Jfe Holdings, Inc. · TSE:5411

Jfe — FY2020 Earnings Presentation

38 slides from Jfe's earnings presentation, May 7, 2021

1. Slide 1: JFE Group Financial Results for Fiscal Year 2020

   Securities Code: 5411.T JFE Group Financial Results for Fiscal Year 2020 ending March 31, 2021 JFE Holdings, Inc. May 7, 2021

2. Slide 2: A table of contents

   A table of contents  JFE Holdings’ Financial Results for Fiscal Year 2020 (April 1, 2020 to March 31, 2021)  Business Performance by Segment • JFE Steel • JFE Engineering • JFE Shoji  Dividends  JFE Holdings’ Financial Forecasts for Fiscal Year 2021 (April 1, 2021 to March 31, 2022) This present

3. Slide 3: JFE Holdings' Financial Results for Fiscal Year 2020

   JFE Holdings’ Financial Results for Fiscal Year 2020 (April 1, 2020 to May 31, 2021) 3

4. Slide 4: Financial Results for Fiscal Year 2020

   JFE-HD Financial Results for Fiscal Year 2020 • In 1H, COVID-19 pandemic resulted in a significant business loss. • In 2H, business profit posted a profit due to the recovery of steel demand and steel market price from the latter half of 1H, and promotion of profit improvement measures. In spite of

5. Slide 5: Financial Results for Fiscal Year 2020 (by Segment)

   JFE-HD Financial Results for Fiscal Year 2020 (by Segment) FY2019 FY2020 FY2020 Actual Previous Change Change （billion yen） Actual Full Forecast 1H 2H (C-A) (C-B) (A) (B) Year(C) Revenue Steel Business 2,681.3 2,260.0 1,027.2 1,227.9 2,255.2 (426.1) (4.8) Engineering 512.2 490.0 221.9 263.7 485.7 (2

6. Slide 6: Cash Flow

   JFE-HD Cash Flow • Improved cash flow through profit recovery and additional asset compression • Interest-bearing Debt Outstanding as of Mar. 2021 was 1,806.1 billion yen (D/E 93.2％), decreased from the previous year. Consolidated Cash Flow in FY 2020 Interest-bearing Debt Outstanding & D/E （billion

7. Slide 7: JFE Steel Financial Results for Fiscal Year 2020

   JFE Steel Financial Results for Fiscal Year 2020 7

8. Slide 8: Financial Results for Fiscal Year 2020

   JFE Steel Financial Results for Fiscal Year 2020 FY2019 FY2020 FY2020 Unit Full year Apr-Jun Oct-Dec Jan-Mar Oct-Mar Full year Forecast billion Revenue 2,681.3 1,027.2 580.2 647.6 1,227.9 2,255.2 2,260.0 yen billion Segment Profit (8.7) (136.2) 34.3 36.4 70.8 (65.4) (80.0) Yen Excluding Inventory bi

9. Slide 9: 14.6 Billion Yen Increase in JFE Steel's Segment Profit

   JFEスチール 14.6 Billion Yen Increase in JFE Steel’s Segment Profit (FY20(Forecast) vs. FY20(Actual)) Segment profit increased by 14.6 billion yen from the previous forecast due to increase in profit of subsidiary companies and foreign exchange valuation etc. （Billion yen） FY2020 FY2020 JFE Steel Foreca

10. Slide 10: 56.7 Billion Yen Decrease in JFE Steel's Segment Profit

    JFE Steel 56.7 Billion Yen Decrease in JFE Steel’s Segment Profit (FY19 (Actual) vs. FY20 (Actual)) Segment profit decreased from the previous fiscal year amid decrease in production and sales volume in 1H, and decrease in profit of domestic and overseas subsidiary companies due to the spread of COV

11. Slide 11: JFE Engineering Financial Results for Fiscal Year 2020

    JFE Engineering Financial Results for Fiscal Year 2020 11

12. Slide 12: JFE Engineering Financial Results for Fiscal Year 2020

    JFE Engineering Financial Results for Fiscal Year 2020 Overview  Orders significantly increased from the previous fiscal year, and segment profit posted 3-year consecutive increase* even under COVID-19 pandemic. • Orders increased in each sector. (Mainly domestic demand in environmental sector and

13. Slide 13: JFE Shoji Financial Results for Fiscal Year 2020

    JFE Shoji Financial Results for Fiscal Year 2020 13

14. Slide 14: JFE Shoji Financial Results for Fiscal Year 2020

    JFE Shoji Financial Results for Fiscal Year 2020 Overview In 2H, in addition to recovery of steel demand especially in the automotive sector, steel market price rose. However, because of the significant decrease in steel demand both in domestic and overseas market in 1H, segment profit for FY2020 re

