Jfe Holdings, Inc. · TSE:5411
Jfe — H1 FY2023 Earnings Presentation
84 slides from Jfe's earnings presentation, Nov 6, 2023
Slide 1: Financial Results for First Half of Fiscal Year 2023
Securities Code︓5411.T JFE Group Financial Results for First Half of Fiscal Year 2023 ending March 31, 2024 JFE Holdings, Inc. November 6, 2023 Copyright © 2023 JFE Holdings, Inc. All Rights Reserved. 1
Slide 2: A table of contents
A table of contents Financial Highlights JFE Holdings’ Financial Results for First Half of Fiscal Year 2023 (April 1 to September 30, 2023) and Financial Forecast for Fiscal Year 2023 (April 1, 2023, to March 31, 2024) Dividends Financial Forecast for Fiscal Year 2023 by Segment Topics App
Slide 3: Financial Highlights
JFE-HD Financial Highlights • From previous forecast: Profit increased Business Profit ¥164.3bn. by 39.3bn. due to initiatives such as sales Results (Increased by ¥39.3bn. from previous forecast, price improvement. for 1H of decreased by ¥23.6bn. year-on-year） • Year-on-year: Profit decreased by [Ex
Slide 4: Consolidated Results for First Half of Fiscal Year 2023
Consolidated Results for First Half of Fiscal Year 2023 (April 1 to September 30, 2023) Copyright © 2023 JFE Holdings, Inc. All Rights Reserved. 4
Slide 5: Financial Results for 1H of Fiscal Year 2023
JFE-HD Financial Results for 1H of Fiscal Year 2023 Business profit for the first half of the year was ¥164.3bn. (increased by ¥39.3bn. from the previous forecast, decreased by ¥23.6bn. year-on-year.) Excluding inventory valuation differences, business profit increased by ¥24.3bn. from the previ
Slide 6: Financial Results for 1H of Fiscal Year 2023 (by Segment)
JFE-HD Financial Results for 1H of Fiscal Year 2023 (by Segment) FY2023 FY2022 FY2023 Change Change 1H Forecast （billion yen） 1H Actual 1H Actual (FY2022 (Previous (Apr-Sep) (Previous) (Apr-Sep) →FY2023) →Actual) (Apr-Sep) Steel Business 1,918.9 1,880.0 1,865.8 (53.1) (14.2) Engineering Business 219
Slide 7: ¥35.8bn. Increase in JFE Steel's Segment Profit
JFE Steel ¥35.8bn. Increase in JFE Steel’s Segment Profit (FY2023.1H (Forecast) vs. FY2023.1H(Actual)) FY2023 FY2023 （billion yen） Unit 1H(forecast) 1H(Actual) FY2023 FY2023 Change Crude Steel JFE Steel 1H(forecast) 1H(Actual) Mt Approx. 12.30 12.16 (Standalone) Segment Shipment Mt - 10.65 Profit 87
Slide 8: ¥25.4bn. Decrease in JFE Steel's Segment Profit
JFE Steel ¥25.4bn. Decrease in JFE Steel’s Segment Profit (FY2022.1H (Actual) vs. FY2023.1H (Actual)) （ billion yen ） FY2022 FY2023 Unit FY2022 FY2023 Change 1H 1H JFE Steel 1H 1H Crude Steel (Standalone) Mt 12.64 12.16 Segment Shipment Profit 148.2 122.8 (25.4) (Standalone) Mt 10.86 10.65 Average E
Slide 9: Financial Forecasts for Fiscal Year 2023
Financial Forecasts for Fiscal Year 2023 (April 1, 2023, to March 31, 2024) Copyright © 2023 JFE Holdings, Inc. All Rights Reserved. 9
Slide 10: Financial Forecast for Fiscal Year 2023
JFE-HD Financial Forecast for Fiscal Year 2023 Full-year business profit is expected to be ¥290.0bn. (as previous forecast, increased by ¥54.2bn. year-on-year) Full-year profit attributable to owners of parent is expected to be ¥190.0bn. (as previous forecast, increased by ¥27.4bn. year-on-year)
Slide 11: Financial Forecast for Fiscal Year 2023 (by Segment)
