full Annual Report 2003(5.9

Annual Report 2003 

For the year ended March 31, 2003 

Kajima Corporation

c2 

Profile 

Twenty years after its founding in 1840, Kajima Corporation constructed Japan’s 

first Western-style building—the Eiichiban kan—in Yokohama. Since then, Kajima 

has rapidly developed its operations by anticipating future trends in all types of 

construction-related needs. The Company’s activities have encompassed the railway 

construction and electric power development that propelled Japan’s initial 

modernization as well as the coastal industrial developments, high-rise structures, 

nuclear power plants, and maritime-related projects that helped the nation rise 

quickly to economic superpower status. Today, as one of Japan’s leading construction 

companies Kajima maintains subsidiaries in North America, Europe, and Asia 

and is active in construction and real estate development business around the 

world. 

With an eye to the dynamic changes under way in the operating and social environments, 

Kajima will continue to evolve, supported by superior technological expertise, 

rich human resources, and a pioneer spirit. By working in close cooperation 

with our stockholders, customers, and local communities, we are confident we can 

contribute to a brighter future for all. 

Contents 

Financial Highlights (Consolidated and 

Non-Consolidated) 1 

Message from the Management 2 

Kajima Group Medium-Term Business Plan 

(Fiscal 2004 to Fiscal 2006) 4 

Domestic Operations 6 

•Construction Business 6 

•Real Estate Development 10 

•Design 12 

Overseas Operations 14 

•Construction and Real Estate 

Development 14 

Research and Development 18 

Highlights 20 

Financial Section 22 

Overseas Network 66 

Principal Subsidiaries and Affiliates 68 

Board of Directors and Auditors 70 

Corporate Data 70 

Cautionary Statements 

This Annual Report includes forward-looking statements that represent Kajima’s assumptions and 

expectations in light of currently available information. These statements reflect industry trends, 

clients’ situations and other factors, and involve risks and uncertainties which may cause actual 

performance results to differ from those discussed in the forward-looking statements in accordance 

with changes in the domestic and overseas business environment.

Financial Highlights (Consolidated and Non-Consolidated) 

KAJIMA Corporation (and Consolidated Subsidiaries) 

For the years ended March 31 

2003 2002 2003 

(Thousands of 

Consolidated: (Millions of Yen) U.S. Dollars) 

Revenues ¥1,874,802 ¥2,060,353 $15,623,350 

Net Income (Loss) 10,111 (41,153) 84,258 

Total Assets 2,024,226 2,226,712 16,868,550 

Stockholders’ Equity 159,017 180,220 1,325,142 

Per Share: (Yen) (U.S. Dollars) 

Basic Net Income (Loss) ¥0,0010.44 ¥000(43.05) $0,0000.087 

(Thousands of 

Non-Consolidated: (Millions of Yen) U.S. Dollars) 

Revenues ¥1,458,086 ¥1,550,317 $12,150,717 

Net Income (Loss) 8,515 (47,794) 70,958 

Total Assets 1,680,439 1,826,910 14,003,658 

Stockholders’ Equity 184,011 206,013 1,533,425 

Contract Awards 1,139,509 1,200,432 9,495,908 

Total Contract Backlog 1,385,832 1,704,409 11,548,600 


Basic Net Income (Loss) ¥0,0008.86 ¥000(49.72) $0,0$00,000.074 

Cash Dividends 5.00 7.00 0.042 

Notes: 1. The U.S. dollar amounts included herein are presented solely for convenience of the reader. Such dollar amounts have been 

translated from yen at the approximate exchange rate in Tokyo on March 31, 2003, of ¥120=U.S.$1. The translations should 

not be construed as representations that Japanese yen have been, could have been or could in the future be converted into 

U.S. dollars at that or any other rate. 

2. Basic net income (loss) per share is computed by dividing net income (loss) attributable to common stockholders by the 

weighted-average number of common shares outstanding for the years ended March 31, 2003 and 2002, respectively. 

3. Diluted net income (loss) per share is not disclosed because the Companies have nothing which might dilute the per share 

information for the year ended March 31, 2003 and because of the net loss of the Companies for the year ended March 31, 

2002 in the consolidated and non-consolidated results. 

1

2 

Message from the Management 

Rokuro Ishikawa 

Chairman 

Operating Environment 

Japanese domestic demand remained subdued overall throughout fiscal 2003 

(ended March 31, 2003), as persistent deflation and steadily deteriorating job 

markets kept personal consumption and business investment in check. Business 

confidence suffered amid deflationary spirals involving falling land and stock prices. 

Concern over a stalling U.S. economy added to the uncertainty, further clouding the 

economic outlook. 

In the Japanese construction market, private domestic demand for construction 

services continued to slide, most notably in the manufacturing sector. Public-sector 

demand also fell, as fiscal consolidation induced central and local governments to 

rein in public works spending. 

Geopolitical risks constrained overseas markets in the latter half of the period, preventing 

the economies of the U.S. and Europe from achieving a robust recovery. 

Results 

Unable to completely avoid the negative influence of these market conditions, the 

Kajima Group on a consolidated basis recorded mixed results for fiscal 2003. 

Revenues fell 9.0% from the previous term to ¥1,874.8 billion, primarily due to a 

decrease in the total construction revenues of the Company and its consolidated 

companies in Japan and overseas. 

These shrinking construction revenues and a less favorable gross profit margin 

combined to bring gross profit down 9.6% year on year. As a result, operating 

income declined 14.2% to ¥36.3 billion. Consolidated net income bounced back to 

¥10.1 billion, after a loss of ¥41.2 billion in the previous fiscal year, when the Group 

booked a large loss to restructure its asset holdings. 

A New Medium-Term Business Plan 

To achieve sustained growth and development into the future, the Kajima Group 

has been aggressively pursuing a medium-term business plan, known as the Next 

Three-Year Plan, which was formulated in fiscal 2002. However, the rapid changes 

in the business environment surrounding the Group, including the shrinking construction 

market and the deepening of deflationary trends in Japan, have significantly 

exceeded the assumptions made when the plan was drafted early in 2001.

Sadao Umeda 

President 

Therefore, while vigorously pursuing measures to strengthen the Group’s earning 

power and diversify sources of profits, we prepared a new medium-term plan one 

year earlier than originally intended, targeting the three years from fiscal 2004 to fiscal 

2006 (ending March 31, 2006). During the fiscal 2004 to fiscal 2006 period, we 

aim to swiftly enhance profitability through measures that include a revamp of our 

retirement pensions system. We are currently focusing the efforts of the entire 

Group on this plan. 

In terms of practical business strategies, we will work to secure orders in our construction 

business by strategically shaping projects through planning and technical 

proposals and by taking more initiative in urban renewal projects. On the production 

side, we will further streamline our production systems, promote centralized and 

overseas procurement, and reinforce synergies among Group companies through 

renewal and other projects, in an effort to further improve project revenues. At the 

same time, we will expand and strengthen overseas operations, development projects, 

private finance initiative (PFI) projects, engineering projects, and the environmental 

business, and build in further earning opportunities over the whole life-cycle 

of buildings. As a result of these strategies, we hope to diversify sources of revenue 

and build a solid base for long-term, stable profitability. We will also promote strategic 

and selective research and development. 

Along with these policies, we will improve and strengthen corporate structures and 

financial performance by focusing strong and sustained efforts on paring fixed 

costs and personnel expenses, restructuring the head office and branches, cutting 

back on asset holdings, and reducing interest-bearing debt. 

We are also reviewing our corporate pension system in an effort to establish a stable 

system that is free from asset management risk. (The medium-term business 

plan is outlined on the following pages.) 

Finally, we would like to request the understanding and support of our shareholders 

and all other interested parties. 


Chairman 

Sadao Umeda 

President 

3

4 

Kajima Group Medium-Term Business Plan (Fiscal 2004 to Fiscal 2006) 

Business Strategy 

The Kajima Group will meet increasingly sophisticated customer needs in shrinking construction 

markets by fully utilizing its technical capabilities and providing superior quality. In doing 

so, Kajima will increase market share as well as profitability in its core construction business. 

More specifically, Kajima will expand its presence in urban renewal markets where Kajima’s 

construction expertise and real estate development experience can be integrated to produce 

unique solutions. Kajima will focus on market segments that require engineering, environmental, 

and renovation skills and input. The Group will also work to build additional sources 

of revenue including PFI projects, life-cycle management services, and overseas ventures. 

Kajima will also improve business fundamentals by cutting back administrative expenses and 

taking measures to reduce financial risk. 

The following are the specific targets and tactics of the plan. 

Performance Targets for Fiscal 2006 (Ending March 31, 2006) 

Consolidated Non-consolidated 

Revenues ¥1,600 billion ¥1,100 billion 

Recurring profit ¥42 billion or more ¥32 billion or more 

Interest-bearing debt ¥480 billion or less ¥300 billion or less

Principal Tactics 

1. Augment profitability of the construction business 

(1) Secure orders by enhancing marketing initiatives 

• Assist clients to coordinate pre-construction tasks, provide clients with technical advice 

that makes strategic sense, and integrate marketing/design/construction staff in ways that 

allow this marketing approach to work most efficiently. 

