0 billion yen to 28.9 billion yen.

In the renovation business, the Housing Company was also impacted by the hike in Japan’s consumption tax. Coupled with the negative flow-on effects attributable to issues relating to the FIT scheme, orders for the company’s mainstay solar products were weak. Taking into account each of these factors, operating income by business fell from 10.1 billion yen in fiscal 2013 to 7.3 billion yen in the fiscal year under review. Meanwhile, the frontier business that covers a wide range of fields including real estate and residential services as well as the overseas business, which were collectively identified as a potential source of additional profit under the previous Medium-term Management Plan “SHINKA!-Advance 2016,” generated operating income of 1.4 billion yen in fiscal 2016 from a zero base in fiscal 2013.

Again, during the three-year period of the previous Medium-term Management Plan, the Housing Company undertook investments to increase the efficiency of its eight nationwide production plants. At the same time, steps were taken to upgrade and expand the company’s lineup of smart house products, thereby harnessing its inherent strengths. Each of these initiatives was geared toward addressing medium- and long-term changes in the market. Moreover, there is considerable expectation that these initiatives will continue to bear fruit through fiscal 2017 and beyond.

Increase in orders and the shift to a profit growth trajectory through a focus on built-for-sale housing in fiscal 2016

In fiscal 2016, the Housing Company reported net sales of 485.0 billion yen, an increase of 11.5 billion yen compared with the previous fiscal year. From a profit perspective, operating income came to 37.5 billion yen, up 1.2 billion yen year on year.

In the fiscal year under review, the Housing Company focused on the built-for-sale housing business, which continued to experience firm demand. As a part of this focus, the company worked vigorously to acquire land for sale as subdivision lots. Among a host of proactive steps to promote the built-for-sale housing business, steps were taken to conduct simultaneous tours across the company’s nationwide network of plants, construction sites, and completed homes. As a result, new housing orders climbed 3% in fiscal 2016. Moreover, the Housing Company worked diligently to cultivate new markets by launching such large-scale products as energy self-sufficient smart houses that combine large-capacity solar power generation systems with storage batteries, recognized as an underlying strength.

In contrast, orders (3% decrease from the previous fiscal year), sales, and profit declined in the renovation business. In addition to sluggish results in solar power generation systems, this downturn was largely due to the priority placed on inspecting existing homes in the wake of the Kumamoto earthquake. In a bid to increase orders, the Housing Company transitioned toward a proposal-type sales style.

In the domestic frontier and overseas businesses, sales and profit increased. Despite these positive results, the pace of growth left some room for concern.

Analysis of Operating Income for FY2016 (year-on-year)

Analysis of Operating Income for FY2016 (year-on-year)

Targets of the Medium-term Management Plan “SHIFT 2019 -Fusion-” and Fiscal 2017 Forecasts

Pursuing the uniqueness of Sekisui Heim to secure sales and profit growth

Under the Medium-term Management Plan “SHIFT 2019 -Fusion-”, the Housing Company will roll out measures that leverage the uniqueness of its Sekisui Heim strengths while working diligently to secure growth. Through the housing business, the company will look to lift its share of the Tokyo, Nagoya, and Osaka markets, which remains low in relative terms. At the same time, energies will be directed toward bolstering the company’s profitability by reforming costs, which includes a review of the supply chain. In the renovation business, efforts will be made to target growth. To this end, the company will strengthen its proposal-type sales style in a bid to expand repeat orders. As far as its domestic real estate and residential service activities in the frontier business and its overseas business in Thailand concerned, the Housing Company will focus on accelerating the pace of sales and profit growth.

In fiscal 2019, the final year of the Medium-term Management Plan “SHIFT 2019 -Fusion-,” the Housing Company has identified the net sales and operating income targets of 550.0 billion yen and 50.0 billion yen, respectively. Plans are also in place to lift the operating income ratio from 7.7% in fiscal 2016 to 9.1% in fiscal 2019.

In the housing business, the company will continue to strengthen its energy self-sufficiency proposals as one specific measure. With an eye toward expanding orders in the volume zone targeting mainly at first-time buyers, steps will be taken to introduce new products to capture the demand, and increase sales personnel. Every effort will be also made to capture a larger share of the urban market. To achieve this goal, the company will reinforce its lineup of three-story products where needs are high and ramp up rebuilding activities.

At the same time, the Housing Company will initiate measures aimed at unifying the operations of production companies in the three major metropolitan areas. Building on these measures, the company will pursue increased efficiency in procurement and distribution as a part of efforts to promote cost innovation across the entire supply chain. The company will further improve the productivity by unit product approach to realize cost decrease of one million yen per building.

In the renovation business, work is being completed to transform the Housing Company’s sales activities. This entails the transition from proposals based on building age to life-stage-based proposals. In this manner, every effort will be made to expand repeat orders. Turning to the real estate business, moves will be made to increase the number of dwelling units under management. In the residential services business, energies will be focused toward creating the market for circulation of pre-owned homes and increasing orders for serviced housings. In the overseas business, the Housing Company will seek to quickly realize contributions to earnings from its unit housing business activities in Thailand while pursuing other initiatives.

Forecasting an increase in sales and profits through various measures including the introduction of strategic products and efforts to strengthen land and built-for-sale housing

Under the Medium-term Management Plan “SHIFT 2019 -Fusion-”, the Housing Company will target net sales of 500.0 billion yen and operating income of 39.0 billion yen in fiscal 2017.

Several initiatives will be taken in the housing business to help achieve these targets. In addition to stimulating demand by progressively introducing strategic products to mark the Group’s 70th anniversary, energies will be directed toward strengthening land and built-for-sale housing activities through a variety of measures including bolstering land-for-sale endeavors.

In line with the targets identified under the Medium-term Management Plan, the Housing Company will promote the transformation of renovation business model to a proposal-based style. In the real estate and residential services businesses, emphasis will be placed on horizontally rolling out a high profitability business model based on the integration of real estate companies in the Tokyo, Nagoya, and Osaka metropolitan areas while expanding sales and the number of dwelling units under management.

Moreover, the Housing Company will engage in the development of its land with houses built-for-sale activities in its overseas business in Thailand. Through these and other means, the company will expand orders while accelerating the pace of contribution to profit by promoting cost reductions through measures including the localization of specifications. Moving forward, the Housing Company will target a second consecutive fiscal year of increased sales and profits by implementing growth measures in each of the aforementioned businesses.

Analysis of Operating Income for FY2017 (year-on-year)

Analysis of Operating Income for FY2017 (year-on-year)

Business Model of the Housing Company

Based on our knowledge of unit housing accumulated over more than 50 years, we are working to provide homes centered on zero energy housing that are friendly to the global environment and in which people can continue to live comfortably and with peace of mind for more than 60 years.

The Sekisui Chemical Group’s Business Process

Portfolio and Growth Strategy of Housing Company

In the housing business that represents our business activities, we aim to increase market share in the three largest metropolitan areas where we have a relatively low market share while simultaneously implementing cost innovation that leverages the appeal of the Unit Construction Method.
In addition, we will promote Frontier Pioneering, such as in real estate, residential services and overseas business activities.

Portfolio and Growth Strategy of Housing Company

Main Products

Housing Company and Market Data

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