JFE-HD Financial Forecast for Fiscal Year 2023 (by Segment) FY2023 Change Change FY2022 FY2023 Forecast FY2022 Previous （billion yen） Actual （Previous) Forecast(Updated) →FY2023 →Updated 1H Full year Full year 1H Full year Full year Full year Steel Business 1,918.9 3,881.1 3,770.0 1,865.8 3,800.0 (8
Slide 12: Dividend
JFE-HD Dividend The Board of Directors resolved to pay an interim dividend of 50 yen per share. (As previous announced) The annual dividend is expected to be 100 yen per share, based on the business outlook and the payout ratio policy of about 30%.(As previous announced) (yen/share) Payout ratio
Slide 13: JFE Steel: Financial Forecast for Fiscal Year 2023
JFE Steel Financial Forecast for Fiscal Year 2023 Copyright © 2023 JFE Holdings, Inc. All Rights Reserved. 13
Slide 14: Business environment (Domestic)
JFE Steel Business environment（Domestic） Although the level of activity in the automotive sector is improving, demand continues to be postponed, particularly in the civil engineering and construction sectors, due to labor shortages and the impact of soaring materials prices. Demand for steel pro
Slide 15: Business environment (Overseas)
JFE Steel Business environment（Overseas） In China, steel exports increased due to sluggish domestic demand caused by a slump in the real estate sector, resulting in a loosening of overseas steel supply and demand and continued stagnation in the market. Although Chinese government stimulus measur
Slide 16: Raw materials market trends
JFE Steel Raw materials market trends Key raw materials • Iron ore is currently hovering around $100 FOB amid a slump in the Chinese steel market. • Since September, coking coal has surged due to increased demand in India and has exceeded FOB $300. • Both iron ore and coking coal are expected to r
Slide 17: Crude steel production
JFE Steel Crude steel production Compared with previous assumptions, the coking coal market has risen sharply, and the recovery of overseas steel demand and market conditions has been slow. Standalone crude steel production is expected to fall to approx. 23.80 Mt per year, mainly due to a decline
Slide 18: Financial Forecast for Fiscal Year 2023
JFE Steel Financial Forecast for Fiscal Year 2023 FY2022 FY2023(updated) FY2023 Unit Previous Full Full Forecast 1Q 2Q 1H 2H Year 1Q 2Q 1H 2H Year billion Revenue 932.6 986.3 1,918.9 1,962.2 3,881.1 917.2 948.6 1,865.8 1,934.2 3,800.0 3,770.0 yen Segment billion 93.0 55.2 148.2 (1.4) 146.8 68.1 54.7
Slide 19: No change in JFE Steel's Segment Profit
JFE Steel No change in JFE Steel’s Segment Profit (FY2023 (Previous Forecast) vs. FY2023(Updated Forecast)) （billion yen） FY2023 FY2023 Change JFE Steel Previous Forecast Updated Forecast Segment Profit 200.0 200.0 ０.0 Excluding Inventory Valuation etc. 225.0 200.0 (25.0) 1. Cost +5.0 2. Volume and
Slide 20: ¥53.2Bn. Increase in JFE Steel's Segment Profit
JFE Steel ¥53.2Bn. Increase in JFE Steel’s Segment Profit (FY2022 (Actual) vs. FY2023 (Forecast)) （billion yen） FY2022 FY2023 Change JFE Steel Actual Forecast Segment Profit 146.8 200.0 53.2 Excluding Inventory Valuation etc. 73.8 200.0 126.2 1. Cost • Structural reforms effect +20.0 • Operational i
Slide 21: ¥45.6Bn. Decrease in JFE Steel's Segment Profit
JFE Steel ¥45.6Bn. Decrease in JFE Steel’s Segment Profit (FY2023.1H vs. FY2023.2H) （Billion yen） FY2023 Forecast Change JFE Steel 1H Actual 2H Forecast Full Year Segment Profit 122.8 77.2 200.0 (45.6) Excluding Inventory Valuation etc. 123.8 76.2 200.0 (47.6) 1. Cost • Structural reforms effect＋20.