• Aggressively pursue projects where Kajima’s know-how and expertise can have the greatest 

impact. Specifically targeted are “engineering” and “environmental” fields and reinforcing 

renovation operations. 

(2) Improve project profit margins by boosting cost-competitiveness 

2. Strengthen involvement in overseas business 

3. Diversify and expand sources of profits 

(1) Real estate operations in Japan 

• Launch complex, large-scale development projects in strategically selected CBD or railwaylinked 

locations. 

• Achieve sufficiently high returns on equity by structuring deals such that the funds invested 

by Kajima are minimized and/or quickly recovered. 

• Launch a real estate investment fund (tentatively called the Kajima Fund) with a mission to 

acquire and manage income producing properties that will generate stable fees/dividends 

over the long haul. 

(2) Enhance involvement in PFI projects 

(3) Building life-cycle management 

• Enhance capabilities in the area of building maintenance and operation as well as consulting 

on related tasks. 

4. Focused research and development 

Stay focused on innovations that enable cost reduction, shortening of works schedules, and 

improvements in other areas of importance to Kajima. 

5. Cut fixed costs and selling and administrative expenses 

(1) Downsize the workforce 

(2) Revamp the retirement benefit system, etc. 

(3) Slim the administrative divisions and cut back on selling and administrative 

expenses 

6. Restructure the head office and branches 

7. Reinforce Group management systems (enhance revenue 

generating capacity and increase in consolidated profits) 

8. Improve risk management and return on assets 

Reduce assets by disposing of asset holdings (shares, real estate, etc.) and reduce interestbearing 

debt (target for fiscal 2006 year-end: reduce consolidated interest-bearing debt to 

¥480 billion or less). 

9. Strengthen the Kajima brand 

5

6 

Roppongi Hills Mori Tower 

Winds Sasebo 

DOMESTIC OPERATIONS 

Kajima 

Corporation 

Construction Business 

During fiscal 2003, the Japanese construction industry faced a 

challenging business climate amid enormous structural changes in 

the market, including a slump in investment and the imbalance 

between the falling scale of construction investment and the 

increasing number of construction businesses. Against a high of 

¥84,000 billion recorded in fiscal 1993, investment in construction 

for fiscal 2004, amid ongoing structural reform, appears likely to 

fall as low as ¥54,000 billion as a result of a reduction in publicsector 

investment and a decline and shifting offshore of privatesector 

investment in plant and equipment. A look at the number of 

construction companies as of March 31, 2003 reveals that there 

were 9.4% more companies in fiscal 2003 than in the days of peak 

construction investment, indicating a fiercely competitive environment. 

Given such circumstances, the current difficult situation is 

likely to continue for the foreseeable future, as investment in construction 

is not expected to grow in the medium to long term. 

Influenced by these environmental factors, the performance of 

Kajima’s operations in Japan for fiscal 2003 was as follows. The 

value of contracts awarded decreased 9.6% from the previous 

term to ¥1,132.4 billion due to a significant decline in orders for 

construction projects by non-manufacturing industries. Total revenues 

across Japan declined 10.8% year on year to ¥1,449.0 billion. 

The gross profit margin for completed works decreased from 

6.8% in fiscal 2002 to 6.6% for the term under review as a result of 

a decline in total revenues and continued fierce price competition. 

Gross income of ¥101.8 billion was recorded for fiscal 2003. 

Annual Report 

2003 

Nakanoshima Mitsui Building

TOKI MESSE: Niigata Convention Center • Bandaijima Building 

PENTA-KUN Tama Center Branch 

In light of the performance outlined above, a new Medium-Term 

Business Plan (fiscal 2004 to fiscal 2006) was recently formulated 

to overlap the final year of the Next Three-Year Plan (fiscal 2002 to 

fiscal 2004). The plan was developed to address the negative business 

environment, which is deteriorating even faster than expected, 

and is a product of Kajima’s awareness of the urgent need to 

establish a stable revenue base for the aggressive promotion of 

stronger earnings and more diverse sources of revenue. In the 

construction business, the core business of the Kajima Group, the 

most pressing issues are increasing Kajima’s share of all contracts, 

strengthening earnings capacity and diversifying sources of 

income. 

To enhance the Group’s share of contracts, Kajima will provide 

clients with ideas and technical advice to assist the launch of their 

projects. More specifically, Kajima is putting in place an organizational 

framework that will help clients coordinate pre-construction 

tasks, provide clients with strategically sound technical advice, and 

integrate the Group’s marketing, design and construction functions. 

In addition, the Group will make the most of Kajima’s technical 

expertise in urban renaissance projects and projects involving 

special zones for structural reform, and will expand and strengthen 

enterprise and sector-based marketing resources based on market 

trends. In the engineering sector, where demand is predicted to 

rise, Kajima intends to increase full-turnkey contracts for building 

production-related facilities and distribution facilities. In addition to 

7

8 

Kinokawa Viaduct 

Akita Highway, Gojome IC 

No. 10 and 11 LNG underground 

storage tanks at TEPCO’s Futtsu 

electric power plant 

Nagoya City Subway, Sunada- 

Bashi, East Construction Area 

the construction of facilities, Kajima aims to cross new business 

boundaries by providing unparalleled solutions that encompass all 

services from the planning of facilities through their operation and 

maintenance. In the environmental sector, Kajima will expand its 

recycled-resources business, focusing on waste-to-resource conversion, 

soil rehabilitation and water treatment. The Group will also 

deploy resources for the recycling of organic waste, wind power 

and the dismantling of existing incinerators. In renewal projects, 

Kajima will generate customer demand that leads to new contracts 

by making the most of proprietary technologies related to in situ 

seismic isolation and earthquake-proofing reinforcement, the 

Group’s various consultation and assessment services, and the 

Kajima Customer Building Support Center. 

Kajima’s initiatives for enhancing earning power, or increasing the 

profit margin on work, are aimed at bolstering on-site productivity. 

To accomplish this, Kajima will take full advantage of a diverse 

range of production systems that enable rationalized construction 

costs and shorter work schedules. Kajima is making maximum use 

of information technology to make labor savings and reduce costs. 

Furthermore, Kajima’s goal is to make thoroughgoing cost reductions 

by reforming procurement activities through adopting practices 

such as centralized procurement by branches, overseas 

procurement and procurement using e-commerce. 

To diversify revenue sources, Kajima will engage in strategic largescale 

and complex projects, mainly real estate development projects 

within Japan, such as projects in the Tokyo central business 

district and developments in the vicinity of transportation hubs. 

Another source of revenue is expected from the establishment of 

the Kajima Fund, which aims to promote leasing projects and thus 

acquire long-term stable revenues. Kajima will also gear up to be a 

leading figure in the field of PFI projects, taking a careful approach 

to project selection. The Kajima Group will work together to promote 

maintenance, control and management services aimed at 

acquiring a wide array of revenue opportunities. In the LCM (lifecycle 

management) sector, the framework for LCM initiatives will 

be strengthened on a Group basis in terms of the maintenance, 

control and management of facilities as well as consulting services. 

Kajima has set its sights on increasing contract opportunities by 

enhancing its services for life-cycle management of buildings. 

The essence of Kajima’s business is to acquire revenue by providing 

invaluable services to customers. As it makes ever greater use 

of its technical capabilities and expertise, the Company’s ambition 

is to provide customers with new services and create new markets 

by stimulating customer demand. By continuing to accurately 

assess market changes, Kajima will strive to develop projects that 

ensure the most effective use of the Group’s resources, in particular 

in sectors where future growth is anticipated. Kajima will do its 

utmost to ensure growth for the entire Group as it continues to fulfill 

all its obligations to society.

Yamaguchi Reservoir 

New Building Construction Contracts 

•Muromachi Mitsui New Building Construction Project 

Use: Office, hotel, retail, parking and common area, Floor area: 130,752 m2 Structure: S and SRC, partially RC 4 basements, 38 floors above ground, 

1 penthouse 

•Shiodome Sumitomo Building Construction Project 

Use: Office, hotel, retail, parking, Floor area: 99,400 m 2 

Structure: S, RC, SRC 3 basements, 25 floors above ground, 2 penthouses 

•Akasaka 1-chome Project 

Use: Office, condominiums, retail, Floor area: 74,640 m 2 

Structure: S, SRC 3 basements, 29 floors above ground, 1 penthouse 

•Shiki Asakadai Project 

Use: Condominiums, Floor area: 61,269 m 2 

Structure: RC, 1 basement, 14 floors above ground 

•Laurel Tower Namba 

Use: Condominiums (389 units), Floor area: 50,731 m 2 

Structure: RC, 1 basement, 39 floors above ground, 1 penthouse 

•Takeda Chemical Industries Hikari Plant 

Use: Pharmaceutical-related facilities, Floor area: 11,926 m 2 

Structure: SRC (partially RC), 3 floors above ground 

New Civil Engineering Contracts 

•Construction Work on the Sunakosawa Dam 

Gravity dam; Height: 78.5 m, Length: 185 m, Maximum water capacity: 

