Nippon Koei Group Integrated Report 2019

NIPPON KOEI GROUP INTEGRATED REPORT 2019

Act with integrity and contribute to society through technology and engineering

INTEGRATED REPORT 2019 Fiscal year ended June 30, 2019

5-4 Kojimachi, Chiyoda-ku, Tokyo 102-8539, Japan These printed products are These materials are made using produced using environmentally FSC® certified materials and https://www.n-koei.co.jp/english/ friendly materials and factories. managed resources. Management Philosophy CONTENTS Act with integrity and contribute to society 27 through technology and engineering 1 Management Philosophy Review of Operations 2 Contents / Editorial Policy The Nippon Koei Group has been building infrastructure for society in Japan and overseas since 1946. Nippon Koei founder Yutaka Kubota proclaimed, “Tackle your problems with 27 Performance Highlights sincerity and the road ahead shall be clear,” and dedicated his technical expertise and 29 Domestic Consulting passion to building infrastructure that is safe and reliable. 31 International Consulting All of our employees today remain dedicated to our fundamental conviction that 33 Power Engineering our business is to contribute to society. The world is full of people who desire better living standards. 35 Urban & Spatial Development The Nippon Koei Group is committed to acting with integrity as we help construct 37 Energy the infrastructure for societies and nations around the world.

Strengths of Nippon Koei Group 3 Introduction A sustainable business model that evolves with progress in society 3 Origin History of the Nippon Koei Group 5 Today Nippon Koei Group Business From its inception, Nippon Koei has been building infrastructure that helps solve social issues. 7 Today for the Future The Value Creation Process/ The Group evolves as the needs of society change while continuing to expand Growth Strategies our business and improve our profitability. 39 Sustainability Society Nippon Koei Commercialize 39 Environmental and Social 43 Corporate Governance Society’s needs solutions for social issues 47 Messages from Outside Directors and Outside Audit & are constantly Supervisory Board Members evolving Changes to meet 51 Board of Directors, Executive Officers and Audit & new needs Supervisory Board Members

Japan’s leading engineering consulting firm 11 53 Consolidated Financial Statements Message from the President 56 Corporate Data The Nippon Koei Group is Japan’s leading civil engineering consulting firm* and 57 Network/History has participated in infrastructure development projects improving safety and security 11 Message from the President for people around the world for more than 70 years. 17 Financial Analysis The Group has developed projects that have become foundations for the advancement of nations and people in over 160 countries and regions. Editorial Policy This Integrated Report has been prepared to enable readers to evaluate the medium-to-long-term corporate value of Nippon Human Integrated Koei. It explains the strategies for realizing Nippon Koei’s Resources Capabilities Technologies Group Vision and the foundation for accomplishing them, with We lead the industry We deploy the integrated We carry out advanced the aim of providing a deeper understanding of the Company’s with over 1,600 capabilities of experts in basic and applied professional engineers various fields to meet the research at our R&D corporate stance and the orientation of its businesses. who provide expert increasingly sophisticated Center, the largest in Organizations Covered: Nippon Koei Co., Ltd. (the “Company”) consulting in countries and complex needs of the industry in Japan. and its consolidated subsidiaries around the world. our age. Period Covered: The fiscal year ended June 30, 2019 19 (July 1, 2018–June 30, 2019) * Source: “Sales ranking of engineering consulting firms in Japan,” Nikkei Construction, April 22, 2019 Medium-Term Management Plan Forward-Looking Statements This Integrated Report contains forward-looking statements regarding 19 Progress of the NK-Innovation 2021 Medium-Term the future performance of the Company and other matters. They are Management Plan based on the judgment of the Company’s management obtained from 21 Growth Fields and New Businesses “Now” currently available information. Please be aware that actual results may differ materially from these forward-looking statements due to various Creating a Smart Society factors including economic trends and the business environment in 25 Universal Group Measures “Now” which the Company operates.

1 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Management Philosophy CONTENTS Act with integrity and contribute to society 27 through technology and engineering 1 Management Philosophy Review of Operations 2 Contents / Editorial Policy The Nippon Koei Group has been building infrastructure for society in Japan and overseas since 1946. Nippon Koei founder Yutaka Kubota proclaimed, “Tackle your problems with 27 Performance Highlights sincerity and the road ahead shall be clear,” and dedicated his technical expertise and 29 Domestic Consulting passion to building infrastructure that is safe and reliable. 31 International Consulting All of our employees today remain dedicated to our fundamental conviction that 33 Power Engineering our business is to contribute to society. The world is full of people who desire better living standards. 35 Urban & Spatial Development The Nippon Koei Group is committed to acting with integrity as we help construct 37 Energy the infrastructure for societies and nations around the world.

NIPPON KOEI GROUP INTEGRATED REPORT 2019 2 Stage 4 Origin N K G Social Transition Stage Rising from the postwar reconstruction period to an international company aiming for sustaining growth 2019 10 Nippon Koei’s Origins Stage 3 Maturity Stage Urban & Spatial 1946 R Development P O Disaster Energy resilience 190 II 19 N K K Electricity K deregulation K 2000 Infrastructure 1990 export 2 2010 T K 19 Environment protection and Infrastructure usage Extension of Stage 2 improvement efficiency infrastructure service life N K G Economic Growth Stage D 190 9 Stage 1 Page colors Infrastructure Establishment Stage Consolidated net sales T I Stage 4 Development of social capital Stage 3 190 Domestic 190 9 and international Stage 2 consulting business Stage 1 Rebuilding 1 sales* Net Sales of basic D (Billions of yen) infrastructure I

19190 Establishment Phase 190190 Development Phase 19902000 Maturity Phase 2010 Innovation Phase P T 190 A 1990 N K T ODA T 190 N K T N K G 2011 RD T T T U N ODA A T D G DG A 19 G P E T N K G U E

I P AK T N T P T D D P A P E D R P

I U K D N P I P A N2 G T P P R D T D P D P E I P R P I P

3 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Stage 4 Origin N K G Social Transition Stage Rising from the postwar reconstruction period to an international company aiming for sustaining growth 2019 10 Nippon Koei’s Origins Stage 3 Maturity Stage Urban & Spatial 1946 R Development P O Disaster Energy resilience 190 II 19 N K K Electricity K deregulation K 2000 Infrastructure 1990 export 2 2010 T K 19 Environment protection and Infrastructure usage Extension of Stage 2 improvement efficiency infrastructure service life N K G Economic Growth Stage D 190 9 Stage 1 Page colors Infrastructure Establishment Stage Consolidated net sales T I Stage 4 Development of social capital Stage 3 190 Domestic 190 9 and international Stage 2 consulting business Stage 1 Rebuilding 1 sales* Net Sales of basic D (Billions of yen) infrastructure I

19190 Establishment Phase 190190 Development Phase 19902000 Maturity Phase 2010 Innovation Phase P T 190 A 1990 N K T ODA T 190 N K T N K G 2011 RD T T T U N ODA A T D G DG A 19 G P E T N K G U E

I P AK T N T P T D D P A P E D R P

I U K D N P I P A N2 G T P P R D T D P D P E I P R P I P

NIPPON KOEI GROUP INTEGRATED REPORT 2019 4 Today N K G Five segments contributing to the sustainability of global society

The Nippon Koei Group currently operates five main business segments—the three core operations of the Power Engineering Domestic Consulting, International Consulting, and Power Engineering to which it added Urban & Spatial Development in the fiscal year ended June 2017 and Energy in the fiscal year ended June 2019 to Helping Japan and other countries meet electric power demand broaden the Group’s reach into new business domains. Each segment develops specialized services and T P E products in line with our founding mission to pursue innovation and new challenges. T D Domestic Consulting / International Consulting P Infrastructure construction and maintenance and various projects providing a foundation for comfortable lifestyles E D E O P D U I T T T P E P 1 PPP N1 P G R T P T N K G PI2 Power Engineering Business Domain Power generation Power transmission, distribution Retail A A I Hydroelectric power generation Power distribution network Power grids Substations (Electric power O T N K G Renewable energy companies, etc.) O Study, Design, Manufacture, Construction, Operation and Maintenance D 000 1 A PPP 2 A PI PPP T I Urban & Spatial Development Energy Meeting urban development demand with architectural Developing and supporting renewable energy and design services in the United Kingdom and worldwide energy storage system

A T E N K UK T DP G 201 DP D T P E P Engineering Consultant Business Domain Operation, Planning, Studies Design Construction Maintenance Management

Japan Consulting Construction (general contractor) Consulting

Construction (general contractor) Overseas Consulting Consulting Construction supervision (consultant)

O P P P D A D U K A P P

5 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Today N K G Five segments contributing to the sustainability of global society

A T E N K UK T DP G 201 DP D T P E P Engineering Consultant Business Domain Operation, Planning, Studies Design Construction Maintenance Management

Japan Consulting Construction (general contractor) Consulting

Construction (general contractor) Overseas Consulting Consulting Construction supervision (consultant)

O P P P D A D U K A P P

NIPPON KOEI GROUP INTEGRATED REPORT 2019 6 Today for the Future T P G To provide services that are of value in building safe and reliable infrastructure and spaces for flourishing lives

Successful results by meeting needs at each stage of national and regional development New growth opportunities from applying our integrated capabilities to help resolve issues for global community

19 N K G O IT AI E T N K G 2021 O G G T NKI 2021 19 NKI 2021 Experience and Expertise Strengths of T G 200 for Each Stage of the Nippon Koei Group U N DG National and Regional Development —The Foundation for Value Creation T G Stage 4 Human Resources Social Transition Stage Largest corps of professional engineers in the industry Creating societies that are sustainable Contributing to and resilient a flourishing and Advance businesses that contribute to attaining Technology and comfortable world the SDGs and future Create disaster-resistant cities Expertise Technical capabilities Domestic International accumulated and refined over Consulting Consulting Stage 3 half a century Maturity Stage P29 P31 Renovating and maintaining infrastructure Research Base supporting comfortable, flourishing lives Management The largest Technology R&D and responding to environmental change Philosophy Center in the engineering Preserve the environment and biodiversity consulting industry in Japan Power Urban & Spatial Extend the life of existing infrastructure, provide Engineering Development Act with integrity efficient management and maintenance Client Base and contribute to P33 P35 Stage 2 Highly trusted with Japan’s top society through sales from ODA projects Energy technology and Economic Growth Stage Developing infrastructure that contributes to engineering industrial growth and expansion International P37 Facilitate large volume movement and logistics Presence of people and goods Projects in over 160 countries and Promote industrialization and industrial activity a global business network Medium-Term Medium-Term Medium-Term Management Plan Management Plan Management Plan Stage 1 Integrated NK-AIM NK-Innovation 2021 Capabilities Infrastructure Establishment Stage Long-Term Management Strategy (July 2012 – June 2021) Improving power supply and other Broad technical expertise local infrastructure integrating consulting, architecture, engineering, electric Build facilities providing stable electricity and power generation equipment water manufacturing, and power Raise agricultural productivity facility construction

7 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Today for the Future T P G To provide services that are of value in building safe and reliable infrastructure and spaces for flourishing lives

Successful results by meeting needs at each stage of national and regional development New growth opportunities from applying our integrated capabilities to help resolve issues for global community

NIPPON KOEI GROUP INTEGRATED REPORT 2019 8 Today for the Future T P G

Nippon Koei Group Initiatives The Nippon Koei Group helps improve the lives of people around the world through its activities developing and building infrastructure in various fields. The Group thrives on taking on the responsibility and applying its superior technology, knowledge, and human resources to help nations and societies around the world lay the foundation for the future.

