Slide 1: Presentation on Results for the 1st Quarter FY 2018
Presentation on Results for the 1st Quarter FY 2018 Idemitsu Kosan Co.,Ltd. August 14, 2018
Slide 2: Table of Contents
Table of Contents 1. FY 2018 1st Quarter Results (1) Overview (2) Segment Information 2. Forecast for FY 2018 Performance (1) Overview (2) Segment Information (3) Shareholder Returns 3. Reference Materials Copyright©2018 Idemitsu Kosan Co.,Ltd. All Rights Reserved. 1
Slide 3: Crude Oil Price Trends
Crude Oil Price Trends <Monthly Dubai Crude Oil Price Trends and Assumptions for Performance Forecasts> (US$/Bbl.) Assumption for Revised Forecasts (July~ ): US$70/Bbl. FY 2018 1Q Average: US$72.1/Bbl. Assumption Announced on 5/15: US$65/Bbl. FY 2017 Actual FY 2018 Actual 5/15 Assumption FY 2017 1Q
Slide 4: JPY/USD Exchange Rate (TTS) Trends
JPY/USD Exchange Rate (TTS) Trends <Monthly JPY/USD Exchange Rate Trends and Assumptions for Performance Forecasts> (JPY/USD) Assumption for Revised Forecasts (July~ ): JPY110/USD FY 2017 1Q Average: JPY112.1/USD FY 2018 1Q Average: JPY110.1/USD FY 2017 Actual FY 2018 Actual Assumption Announced on
Slide 5: Overview
Overview <FY 2018 1st Quarter Results> ■Operating profit increased by ¥36.9 billion year-on-year to ¥71.5 billion due to inventory valuation gains of ¥22.5 billion due to increased crude oil prices and increased petroleum product margins, among other factors ■Ordinary income increased by ¥42.5 billi
Slide 6: 1. FY 2018 1st Quarter Results
1. FY 2018 1st Quarter Results
Slide 7: (1) Overview
(1) Overview 1) Crude Oil / Exchange Rates (Units: $/Bbl., $/Ton, ¥/$) FY2017 1Q FY2018 1Q Change Crude Oil (DB FOB) 49.8 72.1 22.3 44.9% Crude Oil (Brent) 53.8 66.8 13.0 24.2% Naphtha Price (Customs) 482 619 137 28.4% Thermal Coal (NEWC) 83.2 102.6 19.4 23.3% Exchange Rate (TTS) 112.1 110.1 (2.0) (
Slide 8: (2) Segment Information: Operating Income
(2) Segment Information 1) Operating Income (Units: ¥ billions) FY2017 1Q FY2018 1Q Change Petroleum Products 6.9 40.3 33.4 485.9% (Excluding inventory impact) 12.9 17.8 4.9 38.1% Petrochemical Products 10.2 12.6 2.4 23.4% Resources 18.4 19.2 0.8 4.3% Oil Exploration and Production 6.8 9.0 2.1 31.6%
Slide 9: (2) Segment Information: Factor Analysis
(2) Segment Information 2) Factor Analysis for Year-on-year Change in Operating Income (Units: ¥ billions) Petroleum Products +33.4 Increase in Product Margins, etc. +21.2 Increased Refinery Fuel Costs, etc. (16.3) Inventory Impact +28.5 Petrochemical Products +2.4 Increase in Product Margins/Volume
Slide 10: 2. Forecast for FY 2018 Performance
2. Forecast for FY 2018 Performance
Slide 11: (1) Overview
(1) Overview 1) Crude Oil / Exchange Rates (Units: $/Bbl., $/Ton, ¥/$) May 15 Forecast Revised Forecast Difference Assumption (July~ ) Crude Oil (DB FOB) 65.0 70.5 5.5 8.5% 70.0 Crude Oil (Brent) 67.5 71.8 4.3 6.3% 73.0 Naphtha Price (Customs) 602 633 31 5.1% 638 Thermal Coal (NEWC) 88.0 106.4 18.4
Slide 12: (2) Segment Information: Operating Income
(2) Segment Information 1) Operating Income (Units: ¥ billions) May 15 ForecastRevised Forecast Difference Petroleum Products 56.0 97.0 41.0 73.2% (Excluding inventory impact) 56.0 74.5 18.5 33.0% Petrochemical Products 34.0 39.0 5.0 14.7% Resources 60.0 80.0 20.0 33.3% Oil Exploration and Productio
Slide 13: (2) Segment Information: Factor Analysis
(2) Segment Information 2) Factor Analysis for Change in Operating Income (vs. 5/15 Forecast) (Units: ¥ billions) Petroleum Products +41.0 Increase in Product Margins +31.0 Increased Refinery Fuel Costs, etc. (12.5) Inventory Impact +22.5 Petrochemical Products +5.0 Increase in Product Margins, etc.