8,650,000 m3 , Effective capacity: 7,630,000 m3 , Control of flood, water flow 

level and supply of drinking water 

•Ishioka Second Section Tunnel Construction of the Kasumigaura Water 

Conveyance Project 

Water tunnel work to connect Kasumigaura Lake and Nakagawa River; shield 

tunnel method. Main tunnel length: 5,000 m, Tunnel diameter (interior): 3.5 m 

•Water Pipeline (f 1,800 mm – 700 mm) Project, to be constructed between 

Ohi Water Supply Station and Higashi-Ohi, Shinagawa Ward in Tokyo 

Shield tunnel method; utilizing a unique system of ejecting a smaller 2,400-mm 

diameter sub-shield machine from a 4,500-mm main shield machine at right 

angle to build a backup water line system in Tokyo 

•Construction Work of National Highway 9, Kyoto-Nishi Underground 

Two-Level Crossover Project 

Conversion of four-lane highway and building of a two-lane underpath to solve 

traffic congestion at the intersection. Tunnel length: 490 m 

•Civil Portion (The 4th Building Construction Area) of Construction Work 

for the Nakanoshima New Railway 

Open cut tunnel; Length: 192.4 m, Width: 15 to 21 m 

Shield tunnel; Length: 418.6 m, External diameter of segments: 6,800 mm 

•Fukuoka Route 202 Outer Ring Common Duct No. 1 Work Shield Tunnel 

Project 

Construction of a common duct underneath Fukuoka Route 202; 

Length: 2,770 m, External diameter of segments: 6,300 mm 

•Construction Work for the Body of Inaba Dam 

Gravity dam; Height: 56 m, Length: 233.5 m 

Maximum water capacity: 7,270,000 m 3 , Effective capacity: 6,190,000 m 3 , 

Control of water flow level and supply of drinking water 

9

10 

Garden Plaza Shinkemigawa 

Garden Plaza Shinkemigawa 

(1988 to March 2003) 

Location: Mizuho 2-chome, Hanamigawa-ku, 

Chiba City, Chiba Prefecture 

Project outline: 1,031 condominiums (large-scale 

condominium development of 14 

buildings), 14 floors above ground 

Construction area: 128,927 m 2 


Kajima 

Corporation 

Real Estate Development 

Shinjuku East Building 

(1999 to October 2002) 

Location: Tomihisa-cho, Shinjuku-ku, Tokyo 

Project outline: Offices, 6 floors above ground, 2 basement 

levels 


During fiscal 2003, land prices throughout Japan fell for the 12th 

consecutive year, and the current environment offers no signs of a 

slowdown in the decline. In the 23 wards of Tokyo, however, the 

rate of decrease has dropped for four consecutive years, and there 

are some areas in the central business district where prices have 

actually held steady or even risen. 

In the residential market, the supply of newly built condominiums 

in the greater Tokyo metropolitan area was significantly high during 

the fiscal year under review, at around 88,500 new units. Despite 

developers’ concerns over slack demand, low interest rates for 

housing loans and the effects of the calendar 2003 tax reform 

package — which increased the limit for tax exempt pre-mortem 

gifts when the funds are used for acquisition of residential properties 

— are expected to maintain a favorable environment for home 

purchases. Under these conditions, no significant deterioration in 

the balance of supply and demand is currently anticipated. In addition, 

large condominium projects in superior locations with excellent 

access will continue to attract demand. 

The office building market continues to be affected by consolidation 

accompanying the restructuring of large enterprises, resulting 

in rising vacancy rates. Although demand for large newly constructed 

buildings remains high, ever-intensifying competition for 

tenants among medium and small-sized buildings has caused further 

softening in rental market prices. As these facts illustrate, the 

gap between successful properties, which feature good locations 

or added-value amenities, and unsuccessful properties, which lack 

special features, appears likely to continue in both the condominium 

and office property markets. 

Amid this market environment, Kajima has focused its development 

business on redevelopment projects, primarily large office 

buildings and large condominiums. In the office building sector, a 

redevelopment project in Tokyo’s Higashi Shinagawa district 

(Shinagawa Seaside Forest, Phase I, completed in September 



Shinjuku East Building

Shinagawa Seaside Forest 

Shinagawa Seaside Forest, Phase I 

(1996 to September 2002) 

Location: Higashi Shinagawa 4-chome, 

Shinagawa-ku, Tokyo 

Project outline: Offices, retail stores, 23 floors above 

ground, 2 basement levels 


2002) saw Kajima acquire a 23-story office building with a total floor 

area of approximately 46,000 square meters, which was then sold to 

Hitachi Software Engineering Co., Ltd., becoming its new headquarters. 

In the case of the Shinjuku East Building (completed in October 

2002), a six-story metropolitan office building with a total floor area 

of approximately 10,900 square meters, all office space was taken 

prior to the completion of the construction, illustrating the successful 

acquisition of tenants in an unsympathetic market environment. 

In the commercial leasing business as a whole, Kajima leased a total 

of 62 properties as an owner or master lessor. This business generated 

revenues of approximately ¥14.0 billion, with an occupancy rate 

above 95%. Kajima will continue to conduct efficient leasing management 

in association with its affiliates, East Real Estate Co., Ltd., 

and Kajima Tokyo Kaihatsu Corporation. 

In residential sales, several large condominium development projects 

such as Garden Plaza Shinkemigawa (completed in March 

2003) have reached completion, with all of these properties either 

sold out or nearly sold out prior to the completion of the construction. 

The Company recorded sales of a total of around 1,770 condominiums 

and single-family homes in fiscal 2003. 

During fiscal 2003, Kajima completed due diligence works on 69 

buildings, earning high praise for its performance in this area. With 

the forecasted acceleration in the liquidation of real estate, Kajima 

will focus on fee-based businesses, in which the Company will be 

able to leverage its real estate development expertise both in 

Japan and overseas. 

11

12 

Seinan Gakuin Junior and Senior 

High School 

Sumitomo Osaka Cement 

Nano/Tera Technology Center 


Design 

Makuhari Park Tower 

Kajima 

Corporation 

Kajima’s Architectural and Engineering Design Division provides 

design services worldwide in a variety of construction marketing 

and design fields. The division maximizes the global synergies of 

Kajima’s locally incorporated design offices in the United States, 

Europe and Asia — Kajima Associates, Inc. (KAI), Kajima Design 

Europe Ltd. (KDE), and Kajima Design Asia Pte. Ltd. (KDA). In 

Japan, the division is realizing increasingly efficient operations 

through its well-established collaboration with Ilya Corporation, 

which specializes in interior design, and Armo Architects & 

Engineers, experts in presentations and drafting. 

In year ended March 31, 2003, the division was awarded 533 

design commissions (for a total construction value of ¥409.6 billion), 

and delivered consultancy services in 1,068 projects. 

Among the division’s major design projects were three skyscrapers 

completed between April and June 2003 on redeveloped land in 

Shiodome in Tokyo — the Shiodome Tower complex (38 stories) of 

offices and a city hotel, the Shiodome Media Tower (34 stories), 

and the Nippon Express Headquarters Building (28 stories). Major 

projects that have played an important role in urban renewal in 

Tokyo included the construction management of three high-rise 

towers in Higashi Shinagawa, and a residential and office complex 

in Toranomon that is currently in the design stage. The Makuhari 

Park Tower (32 stories), which used the Kajima Free-Plan High- 

Rise Housing System (using Super Reinforced-Concrete Frame 

Construction), was completed in March 2003 and has elicited a 

favorable response from the market. Several other high-rise residential 

developments using this proprietary Kajima system are 

currently on the drawing board. 

Other noteworthy design proposals include (1) the Akihabara UDX 

Building, which employs performance design to meet the needs of 

diversifying work styles and ensure open and highly adaptable 

work spaces; and (2) the PFI project for the Akasaka Apartment for 

the House of Representatives, a commission that Kajima won 

thanks to special security proposals and overall design quality as a 

housing complex. 



The Second Building of Taisho 

Pharmaceutical’s Head Office

Shiodome Area including Shiodome Tower and Nippon Express Headquarters 

Technical development by the division included the development 

of a 3-Dimensional Data Base CAD system that supports data 

sharing and integration at all phases of a project from design to 

construction. In 2001, the division began applying the technology 

to actual design work, and in 2002, 27 projects were done using 

this system. CAD drafting centers have also been established 

overseas to promote even greater operating efficiency. 

The division is also involved in a variety of environmentally conscious 

design projects. These include the use of natural ventilation 

Organizational Profile 

Kajima’s dynamic global marketing and design campaign is spearheaded by 

the Company’s Architectural and Engineering Design Division, which provides 

design services to meet the needs of a rapidly changing world, working in close 

cooperation with Kajima’s locally incorporated design offices in the United 

States, Europe and Asia — KAI, KDE, and KDA. The credibility of the Company’s 

services has been further enhanced by its status as a design organization 

accredited with ISO9000 and ISO14001. 