International Consulting Senegal Domestic Consulting Japan International Consulting Philippines Stage 1 Mamelles Sea Water Desalination Project Nagano National Highway Disaster New Clark City Infrastructure Services for Societies at Contract period: 2017–2023 Prevention Survey Design Project the Infrastructure Establishment Stage D Contract period: 2017–2019 Contract period: 2019–2020 0 N K T P International Consulting Bangladesh N P Haor Flood Management & Livelihood Improvement Project D Contract period: 2015–2023 T T T N K R 20 T N D T P U T N K G N K P K 2019 T 12 Stage 3 Stage 4 Power Engineering Japan International Consulting Kenya Services for Societies at Services for Societies at the Maturity Stage IP Equipment Installation at The Project for Enhancing Community the Social Transition Stage Control Stations Resilience against Drought in International Consulting Vietnam Domestic Consulting Japan P Northern Kenya Hai Phong Environment & Sanitation Development of an Infrastructure Contract period: 2017–2022 Improvement Project (Stage 1) Maintenance and Management System K 0 Contract period: 2010–2019 Using Satellite Data N K I D D 1 R T N K AR IP IP N K TEPO P G I T N K T K P AT Stage 2 T Services for Societies at 2020 Energy Europe the Economic Growth Stage Urban & Spatial Development United Kingdom Palace of Westminster Restoration and Domestic Consulting Japan Storage Battery Project International Consulting India Renewal Project Advancing the Introduction and A Rengali Irrigation Project Contract period: 2017– Diffusion of Self-driving Vehicles N Contract period: 2016–2023 T N K G K T R I P DP I O P T P 90 A T EP R 100 T NE E I N K U K DP P P

9 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Today for the Future T P G

NIPPON KOEI GROUP INTEGRATED REPORT 2019 10 Message from the President

We are approaching the changing times and needs of society as an opportunity for growth as we advance our long-term IT N K T management strategy and seek to achieve Using our five businesses to meet the needs of The three core elements in the medium-term SDGs are a common language for producing I I A I TD 2020 global society management plan better solutions the targets of our medium-term G 2019 G G T Growth fields and new businesses 100 201 000 A T E O management plan. T 2021 DP N K I 2019 D I N K E E R P E 0 10 2021 G N E I T R I I U N I 2019 1 G D G DG A RT I Priority Investment Area 3 E P AI A U D D E 201 1 DG 201 201 E D O 2020 2021 A G T 19 U A G E T 2020 1 DG DG U D 201 E G G 2 T E G G Ryuichi Arimoto UK TD T R TR I Representative Director DP DP G I 2 201 T and President 201 E I Priority Investment Area 2 T E I Priority Investment Area 1 U D N K T TR T DP N K G U K G DP G I 2019 U T K E U I E P G A UK 1 222 T Opportunity in the changing times to grow G N K G toward our long-term management vision T G T ODA N K T T G D G 200 I 10 T N K G Priority Investment Area 1 T G Enhancement of the Operating System for T N K G 12 the Railways Business ODA 20 EG Framing the new long-term management strategy I ODA T ODA 0 G T G A Market environment A T DG 10 2019 G G N I I D I G A IT RD N K G A N K G N I KPI I T T NKI 2021 201 2021 2021 Our strengths KPI G G AI IT T I G U E A 1 DG 200 E G T NKI 2021 A I Strategy K N K 19 G D G T I 100 201 P 201 A 000 2021 T IT T 201 G N K G G 19 T K 2021 N K 100 12 Prepare for increasing order volume by 90 ROE 12 improving productivity and profitability A 2021

11 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Message from the President

NIPPON KOEI GROUP INTEGRATED REPORT 2019 12 Message from the President

IT N K T Using our five businesses to meet the needs of The three core elements in the medium-term SDGs are a common language for producing I I A I TD 2020 global society management plan better solutions G 2019 G G T 100 201 000 A T E O T 2021 DP N K I 2019 D I N K E E R P E 0 10 2021 G N E I T R I I U N I 2019 1 G D G DG A RT I Priority Investment Area 3 E P AI A U D D E 201 1 DG 201 201 E D O 2020 2021 A G T 19 U A G E T 2020 1 DG DG U D 201 E G G 2 T E G G UK TD T R TR I DP DP G I 2 201 T 201 E I Priority Investment Area 2 T E I Priority Investment Area 1 U D N K T TR T DP N K G U K G DP G I 2019 U Core operations T K E U I E P G A UK 1 222 T Opportunity in the changing times to grow G N K G toward our long-term management vision T G T ODA N K T T G D G 200 I 10 T N K G Priority Investment Area 2 T G Overseas Expansion of the Urban & Spatial Priority Investment Area T N K G 3 12 Development Business Establishment of the Energy Business ODA 20 EG Framing the new long-term management strategy I ODA T ODA 0 G T G A Market environment Market environment A T DG 10 2019 G G N I I U A E D I G IT RD N K G I A A I N K G N 2020 KPI I T T NKI 2021 201 2021 The New Business Creation Process in the Consulting Business 2021 Our strengths Our strengths KPI G G AI IT A E T Control business Geoplan Namtech has been added I G U Optimal Best proposal risk and maximize to the Group to strengthen our DP T management advice returns infrastructure management 1 DG 200 G T NKI 2021 A I • IT consulting company selling and Strategy Strategy K N K 19 G supporting IT systems for networked infrastructure D NK G E E • Networked asset management business T I DP I Planning, Operation, A in Japan and overseas specializing in P 201 A development, and Construction stage maintenance, and deployment consulting, customization, T EP preparation stage management stage maintenance, and operational support for networked asset management T D software for electric power, gas, water, 201 G N K G RD A and telecom operators 19 T K 2021 E N K 100 12 90 ROE 12 I A 2021

13 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Message from the President

NIPPON KOEI GROUP INTEGRATED REPORT 2019 14 Message from the President

IT N K T Using our five businesses to meet the needs of The three core elements in the medium-term SDGs are a common language for producing I I A I TD 2020 global society management plan better solutions G 2019 G G T 100 201 000 A T E O T 2021 DP N K I 2019 D I N K E E R P E 0 10 2021 G N E I T R I I U N I 2019 1 G D G DG A RT I Priority Investment Area 3 E P AI A U D D E 201 Universal Group measures 1 DG 201 201 E D O 2020 2021 A G T 19 U A G E T 2020 1 DG DG U D 201 E G G 2 T E G G UK TD T R TR I DP DP G I 2 201 T 201 E I Priority Investment Area 2 T E 16 Themes for Technology Measures I Priority Investment Area 1 U D N K T TR Development of technologies to T DP N K G 1 address climate change U K G DP G I 2019 U T Development of disaster prevention/ 2 mitigation technologies K Development of data network E U I E P 3 IT G technologies A UK 1 222 T Opportunity in the changing times to grow G N K G toward our long-term management vision Development of new analytical and T G T ODA Development of 4 design technologies, and upgrade of G N K Innovative technical proposal capabilities I I R AR T T Technologies G D G 200 I 10 T G T N K G Development and utilization of AI T 1 5 innovative artificial intelligence (AI) N K G 12 ODA 20 technologies EG Framing the new long-term management strategy I ODA Development of new geotechnical, T ODA 0 6 geological, environmental, and DNA G T G water quality investigation methods A A T DG 10 2019 G G N I 7 Development of resilience I technologies D I G IT RD N K G Expansion in the fields of architecture, NEW 8 urban design, and transportation A A N K G N development (such as MaaS) KPI Creation of business models centered I T NEW 9 T on energy NKI 2021 201 2021 2021 Construction and operation of IT KPI G NEW 10 next-generation infrastructure G AI IT Development of maintenance systems T Next-generation I G U Businesses Application of big data to 11 infrastructure 1 DG 200 G T NKI 2021 2 A Inspection and application of digital I NEW 12 twin technology for infrastructure K N K 19 G Inspection and implementation of NEW 13 new business models aimed at T I achieving the SDGs P 201 A 14 Development of a project IT T management IT (PM-IT) system T Company Infrastructure 201 G N K G Innovation and 15 Study of BIM software II 19 T K 2021 Productivity Improvement N K 100 12 16 Establishment of a high-quality, O IT efficient production system 90 ROE 12 3

A 2021 NEW 2020

15 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Message from the President