15. Slide 15: Dividends

    Dividends 15

16. Slide 16: Dividends

    JFE-HD Dividends The company intends to propose a per-share dividend of 10 yen (total annual dividend of 10 yen) at the upcoming general meeting of shareholders, in light of the substantial improvement in earnings in the second half, particularly in the steel business, as well as prospects for impro

17. Slide 17: JFE Group Financial Forecasts for FY2021

    JFE Group Financial Forecasts for FY2021 17

18. Slide 18: Business Environment Outlook

    JFE-HD Business Environment Outlook  Steel Demand Steel demand is expected to continue to recover on the whole Domestic: Steel demand is expected to continue to recover gradually due to recovery in activity levels of customers Overseas: Steel demand is expected to recover generally due to, - China’

19. Slide 19: Financial Forecast for FY2021

    JFE-HD Financial Forecast for FY2021 FY2021 Business Profit: 200.0 billion yen (Forecast) FY2020 FY2021 Change （billion yen） Actual (A) Forecast(B) (B-A) Revenue 3,227.2 3,930.0 702.8 Business Profit (12.9) 200.0 212.9 Steel Business (65.4) 140.0 205.4 Engineering Business 24.0 25.0 1.0 Trading Busi

20. Slide 20: 205.4 Billion Yen Increase in JFE's Steel Segment Profit

    JFE Steel 205.4 Billion Yen Increase in JFE’s Steel Segment profit (FY2020(Actual)vs. FY2021(Forecast)) Crude Steel(standalone) Approx. 26.50Mt/year Exchange Rate 105yen/$ FY2020 FY2021 Actual Forecast Change （Billion yen） (A) (B) (B)-(A) Segment Profit (65.4) 140.0 ＋205.4 （Billion yen） 1. Cost +30.

21. Slide 21: Financial Forecast for FY2021 Engineering Business and Trading Business

    JFE Engineering Financial Forecast for FY2021 JFE Shoji Engineering Business and Trading Business FY2020 FY2021 Actual Forecast Change (A) (B) (B)-(A) （billion yen) Engineering business Orders 501.1 550.0 +48.9 Segment Profit 24.0 25.0 +1.0 Trading business Segment Profit 20.0 27.0 +7.0 Engineering

22. Slide 22: Appendix

    Appendix 22

23. Slide 23: Main Financial Data

    JFE-HD Main Financial Data J-GAAP IFRS FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY18 FY19 FY20 (bn. Yen, times) (bn. Yen, times) Ordinary Income 52.2 173.6 231.0 64.2 84.7 216.3 221.1 Business profit 232.0 37.8 -12.9 EBITDA 260.6 368.9 421.5 254.4 279.9 388.8 405.9 EBITDA ＊1 428.2 269.4 223.4 ROS ＊2 6.0%

24. Slide 24: 2.1 Billion Yen Increase in JFE Steel's Segment Profit (3Q vs 4Q)

    JFE Steel 2.1 Billion Yen Increase in JFE Steel’s Segment Profit (FY2020 3Q (Actual) vs. FY2020 4Q (Actual)) （Billion yen） FY2020 JFE Steel 1Q 2Q 3Q 4Q Change Apr-Jun Jul-Sep Oct-Dec Jan-Mar Full year Segment Profit (57.8) (784) 34.3 36.4 (65.4) 2.1 1. Cost ±0 2. Volume and Mix • Production increase

25. Slide 25: 207.0 Billion Yen Increase in JFE Steel's Segment Profit (1H vs 2H)

    JFE Steel 207.0 Billion Yen Increase in JFE Steel’s Segment Profit (FY2020 1H (Actual) vs. 2H (Actual)) （Billion yen） FY2020 JFE Steel Change 1H 2H Full year Segment Profit (136.2) 70.8 (65.4) 207.0 1. Cost • Curb variable cost increase amid production reduction +15.0 • Fixed cost reduction mainly s

26. Slide 26: Combined Inventories of HR, CR and Coated Steel Sheet

    JFE Steel Domestic Combined Inventories of HR, Market Environment CR and Coated Steel Sheet （000ｔ） （Month） 5,000 5 Maker Whole Saler Coil Center Inventory Ratio(right axis) 4,000 4 3,000 3 2,000 2 Change From From Feb, 2021 Jan, 2021 Feb, 2020 previous previous 1,000 1 month year Inventories -11 -95

27. Slide 27: Inventories of Plate and Wide Flange Shapes

    JFE Steel Domestic Inventories of Plate (Plate Shear) Market Environment and Wide Flange Shapes Inventories of Plate (Plate Shear) Inventories of Wide Flange Shapes （000ｔ） （Month） （000ｔ） Inventories （Month） 500 3.5 250 3.5 Shipment Inventories Inventory Ratio (right axis) Inventory Ratio(right axis)