Volume of Business in Fiscal 2003 

(Architectural and Engineering plus Design Division Branches) 

Commissioned design projects: 

533 

Value of construction of commissioned projects: 

¥409.6 billion 

Number of consulting projects: 

1,068 

Major Design Projects 

Shiodome Tower 

Shiodome Media Tower 

Nippon Express Headquarters 

TOKI MESSE Bandaijima Building 

Higashi Shinagawa Stage 2 Development 

Akihabara Station Environs Redevelopment 

Akasaka Apartment for the House of Representatives 

Jiji Press Building 

to conserve energy, technologies to reduce energy consumption 

throughout a building’s life cycle, and the use of large-panel terracotta 

tiles for skyscraper exteriors that are manufactured with low 

carbon dioxide emissions. 

Kajima’s technical and design prowess was recognized with a total 

of 41 awards in 2002, including the Greening Techniques 

Concours Grand Award. 

The Second Building of Taisho Pharmaceutical’s Head Office 

Makuhari Park Tower 

Seinan Gakuin Junior and Senior High School 

PENTA-KUN Tama Center Branch 

Sumitomo Osaka Cement Nano/Tera Technology Center 

Consultancies 

Life-cycle engineering (LCE), renewal projects, conversion projects, seismic risk 

assessment, deterioration assessment, market competitiveness assessment, 

energy conservation assessment, environmental site assessment, engineering 

due diligence. 

Technical Development 

Development of 3-Dimensional Data Base CAD system, application of this technology 

to actual projects and the establishment of overseas CAD drafting centers, 

adapting technologies for performance specifications (fire proofing and 

prevention, evacuation safety, earthquake proofing), development of the Kajima 

Free-Plan High-Rise Housing System (using Super Reinforced-Concrete Frame 

Construction). 

External Awards 

Greening Techniques Concours Grand Award (Kajima KI Building and Atrium) 

Good Design Award (Shiba Park Tower) 

Award of the Society, Society of Heating, Air-Conditioning and Sanitary 

Engineers of Japan (Commissioning Tools with Building Energy Management 

Systems [BEMS]) 

Total of 41 awards 

13

14 

Macronix Fab-3 plant 

in Hsinchu, Taiwan 

Yamanouchi Pharmaceutical 

Oklahoma plant in Norman, U.S.A. 

OVERSEAS OPERATIONS 

Kajima 

Corporation 

Since the Kajima Group took on the challenge of its first overseas 

construction project, the Group has expanded its reach to more 

than 50 countries. Kajima now maintains local subsidiaries and 

affiliates, district offices, or other permanent presences in 22 countries, 

with projects in 13 countries directly managed by Kajima 

headquarters. 

As the Kajima Group works to integrate overseas operations, the 

subsidiaries and affiliates in Kajima’s main regions of operation — 

the United States, Europe, Southeast Asia, and Taiwan — continue 

to streamline corporate structure and enhance profitability to contend 

with a dramatically changing market environment. At the 

same time, they are focusing their efforts on increasing the volume 

of contracts awarded by the leading local companies in these 

regions. These efforts are driven by Kajima’s strategy of advancing 

into new arenas to offset the decrease of foreign direct investment 

by Japanese companies, which had been the principal pillar of 

Kajima’s overseas sales. This approach enabled Kajima’s subsidiaries 

and affiliates to post more than ¥100 billion in total new 

contracts for the third consecutive year. Of the ¥102.7 billion in 

new contracts, local non-Japanese companies placed more than 

70%, demonstrating the steadily increasing localization of Kajima 

Group operations. 

In real estate development operations undertaken by subsidiaries 

and affiliates, the Kajima Group is improving the return on investment 

of the operating properties and working to reduce each company’s 

indebtedness. On the other side of the equation, new 

investments such as the development of distribution warehouse 

facilities in the United States and Private Finance Initiative (PFI) 

projects in the United Kingdom are being selectively undertaken in 

line with profitability and risk management criteria. 

Construction and Real Estate Development 



Department for Environment, Food 

and Rural Affairs (DEFRA) office 

building in Cambridge, U.K.

Pampered Chef headquarters building in Chicago, U.S.A. 

UMCi Wafer Fab plant in Singapore 

Kajima U.S.A. Inc. (KUSA), which is responsible for the North 

American market, has focused on strategic markets such as automobiles, 

pharmaceuticals, food products, and schools where 

Kajima can capitalize on its experience and expertise. This 

approach countered the lackluster capital investment of the post- 

IT bubble environment, resulting in ¥44.9 billion in new contracts 

for KUSA, which surpassed the volume of the previous year. 

Excelling in distribution warehouse facility development, Industrial 

Developments International, Inc. (IDI), an affiliate of KUSA, continued 

to post robust performance, contributing to KUSA’s consolidated 

revenues and profits. 

Hualalai Resort, developed and managed by Kajima Kona 

Company (KKCo), has been rated one of Hawaii’s premier luxury 

resorts since its opening in 1996. The resort features an awardwinning 

five-star Four Seasons hotel, championship golf courses, 

and other recreational facilities — all catering to the discriminating 

tastes of the high-end resort guests and home owners of Hualalai. 

Hotel performance for this year rebounded relatively quickly as 

the impact of September 11, 2001 dissipated and the number of 

individual repeat guests increased. 

Kajima Overseas Asia Pte. Ltd. (KOA) handles the Southeast Asia 

market, which has been buffeted by the Asian economic slump, 

the secondary effects of the Iraq war, and most recently by the 

outbreak of Severe Acute Respiratory Syndrome (SARS). The current 

challenging business environment has not altered Kajima’s 

long-term prospects in the Southeast Asian region, which is one of 

the Group’s most important overseas markets. With contracts for a 

large-scale public construction project in Singapore and a steady 

flow of projects in Thailand and Malaysia, KOA won new contracts 

worth ¥33.8 billion in 2002, an increase over the previous year. 

Although the market environment for real estate development 

continues to be as harsh as in recent years in the Southeast Asian 

region, low interest rates have supported KOA’s steady performance 

15

16 

Hitachi High-Technologies headquarters 

building in Düsseldorf, 

Germany 

Shinnyo-En Buddhist temple in 

Seattle, U.S.A 

SONY Supply Chain Solutions 

Distribution Center in Bangi, 

Malaysia 

Renovation work on highway in 

Ethiopia 

in the leasing and operation of offices, hotels, shopping malls, and 

other facilities. 

Chung-Lu Sino-Kajima Construction Co., Ltd., the Kajima Group’s 

affiliate in the Taiwanese market, posted record profits due to 

improved gross profit ratios in plant construction for Japanese 

companies. Total new contracts, however, declined to ¥6.2 billion, 

in comparison with the extraordinary performance of the previous 

year, when the volume of new contracts doubled due to projects 

for large-scale Japanese plants and local apartment buildings. As 

the company has earned credibility with clients in Taiwan for its 

capability to execute large-scale construction, it will seek to 

improve management stability by selectively undertaking projects 

based on a thorough analysis of profitability and risk management. 

In the face of the mature European construction market, Kajima 

Europe B.V. (KE) is working to improve business performance by 

focusing on specific projects in the United Kingdom, as well as 

seeking to expand its operations on the continent with select projects 

for Japanese companies. In terms of real estate development 

operations, proactive involvement in national and local governmental 

PFI projects in the United Kingdom is beginning to bear fruit. 

The Department for Environment, Food and Rural Affairs (DEFRA) 

office building in Cambridge, a project already in progress in 1999 

and the first PFI project commissioned to a Japanese company, 

was completed and opened in April 2003. KE also secured contracts 

from North Tyneside and two other local governments for 

PFI school construction projects, which are currently underway. 

The projects directly managed by Kajima headquarters in regions 

and arenas not covered by subsidiaries and affiliates are primarily 

in the field of large-scale civil engineering. Although total new contracts 

for directly managed projects in this year did not exceed that 

of the previous year, Kajima was able to secure contracts for largescale, 

locally financed, infrastructure projects in Taiwan. 

With the projected cutbacks in official development assistance 

(ODA) projects, which have formed the core of directly managed 

operations, Kajima’s long term strategy is to expand its involvement 

in prospective projects in China, Russia, Central Europe, and 

other promising regions, while reinforcing its presence in the fields 

of locally financed infrastructure projects where Kajima leads in 

technological expertise. 

The following are the major projects completed this year: Chirundu 

Bridge over the Zambezi River between Zambia and Zimbabwe, 

rehabilitation works for the Trunk Road in Ethiopia, rehabilitation 

works for National Route 3 in Central Africa, the Yazaki Surabaya 

Factory in Indonesia, the Toppan CFI Taiwan Color Filter Factory in 

Taiwan, and the Pampered Chef headquarters building and central 

distribution warehouse facilities in the United States.

Chirundu Bridge over the Zambezi River between Zambia and Zimbabwe 

Major New Contracts Won in 2002 

Taipei Metropolitan Area Rapid Transit System Project 

Taiwan 

Shield tunnel 

Inner diameter: 5.6 m, Total length: 4,730 m 

Keelung River Yuanchantze Flood Diversion Project 

Taiwan 

NATM Tunnel 

Inner diameter: 12.0 m, Total length: 2,470 m 

First ITE Regional Campus Project 

Singapore 

Institutional buildings for education 

7 floors, Floor area: 180,000 m 2 

Pidemco Center Redevelopment Project 

Singapore 

Commercial building 

1 basement, 23 floors, Floor area: 74,632 m 2 

Toppan CFI Taiwan H-11 Line Clean Room Project 

Taiwan 

Clean room 

4 floors, Floor area: 34,893 m 2 

Accordia Housing Project 

Cambridge, U.K. 