IT N K T Using our five businesses to meet the needs of The three core elements in the medium-term SDGs are a common language for producing I I A I TD 2020 global society management plan better solutions G 2019 G G T 100 201 000 A T E O T 2021 DP N K I 2019 D I N K E E R P E 0 10 2021 G N E I T R I I U N I 2019 1 G D G DG A RT I Priority Investment Area 3 E P AI A U D D E 201 Universal Group measures 1 DG 201 201 E D O 2020 2021 A G T 19 U A G E T 2020 1 DG DG U D 201 E G G 2 T E G G UK TD T R TR I DP DP G I 2 201 T 201 E I Priority Investment Area 2 T E 16 Themes for Technology Measures I Priority Investment Area 1 U D N K T TR Development of technologies to T DP N K G 1 address climate change U K G DP G I 2019 U T Development of disaster prevention/ 2 mitigation technologies K Development of data network E U I E P 3 IT G technologies A UK 1 222 T Opportunity in the changing times to grow G N K G toward our long-term management vision Development of new analytical and T G T ODA Development of 4 design technologies, and upgrade of G N K Innovative technical proposal capabilities I I R AR T T Technologies G D G 200 I 10 T G T N K G Development and utilization of AI T 1 5 innovative artificial intelligence (AI) N K G 12 ODA 20 technologies EG Framing the new long-term management strategy I ODA Development of new geotechnical, T ODA 0 6 geological, environmental, and DNA G T G water quality investigation methods A A T DG 10 2019 G G N I 7 Development of resilience I technologies D I G IT RD N K G Expansion in the fields of architecture, NEW 8 urban design, and transportation A A N K G N development (such as MaaS) KPI Creation of business models centered I T NEW 9 T on energy NKI 2021 201 2021 2021 Construction and operation of IT KPI G NEW 10 next-generation infrastructure G AI IT Development of maintenance systems T Next-generation I G U Businesses Application of big data to 11 infrastructure 1 DG 200 G T NKI 2021 2 A Inspection and application of digital I NEW 12 twin technology for infrastructure K N K 19 G Inspection and implementation of NEW 13 new business models aimed at T I achieving the SDGs P 201 A 14 Development of a project IT T management IT (PM-IT) system T Company Infrastructure 201 G N K G Innovation and 15 Study of BIM software II 19 T K 2021 Productivity Improvement N K 100 12 16 Establishment of a high-quality, O IT efficient production system 90 ROE 12 3

A 2021 NEW 2020

NIPPON KOEI GROUP INTEGRATED REPORT 2019 16 Message from the President / Financial Analysis

O P R O

FYE June 2020 Forecast Review and analysis of operating performance in I the fiscal year ended June 2019 10 FYE19/6 Results FYE20/6 Forecast YoY Change YoY Change FYE20/6 Forecast GAAP GAAP Amount % IR T N K G 110 U D 2 9 O 110 1 19 1 1 ROE 2019 0 100 NKI 2021 T 10 N 10 12 191 1 12 G O I 1 0 1 2019 G 10 9 O I 2 0 110 0 1 2 T D P A 02 Business environment and issues requiring action O P I P T N K G 09 ROE O 2 T ROE 1 20 T G A A D T P E K G DP 0 N K I T E 2019 2 E 100 2020 T EP I T A 2019 I U D T G PPP U K A I D I E G 2020 G 2021 T T N K G I R IR A Annual Dividend and Dividend Payout Ratio T P E IR D P R Outlook for the fiscal year ending June 2020 20 202 T 100.0 2020 A IT G 0 0 0 G T P D U D U R GAAP D I IR 1 2020 33.1 T 2 T I U D DP Shareholder returns T N K 201 201 2019 June 2020 U D

17 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Message from the President / Financial Analysis

O P R O

NIPPON KOEI GROUP INTEGRATED REPORT 2019 18 P NKI 2021

T P Review of FYE June 2019 and Priorities for FYE June 2020 The Nippon Koei Group is advancing a long-term management strategy through the fiscal year ending June 2021 Review of FYE June 2019 Priority Issues for Business strategy Key initiatives focused on positioning the Group to address issues ranging from the intensifying environmental and energy issues Evalu- FYE June 2020 accompanying global population growth to the growing demand, particularly in emerging countries, for Main actions ation infrastructure and for traffic solutions associated with urbanization. D O D The plan outlines strategies to fortify the three core operatioons of Domestic Consulting, International Consulting, Enhancement of T I P and Power Engineering and sets a basic course for “continuing to evolve into a global consulting and engineering operating system I E E IT firm.” In this direction, the Group established the Urban & Spatial Development Business in the fiscal year ended for Railways D D June 2017 and the Energy Business in the fiscal year ended June 2019. Business O P

P O P22 The NK-Innovation 2021 medium-term management plan is the third step of the Group’s long-term management OT strategy and sets three priority investment areas: railways, urban development, and energy. D NK G DP I 3rd STEP A 2nd STEP Overseas I E NK-Innovation 2021 expansion of A

NK-AIM (FYE19/6–FYE21/6) Urban & Spatial G A P23 (FYE16/6–FYE18/6) Development O I D Business P Basic Objectives Growth Fields and New Businesses RD 1st STEP (FYE13/6–FYE15/6) E E Core Operatioons P Basic Objectives E E P UK Establishment of A EP P Energy Business E Universal Group Measures D D A E A D P24 E FYE21/6 Targets → D R N O P Creation of D businesses and P D I G N 10 12 overseas expansion A I G → A O ROE of Consulting Business E I 90 12 D FYE20/6 (Forecast) Product → I development and 12 overseas D FYE19/6 expansion of Power Engineering 10 R FYE18/6 Business I R 100 Establishment of P FYE15/6 one-stop marketing system 3rd STEP 1

P R Net sales 2nd STEP P25 P E R Investment in D P O Basic Continue to evolve into a global consulting and N technologies and A R AI Objective engineering firm human resources D 1st STEP P E I Group Provide services that are of value in building safe and P P Vision reliable social infrastructure and comfortable living spaces E G E I IR Enhancement of P GAGE Group governance IR EP P GAGE IR EP Long-Term Management Strategy

GAGE G A G E

19 NIPPON KOEI GROUP INTEGRATED REPORT 2019 P NKI 2021

GAGE G A G E

NIPPON KOEI GROUP INTEGRATED REPORT 2019 20 Progress of the Medium-Term Management Plan Priority Investment Area 1 Enhancement of the Operating System for the Railways Business Railway Development in Emerging Countries

Growth Fields and New Businesses “Now” Dhaka MRT Line 6 Construction Project

Contract period 201202 The Nippon Koei Group’s NK-Innovation 2021 medium-term Contract amount management plan to the fiscal year ending June 2021 calls for Client D T Consultant N K N K concentrating our investment on addressing social issues and I P supporting sustainable growth in Japan and overseas in the three Nippon Koei Group contribution areas of railways, urban development, and energy. T T D RT Focusing the Group’s operating structure into a five-business structure of these three areas and the existing businesses will enable us to create a comprehensive vision and apply our wide-ranging integrated Meeting demand for railways and adjacent Highly trained local human resources contribute capabilities to realizing the smart societies that will be needed in the infrastructure as populations grow to high-quality infrastructure future. By establishing Nippon Koei as a corporate group integral to T infrastructure development around the world, our business will grow together with the stakeholders in international community. T N K 201 N K 0 A D 1 T R T RT

D RT P N K

Voice Wider opportunities from training and using skilled local staff R T D RT 0000 20 N K A I ODA

Takayuki Fujitomi General Manager of Dhaka MRT Line 6 Project Office

21 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Progress of the Medium-Term Management Plan Priority Investment Area 1 Enhancement of the Operating System for the Railways Business Railway Development in Emerging Countries

Growth Fields and New Businesses “Now” Dhaka MRT Line 6 Construction Project

D RT P N K

Voice Wider opportunities from training and using skilled local staff R T D RT 0000 20 N K A I ODA

Takayuki Fujitomi General Manager of Dhaka MRT Line 6 Project Office

NIPPON KOEI GROUP INTEGRATED REPORT 2019 22 Priority Investment Area 2 Overseas Expansion of the Urban & Spatial Development Business Priority Investment Area 3 Establishment of the Energy Business Railway Line and Urban Development in Europe Energy Management System/ Emerging Countries Energy Storage System Project

Thailand High-speed Rail Line / TOD Plan Preparation Project

Contract period 20192020 Contract amount 100 Client G T Consultant N K DP Nippon Koei Group contribution P

Transit-oriented development for urbanizing T T R Solutions for realizing a renewable energy society Enabling reliable and environmentally sound societies and sustainable lifestyles energy supply in emerging countries T T TOD Combining our civil engineering and architectural TOD knowledge for TOD T TOD E T N K G N N K TOD E N K DP A T EP P DP U K T TOD N K Voice P T P U K We offer comprehensive services combining each company’s areas of expertise Peter Jenkins T Architect Director U K DP DP and Head of Voice Transport Sector, BDP Promoting business development and operations in Europe and fighting climate change A DP N K G T 2020 A Nozomi Hishida N K N K DP TOD Private Business E D 201 2019 T Promotion Division O N K G E Masato Suzuki Executive Director Vice Chairman Nippon Koei Energy Europe B.V.

23 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Priority Investment Area 2 Overseas Expansion of the Urban & Spatial Development Business Priority Investment Area 3 Establishment of the Energy Business Railway Line and Urban Development in Europe Energy Management System/ Emerging Countries Energy Storage System Project

Thailand High-speed Rail Line / TOD Plan Preparation Project

Contract period 20192020 Contract amount 100 Client G T Consultant N K DP Nippon Koei Group contribution P

NIPPON KOEI GROUP INTEGRATED REPORT 2019 24 Progress of the Medium-Term Management Plan U G N

Technology Measures R&D budget to the year ending June 2021 Human Resource From June 2019 to June 2021 Development 2 I G 2000

Technology Measures: 16 Themes for Investment Hiring and training local engineers overseas Personnel system reform 3. Company Infrastructure 1. Innovative Technologies 2. Next-generation Businesses Innovation and Productivity T 2020 R 120 A P IT D E I D A Career vision Work-life balance A I N DG I R D

Focus Water Level Prediction Using AI Focus AI

We are actively integrating AI and IoT into our R R AI We are increasing the training of locally hired engineers development of advanced technologies because we believe AI to effectively meet the growing worldwide demand in they offer great potential for improving civil engineering our priority investment fields, particularly railways, and and disaster prevention and mitigation technology. the ongoing trend for increasingly larger projects. D • Floodgate and dams preparation is activated • People in flood regions are quickly evacuated to safety

Using AI to predict flood levels Preparing for more frequent flood events Regional engineer system in each global region Using BIM in Bangladesh N K T T N K G N K I AI I D AI D RT T 1 P G DP U K I E AI E N K N K 2 A D 2019 0 RT T R N K T 120 2020

25 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Progress of the Medium-Term Management Plan U G N

Technology Measures R&D budget to the year ending June 2021 Human Resource From June 2019 to June 2021 Development 2 I G 2000

Focus Water Level Prediction Using AI Focus AI

NIPPON KOEI GROUP INTEGRATED REPORT 2019 26 Review of Operations P

Urban & Spatial Development Energy Equity ratio ROE N O N O 80 10 8.5 62.6 8.1 52.2 8 1 01 0 0 60 50.6 47.9 51.2 6.2 5.7 6 40 4 Power Engineering Domestic Consulting 20 2 3.5 N N O N O 0 0 ¥108.5 billion Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 1 20 O 9 9 ¥5.1 billion International Consulting Human resources N O T G