Slide 14: (3) Shareholder Returns
(3) Shareholder Returns ■Providing shareholder returns is a strong management priority at Idemitsu. We aim to provide stable dividends by achieving an optimal balance between strengthening existing operations, strategic investments towards future business development, improving our financial positio
Slide 15: 3. Reference Materials
3. Reference Materials
Slide 16: Table of Contents
Table of Contents 1. Financial Reporting 4. Foreign Exchange (1) Net Sales by Segment 5. Market Conditions (2) Extraordinary Gains/Losses 6. Capacity Utilization at Refineries (3) Consolidated Balance Sheet 7. Number of Service Stations 2. Sensitivity 3. Sales and Production (1) Sales/Production Vol
Slide 17: Net Sales by Segment
1. Financial Reporting (1) – 1. FY2018 1st Quarter Net Sales by Segment (Units: ¥ billions) FY2017 1Q FY2018 1Q Change Petroleum Products 631.1 775.6 144.5 22.9% Petrochemical Products 114.3 145.9 31.6 27.7% Resources 72.2 68.1 (4.1) (5.7%) Oil Exploration 19.2 20.3 1.1 5.6% and Production Coal, etc
Slide 18: FY2018 Net Sales Forecast by Segment
1. Financial Reporting (1) – 2. FY2018 Net Sales Forecast by Segment (Units: ¥ billions) May 15 Forecast Revised Forecast Difference Petroleum Products 3,020.0 3,340.0 320.0 10.6% Petrochemical Products 540.0 570.0 30.0 5.6% Resources 270.0 300.0 30.0 11.1% Oil Exploration and Production 80.0 90.0 1
Slide 19: Extraordinary Gains/Losses
1. Financial Reporting (2) Extraordinary Gains/Losses (Units: ¥ billions) FY2017 1Q FY2018 1Q Change Gain on Sale of Fixed Assets 0.0 0.2 0.2 Gain on Sale of Affiliate Stock 0.0 0.2 0.2 Other 0.0 6.3 6.3 Total Extraordinary Gains 0.0 6.7 6.6 Loss on Sale or Depletion of Fixed Assets 0.3 0.3 (0.1) Im
Slide 20: Consolidated Balance Sheet
1. Financial Reporting (3) Consolidated Balance Sheet (Units: ¥ billions) 3/31/2018 6/30/2018 Change 3/31/2018 6/30/2018 Change Cash and Deposits 88.4 81.2 (7.2) Payables 429.6 367.7 (61.9) Receivables 486.2 444.6 (41.6) Short-term Borrowings 305.9 348.9 43.1 Inventory 535.6 555.4 19.7 Other Current
Slide 21: Sensitivity
2. Sensitivity (1) Impact of a US$1/bbl. Increase in Crude Oil Prices on FY Earnings Increase in refinery Petroleum (￥0.6 billion) fuel costs, etc. Products Inventory impact ￥3.5 billion ￥2.9 billion Oil Exploration & Production ￥1.0 billion (2) Impact of a 1 JPY/USD Appreciation on FY Earnings Decr
Slide 22: Sales Volume (Domestic Fuel Oil)
3．Sales and Production (1)－1.Sales Volume (Domestic Fuel Oil Sales Volume: Non-consolidated) （Units:Thousand KL,% ） FY 2017 1Q FY 2018 1Q Change Gasoline 1,929 1,879 (50) (2.6%) (Premium-Unleaded) 208 195 (13) (6.4% ) (Regular-Unleaded) 1,721 1,684 (37) (2.1% ) Naphtha 65 110 45 68.2% Jet Fuel 448 4
Slide 23: Sales Volume (Petrochemical Products, Lubricants)
3．Sales and Production （1）－2.Sales Volume (Petrochemical Products: Non-consolidated) (Units:Thousand tons, % ) FY 2017 1Q FY 2018 1Q Change Petrochemical Products-Total 801 937 136 17.0% (Basic Chemicals) 790 924 134 17.0% (Performance Chemicals) 11 13 2 20.6% （1）－3.Sales Volume (Lubricants) （Units:
Slide 24: Oil Exploration & Production and Coal Production Volume
3．Sales and Production （1）－4.Oil Exploration & Production – Production Volume (including Gas) （Units:Thousand BOED） FY 2017 1Q FY 2018 1Q Change Norway 38.7 28.8 (9.9) (25.7%) United Kingdom 5.3 0.0 (5.3) (100.0%) Total('000BOED) 44.0 28.8 (15.2) (34.6%) Total('000BOE) 3,958 2,589 (1,369) (34.6%) *F