Residential buildings 

21 blocks, 379 units, Floor area: 44,500 m 2 

John A. Burns School of Medicine, University of Hawaii 

Hawaii, U.S.A. 

Education & administrative building 

Floor area: 12,700 square meters 

Biomedical research building 

Floor area: 16,600 m 2 

Yamanouchi Pharmaceutical Technologies R&D Facility Consolidation 

Oklahoma, U.S.A. 

Relocation of research facilities 

Pharmaceutical manufacturing and laboratory consisting of R&D space, 

office areas, GMP storage, process utilities & equipment 

Floor area: 5,950 m 2 

17

18 

Environmental jet method 

RESEARCH & DEVELOPMENT 

R&D Topics 

Kajima 

Corporation 

Continuous research and development is essential to corporate 

growth. Kajima proceeds proactively with R&D targeting diversifying 

social and client needs. Kajima’s R&D covers a wide range of 

subjects from developing new technologies, to improving the quality 

and productivity of construction projects, to research on technologies 

to meet the needs of society in the future, which the 

Company efficiently conducts with universities, public organizations 

and other firms. 

In fiscal 2003, the second year of the Company’s Next Three-Year 

Plan, Kajima emphasized R&D and its efficient promotion. 

Research topics were selected on a priority basis, with emphasis 

on fields closely related to market needs. Economies were realized 

through greater efficiency, reducing overall R&D expenses without 

compromising the Company’s commitment to strong R&D investment. 

There were 155 technical development topics identified for 

fiscal 2003, and research investment totaled ¥10.5 billion, or 

0.72% of net sales. 

In the current challenging business environment, Kajima is focusing 

its R&D on contributing to winning and expanding contracts 

and reducing construction costs, and has selected urban redevelopment, 

the environment, and housing as the key market sectors. 

The Company’s R&D initiative emphasizes technologies associated 

with reducing construction costs, irrespective of its application in 

new or traditional market sectors. Kajima is also engaged in a wide 

spectrum of activity to contribute to the solution of global environmental 

problems, from environmental conservation to environment 

creation. Markets with considerable potential are those of building 

renewal and life-cycle engineering (LCE), and R&D is also being 

carried out in these areas. 

Here are some of the major R&D results recently achieved by 

Kajima. Urban redevelopment related successes included the 

“Total Construction System of Shield Tunnels for Traffic 

Infrastructure” which combined a series of shield tunnel technologies; 

the “Self Elevating Bridge (SEB) Construction Method” for a 

low-cost two-level crossover; the “Water Screen System,” a fire 

prevention system for underground space; and “Construction 

Technology of Underground Floor,” which provides for shorter 

construction periods and higher levels of safety. In the field of environment 

related projects, results included analysis and planning 

technologies for the “Environmentally-Friendly Energy-Conserving 

Office”; the “Assessment System for Greenspace and Water 

Environment”; the “Environmental Jet Method” of combating VOC 

related soil contamination; and “Resource Technology of Organic 

Waste,” which is based on our METAKLES technology that converts 

organic waste into bio-gas. In the field of renewal and Life 

Cycle Engineering, major successes were the “Seismic Risk 

Assessment Method”; and “Assessment for the Deterioration of 

Concrete Structure.” In addition to these, Kajima produced results 

in the area of earthquake forecasting and disaster prevention technologies, 

such as “Assessment of Strong Ground Motion.” 

The following are the primary technical development results 

achieved in fiscal 2003. 


2003

Image of “Total Construction 

System of Shield Tunnels for 

Traffic Infrastructure” 

Image showing how Shiodome 

Media Tower’s hybrid airconditioning 

system works 

Air flow 

Fire prevention system for underground 

space — fire compartment 

using water screen system 

Total Construction System of Shield Tunnels for Traffic Infrastructure 

Growth in urban renewal and the passage of special legislation on public use of space deep underground 

have seen the increasing use of underground space for infrastructure, and plans that 

include the use of space deep underground for arterial roads in cities have made the cut and cover 

method difficult. It is in this context that Kajima has developed new technology that has made it 

possible to construct special sections of road tunnels (emergency parking bays, ramp tunnels) deep 

underground, and by integrating this with previously developed large-diameter shield tunnel technology, 

has developed a “Total Construction System of Shield Tunnels for Traffic Infrastructure.” 

This new technology comprises three methods: the “shield tunneling method of partly widening 

cross-sectional area,” the “shield tunneling method of reducing cross-sectional area” and the 

“shield tunneling method of applying recoverable and reusable machines.” 

Large-Scale Hybrid Air-Conditioning System with Natural Ventilation for Offices 

The heightened level of interest in environmentally-friendly buildings has resulted in stronger demand 

for natural ventilation. As well as developing specific design tools for the cost-efficient design of buildings 

using natural ventilation, Kajima has compiled a list of items for examination at the planning 

stage, including airflow simulation, assessment of the thermal environment, and a ventilation control 

strategy, which have led to the realization of large-scale hybrid air-conditioning systems with natural 

ventilation for offices. In the case of some buildings, we have commissioned natural ventilation 

systems and double-skin facades, and have confirmed their favorable performance. 

Fire Prevention System for Underground Space — Water Screen System 

As illustrated by the public use of space deep underground, the role of underground space in urban 

renewal is being re-evaluated. In doing so, however, fire safety requires serious attention. 

Experiments using scaled models have been repeated numerous times for railroad and vehicle tunnels, 

underground streets, and underground parking lots, resulting in the development of highly 

accurate simulation technology for simulating fire behavior in such spaces. Furthermore, knowledge 

gained through these activities has been used to develop and construct a fire prevention system in 

which compartments use water screens, a completely new concept. As well as localizing the size of 

the area affected by a fire and providing a safe evacuation environment, the system also inhibits 

rapid combustion, thus minimizing structural damage. 

Development of a Quantitative Assessment System for the Environmental Functions of 

Greenspaces — “m-EASE (microscale Environmental Assessment System on Ecology)” 

Kajima has developed a quantitative assessment system for the environmental functions of greenspaces 

called “m-EASE,” a green CAD system through which a quantitative assessment of the following 

six environmental functions of greenspaces can be made: fixation of atmospheric CO2; 

atmospheric purification; mitigation of heat island effects; preservation of biological diversities; 

improvement of scenery; and fire prevention. Use of this system has made it possible to promptly 

and effortlessly formulate proposals for optimum greenspace plans corresponding to customers’ 

needs at the planning and design stages. The system also enables constructive “quantitative 

assessment of the environmental functions that greenspaces already possess” and “prediction of 

future changes of the functions of greenspaces.” 

Environmental Jet Method 

The environmental jet method is a ground contamination cleaning technique that is able to partially 

clean contaminated ground (soil and ground water) using intersecting jet flows of water. This 

method has the following advantages: (1) it is possible to partially clean at only the depths required; 

(2) it can be applied to various kinds of contaminated substances; (3) it can even be applied to contaminated 

layers difficult to penetrate with water (clay, etc); and (4) it can be applied in small places 

and even inside buildings. 

Kajima offers the following three options, depending on the contamination circumstances and 

budget for the cleaning work. 

1) The Jet Replace method for substituting contaminated soil with non-harmful materials. 

2) The Jet Blend method for cleaning ground water by mixing cleaning materials in contaminated 

water layers. 

3) The Jet Rinse method for cleaning contaminated soil. 

19

20 

Highlights 

Shiodome Tower — A High-Rise Building 

Designed for People and the Environment 

This eye-catching high-rise building in the Shiodome area in Tokyo’s Minato Ward is 

the Shiodome Tower, designed and built by Kajima. Its exterior is clad with terracotta 

tiles — a nature-friendly material — and the building is also equipped with the latest 

environmental control technology. The result is a new style of high-rise building that 

puts both people and the environment first. 

Launch of the Akihabara IT Center (Tentative 

Name) Redevelopment Project 

Kajima’s IT Center (tentative name) Project is underway on a site in front of Akihabara 

Station. Kajima and two other companies, NTT Urban Development and Daibiru 

Corporation, won a publicly invited bid to acquire land that was owned by the Tokyo 

Metropolitan Government. The IT Center will be a hub of international information technology, 

serving as a center for new initiatives such as creation of new businesses 

through industrial-academic collaboration, as a location for employee training, and as a 

facility to bring people together. 

New National Art Museum 

under Construction 

Construction is moving forward on a new national art museum (tentatively called the 

“National Gallery”), in Tokyo’s Roppongi district. Based on the concept of “an art museum 

surrounded by greenery,” the gallery will mark the birth of a new form of art museum 

that focuses on exhibiting publicly invited art works. Construction is scheduled for 

completion in August 2005. 

Kajima Contracted to Build 

Japan’s First PFI Library 

A special purpose company (SPC) headed by Kajima has been contracted to build a 

public complex that will house a library and other facilities, utilizing the private finance 

initiative (PFI) method. Planned by Kuwana City in Mie Prefecture and designed by AXS 

Satow Inc., the library will be Japan’s first to be operated by the private sector, and is 

expected to provide high-quality public service. The complex is scheduled to open in 

October 2004.