29 0 Number of employees (consolidated) N Number of new university graduates hired (including by Group companies in Japan) N R O 8,000 E 160 144 6,000 5,497 4,566 4,923 4,336 120 111 105 95 4,000 3,320 81 80 Financial-related 2,000 40 P D I 0 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 P E DP 0 U D 0 100 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 10 I E 0 2019

Orders Net sales 150,000 120,000 106,023 108,589 Technology 117,442 118,085 101,338 120,000 101,079 104,350 90,000 81,839 81,865 87,573 90,000 T N K G 60,000 60,000 Number of patents (parent company) Number of certified professional engineers 30,000 30,000 Domestic Overseas (including Group companies) N 0 0 120 2,000 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 92 1,534 1,584 1,621 90 87 1,500 1,462 1,466 77 71 78 Operating income Operating margin 60 56 60 1,000 62 55 57 8,000 8 6,561 6.2 30 500 5.5 5.8 36 6,000 5,464 6 5.4 15 16 21 27 4,723 5,110 4.7 0 0 4,502 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 4,000 4

2,000 2

0 0 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Overseas-related Ordinary income Profit attributable to owners of parent T G 8,000 5,000 4,555 6,721 4,261 5,958 6,000 5,477 5,584 4,000 3,288 3,318 4,365 Overseas sales ratio (consolidated) Number of employees of overseas Group companies 3,000 N 4,000 1,823 2,000 50 2,500 2,000 40.2 41.2 38.4 2,017 1,000 40 2,000 1,643 28.6 1,421 0 0 30 26.4 1,500 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 20 1,000 421 492 DP 201 10 500 I 201 N K G 0 0 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019

27 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Review of Operations P

2,000 2

NIPPON KOEI GROUP INTEGRATED REPORT 2019 28 Review of Operations

Domestic Consulting

Performance in the Fiscal Year Ended June 2019

Business Areas Main Customers Performance Summary

O U I D T T I D T O E

Business Overview T D T T D RD 9 T 2 N I T 99 1 T I RD 990 202 9

Market Trends Orders, net sales, and operating income Public works spending (initial + revised budget) / Nippon Koei Domestic Consulting Business orders O N O N K D P T 60,000 10,000 120 10 52,855 52,400 48,265 48,529 49,593 51,300 7.7 7.5 7.6 7.5 7.5 7.7 7.6 7.6 46,617 45,057 46,595 7.1 7.0 41,845 44,109 43,516 8,000 6.4 6.6 41,817 40,778 90 40,000 5.6 6,000 60 5 4,990 4,000 52.8 20,000 4,200 46.6 45.0 44.1 48.2 48.5 4,279 30 36.1 37.0 36.6 37.5 38.4 3,298 34.5 30.5 2,502 2,723 2,956 2,000

0 0 0 0 Mar 2007 Mar 2008 Mar 2009 Mar 2010 Mar 2011 Mar 2012 Mar 2013 Jun 2014 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Jun 2014 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Jun 2020 (Japanese GAAP) (Forecast/IFRS) I T T Survey of Trends in Construction-Related Industries (Construction Consulting)

Main Strategies Medium- and Long-term Strategies T Incorporation of Geoplan Namtech Inc. into Nippon Koei Competitive Advantages the Group Effective FYE June 2020 T D A Nippon Koei Geoplan PIPPP Group companies Namtech A 2020 Business perspective IT perspective Business Opportunities Risks G N I IT E D T N I G 0 K G 201 G N Fusion of business and IT perspectives Basic Strategies RD P Further strengthen the management base Business creation D E Use our advanced technologies to promote global strategies Make business management more efficient

29 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Review of Operations

Domestic Consulting

Performance in the Fiscal Year Ended June 2019

Business Areas Main Customers Performance Summary

O U I D T T I D T O E

Business Overview T D T T D RD 9 T 2 N I T 99 1 T I RD 990 202 9

NIPPON KOEI GROUP INTEGRATED REPORT 2019 30 Review of Operations

International Consulting

Performance in the Fiscal Year Ended June 2019 Business Areas Main Customers

A I Performance Summary A O U IA E O T O D E O T I O 22 Business Overview 1 292 T N K G N K G 2 1 ODA T G T P 2 P P PPP E A A Orders, net sales, and operating income N E A T ODA O N O T 50,000 48,100 10,000 41,573 Market Trends 40,000 34,500 8,000 1 2 30,023 28,889 28,889 28,482 ODA budget* / Total overseas consulting business orders (industry total)* / Nippon Koei International Consulting Business orders 30,000 25,936 26,716 24,928 6,000 22,070 24,491 N K I T ODA T 20,947 20,174 20,000 4,000 2,649 2,100.0 2,165.0 200 2,200 10,000 2,900 2,000 1,855.3 658 841 1,766.7 1,785.6 1,776.0 1,805.7 285 1,887 1,625.0 1,704.7 1,701.6 1,690.7 1,156 150 1,511.3 1,650 0 0 1,414.9 Jun 2014 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Jun 2020 137.7 (Japanese GAAP) (Forecast/IFRS) 100 123.3 125.6 1,100 103.8 89.2 96.5 93.3 78.3 79.4 50 57.8 68.1 70.7 66.6 550 41.5 30.0 28.8 28.8 26.7 28.4 Medium- and Long-term Strategies 0 13.9 20.0 19.1 20.1 15.3 19.6 20.1 0 Mar 2007 Mar 2008 Mar 2009 Mar 2010 Mar 2011 Mar 2012 Mar 2013 Jun 2014 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 T ODA project participation by industry (FYE June 2018 total) 1 A ODA I E 2 I D I Report on Orders Received in Overseas Consulting Business, etc. I Product loan Transportation 12 Main Strategies Irrigation, Nippon Koei Competitive Advantages flood control, T G reclamation ODA Based on FYE June G 2018 amounts Electrical Business Opportunities Risks T I Social services & Gas ODA ODA 1 201 A ODA T ODA T I PPP ODA PPP T D International Consulting Business ratio of non-ODA orders G FYE June 2019 FYE June 2021 target Basic Strategies A 2 Approximately 30% Strengthen the production system Apply comprehensive risk management Ensure safety E Increase non-ODA business Stabilize revenue management G E G G

31 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Review of Operations

International Consulting

Performance in the Fiscal Year Ended June 2019 Business Areas Main Customers

NIPPON KOEI GROUP INTEGRATED REPORT 2019 32 Review of Operations

Power Engineering

Performance in the Fiscal Year Ended June 2019

Business Areas Main Customers Performance Summary E O P O G T P E O 111 Business Overview T P E T N 9 11 G O 11 T 209 T 0 20

Market Trends Orders, net sales, and operating income TEPCO Holdings total capital investment / TEPCO Holdings repair expenses* / Nippon Koei Power Engineering Business orders O N O N K P E TEPO TEPO 750.0 20,000 19,600 10,000 120 695.9 800 17,857 17,522 17,577 664.2 676.7 675.0 665.7 15,831 15,943 15,762 16,531 16,000 640.8 639.7 14,716 15,411 8,000 574.6 575.9 585.9 568.6 602.7 15,000 14,169 13,595 14,087 90 600 6,000 10,000 60 459.0 400 4,000 432.1 412.0 381.3 373.9 349.0 378.2 389.9 319.9 318.7 5,000 2,300 30 278.8 263.8 268.2 200 2,834 3,048 2,683 2,000 2,089 1,267 1,873 13.0 10.7 11.3 12.8 14.6 12.0 12.5 15.8 13.5 14.7 14.0 15.9 15.4 0 0 0 0 Jun 2014 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 Jun 2020 Mar 2007 Mar 2008 Mar 2009 Mar 2010 Mar 2011 Mar 2012 Mar 2013 Jun 2014 Jun 2015 Jun 2016 Jun 2017 Jun 2018 Jun 2019 (Japanese GAAP) (Forecast/IFRS) P T E P I

Main Strategies Medium- and Long-term Strategies T P Nippon Koei Competitive Advantages P E TEPO T T O E TEPO G T A Business Opportunities Risks

I E Action plans for existing businesses and new areas P E E TEPO P G I Strengthen I price competitive- RD ness D Create Basic Strategies Expand new products RD globally and services E E E Diversify G A customers A E

33 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Review of Operations

Power Engineering

Performance in the Fiscal Year Ended June 2019

Business Areas Main Customers Performance Summary E O P O G T P E O 111 Business Overview T P E T N 9 11 G O 11 T 209 T 0 20

Main Strategies Medium- and Long-term Strategies T P Nippon Koei Competitive Advantages P E TEPO T T O E TEPO G T A Business Opportunities Risks

NIPPON KOEI GROUP INTEGRATED REPORT 2019 34 Review of Operations

Urban & Spatial Development Performance in the Fiscal Year Ended June 2019

Performance Summary O P Business Areas Main Customers G A P O U R

Business Overview T U D O N K U D UK A 9 2010 201 DP U G 1 19 O K G 12 11 DP I A 2019 22 11 A Orders, net sales, and operating income O N O Main Strategies 25,000 1,500 1,500 Nippon Koei Competitive Advantages 20,510 20,000 18,600 18,800 1,200 N U K 15,359 15,000 13,460 14,347 13,040 900 U 12,855 A DP I 10,000 600

5,000 300 81 151 0 173 0 Business Opportunities Risks Jun 2017 Jun 2018 Jun 2019 Jun 2020 (Japanese GAAP) (Forecast/IFRS) U A I UK G TOD Medium- and Long-term Strategies G T O U D A DP DP N U K Basic Strategies K G 0 G DP G Build up BDP business outside the U.K. market Strengthen the business execution system UK T G Megatrend (rapid urban population growth) and Asia Formulate new business models N K market strategies A T T N K G P N K G DP A 2020 A

Growth strategies for the Urban & Spatial Development Business Phase 1 Phase 2 Phase 3 Phase 4 Establish Nippon Koei Group Reorganize to Establish business Manage projects and and BDP collaboration in strengthen core drivers to realize participate as the Group’s existing functions growth strategies a primary company Asian markets