Slide 22: Outlook on spread for the second half of FY2023
JFE Steel Outlook on spread for the second half of FY2023 In the second half of FY2023, the spread, especially for export is expected to deteriorate significantly due to the rise in the coking coal market and the slump in overseas markets. Since the first half of FY2024, spreads expect to improv
Slide 23: Paths toward achieving the Seventh Medium-Term Plan
JFE Steel Paths toward achieving the Seventh Medium-Term Plan In FY2023, segment profit excluding Inventory Valuation etc. in the steel business is expected to be 200 billion yen. In FY2024, due to steadily implementing various measures, including structural reforms, sales price improvements, an
Slide 24: JFE Engineering: Financial Forecast for Fiscal Year 2023
JFE Engineering Financial Forecast for Fiscal Year 2023 Copyright © 2023 JFE Holdings, Inc. All Rights Reserved. 24
Slide 25: Financial Forecast for Fiscal Year 2023 (JFE Engineering)
JFE Engineering Financial Forecast for Fiscal Year 2023 Current Business Environment/Overview of Financial Status Annual segment profit is expected to be ¥25 billion. (As previous forecast) ＜Year-on-year＞ ・ Orders: Expect to increase in the field of “Waste to Resource” and “Carbon neutral”. ・ Segm
Slide 26: JFE Shoji: Financial Forecast for Fiscal Year 2023
JFE Shoji Financial Forecast for Fiscal Year 2023 Copyright © 2023 JFE Holdings, Inc. All Rights Reserved. 26
Slide 27: Financial Forecast for Fiscal Year 2023 (JFE Shoji)
JFE Shoji Financial Forecast for Fiscal Year 2023 Current Business Environment/Overview of Financial Status Annual segment profit is expected to be ¥48 billion. (As previous forecast) ＜Year-on-year＞ Despite the recovery in automobile production, profit is expected to decline due to the slow reco
Slide 28: Topics
Topics Copyright © 2023 JFE Holdings, Inc. All Rights Reserved. 28
Slide 29: Shutdown of upstream facilities in Keihin district
JFE Steel Shutdown of upstream facilities in Keihin district The upstream and hot rolling facilities in Keihin were closed on September 16 th. By FY2024, a fixed cost reduction of ¥45 billion can be realized, which significantly lower the break-even point. Utilizing slabs and coils from other
Slide 30: Land reuse project in Keihin district
JFE-HD Land reuse project in Keihin district （”OHGISHIMA2050” released on 7 th Sep. 2023 ） Comprehensive land management will be engaged that appropriately combines "sale”, "lease" and "business use". Proactive introduction of public funds will be discussed with the national and city governments,
Slide 31: Adoption status of green steel JGreeX
JFE Steel Adoption status of green steel “ “ JGreeXTM has been first adopted for buildings and transformers as well as for ships. • With eight domestic shipping companies, we are • First adopted for the new construction of the first in the world to build a model that will “(tentative name) Suido
Slide 32: Fundraising through public offering and CB issuance
JFE-HD Fundraising through public offering and CB issuance In September 2023, we raised a total of 204.5 billion yen through a public offering and CB issuance (Issuance of new shares, disposal of treasury shares, and issuance of convertible bonds) in order to flexibly and reliably implement the GX
Slide 33: Published JFE Group Report and Sustainability Report
JFE-HD Published JFE Group Report and Sustainability Report JFE Group Report 2023 and Sustainability report has been published JFE Group Report: Published on 26th Sep. 2023 Sustainability Report: Published on 28th Sep. 2023 1. Strategy to Create Value • Message from the CEO and CFO • Material Issues
Slide 34: Appendix(1) Profit/Loss Analysis
Appendix(1) Profit/Loss Analysis Copyright © 2023 JFE Holdings, Inc. All Rights Reserved. 34
Slide 35: Main Financial Data
JFE-HD Main Financial Data JAAP IFRS FY15 FY16 FY17 FY18 FY18 FY19 FY20 FY21 FY22 FY23 Forcast (bn. Yen, times) (bn. Yen, times) Ordinary Income 64.2 84.7 216.3 221.1 Business profit 232.0 37.8 -12.9 416.4 235.8 290.0 EBITDA 254.4 279.9 388.8 405.9 EBITDA ＊1 428.2 269.4 223.4 668.7 505.4 570.0 ROS 1
Slide 36: Main Performance & Profitability Targets and Results
JFE-HD Main Performance & Profitability Targets and Results The 7th mid-term FY2021 FY2022 FY2023 business plan Actual Actual Forecast FY2024 Business Profit ¥320.0 ¥ 416.4Bn. ¥ 235.8bn. ¥290.0bn. Consolidated [Excluding Inventory Valuation etc.] bn. [¥2,224bn.] [¥162.8bn.] [¥290.0bn.] Profit attrib
Slide 37: Cash Flow Improvements, Debt/EBITDA Ratio
JFE-HD Cash Flow Improvements, Debt/EBITDA Ratio At the end of FY2023, the Debt/EBITDA ratio is expected to be x3.3. FY2023 （billion yen） Progress of Debt/EBITDA Ratio Consolidated Cash Flow Forecast （billion yen） Debt/EBITDA Ratio (Right Axis) Cash-in Cash-out 1,600 9.0 Net Profit CAPEX & 1,400 T
Slide 38: Financial Results for 1H of Fiscal Year 2023
JFE Steel Financial Results for 1H of Fiscal Year 2023 FY2021 FY2022 FY2023 Unit Full Full 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q Year Year billion Revenue yen 638.5 771.9 832.8 930.2 3,173.4 932.6 986.3 986.9 975.3 3,881.1 917.2 948.6 Segment billion 69.7 88.8 93.5 71.7 323.7 93.0 55.2 21.8 (23.2) 146.8 68.