Japan’s Largest Covered 

Final Disposal Facility Completed 

This is the Kizukuri-Inagaki municipal waste final disposal site in Aomori Prefecture, 

constructed by Kajima. Maintenance and control are made easy at this roofed disposal 

facility, which is located on reclaimed land. Thanks to the roof, work can proceed 

irrespective of weather conditions. The facility also prevents odors from escaping and 

waste materials from being scattered by the wind, thus serving to protect the 

surrounding landscape. 

Assessing the Seismic Vibrations of the 

Great Kanto Earthquake 

Information on the damage caused by the Great Kanto Earthquake have been collated 

and used to draw up a “map” of the damage and the distribution of seismic vibrations 

across the entire southern Kanto region. The results provide a clearer picture of the 

relationship between ground conditions and the distribution of seismic vibrations. This 

information may now be used in predictions of strong earth tremors. 

Kajima Sculpture Competition Wins the 2002 

Mécénat Award for Outstanding Corporate Culture 

Held for the 7th time in 2002, the biennial Kajima Sculpture Competition was inaugurated 

in 1989 to commemorate the 150th anniversary of the founding of Kajima 

Corporation. The competition discovers new, emerging sculptors, serving as a launching 

pad for successful careers. It was awarded the Mécénat Award in appreciation of 

these factors, indicating the widespread recognition enjoyed by the competition in the 

sculpting world. 

Phase II Construction Begins on the 

Shinagawa Seaside-Forest Project 

Phase II construction on the Shinagawa Seaside-Forest urban redevelopment project is 

underway in Tokyo’s Shinagawa Ward. The phase II project will add a mixed-use 

hotel/office building and two other office buildings to the structures built during phase I: 

an office building, multi-family housing, commercial retail facilities and a new train station. 

Kajima is the sole developer of the phase II project, which is scheduled for completion 

in August 2004. 

21

22 

Selected Financial Data 

KAJIMA Corporation (and Consolidated Subsidiaries) 

For the years ended March 31 

2003 2002 2001 2000 1999 2003 

(Thousands of 

Consolidated: (Millions of Yen) U.S. Dollars) 

Revenues ¥1,874,802 ¥2,060,353 ¥1,909,948 ¥1,727,871 ¥1,658,884 $15,623,350 

Net Income (Loss) 10,111 (41,153) 9,275 9,018 (198,557) 84,258 

Total Assets 2,024,226 2,226,712 2,438,041 2,423,542 2,402,481 16,868,550 

Stockholders’ Equity 159,017 180,220 235,192 176,058 174,595 1,325,142 

Short-Term Borrowings, Commercial Paper 

and Long-Term Debt 594,592 674,153 718,760 771,982 862,539 4,954,933 

(Thousands of 

Non-Consolidated: (Millions of Yen) U.S. Dollars) 

Revenues ¥1,458,086 ¥1,550,317 ¥1,330,729 ¥1,174,910 ¥1,250,260 $12,150,717 

Contract Awards 1,139,509 1,200,432 1,245,516 1,287,623 1,280,287 9,495,908 

Net Income (Loss) 8,515 (47,794) 7,127 7,633 (196,675) 70,958 

Total Assets 1,680,439 1,826,910 1,998,802 2,017,756 2,027,805 14,003,658 

Stockholders’ Equity 184,011 206,013 271,464 215,020 214,117 1,533,425 

Short-Term Borrowings, Commercial Paper 

and Long-Term Debt 399,800 452,889 508,615 568,808 619,405 3,331,666 


Cash Dividends ¥5.00 ¥7.00 ¥7.00 ¥7.00 ¥7.00 $0.042 

(Thousand Shares) 

Number of Shares Issued 961,312 961,312 961,312 961,312 961,312

24 

Summary of Business Performance for Fiscal 2003 

Overview 

During the fiscal year under review, the Kajima Group companies performed 

as follows: 

Consolidated revenues totaled ¥1,874.8 billion, down 9.0% from the 

previous year, reflecting the setbacks in total construction revenues of 

the Company and its group companies. 

Consolidated gross profit dropped 9.6% as construction revenues 

and the gross profit margin also decreased, resulting in consolidated 

operating income of ¥36.3 billion, down 14.2%. Consolidated net 

income recovered to ¥10.1 billion from the net loss of ¥41.2 billion a 

year earlier, when the Group restructured its asset holdings by booking 

a large loss. 

Segment Performance 

Construction 

•Contracts Awarded 

Year ended Year ended 

March 31, 2003 March 31, 2002 

(Millions of Yen) 

Construction in Japan ¥1,132,437 ¥1,252,815 

Construction overseas 

(The Company and consolidated 

140,599 156,676 

companies in Japan) 37,884 39,736 

(Overseas subsidiaries) 102,714 116,939 

Construction total ¥1,273,036 ¥1,409,492 

•Revenues 




Construction in Japan ¥1,449,017 ¥1,624,925 

Construction overseas 

(The Company and consolidated 

105,757 134,225 

companies in Japan) 19,959 26,846 


Construction total ¥1,554,775 ¥1,759,151 

(1) Domestic Operations 

New construction orders for the Group companies totaled ¥1,132.4 

billion, down 9.6% from the previous year, reflecting drops in orders 

secured by the Company and Chemical Grouting Co., Ltd. The 

Company itself accounted for ¥265.1 billion in civil engineering contracts 

(down 6.1%) and ¥726.0 billion in architectural construction 

contracts (down 10.5%), for a total of ¥991.1 billion (down 9.3%). The 

civil engineering business suffered from weak demand in public and 

private markets, while the architectural construction business slipped 

as non-manufacturing clients sharply reduced their orders. 

Group revenues for the year stood at ¥1,449.0 billion, a 10.8% 

decline. Both the Company and its consolidated companies in Japan 

posted lower total revenues. The Company registered total revenues 

of ¥1,343.7 billion (down 6.4%), with ¥373.5 billion in civil engineering 

contracts (up 3.0%) and ¥970.1 billion in architectural construction 

contracts (down 9.5%). 

(2) Overseas Operations 

New orders received amounted to ¥140.6 billion (down 10.3% from 

the previous year), which breaks down to ¥102.7 billion awarded to 

overseas subsidiaries and ¥37.9 billion secured by the Company and 

its consolidated companies in Japan. The decrease is mostly attributable 

to reduced contract awards to the Company’s Taiwan subsidiary. 

Total revenues reached ¥105.8 billion (down 21.2%), consisting of 

¥85.8 billion posted by overseas subsidiaries and ¥20.0 billion by the 

Company and its consolidated companies in Japan. 

(3) Profit Margins 

The Group finished the period with a gross profit of ¥101.9 billion, 

down ¥18.6 billion from last year. The results reflect a smaller total 

revenue base, coupled with intense price competition in the marketplace 

that pushed the Group companies’ gross profit margin on completed 

construction jobs down to 6.6% from 6.8% a year ago. The 

Company itself also suffered a year-on-year deterioration in the same 

margin from 7.0% to 6.9%.

Real Estate Operations 

•Revenues 




Development projects in Japan ¥ 95,853 ¥ 88,251 

Development projects overseas 88,985 66,760 

(The Company) 576 576 


Real estate development total ¥184,838 ¥155,011 

Buoyed by higher revenues in the United States, consolidated revenues 

from real estate operations advanced to ¥184.8 billion, up 

19.2% from last year, with consolidated operating income of ¥14.1 

billion, up 19.4%. 

Others 

Other segments, consisting mainly of processed construction materials 

and design, engineering and property management services, 

reported consolidated revenues of ¥135.2 billion (down 7.5% from 

the previous year) and consolidated operating income of ¥2.7 billion 

(up 43.7%). 

Forecast of Business Performance for Fiscal 2004 

In Japan, we see no sign of deflation ending, and little reason to 

expect strength in job markets, personal consumption or housing 

starts over the short term. Slumps in demand and capital investment 

will leave the economy confined to a sub-par growth mode. 

We recognize signs of domestic construction markets shrinking 

steadily. Fiscal retrenchment keeps governments in Japan under 

pressure to cut back on public works orders. Private-sector demand 

faces structural adjustments as manufacturing companies opt to 

move abroad. 

Globally, while conditions vary from region to region, cyclical weaknesses 

persist in the major markets of Europe and North America. 

Based on the above perspective, we forecast our consolidated performance 

for year ending March 31, 2004 as follows: 


March 31, 2004 March 31, 2003 

(forecast) 


Revenues ¥1,700,000 ¥1,874,802 

Operating income 45,000 36,298 

Net income (loss) (5,000) 10,111 

We look for consolidated revenues to edge downward to ¥1,700 billion. 

However, on-site construction cost reduction along with a paring 

of selling, general and administrative expenses puts projected consolidated 

operating income at ¥45 billion, up 24% from this year. 

A major effort is under way to revamp the Company’s retirement benefits 

plan whereby the existing employees’ pension fund will be dissolved, 

and a new defined-contribution plan adopted. As this will 

involve taking a loss of approximately ¥40 billion, our forecast for consolidated 

net loss for the year is ¥5 billion. 