Markets: U.K., Canada, Asia Markets: U.K., Canada, Asia, Japan

35 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Review of Operations

Urban & Spatial Development Performance in the Fiscal Year Ended June 2019

Performance Summary O P Business Areas Main Customers G A P O U R

Markets: U.K., Canada, Asia Markets: U.K., Canada, Asia, Japan

NIPPON KOEI GROUP INTEGRATED REPORT 2019 36 Review of Operations

Energy

Performance in the Fiscal Year Ended June 2019

Performance Summary Business Areas Main Customers O EP E E E P O E I

T E Business Overview PP N K E 201 T O 0 2 102 19 T T EP 91 I Main Strategies

Nippon Koei Competitive Advantages Orders, net sales, and operating income EP O N O O 3,000 3,000 2,200 E 2,100 2,000 1,405 2,000 1,000 354 723 719 1,000 55 179 0 0 Business Opportunities Risks (18) -1,000 (365) -1,000 (900) E -2,000 -2,000 I (2,485) -3,000 -3,000 Jun 2017 Jun 2018 Jun 2019 Jun 2020 E (Japanese GAAP) (Forecast/IFRS) T E 2020 Medium- and Long-term Strategies T E Basic Strategies PP EP Power generation business Energy management business I E N K E E NKEE E E E NKEE N K D A T N K G E R N Energy Business domain I A 2019 Domestic power generation Overseas power generation Development and operation of hydroelectric power generation Development and operation of electric power generation E P R I P

Domestic energy management Overseas energy management

Renewable energy monitoring and Investment in ancillary services and other businesses energy conservation consulting services D E PP ETI

37 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Review of Operations

Energy

Performance in the Fiscal Year Ended June 2019

Performance Summary Business Areas Main Customers O EP E E E P O E I

T E Business Overview PP N K E 201 T O 0 2 102 19 T T EP 91 I Main Strategies

Domestic energy management Overseas energy management

Renewable energy monitoring and Investment in ancillary services and other businesses energy conservation consulting services D E PP ETI

NIPPON KOEI GROUP INTEGRATED REPORT 2019 38 Sustainability

Environmental and Social TOPIC

The Nippon Koei Group’s approach to sustainability is corporate conduct and employee actions in the Nippon Koei manifest in its management philosophy to “Act with integrity Group Code of Conduct and our Ten Environmental Topic and contribute to society through technology and Principles, which were formulated based on international Participation in the SDGs Open Innovation Platform engineering.” The sustainability of our business comes from standards including ISO 26000 and the United Nations Global Nippon Koei is an administrator of the Osaka Chamber of method to propose product and service combinations that applying this philosophy as we develop business strategies to Compact. As a contributor to the development of sustainable Commerce’s SDGs Open Innovation Platform website designed could improve ef ciency, speed, and provide the best value. In pursue opportunities in the risk related to environmental societies, we are deeply aware of our responsibility to to help companies connect with institutions that could help addition to distributing information related to the SDGs, the issues and by proposing solutions and conducting business maintain the highest ethical standards. The Group has set it’s with their SDG activities. The website includes examples of site has become a spark for new business creation. activities that anticipate environmental and social needs. own high standard for corporate social responsibility (CSR) successful business endeavors that have integrated SDG-related Elevating and maximizing our social and environmental value that goes beyond compliance with laws and regulations, and technology and expertise from companies, universities, and The SDGs Open Innovation Platform increases the Group’s corporate value and competitiveness. we are dedicated to achieving the sustainable development research institutions as a way to encourage other businesses to SDGs Open Innovation Platform Nippon Koei has de ned guidelines and standards for its goals (SDGs) of the international community. incorporate the SDGs into their operations. The site also has a unique service enabling a registered Register technology, expertise, Connect to user matches business domain company to upload the attributes and characteristics of their data, which it then correlates into a common format and Climate Change Countermeasures promoted supporting cities in Japan and greater Asia seeking generates a chart showing potential compatibility with other Nippon Koei’s R&D Center is spearheading activities to to introduce low-carbon technologies and create a Joint Companies, Universities, Industry support companies and institutions. The website’s administrators startups research institutes institutions develop cutting-edge technologies to cope with climate Crediting Mechanism (JCM) to contribute to reducing manage and operate the site and use the open innovation change in two key areas: technologies for formulating climate greenhouse gas emissions. The Ministry of Economy, Trade change scenarios and technologies for formulating criteria for and Industry also released a report entitled “Contributing decision-making in conditions of high uncertainty. We are Visualization Project of Japanese Companies in Adaptation sharing expertise and developing tools for all of our internal Areas in Developing Countries” aimed at increasing departments so these technologies can be used across our awareness of the business opportunity potential in responding Human Resource Training and Skill Development their role as a professional, has opportunities grow in their consulting businesses to further improve our services to climate change. We expect these government reports to The Nippon Koei Group considers its human resources as its career, and feels a sense of purpose in their work. In addition, throughout the Group. help spur activities to adapt to and mitigate the effects of greatest asset. The Group provides a full range of training and the personnel structure and training systems are formulated to In 2019, the Japanese Ministry of the Environment report global climate change. seminar programs designed so each employee is fully aware of support continuing skill development. “City-to-City Collaboration for Low-Carbon Society” Human Resource Training and Skill Development Activities Topic Training and Seminars Programs Systems Development of a New Bias Correction Method and a Website Launch • New employee training • Technical development training / • Personnel Exchange Multiseed • NKG E-learning System 1 • Third-year training TD follow-up training* Program*2 • Career Path Planning Accurate climate forecasting for speci c regions requires a bias-corrected time-series predictions for major cities around the • Mid-level employee training • Professional engineer (secondary) • Distance education System correction process that correlates the differences (bias) world. Making accurate base data freely available provides a • Manager training exam preparation seminar • Financial incentives for paper • CPD Activity Recording between data produced from institutional forecast models and useful tool for climate change adaptation businesses and • Harassment prevention training • Skill advancement courses submissions and lecture attendance System the actual observed data. Nippon Koei has taken bias research in various elds, and Nippon Koei hopes it will stimulate • Live presentation seminar • Financial incentives for certification attainment correction to a new level with its TR3S data correction method open innovation and help create new business opportunities. capable of factoring various statistical properties. *1 Technical Development: A Nippon Koei training program for employees to define their career vision to serve as a guide for developing technical expertise to achieve their vision. We used the corrected data produced by TR3S to create a *2 Multiseed Program (MSP): A personnel exchange system for assigning employees to different departments for specified periods to help develop engineers with diverse skills, knowledge, and perspectives. world map of the climate forecasts (rainfall, temperature) that are used as base data when researching climate change adaptation measures. Nippon Koei has made the map freely Topic accessible on its NK-ClimVault website, where visitors can view The NK-ClimVault webpage Advancing BIM and CIM Technology

The Nippon Koei Group is harnessing advances in information including improving the ef ciency and productivity of all of the and communications technology applications in the Group’s construction production systems and lowering costs. construction industry, including using Building Information We believe BIM is becoming essentially mandatory in Japan Modeling (BIM) combining digital 3D modeling and a design for design visualization and interference checking of architectural, Signatory of the UN Global Compact Action Toward Achieving the Sustainable information database and Construction Information Modeling structural, and building designs, and expect it to be increasingly Nippon Koei announced its support for the United Nations Development Goals (CIM) in the construction, maintenance, and production used in other countries of Asia as well. The Nippon Koei Group Global Compact in July 2019. The Company is fully NK-Innovation 2021 sets the SDGs as a common platform for processes of civil infrastructure projects. is keeping abreast of the changing needs of the times as it dedicated to the compact’s Ten Principles, to actively our businesses to be incorporated into our daily activities. We BDP is a leader in BIM application not only in the United continues to provide the high value-added services and solutions. following a global perspective in its business activities in constantly consider how our projects and our actions can Kingdom but in all of Europe, and 70% of its technical staff is accordance with the expectations of contribute to achieving the goals. We seek to accurately assess pro cient in the use of BIM software. When BDP joined the international stakeholders, to conducting how our projects relate to various issues and mobilize our Group, Nippon Koei eagerly invited BDP staff to provide BIM responsible management as expected of a technologies to solve those issues. training in Japan and sent young and mid-career employees to truly global company, and to contributing to train in BIM for several months at BDP. Integrating BIM the creation of a sustainable society. software should improve the Group’s operations in many areas

39 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Sustainability

Environmental and Social TOPIC

NIPPON KOEI GROUP INTEGRATED REPORT 2019 40 Sustainability Environmental and Social

Topic Topic Supporting Pursuit of Engineering Certification Recognition an Outstanding Health and Productivity Management Organization

Professional Engineer is the highest national quali cation in sessions on test preparation and how to write papers, practice The Ministry of Economy, Trade and Industry (METI) and the Nippon Koei will continue to this technical eld in Japan, and it is essential to the questions and answers, and mock interviews for the oral Nippon Kenko Kaigi selected Nippon Koei as a 2019 “White support employee health-related Company’s business strategy that our engineers have this examination. 500” Outstanding Health and Productivity Management activities by providing an environment quali cation. The Company supports individuals seeking to The Company also offers nancial incentives and a support Organization. The selection recognizes companies encouraging employees to be active become Professional Engineers by offering annual preparation system for the cost of examinations to reward employees that demonstrating exceptional health management measures about maintaining and improving seminars for the certi cation examinations. earn certi cation. through rapid countermeasures for health issues and activities their health. Programs are designed to build the con dence of The Company encourages its employees to earn to promote employee health. individuals preparing for the examination through correcting professional quali cations and will continue to promote the and advising about written submissions, workshops and study professional development of all employees.

Respect and Consideration for Human Rights and when carrying out its business activities in Japan and around the Environment the world. We work to reduce potential human rights risks by Promoting Diversity and Workstyle Reform Japanese and English. The Company fully supports female In accordance with the Nippon Koei Group Code of Conduct effectively assessing the impact of our activities on people and Nippon Koei seeks to boost employee productivity and to employees, non-Japanese employees, and workforce diversity, and its Ten Environmental Principles, Nippon Koei conducts full regional societies based on international standards. ensure employees maintain a healthy work-life balance because and seeks to provide an environment in which employees can due diligence, particularly in environmental and social areas, it believes both are necessary for all employees to realize work perform to the best of their capabilities. In addition, work styles that bring out the highest quality in their work. structures are designed to accommodate various work styles Nippon Koei is applying its Phase II Action Plan based on and encourage a diverse workforce to be themselves. The Stakeholder Engagement seeks to identify and address social issues that stakeholders the Act on Promotion of Women’s Participation and Company also reviews the personnel system to ensure We value dialogue with diverse communities and stakeholders, would expect the Group to address now and in the future. We Advancement in the Workplace and maintains a fundamental employee evaluations are fair and based on skill and including our customers, shareholders and investors, also actively develop partnerships and networks among framework that includes consultation services offered in performance standards. employees, civil society, governments, international stakeholders as we engage in business activities in Japan and organizations, and educational institutions. The Group actively other countries around the world.