Slide 25: Sales Forecasts (Domestic Fuel Oil)
3．Sales and Production （2）－1.Sales Forecasts (Domestic Fuel Oil Sales Volume: Non-consolidated) （Units:Thousand KL,% ） May 15 Revised Difference Forecast Forecast Gasoline 7,700 7,710 10 0.1% (Premium-Unleaded) 820 810 (10) (1.2% ) (Regular-Unleaded) 6,880 6,900 20 0.3% Naphtha 430 390 (40) (9.3%) J
Slide 26: Sales Forecasts (Petrochemical Products, Lubricants)
3．Sales and Production （2）－2.Sales Forecasts (Petrochemical Products: Non-consolidated) (Units:Thousand tons, % ) May 15 Revised Difference Forecast Forecast Petrochemical Products-Total 3,600 3,600 0 0.0% (Basic Chemicals) 3,550 3,550 0 0.0% (Performance Chemicals) 50 50 0 0.0% （2）－3.Sales Forecast
Slide 27: Production Volume Forecasts
3．Sales and Production （2）－4.Oil Exploration & Production – Production Volume Forecasts (including Gas) （Units:Thousand BOED） May 15 Revised Difference Forecast Forecast Norway 26.9 27.0 0.2 0.6% Total('000BOE) 9,810 9,870 60 0.6% *Figures based on interest owned by Idemitsu's resource development s
Slide 28: Foreign Exchange (1) USD
4．Foreign Exchange （1）USD Copyright©2018 Idemitsu Kosan Co.,Ltd. All Rights Reserved. 24
Slide 29: Foreign Exchange (2) Norwegian Krone
4．Foreign Exchange （2）Norwegian Krone Copyright©2018 Idemitsu Kosan Co.,Ltd. All Rights Reserved. 25
Slide 30: Foreign Exchange (3) Norwegian Krone
4．Foreign Exchange （3）Norwegian Krone Copyright©2018 Idemitsu Kosan Co.,Ltd. All Rights Reserved. 26
Slide 31: Foreign Exchange (4) Australian Dollar
4．Foreign Exchange （4）Australian Dollar Copyright©2018 Idemitsu Kosan Co.,Ltd. All Rights Reserved. 27
Slide 32: Foreign Exchange (5) Australian Dollar
4．Foreign Exchange （5）Australian Dollar Copyright©2018 Idemitsu Kosan Co.,Ltd. All Rights Reserved. 28
Slide 33: Market Conditions: Crude Oil Prices
5．Market Conditions （1）Crude Oil Prices (Dubai and Brent) Copyright©2018 Idemitsu Kosan Co.,Ltd. All Rights Reserved. 29
Slide 34: Market Conditions: Gasoline, Crude Oil CIF
5．Market Conditions （2）Gasoline, Crude Oil CIF (Prices and Spreads) Copyright©2018 Idemitsu Kosan Co.,Ltd. All Rights Reserved. 30
Slide 35: Market Conditions: Diesel Oil, Crude Oil CIF
5．Market Conditions （3）Diesel Oil – Crude Oil CIF (Prices and Spreads) Copyright©2018 Idemitsu Kosan Co.,Ltd. All Rights Reserved. 31
Slide 36: Market Conditions: Paraxylene, Naphtha
5．Market Conditions （4）Paraxylene, Naptha (Prices and Spreads) Copyright©2018 Idemitsu Kosan Co.,Ltd. All Rights Reserved. 32
Slide 37: Market Conditions: Styrene Monomer, Naphtha
5．Market Conditions （5）Styrene Monomer, Naptha (Prices and Spreads) Copyright©2018 Idemitsu Kosan Co.,Ltd. All Rights Reserved. 33
Slide 38: Capacity Utilization at Refineries
6．Capacity Utilization at Refineries Copyright©2018 Idemitsu Kosan Co.,Ltd. All Rights Reserved. 34
Slide 39: Number of Service Stations
7．Number of Service Stations Copyright©2018 Idemitsu Kosan Co.,Ltd. All Rights Reserved. 35
Slide 40: Precaution statement about forecasts
Precaution statement about forecasts Any information about forecasts for the Company’s operating results, management strategy and management policy contained in this documents other than historical facts is prepared, according to judgments made by the top management of the Company based on informati
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