Kajima GroupMedium-Term Business Plan (Financial Year to March 2007—Financial Year to March 2009)Announced on May 18, <strong>2006</strong>Credibility and TrustOur Credibility and TrustMedium-Term Business Plan4Our goals for the three-year medium-term businessplan ended in the financial year to March <strong>2006</strong>were to secure consolidated recurring profit ofmore than ¥42.0 billion and reduce our level ofinterest-bearing debt. As a result of our efforts toenhance business profitability, improve our financialposition, strengthen earnings capacity and diversifysources of earnings, we exceeded this figure, andachieved nearly all targets in our initial plan.The basic principles of the new medium-term businessplan, launched in April <strong>2006</strong> and extendingthrough the financial year to March 2009,are “Focus on client orientation” and “Ensurecorporate ethics.”In executing our business, we emphasize workingwith the client, to maintain the level of trustworthinessexpected of the Kajima Group. We will significantlyenhance our efforts with regard to quality,safety and the environment, while respecting and<strong>full</strong>y enforcing compliance and CSR based on selfdisciplinedcorporate ethics.Through such company-wide efforts, we will realizea corporate culture filled with the spirit of challenge,achieve a higher earnings capacity, and raise ourcorporate value by fostering vigorous and enthusiasticemployees, as we seek to make furtherstrides in our development.I. Earnings Targets (Financial Year toMarch 2009)Our target is to establish a structure capable ofmaintaining a stable level of consolidated recurringprofit of more than ¥60.0 billion annually,raising profitability to an even higher level. At thesame time, we will maintain a proactive stancewith regard to return of profit to investors andstakeholders, and by cutting interest-bearing debtand enhancing shareholders’ equity, achieve adebt/equity ratio of around 1.00.II. Business StrategiesDeeply cultivate our mainstay construction business,and strengthen technology and marketing•To further boost competitiveness in the coredomestic construction business, we will enhanceour sales capability to win contracts through aproject proposal capacity that respects the growingsophistication and diversification of customerneeds, and through our advanced technologyand engineering capabilities, thereby boostingearning capacity.•We will pursue synergistic effects in the constructionbusiness through proactive expansion of thereal estate development business, strengtheningthe environment and private finance initiative (PFI)businesses, and expanding the constructionrelatedfield, seeking to enhance the earningscapacity of the Kajima Group.Principal measures for these strategies are asfollows.1. ConstructionDomestic Construction Business•We will strengthen our project proposal capacityand competitiveness through efforts to ensurecloser cooperation between sales, design andconstruction, and by enhancing our productionplanning and estimate functions at the time ofreceipt of the contract. In particular, we will bolsterthe business framework by sector, such as forelectronic devices and healthcare.•Responding to the growth of comprehensive evaluationsystems as a result of laws related to thepromotion of quality maintenance for public
works, we will improve our technological proposalcapability and price competitiveness by exertingour comprehensive capabilities.•We will enhance our construction supervisionstructure, as well as develop and strengthensubcontractors, suppliers and other affiliatedcompanies, to build a production structure thatgives ample consideration to quality, safety andthe environment.Overseas Construction Business•We will improve our risk management structure,and focus on selective business promotion, care<strong>full</strong>ychoosing regions and projects that allow us toensure the superiority of the Kajima Group.•In civil engineering, we will continue to enhancestructures and personnel in areas with growingmarkets such as Asia and the Middle East, andattain stable profit generation.III. Management FoundationImplement rapid reform, and increase the level ofsocietal trust and our standing•We will restructure our operational, organizationaland personnel structure in accordance withchanges in the business environment, and seek tofurther increase efficiency and corporate competitivenessthrough such measures as focusing onresearch and development.•We will establish Office of Internal Control, and willdevelop and strengthen our internal control systemthrough a company-wide risk managementstructure. We will also ensure strict observance ofcompliance, and work toward sound and efficientmanagement. We will strengthen the functionsof Office of Corporate Social Responsibility witha framework directly under the President,and expand fulfillment of the Company’ssocial responsibility.Our Credibility and TrustMedium-Term Business Plan52. Real Estate DevelopmentDomestic Real Estate Development Business•As the second source of earnings following thedomestic construction business, we will workaggressively in this business to generate new,high-quality projects by cultivating our expertise,and further strengthening cooperation with theconstruction division.Overseas Real Estate Development Business•We will pursue healthy and vigorous businessdevelopment tailored to the special characteristicsof each region, such as the distribution warehousedevelopment business, which is growing stronglyin North America, and the leasing business inSoutheast Asia.