Topic Stakeholders Key Issues Main Points of Contact Method of Communication Promoting Workstyle Reform Customers Create good products and services, Each business headquarters • Business activities Steps to create an environment that accommodates various not tied to a time or place by deepening the use of IT to reduce respond to complaints, provide and operations • Website work styles included introducing a work-at-home system in paperwork and Microsoft Of ce 365 software to increase the appropriate product and service information 2016 and expanding it in 2018 to raise productivity and reduce ef ciency of communication and information sharing. the commute burden for a greater number of employees. In Shareholders, Disclose appropriate information in Corporate Communication • Results announcement meetings investors a timely manner, earn appropriate Office (twice annually) 2019, the Company initiated a satellite of ce system for assessments and support from capital Legal & Compliance • General Meeting of Shareholders (annual) markets, reflect shareholder and investor employees at the R&D Center in Tsukuba, Ibaraki Prefecture, Department • IR events, individual meetings perspectives in corporate management and the Yokohama Technology Center in Kanagawa Prefecture. (about 100 annually) The Company is seeking to create work systems that are • IR materials (integrated reports, shareholder newsletters, shareholder surveys, etc.)

Suppliers Conduct fair business relationships, Each business headquarters • Procurement activities smoothly share information to create closer partnerships

Supporting Employee Health Activities to Promote Employee Health Employees Keep all employees active, treat Human Resources Department • Intranet employees appropriately, strengthen General Affairs Department • Internal communications Employees are the foundation of our Company and ensuring the occupational health and safety Technology Headquarters • Group training sessions Health Area Activities management system their health and well-being is of utmost importance to helping Each business headquarters • Manager and staff dialogue meetings them perform to the best of their abilities. Regular full health Fully subsidized screening for and operations (at each business site with president and director in charge of personnel The Nippon Koei Group offers various health management checkups, consultation, lifestyle-related diseases, and follow-up general checkups, health guidance for administration; twice annually) and health promotion activities and maintains a Safety and speci c health issues using ICT • Employee e-learning (40 times annually) Health & Environment Committee, which is supervised by the Mental health care Full-time in-house physician, counseling National and local Comply with all laws and regulations Each business headquarters • Participation in business and industry Total Risk Management Council chaired by the Company by a certi ed psychologist, stress checks governments, in Japan and all countries and operations associations president, and the Work-Life Balance Promotion Committee for all employees industry groups under the Management Council. Further support for Collaboration with the Fully subsidized u vaccinations and Local communities Fulfill responsibilities as a corporate Each business headquarters • Contributions to local communities employee health management is provided by a full-time health insurance outpatient services for employees trying citizen, participate in local communities and operations through business activities association to quit smoking, General Affairs Department • Participation in volunteer activities in-house physician in the Health Management Of ce and staff dental checkups, health seminars from the Human Resources Department, General Affairs Academic groups, Assist academic groups and research Technology Headquarters • Open innovation (joint research) Health literacy Relay race, walking events, indoor gym, research institutes institutes in technology innovation, Each business headquarters Department, health insurance association, and Health access to health check equipment participate in industry-government- and operations Management Of ce. academia collaboration

41 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Sustainability Environmental and Social

Topic Topic Supporting Pursuit of Engineering Certification Recognition an Outstanding Health and Productivity Management Organization

Suppliers Conduct fair business relationships, Each business headquarters • Procurement activities smoothly share information to create closer partnerships

NIPPON KOEI GROUP INTEGRATED REPORT 2019 42 Sustainability G

The Nippon Koei Group’s fundamental approach to enhancing corporate value is to perform Member Distribution A Legal Restrictions I comprehensive corporate governance by strengthening oversight of management organizations, T G T 20 Audit & Nominating and Outside Board of Management 1 ensuring management transparency, and maintaining a structure facilitating the swift execution Position Name Supervisory Compensation N K G Officers Directors Council of business. Board Advisory Committee T A A A A 2019 0 G 2 201 T R D Noboru Takano A A A D P P E 9 D Akira Mizukoshi A I Structure and Policy Nominating and Compensation Advisory Committee R D P Ryuichi Arimoto 2 2019 T T T N R D Hiroyuki Akiyoshi A G 0 0 G A D Takayasu Tsuyusaki T 2 201 T A D Haruhiko Kanai Status of Internal Audits Compensation of Board Members 2 D T 20 1 T A D Hiroaki Shinya T I A R I A Policy and Items Concerning Officer Compensation and T O the Calculation Method of Director Compensation 0 D Yasushi Hirusaki N D I D A G 2 201 A D Hiizu Ichikawa D T A A Management Council D Kazumasa Kusaka T P G T T A Yoshizo Goto G A Kunio Okamura D Nomination and Compensation Advisory Committee T I A O A G A Processes for Determining Officer Compensation A Naoki Honjo T T D A Yoshiko Koizumi N Board of Directors O A D O A A T D R A A T I A O I D O Resolution of the General Meeting of Shareholders 2019 N T T Board of Executive Officers Total Risk Management Council Regarding Officer Compensation A T D 10 R T T T R TR Business Risks T T 2020 10 2019 A P T G T RD 2 G T D T 2 200 T 1 D T E O A 1 2019 T E A N K G 0 2019 Corporate Governance Organizational Chart (as of September 26, 2019) T TR Dependence on Major Customers General Meeting of Shareholders E O E I O A AD D R N A I A Board of Directors A ODA R Audit & Audit & Supervisory Board Audit Status Nominating and Compensation Advisory Committee Supervisory T A Status of Audits by the Audit & Supervisory Board Board A N K A ODA R T A A A President and Representative Director A A A O TEPO P G I I R D R TEPO P G I Management Council Total Risk Management Council Internal I A A O P Auditing Office Accounting I D T A A Defect Liability for Deliverables T Technology Committee Internal Control over Financial Reporting Auditor Committee Technical T G IO 9001 A N Auditing I Human Resources Committee A A A Safety and Health & Environment Office Committee Work-Life Balance Promotion A Committee D G P R I A A I D A I G P A Board of Executive Officers I G Business Operations Corporate Headquarters A Legal Advisor Group Companies A P D A T A

43 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Sustainability G

NIPPON KOEI GROUP INTEGRATED REPORT 2019 44 Sustainability Corporate Governance

A Legal Restrictions I T G T 20 N K G 1 T A A A A 2019 0 G A A A D P 2 201 T P E 9 A I Structure and Policy Nominating and Compensation Advisory Committee 2 2019 T T T N A G 0 0 G A T 2 201 T A Status of Internal Audits Compensation of Board Members 2 D T T I A R I A Policy and Items Concerning Officer Compensation and 20 1 T A T O the Calculation Method of Director Compensation 0 N D I D A G 2 201 A D T A A Management Council T P G T T G D Nomination and Compensation Advisory Committee T I A O A G A Processes for Determining Officer Compensation T T D N Board of Directors O A D O A A T D R A A T I A O I D O Resolution of the General Meeting of Shareholders 2019 N T T Board of Executive Officers Total Risk Management Council Regarding Officer Compensation A T D 10 R T T T R TR Business Risks T T 2020 10 2019 A P T G T RD 2 G T D T 2 200 T 1 D T E O A 1 2019 T E A N K G 0 2019 T TR Dependence on Major Customers Total Amount of Compensation in FYE19/6 by Officer Classification, Total Amount of Compensation by Type, and E O E I O Number of Eligible Officers R N A I Total Amount of Compensation by Type A ODA Total Amount of Results-based Fixed Compensation Number of Officer Classification Compensation Compensation Eligible Officers Audit & Supervisory Board Audit Status R T A Status of Audits by the Audit & Supervisory Board A N K A ODA Directors 21 91 9 T A A A A A O TEPO P G I Audit & Supervisory Board Members 2 2 TEPO P G I D I A A O P Outside Directors 0 0 2 I D T A A Defect Liability for Deliverables T T G IO 9001 A N Outside Audit & Supervisory Board Members 2 A A A N 1 T A A G 2 201 G 2 T I A A I D A I G P T A 9 A G 29 200 A G A A T A

45 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Sustainability Corporate Governance

NIPPON KOEI GROUP INTEGRATED REPORT 2019 46 Sustainability

O D O A

A K I T R I D G 10 I T N K T G I 2020 I 2021 E

Hiizu Ichikawa Kazumasa Kusaka Yoshiko Koizumi Kunio Okamura Becoming a corporate group where Outside Director Outside Director Outside Audit & Supervisory Outside Audit & Supervisory Board Member Board Member everyone from top executives to the youngest employees feels The Nippon Koei Group seeks to strengthen its corporate governance by maintaining various types of meeting a sense of ownership committee structures, such as including outside directors and outside Audit & Supervisory Board members on the Board of Directors, to receive advice and council from specialized and objective perspectives. K K This section presents comments by four outside officers about what they think are key points for the Group to O D strengthen its corporate governance now and for the future.