28. Slide 28: Trend of Import Steel (Ordinary Steel)

    JFE Steel Domestic Market Environment Trend of Import Steel (Ordinary Steel) （000ｔ） 600 S.Korea China Taiwan Others 500 400 300 200 Change Feb, From From Jan, Feb, Unit:000t 100 2021 Previous Previous 2021 2020 Month Year +42 +37 Import Steel 391 349 354 (+12.2%) (+10.4%) 0 Jan Mar May Jul Sep Nov J

29. Slide 29: Crude Steel & Im/Export, China

    JFE Steel Overseas Market Environment Crude Steel & Im/Export, China (Mｔ） Export (Left axis) Import (Left axis) Crude Steel (Right axis) （Mｔ） 12 100 90 10 80 70 8 60 6 50 40 4 30 Mar, From Jan-Mar, From 2021 previous 2021 Oct-Dec, 20 2 month 2020 Crude Steel（Mt） 94.0 +11.2% 271.5 +0.1% 10 Export（Mt）

30. Slide 30: Inventories in China by Product

    JFE Steel Overseas Market Environment Inventories in China by Product （Mｔ） 30.0 Bar Rod & Wire Plate HR CR Change by previous year (%) 100.0% 50.0% 25.0 0.0% 20.0 -50.0% 15.0 -100.0% -150.0% 10.0 -200.0% Change Mar, From From Feb, Mar, 5.0 2021 Previous Previous 2021 2020 Month Year -250.0% Inventor

31. Slide 31: Metal Spread Trend (Chinese Spot Basis)

    Overseas Metal Spread Trend JFE Steel Market Environment (Chinese Spot Basis) （$/t) （$/t) 900 900 800 800 700 700 600 HRC 600 500 500 400 400 300 300 200 200 100 100 Metal Spread 0 0 Metal Spread ＝ HRC Price － Raw Materials Cost *HRC Price： Chinese Spot basis Raw Materials Cost： Calculated from mark

32. Slide 32: Price Trend of Import Steel

    JFE Steel Domestic Market Environment Price Trend of Import Steel （000 yen/ ton） 70 65 60 55 50 45 40 Mar May Mar May Mar May Sep Mar May Jul Sep Mar May Jan Nov Jul Sep Mar May Feb Jan Nov Jul Sep Jan Nov Jul Sep Jan Nov Jul Sep Jan Nov Jul Jan Nov 2015 2016 2017 2018 2019 2020 2021 Data: The Japan

33. Slide 33: Iron Ore and Coking Coal

    JFE Steel Raw Materials Iron Ore and Coking Coal ($/DMT) ($/WMT) $200 Iron ore (Iron Ore Fines from Australia) $300 Coking Coal （Hard Coking Coal from Australia) $180 $275 Spot FOB Spot FOB Term-contract FOB $160 $250 Term-contract FOB $225 $140 $200 $120 $175 $100 $150 $80 $125 $60 $100 $40 $75 17/

34. Slide 34: Trend of Metal's Market Price

    (￠/lb) 60 80 100 120 140 160 180 1,000 1,200 1,400 1,600 1,800 400 600 800 2015.1 2015.1 2015.7 FeCr (U$/t) FeMn 2015.7 2016.1 2016.1 2016.7 2016.7 2017.1 2017.1 2017.7 2017.7 2018.1 2018.1 2018.7 2018.7 2019.1 2019.1 Raw Materials 2019.7 2019.7 2020.1 2020.1 2020.7 2020.7 2021.1 2021.1 (U$/lb) (U$/

35. Slide 35: Trend of Sub Material's Market Price

    JFE Steel Raw Materials Trend of Sub Material’s Market Price （¥/ｔ） Scrap ($/B) Spot Bulker 50,000 40,000 45,000 35,000 40,000 30,000 35,000 30,000 25,000 25,000 20,000 20,000 15,000 15,000 10,000 10,000 5,000 5,000 0 0 2015.1 2015.7 2016.1 2016.7 2017.1 2017.7 2018.1 2018.7 2019.1 2019.7 2020.1 2020

36. Slide 36: Orders by Business Field

    JFE Engineering Orders by Business Field （billion yen） Business FY2019 FY2020 Main orders received in FY2020 Change Field Actual Actual ★・・・New projects received in FY2020 4Q  Construction of waste treatment plant [Fukui, Fukuyama, Kurashiki, Okayama]  Improvement works of waste treatment plant [H

37. Slide 37: Links to the reports published during FY2020

    JFE-HD Links to the reports published during FY2020 Report URL QR code JFE Group REPORT https://www.jfe- 2020 holdings.co.jp/en/investor/library/gro up-report/index.html JFE Group CSR https://www.jfe- REPORT 2020 holdings.co.jp/en/csr/index.html JFE Group CSR https://www.jfe- REPORT 2020 holdings.co

38. Slide 38: Copyright © 2021 JFE Holdings, Inc.

    Copyright © 2021 JFE Holdings, Inc. All Rights Reserved 38

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