25

26 

Consolidated Balance Sheets 

KAJIMA Corporation and Consolidated Subsidiaries 

March 31, 2003 and 2002

28 

Consolidated Statements of Operations 


Years ended March 31, 2003 and 2002

Consolidated Statements of Stockholders’ Equity 


Years ended March 31, 2003 and 2002 

29

30 

Consolidated Statements of Cash Flows 



Notes to Consolidated Financial Statements 



31

50 

Non-Consolidated Balance Sheets 

KAJIMA Corporation 

March 31, 2003 and 2002

52 

Non-Consolidated Statements of Operations 



Non-Consolidated Statements of Stockholders’ Equity 



53

54 

Non-Consolidated Statements of Cash Flows 



Notes to Non-Consolidated Financial Statements 



55

66 

Overseas Network 

HEAD OFFICE OVERSEAS DISTRICT AND REPRESENTATIVE OFFICES, SUBSIDIARIES, AND AFFILIATES 

2-7, Motoakasaka 1-chome, 

Minato-ku, Tokyo 107-8388, Japan 

Tel: 81-3-3404-3311 

Fax: 81-3-3470-1444, 1445 

(International Division) 

28th Floor, Shinjuku Park Tower Building, 

7-1, Nishishinjuku 3-chome, Shinjuku-ku, 

Tokyo 163-1028, Japan 

Tel: 81-3-5324-5880 

Fax: 81-3-5324-5827 

KAJIMA TECHNICAL 

RESEARCH INSTITUTE 

19-1, Tobitakyu 2-chome, 

Chofu-shi, Tokyo 182-0036, Japan 

Tel: 81-424-85-1111 

Fax: 81-424-88-3394 

U.S.A. 

KAJIMA U.S.A. INC. 

1251 Avenue of the Americas, 9th Floor, 

New York, New York 10020-1104, U.S.A. 

Tel: 1-212-355-4571 

Fax: 1-212-355-4576 

KAJIMA INTERNATIONAL INC. 

KAJIMA REAL ESTATE DEVELOPMENT INC. 

395 West Passaic Street, 3rd Floor, 

Rochelle Park, New Jersey 07662, U.S.A. 

Tel: 1-201-518-2100 

Fax: 1-201-518-1539 

KAJIMA ENGINEERING AND 

CONSTRUCTION, INC. 

901 Corporate Center Drive, Suite 212, 

Monterey Park, California 91754-7630, U.S.A. 

Tel: 1-323-780-4700 

Fax: 1-323-780-4900 

EAST WEST DEVELOPMENT CORPORATION 

123 Astronaut Ellison S. 

Onizuka Street, Suite 313, 

Los Angeles, California 90012, U.S.A. 

Tel: 1-213-485-1177 

Fax: 1-213-687-4324 

KAJIMA KONA COMPANY 

100 Ka’upulehu Drive, 

Ka’upulehu-Kona, Hawaii 96740 U.S.A. 

Tel: 1-808-325-8550 

Fax: 1-808-325-8551 

BELGIUM 

KAJIMA EUROPE B.V. 

Belgium Branch 

Rue Defacqz, 113-115 1060, 

Brussels, Belgium 

Tel: 32-2-537-9885 

Fax: 32-2-537-3247 

CZECH REPUBLIC 


Czech Branch 

J&T Building 4th Floor, Pobrezni 14, 

186 00 Praha 8, Czech Republic 

Tel: 420-2-2171-0301 

Fax: 420-2-2171-0310 

EGYPT 

KAJIMA CORPORATION 

Egypt District Office 

3 El Mansour Mohamed St., 

4th Floor, Apt. No. 401, Zamalek 

Cairo, Egypt 

Tel: 20-2-7360935 

Fax: 20-2-7360948 

FRANCE 

KAJIMA EUROPE S.A. 

10 Rue de la Paix 75002, 

Paris, France 

Tel: 33-1-42-61-20-53 

Fax: 33-1-42-60-37-64 

GERMANY 

Kajima GmbH 

Niedenau 61-63, 60325, 

Frankfurt/Main, Germany 

Tel: 49-69-740372, 740373, 740374 

Fax: 49-69-742514 

NETHERLANDS 


Biesbosch 225, 1181 JC, 

Amstelveen, The Netherlands 

Tel: 31-20-347-3250 

Fax: 31-20-347-3260 

POLAND 


Poland District Office 


Poland Branch, Warsaw Office 

LIM Center 16th Floor, Al. Jerozolimskie 

65/79 00-697, Warsaw, Poland 

Tel: 48-22-630-7520 

Fax: 48-22-630-7519 

TANZANIA 


Tanzania District Office 

P.O. Box 9763 Dar Es Salaam, Tanzania 

Tel: 255-22-2170510, 2170438 

Fax: 255-22-2170438, 2170510 

TURKEY 


Turkey District Office 

Balmumcu, Sakir Kesebir Sok, 

No. 32/10, 80700 Besiktas, 

Istanbul, Turkey 

Tel: 90-212-275-4620 

Fax: 90-212-275-4626 

UNITED KINGDOM 

KAJIMA EUROPE UK HOLDING LTD. 

Grove House, 248A Marylebone Road, 

London NW1 6JZ, U.K. 

Tel: 44-20-7465-0007 

Fax: 44-20-7465-8788

CHINA 


China District Office 

Tower A-605, Pacific Century Place 

No. 2 A Gong Ti North Road, Chaoyang District, 

Beijing 100027, China 

Tel: 86-10-6539-2171, 2172 

Fax: 86-10-6539-1716 


Shanghai District Office 

East Tower 437, Shanghai Centre, 

1376 Nanjing XI Lu, 

Shanghai 200040, China 

Tel: 86-21-6279-8525 

Fax: 86-21-6279-8526 

HONG KONG 

KAJIMA OVERSEAS ASIA PTE. LTD. 

Hong Kong District Office 

Room 1901, 19th Floor, Allied Kajima Building, 

138 Gloucester Road, 

Wan Chai, Hong Kong, S.A.R., China 

Tel: 852-2598-6767 

Fax: 852-2598-0696 

INDIA 


New Delhi Liaison Office 

S-71, Greater Kailash Part-I, 

New Delhi - 110048, India 

Tel: 91-11-2647-8505 

Fax: 91-11-2647-5806 

INDONESIA 


Indonesia District Office 

Sentral Seneyan 1, 17th Floor, Unit #117C, 

JL. Asia Afrika No. 8, 

Jakarta 10270, Indonesia 

Tel: 62-21-572-4480 

Fax: 62-21-572-4485 

P.T. KAJIMA INDONESIA 

Sentral Senayan 1, 17th Floor, Unit #117A 

JL. Asia Afrika No. 8, 

Jakarta 10270, Indonesia 

Tel: 62-21-572-4477 

Fax: 62-21-572-4473 

P.T. SENAYAN TRIKARYA SEMPANA 

JL. New Delhi No. 9 Pintu Satu Senayan, 

Gelora Bung Karno, 

Jakarta Pusat 10270, Indonesia 

Tel: 62-21-570-8877 

Fax: 62-21-570-8879 

MALAYSIA 


Malaysia District Office 

Unit 11.08, 11th Floor Menara Promet, 

Jalan Sultan Ismail 50250, 

Kuala Lumpur, Malaysia 

Tel: 60-3-2145-2526 

Fax: 60-3-2145-2786 

KAJIMA (MALAYSIA) SDN. BHD. 

16th Floor, Menara Promet, 

Jalan Sultan Ismail 50250, 

Kuala Lumpur, Malaysia 

Tel: 60-3-2141-4391 

Fax: 60-3-2142-0322 

MYANMAR 


Myanmar District Office 

55-A, University Avenue, Bahan Township, 

Yangon, Myanmar 

Tel: 95-1-503237, 503238 

Fax: 95-1-503308 

PHILIPPINES 


Philippines District Office 

KAJIMA PHILIPPINES INC. 

12F Sky Plaza, 6788 Ayala Avenue, 

Makati City, Philippines 

Tel: 63-2-886-6818 

Fax: 63-2-886-6817 

SINGAPORE 


Singapore District Office 

80 Marine Parade Road, 

#14-07 Parkway Parade, 

Singapore 449269, Singapore 

Tel: 65-6344-9722 

Fax: 65-6342-2272 


80 Marine Parade Road, 

#14-07 Parkway Parade, 

Singapore 449269, Singapore 

Tel: 65-6344-0066 

Fax: 65-6344-3777 

SRI LANKA 


Sri Lanka District Office 

No. 77A, Ward Place, 

Colombo 7, Sri Lanka 

Tel: 94-1-678415, 678416, 678417 

Fax: 94-1-678414 

TAIWAN 


Taiwan District Office 

2nd Floor, No. 9, Lane 65, 

Chung Shan North Road Section 2, 

Taipei, Taiwan 

Tel: 886-2-2541-0812 

Fax: 886-2-2523-5637 

CHUNG-LU SINO-KAJIMA 

CONSTRUCTION CO., LTD. 

2nd Floor, No. 9, Lane 65, 

Chung Shan North Road Section 2, 

Taipei, Taiwan, R.O.C. 