T G T T U D G I T G UK DP I would like to help the Company T I strengthen its abilities at the worksite and in management I I G I O D ODA T T 0 I T 10 T T O I N K T 201 T G I G D I N E O T ODA G I

47 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Sustainability

O D O A

A K I T R I D G 10 I T N K T G I 2020 I 2021 E

T G T T U D G I T G UK DP I would like to help the Company T I strengthen its abilities at the worksite and in management I I G I O D ODA T T 0 I T 10 T T O I N K T 201 T G I G D I N E O T ODA G I

NIPPON KOEI GROUP INTEGRATED REPORT 2019 48 Sustainability Messages from Outside Directors and Outside Audit & Supervisory Board Members

K I Seeking to maintain objectivity as we expand from the government to T R G 10 the private market I T N K 2020 K O I O A

I O A 2019 I A I I G Maintaining the corporate culture of I G A D open discussion as the Group grows I G T G R I D G K AI IT O A O N K G I I I I I I G N K D G A I D I G T I I I T G T PPP T U D G I PI I T G UK DP I T D 20 0 I T O E N A G I D I G A G I G I G ODA T O I I T N K G 000 T 10 I T 00 G N K G T G I G D N E O T G I

49 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Sustainability Messages from Outside Directors and Outside Audit & Supervisory Board Members

K I Seeking to maintain objectivity as we expand from the government to T R G 10 the private market I T N K 2020 K O I O A

NIPPON KOEI GROUP INTEGRATED REPORT 2019 50 Sustainability

Board of Directors, Executive Officers and Audit & Supervisory Board Members (As of September 26, 2019)

Directors

Noboru Takano Akira Mizukoshi Ryuichi Arimoto Hiizu Ichikawa Kazumasa Kusaka Representative Director and Chairman Director and Vice Chairman Representative Director and President Director Outside Independent Director Outside Independent 1975 Joined the Company 1976 Joined the Company 1977 Joined the Company 1970 Joined The Mitsubishi Bank, Ltd. 1970 Joined Ministry of International Trade and 2009 Senior Vice President of Mitsubishi Electric 2011 Director and Executive Of cer 2010 Director and Executive Of cer 2009 Director and Executive Of cer 1993 General Manager of Singapore Branch of Industry (MITI) Corporation Acting Director General of Domestic Consulting 2012 Director and Managing Executive Of cer Director General of Corporate Headquarters and The Mitsubishi Bank, Ltd. 1984 MITI Energy Minister of the International Energy 2011 Visiting Professor of Graduate School of Public Operations and General Manager of Operations General Manager of Business Promotion General Manager of Corporate Planning 1996 General Manager of Industrial Research Agency (IEA) of the Organization for Economic Policy, The University of Tokyo (current position) Planning Of ce, Domestic Consulting Operations Headquarters Department Department of The Bank of Tokyo-Mitsubishi, Ltd. Co-operation and Development (OECD) Advisor, The Canon Institute for Global Studies 2012 Director and Managing Executive Of cer 2014 Director and Senior Managing Executive Of cer 2011 Director General of Corporate Headquarters 1997 General Manager of Sales Screening Department 2001 Director-General, Industrial Science and (current position) Director General of Domestic Consulting Operations Director General of Corporate Headquarters and General Manager of Personnel & General of The Bank of Tokyo-Mitsubishi, Ltd. Technology Policy and Environment Bureau, 2013 Chairman of Japan Economic Foundation 2014 Representative Director and Senior Managing and Director General of Business Promotion Affairs Department 1999 Senior Executive Director of The Resolution and Ministry of Economy, Trade and Industry (METI) (current position) Executive Of cer Headquarters 2012 Director and Managing Executive Of cer Collection Corporation 2002 Director-General, Trade Policy Bureau, METI 2015 Outside Director of the Company 2015 Representative Director and Executive Vice Director General of Corporate Headquarters Director General of Corporate Headquarters and 2001 Senior Executive Director of Chiyoda Corporation 2003 Commissioner of Agency for Natural Resources (current position) President in charge of technology 2015 Director and Executive Vice President in charge of General Manager of Personnel Department 2004 Representative Director and Managing Director and Energy, METI 2017 Representative Director and Chairman Head Of ce 2014 Representative Director and President of Mitsubishi Motors Corporation 2004 Vice-Minister for International Affairs, METI (current position) 2016 Representative Director and Executive Vice (current position) 2010 Representative Director and Executive Vice 2006 Advisor, Dentsu Inc. President in charge of Head Of ce and IR President of Mitsubishi Motors Corporation 2007 President of Japan Cooperation Center for 2017 Director and Vice Chairman (current position) 2014 Outside Corporate Auditor of The Hyakugo the Middle East Bank, Ltd. 2008 Special Advisor to the Cabinet Outside Director of the Company (current position)

Senior Managing Managing Executive Executive Officers Executive Officer Officers Kevin Tynes Noriyuki Nakashima Hideo Tamura Yasuyoshi Iio Shuichi Ueda Hiroyuki Yamate Shigeki Toyoshima Hiroshi Yokota Ken Nishino Yasusuke Kurosaki Katsuya Fukasaku Toru Nakagawa Noriaki Yoshida Takuro Hamanaka Hiroshi Matsuda Michio Hasegawa Akimitsu Arai Hitoshi Nagasaki Tomohisa Fukuoka Hiroyuki Akiyoshi Takayasu Tsuyusaki Haruhiko Kanai Representative Director and Vice President / Director and Senior Managing Executive Of cer / Director and Senior Managing Executive Of cer / Managing Executive Of cer in charge of Director General of Global Strategy Headquarters Director General of International Consulting Audit & Supervisory Board Members energy business and power engineering 1979 Joined the Company Operations 1979 Joined the Company 2015 Director General of Global Strategy Headquarters 1982 Joined the Company 2012 Director and Executive Of cer 2016 Managing Executive Of cer 2017 Managing Executive Of cer Acting Director General of Power Engineering 2017 Director and Managing Executive Of cer Director General of International Consulting Operations and General Manager of 2018 General Manager of Business Development Operations (current position) Fukushima Works Of ce (current position) Director and Managing Executive Of cer 2013 Director General of Power Engineering Operations 2019 Director and Senior Managing Executive Of cer 2019 Director and Senior Managing Executive Of cer 2015 Director and Managing Executive Of cer (current position) (current position) 2016 Director and Senior Managing Executive Of cer 2017 Representative Director and Senior Managing Executive Of cer 2018 Representative Director and Senior Managing Executive Of cer in charge of energy business and power engineering (current position) 2019 Representative Director and Executive Vice President (current position)

Yoshizo Goto Kunio Okamura Naoki Honjo Yoshiko Koizumi Audit & Supervisory Board Member Audit & Supervisory Board Member Audit & Supervisory Board Member Audit & Supervisory Board Member 1982 Joined the Company Outside Independent 1978 Joined the Company Outside Independent 2008 General Manager of Logistics & 1979 Joined Overseas Economic 2008 General Manager of Finance & 1972 Registered in bar association Operations Department of International Cooperation Fund Accounting Department, Corporate (The Daini Tokyo Bar Association) Consulting Operations 2008 Director General of Operations Strategy Headquarters Joined Kikuchi Law and Patent Of ce 2010 General Manager of Operations Department, Japan International 2011 Executive Of cer 1980 Partner at Masuda & Ejiri Law Of ce Planning Of ce, International Cooperation Agency Deputy Director General of Corporate (current Nishimura & Asahi) Consulting Operations 2012 Senior Special Advisor of the Japan Headquarters and General Manager of 2000 Chair of Women Business Lawyers General Manager of Revenue International Cooperation Agency Finance & Accounting Department Committee, Inter-Paci c Bar Association Management Of ce, International 2015 Ambassador Extraordinary and 2014 Director and Executive Of cer (IPBA) Consulting Operations Plenipotentiary of Japan to the Republic Acting Director General of Corporate 2003 Expert member of Food Safety 2011 General Manager of Revenue of Cameroon, Ministry of Foreign Headquarters and General Manager of Commission of Japan Management Of ce and General Affairs of Japan (MOFA) Finance & Accounting Department 2007 Auditor at Bosch Corporation Manager of Compliance Of ce, 2016 Ambassador Extraordinary and Acting Director General of 2008 Counsel at Nishimura & Asahi International Consulting Operations Plenipotentiary of Japan to the Republic Corporate Headquarters 2009 Partner at City-Yuwa Partners 2013 General Manager of Corporate of Cameroon and the Central African 2015 Director General of Corporate (current position) Hiroaki Shinya Yasushi Hirusaki Auditing Of ce Republic, MOFA Headquarters 2012 Deputy Chair of the Government 2014 General Manager of Internal 2017 Special Adviser Procurement Review Board Director and Managing Executive Of cer / Director Director and Executive Of cer / Executive Of cer in 2019 Outside Audit & Supervisory Board Auditing Of ce Member of the Company 2018 Audit & Supervisory Board Member 2013 Director of the Japan Bar Association General of Domestic Consulting Operations charge of IR, Director General of Corporate 2015 Deputy Director General of International (current position) (current position) (current position) 1985 Joined the Company Headquarters and Director General of Human Consulting Operations 2015 Outside Director of Taiheiyo Cement 2017 Director General of Domestic Consulting Resources 2018 Audit & Supervisory Board Member Corporation (current position) Operations (current position) 1985 Joined the Company (current position) Outside Director of Dowa Holdings Co., Ltd. Director and Executive Of cer 2017 Executive Of cer in charge of IR and Director (current position) 2018 Director and Managing Executive Of cer General of Corporate Headquarters and 2016 Outside Auditor of Sumitomo Bakelite (current position) General Manager of Personnel Department Co., Ltd. Director and Executive Of cer (current position) 2017 Outside Audit & Supervisory Board 2018 General Manager of the 75th Anniversary Member of the Company (current position) Secretarial Of ce (current position)

51 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Sustainability

Board of Directors, Executive Officers and Audit & Supervisory Board Members (As of September 26, 2019)

Directors

NIPPON KOEI GROUP INTEGRATED REPORT 2019 52 Consolidated Financial Statements

I I

For the scal For the scal For the scal For the scal For the scal For the scal For the scal For the scal year ended year ended year ended year ended year ended year ended year ended year ended June 30, 2018 June 30, 2019 June 30, 2018 June 30, 2019 June 30, 2018 June 30, 2019 June 30, 2018 June 30, 2019

Assets Liabilities Net sales 106,023 108,589 Cash flows from operating activities Current assets Current liabilities Cost of sales 73,664 75,627 I 1 D 1 110 192 11 N 1 0 Gross profit 32,359 32,962 A 2 N 221 299 Selling, general and 200 202 25,797 27,851 administrative expenses 12 92 09 I 1012 11 Operating income (loss) 6,561 5,110 O 9 1 11 A 9 Non-operating income A 20 129 P 10 192 I 10 22 Total current assets 54,263 52,446 P 91 D 0 11 Non-current assets 12 1 P G I Property, plant and equipment 1 119 1 11 112 11 O 109 109 O 2 02 I 0 10 A 1100 909 Total current liabilities 28,441 28,082 T 120 I 02 21 Non-current liabilities Non-operating expenses 122 9 9 19 19 I 222 2 I A 2 20 D D 2 219 1 11 0 291 10 122 P 2 0 D 9 222 129 T 00 2 I P 19 A 9 1 1 1 I T 22 91 O 101 1 11 O 19 10 T 2 9 I 209 201 Total non-current liabilities 25,999 24,886 1 1 Ordinary income (loss) 6,721 5,584 D Total liabilities 54,440 52,969 2 A 99 9 Extraordinary income Net assets O 11 G 11 12 Subtotal 109 020 Shareholders’ equity 29 11 I 91 1 1 T 12 Total property, plant and equipment 27,624 29,882 I 21 2 Extraordinary losses I 19 11 Intangible assets R 2 2 N G 1 19 02 109 T 110 T 2 O 0 Cash flows from investing activities Total shareholders’ equity 58,229 61,003 Income (loss) before income taxes 7,165 5,584 N 12 9 Total intangible assets 12,964 13,501 Accumulated other comprehensive income Income taxes—current 1,832 1,991 P 22 Investments and other assets P 119 Income taxes—deferred 723 189 29 1 I 91 22 Total income taxes 2,556 2,180 P 2 19 1 22 20 0 Net income (loss) 4,608 3,403 P 192 19 D 112 102 R 9 9 N P 2 N 09 9 Total accumulated other 133 (1,913) P 1 2 comprehensive income Net income (loss) attributable to 4,555 3,318 O 2 2 owners of parent Non-controlling interests 1,086 1,115 P 90 00 A 1 19 Net income (loss) attributable to 52 85 992 Total net assets 59,449 60,205 non-controlling interests Total investments and other assets 19,037 17,345 O 0 21 Total liabilities and net assets 113,890 113,175 Total non-current assets 59,626 60,728 Other comprehensive income (loss) N 9 0 Total assets 113,890 113,175 1 0 Cash flows from financing activities 21 92 P 129 R 2100 29 R 1 29 P 29 00 91 P 2 1192 11 90 20 T O 2 Comprehensive income (loss) 4,698 1,349 N 02 19 Effect of exchange rate change on (22) (309) O 0 12 cash and cash equivalents N 1 Net increase (decrease) in cash and cash equivalents (2,709) (2,641) Cash and cash equivalents at beginning of period 17,083 15,233 Increase in cash and cash equivalents 860 71 from newly consolidated subsidiaries Cash and cash equivalents at end of period 15,233 12,663

53 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Consolidated Financial Statements

I I

NIPPON KOEI GROUP INTEGRATED REPORT 2019 54 Consolidated Financial Statements

D A 0 2019 E

For the scal For the scal For the scal For the scal Corporate Data year ended year ended year ended year ended June 30, 2018 June 30, 2019 June 30, 2018 June 30, 2019 Corporate name: N K Established: 19 Shareholders’ equity Accumulated other Head office: 11 K T Capital: 0991 A O 2 2019 comprehensive income Capital stock 1029 Business areas: D I Valuation difference on 9 1 available-for-sale securities Registered address: K T P E U D 10200 E I 21 22 101 119 Phone: 1200 Number of employees: 9 22 T 21 22 1 Representative: R A N 1 R D P Capital surplus 20 T 1 I 21 22 119 9 Foreign currency translation adjustment 11 20 D Stock Information R 21 1 T 22 Number of shares authorized: 000000 Shareholder T I N 209 1001 Distribution Number of shares issued: 1919 0.06% Retained earnings 35.44% T 21 101 Number of shareholders: 2 0 2 20 0 Fiscal year-end: 0 3.98% Remeasurements of defined Stock listing: T E benefit plans D 209 2 9 Securities code: 19 D 1192 1192 11.61% P Transfer agent: T 1 N 1 29 14.58% 34.33% R 12 T 1 29 T 20 2 Major Shareholders (Top 10 by Shares Owned) 9 9 2 Name Shares Owned Percentage of Total Shares Owned Total accumulated other Treasury shares comprehensive income T K E A 101 10 0 110 0 1 T T T A 10100 09 UG 92 P 2 21 1 I 090 D 29 00 N 12 2029 R 21 GOERNENT O NORA 1099 T 22 92 T 102 20 T T A 000 1 110 1 191 00 21 Total shareholders’ equity Non-controlling interests T T A 9 00 2 10 229 212 20 T K 00 22 10 I N N T 1910 91 9 29 209 D 1192 1192 T 20 29 P 1 10 111 Stock Price Total net assets T T P 2 99 000 2000 D 29 00 T 2 2 I 000 100 229 100 19 D 1192 1192 000 1200 P 1 P 2 2000 00 D 29 00 N 2000 1000 00 1 T 0 0 99 020 201 201 201 201 2019

55 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Consolidated Financial Statements

D A 0 2019 E

NIPPON KOEI GROUP INTEGRATED REPORT 2019 56 Network (As of June 30, 2019)

Of ces (Nippon Koei) Main Domestic Bases of Nippon Koei Liaison Of ces (Nippon Koei) Head Of ce / Shin-Kojimachi Of ce / Group Companies Tokyo Branch Of ce Of ces (Group Companies) Branch Of ces / Research Centers / Sites Sapporo Of ces Branch Of ce

Okinawa Dublin Branch Of ce BDP Holdings Manchester Sendai Branch Of ce Niigata Branch Of ce Nippon Koei Energy Europe Hiroshima Power & Digital Ruien Energy Storage Branch Of ce Business Unit London R&D Center Quadrangle Architects Limited Fukuoka Branch Of ce Nippon Koei Bangladesh Nippon Koei India Tunis Vientiane Rabat Baghdad Amman Shanghai Head Of ce / Bangkok Nagoya Shin-Kojimachi Of ce / New Delhi Dhaka Hanoi Shikoku Branch Of ce Tokyo Branch Of ce Nippon Koei Branch Of ce Naypyidaw Vietnam International Nippon Koei Osaka Yangon Manila Latin America-Caribbean, Mexico Philkoei International Branch Of ce Myanmar Koei Phnom Penh San Salvador Ho Chi Minh City Colombo Thaikoei Ironmont Hydro Nippon Koei LAC Medellin International Singapore Of ce Quito Koei Africa Nairobi Guayaquil Jakarta Cikaengan Tirta Energi Lima Palmas Indokoei Cochabamba

Maputo Nippon Koei Nippon Koei Mozambique Asuncion LAC do Brasil Sao Paulo

Major Group Companies (As of June 30, 2019) History

1946 Nippon Koei established in Chiyoda-ku, Tokyo 2008 Nippon Koei India Pvt. Ltd.* established in India Domestic Consulting Business International Consulting Business 1954 Received order for planning of Baluchaung Hydropower 2010 NKLAC, Inc.* established in Panama Consolidated Subsidiaries Consolidated Subsidiaries • Philkoei International, Inc. Plant in Burma (name changed to Nippon Koei LAC, Inc. in September 2011) • Tamano Consultants Co., Ltd. • Koei Research & Consulting Inc. (KRC) • PT. Indokoei International • Nippon Civic Consulting Engineers Co., Ltd. • Nippon Koei Latin America-Caribbean Co., Ltd. • Myanmar Koei International Ltd. 1958 Acquired Nikki Manufacturing Co., Ltd. 2012 Nippon Koei Vietnam International Co., Ltd.* established • El Koei Co., Ltd. • Nippon Koei Latin America-Caribbean, (name changed to Nikki Corporation* in July 1982) Non-Consolidated Subsidiaries 2013 Myanmar Koei International Ltd.* established Non-Consolidated Subsidiaries Mexico S.de R.L. de C.V. • Thaikoei International Co., Ltd. • Nippon Koei LAC, Inc. 1963 Shares listed on the Second Section of the Tokyo • Aichi Tamano Information System Co., Ltd. • Koei Africa Company Limited 2015 KOEI Energy Co., Ltd.* established • Nippon Koei LAC do Brasil Ltda. Stock Exchange • Tamano Ecost Co., Ltd. • Nippon Koei Mozambique, Ltda. 2016 UK-based architectural design company • Nippon Koei India Pvt. Ltd. 1978 New head office building completed in Kojimachi, Tokyo; • Geoplan Namtech Inc. • Nippon Koei Bangladesh Ltd. BDP Holdings Limited* becomes a subsidiary • Nippon Koei Vietnam International Co., Ltd. relocated head office; listing moved to the First Section of the Tokyo Stock Exchange 2017 Koei Research & Consulting Inc.* established (Koei Research Institute International Corp. and Power Engineering Business Energy Business Urban & Spatial Development Business 1986 Koei System Co., Ltd.* established System Science Consultants Co., Ltd. merged) Consolidated Subsidiary Consolidated Subsidiaries Consolidated Subsidiaries 1989 Philkoei International, Inc.* established in the Philippines 2018 Made Ironmont Hydro Pte. Ltd.* • Koei System Inc. • KOEI Energy Co., Ltd. • BDP Holdings Limited 1992 PT. Indokoei International* established in Indonesia (a hydropower investment company in Singapore) and • Nippon Koei Energy Europe B.V. • Quadrangle Architects Limited El Koei Co., Ltd.* established its subsidiaries into a consolidated subsidiary of the Company • Ironmont Hydro Pte. Ltd. Non-Consolidated Subsidiary Nippon Koei Bangladesh Ltd. established Non-Consolidated Subsidiaries • Kisho Kurokawa architect & associates Co., Ltd. 1995 KRI International Corp. established 2019 Canada architectural design company • PT. Cikaengan Tirta Energi 2003 Nippon Koei Latin America-Caribbean Co., Ltd.* established Quadrangle Architects Limited* becomes a subsidiary • Ruien Energy Storage NV Nippon Civic Consulting Engineers Co., Ltd.* becomes a subsidiary * Currently a consolidated subsidiary Real Estate Leasing Business Other 2005 Tamano Consultants Co., Ltd.* becomes a subsidiary Consolidated Subsidiary Consolidated Subsidiary 2007 Nippon Koei LAC do Brasil Ltda.* established in Brazil • Nikki Corporation • DSI Co., Ltd. Non-Consolidated Subsidiary • Nippon Koei Australia Pty. Ltd.

57 NIPPON KOEI GROUP INTEGRATED REPORT 2019 Network (As of June 30, 2019)

Maputo Nippon Koei Nippon Koei Mozambique Asuncion LAC do Brasil Sao Paulo

Major Group Companies (As of June 30, 2019) History

NIPPON KOEI GROUP INTEGRATED REPORT 2019 58 NIPPON KOEI GROUP INTEGRATED REPORT 2019

Act with integrity and contribute to society through technology and engineering

INTEGRATED REPORT 2019 Fiscal year ended June 30, 2019