Tel: 886-2-2541-0812 

Fax: 886-2-2522-3092 

THAILAND 


Thai District Office 

952 Ramaland Building 17th Floor, 

Rama IV Road, Suriyawongse, Bangrak, 

Bangkok 10500, Thailand 

Tel: 65-2-632-8600 

Fax: 65-2-632-8603 

THAI KAJIMA CO., LTD. 

19th Floor, Ramaland Building, 

952 Rama IV Road, Bangrak, 

Bangkok 10500, Thailand 

Tel: 66-2-632-9300 

Fax: 66-2-632-9312 

VIETNAM 


Vietnam District Office 

Thanglong Bldg. Unit No. 203A, 2nd Floor, 

No. 105, Lang Ha Street, 

Hanoi, Vietnam 

Tel: 84-4-562-2748 

Fax: 84-4-562-2738 


Vietnam District Office 

7th Floor, Me Linh Point Tower, 

2 Ngo Duc Ke, District 1, 

Ho Chi Minh City, Vietnam 

Tel: 84-8823-4510 

Fax: 84-8823-4512 

67

68 

Principal Subsidiaries and Affiliates 

DOMESTIC 

Katabami Kogyo Co., Ltd. 

Head Office: Tokyo 

Established: 1941 

Taiko Trading Co., Ltd. 



Azuma Kanko Kaihatsu Co., Ltd. 



Kajima Road Co., Ltd. 



Nippon Foundation Engineering Co., Ltd. 



Kajima Resort Corporation 



Toasangyo Co., Ltd. 



Chemical Grouting Co., Ltd. 



Kajima Institute Publishing Co., Ltd. 



Kajimavision Productions Co., Ltd. 



Japan Sea Works Co., Ltd. 



Chuo Industries Co., Ltd. 

Head Office: Osaka 


Hotel Kajima no Mori 

Head Office: Karuizawa 


Yaesu Book Center Co., Ltd. 



Kajima Services Co., Ltd. 



Kajima Leasing Corporation 



Shinrinkohen Golf Club 

Head Office: Saitama 


Creative Life Corporation 



Ilya Corporation 



KOCAMB Co., Ltd. 



Kobori Research Complex Inc. 



Kajima Regional Engineering Support & 

Services Tokyo 



Armo Architects & Engineers 



Human Life Services Co., Ltd. 



Environment Management Corporation 



F.R.C. Corporation 



Kajima Mechatro Engineering Co., Ltd. 




Services Yokohama 

Head Office: Yokohama 


Atema Kogen Resort Inc. 

Head Office: Niigata 


Act Technical Support Inc. 



Kajima Tokyo Kaihatsu Corporation 



Kajima Aquatech Corporation 



ARTES Corporation 



Nasu Resort Corporation 



Plus Alpha, Ltd. 



Kajima Karuizawa Resort Inc. 

Head Office: Gunma 



Services Osaka 

Head Office: Osaka 


Today & Tomorrow Co., Ltd. 



Toshi Kankyo Engineering Co., Ltd. 



Grout Trading Co., Ltd. 



Kasen Development Inc. 



KRC Co., Ltd. 


Established: 1994

East Real Estate Co., Ltd. 



SEEDER Co., Ltd. 



Act Engineering Inc. 



Kajima Tohoku Kosan Co., Ltd. 

Head Office: Sendai 


Clima-Teq Co., Ltd. 



Public Relations Officer Corporation 



Engineer & Risk Services Corporation 



Techno-Wave Corporation 



Kajima Yaesu Kaihatsu Co., Ltd. 



Niigata Bandaijima Building Co., Ltd. 

Head Office: Niigata 


Kajima Shiodome Kaihatsu Co., Ltd. 



Green Materials Recycle Corporation 



Toyama Green Food Recycle Co., Ltd. 

Head Office: Toyama 


OVERSEAS 

NORTH AMERICA 

Kajima U.S.A. Inc. 

Head Office: New York, New York, U.S.A. 


Kajima International Inc. 

Head Office: Rochelle Park, New Jersey, U.S.A. 


Kajima Construction Services, Inc. 

Kajima Associates, Inc. 



Kajima Real Estate Development Inc. 



Industrial Developments International, Inc. 

Head Office: Atlanta, Georgia, U.S.A. 


KUD International LLC 

Head Office: Santa Monica, California, U.S.A. 


Commercial Development International/ 

East, Inc. 

Head Office: New York, New York, U.S.A. 


Commercial Development International/ 

West, Inc. 

Head Office: Monterey Park, California, U.S.A. 


Kajima Engineering and Construction, Inc. 

Head Office: Monterey Park, California, U.S.A. 


East West Development Corporation 

Head Office: Los Angeles, California, U.S.A. 


Kajima Kona Company 

Head Office: Ka'upulehu-Kona, Hawaii, U.S.A. 


EUROPE 

Kajima Europe B.V. 

Head Office: Amstelveen, The Netherlands 


Kajima Europe UK Holding Ltd. 

Head Office: London, U.K. 


Kajima Construction Europe (U.K.) Ltd. 



Kajima Design Europe Ltd. 



Kajima Property Holdings Ltd. 



Kajima Europe S.A. 

Head Office: Paris, France 


Kajima GmbH 

Head Office: Frankfurt/Main, Germany 


ASIA 

Kajima Overseas Asia Pte. Ltd. 

Head Office: Singapore, Singapore 


Kajima Design Asia Pte. Ltd. 

Head Office: Singapore, Singapore 


P.T. Kajima Indonesia 

Head Office: Jakarta, Indonesia 


P.T. Senayan Trikarya Sempana 

Head Office: Jakarta, Indonesia 


Thai Kajima Co., Ltd. 

Head Office: Bangkok, Thailand 


Kajima (Malaysia) Sdn. Bhd. 

Head Office: Kuala Lumpur, Malaysia 


Kajima Philippines Inc. 

Head Office: Makati City, Philippines 


Chung-Lu Sino-Kajima Construction Co., Ltd. 

Head Office: Taipei, Taiwan 


69

70 

Board of Directors and Auditors 

CHAIRMAN 


PRESIDENT 

Sadao Umeda 

EXECUTIVE VICE PRESIDENTS 

Yoshihiko Iwamatsu 

Masaru Kawai 

Mikio Shoji 

Naoki Atsumi 

Osamu Minamitani 

Kiyoshi Ogami 

Corporate Data 

HEAD OFFICE 

2-7, Motoakasaka 1-chome, Minato-ku, 

Tokyo 107-8388, Japan 

Tel: 81-3-3404-3311 

Fax: 81-3-3470-1444, 1445 

URL: http://www.kajima.co.jp/welcome.html 

FOUNDED 

1840 

ESTABLISHED 

1930 

SENIOR MANAGING DIRECTORS 

Ryosuke Hirota 

Kazuhito Amikura 

Suguru Akiyama 

Takehisa Iho 

Seiichiro Tomioka 

Mitsuyoshi Nakamura 

Kinji Ohashi 

Yukihiro Omika 

Tasaburo Shimizu 

Hiroshi Kaneko 

MANAGING DIRECTORS 

Takahiko Nishio 

Keiichiro Namai 

Seisuke Nakano 

Mitsuhiro Hirata 

Yoshihiro Nakahora 

Yoshitoshi Tamura 

Takashi Tokuda 

Hisaya Igarashi 

Akira Okamoto 

Komao Yasuda 

Noboru Ikebata 

Hiroshi Ishikawa 

Hiroaki Hoshino 

Shuji Horita 

Hirohisa Takita 

Kaoru Someya 

Yasuo Morimitsu 

NUMBER OF EMPLOYEES 

10,850 

PAID-IN CAPITAL 

¥64,071 million 

COMMON STOCK 

Authorized: 1,920,000,000 shares 

Issued: 961,312,022 shares 

NUMBER OF STOCKHOLDERS 

77,658 

DIRECTOR AND SENIOR ADVISER 

Shoichi Kajima 

DIRECTORS 

Takaji Mineo 

Kunio Yanagisawa 

Kenichi Kotani 

Teruaki Murata 

Atsushi Hattori 

Teruaki Yamaguchi 

Motomichi Ishikawa 

Susumu Tsuchiya 

Takashi Hinago 

Toshio Yamamoto 

Takashi Momma 

Seigo Akanuma 

Kimitsugu Kudo 

CORPORATE AUDITORS 

Kozo Takahara 

Tatsuo Hatanaka 

Akira Aoki 

Shoh Nasu 

Shigeru Kobori 

(As of June 30, 2003) 

TRANSFER AGENT 

The Chuo Mitsui Trust & Banking Co., Ltd. 

INDEPENDENT AUDITORS 

Deloitte Touche Tohmatsu 

LISTINGS 

Common stock is listed on the Tokyo, Osaka, 

Nagoya, and London stock exchanges. 

(As of March 31, 2003)

2-7, Motoakasaka 1-chome, 

Minato-ku, Tokyo 107-8388, Japan 

TEL: 81-3-3404-3311 

FAX: 81-3-3470-1444, 1445 

URL: http://www.kajima.co.jp/welcome.html 

Printed in Japan

full Annual Report 2003(5.9

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