Slide 39: ¥13.4bn. Decrease in JFE Steel's Segment Profit (1Q vs 2Q)
JFE Steel ¥13.4bn. Decrease in JFE Steel’s Segment Profit (FY2023.1Q (Actual) vs. FY2023.2Q (Actual)) FY2023 JFE Steel Change 1Q(Actual) 2Q(Actual) 1H(Actual) (billion yen) Segment Profit 68.1 54.7 122.8 (13.4) Excluding Inventory Valuation etc. 59.1 64.7 123.8 ＋5.6 1. Cost ＋5.0 2. Volume and Mix ＋2
Slide 40: ¥124.2bn. Increase in JFE Steel's Segment Profit
JFE Steel ¥124.2bn. Increase in JFE Steel’s Segment Profit (FY2022.2H (Actual) vs. FY2023.1H (Actual)) FY2022 FY2023 Change JFE Steel 2H(Actual) 1H(Actual) (billion yen) Segment Profit (1.4) 122.8 124.2 Excluding Inventory Valuation etc. 41.6 123.8 82.2 1. Cost • Disappearance of blast furnace refur
Slide 41: Appendix(2) Business Environmental Indicators, etc.
Appendix(2) Business Environmental Indicators, etc. Copyright © 2023 JFE Holdings, Inc. All Rights Reserved. 41
Slide 42: Combined Inventories of HR, CR and Coated Steel Sheet
JFE Steel Domestic Combined Inventories of HR, Market Environment CR and Coated Steel Sheet （kt） （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 Aug,2023 Jul,2023 Aug,2022 previous previous 1,000 1 month year Inventories +69 -465 4,0
Slide 43: 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 （kt） （month） （kt） （month） Inventories Inventories 500 3.5 250 3.5 Inventory Ratio(Right axis) Shipment Inventory Ratio(Right axis) 450
Slide 44: Domestic Trend of Import Steel
JFE Steel Domestic Trend of Import Steel (Ordinary Steel) Market Environment （kt） 600 S.Korea China Taiwan Others 500 400 300 200 100 Aug,2023 From From Jul,2023 Aug,2022 previous previous month year Import Steel ＋25 ＋27 416 392 389 0 （kt） (+6.3%) (+7.1%) Jan Mar May Jul Sep Nov Jan Mar May Jul Sep
Slide 45: Price Trend of Import Steel
JFE Steel Domestic Market Environment Price Trend of Import Steel （k yen / t） 120 110 100 90 80 70 60 50 40 Oct Oct Oct Oct Oct Jul Oct Jul Oct Jul Jan Jul Jan Apr Jul Jan Apr Jul Jan Apr Jul Jan Apr Jul Jan Apr Jan Apr Jan Apr Apr 2016 2017 2018 2019 2020 2021 2022 2023 Data: The Japan Iron and Ste
Slide 46: 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） 9 120 8 100 7 6 80 5 60 4 3 40 From Apr,-Sep, From Sep,2023 2 Previous 2023 Apr,-Sep, month 2022 20 1 Crude Steel（Mt） 82.1 -5.0% 533.2 +0.2% Export（Mt） 8.1 -2.7%
Slide 47: Crude Steel & Im/Export, China
JFE Steel Overseas Market Environment Crude Steel & Im/Export, China （Mt） 30.0 100.0% Bar Rod & Wire Plate HR CR Change by Previous year(%) 50.0% 25.0 0.0% 20.0 -50.0% 15.0 -100.0% -150.0% 10.0 Change -200.0% Sep, From From Jul, Sep, 5.0 2023 Previous Previous 2023 2022 Month Year -250.0% Inventorie
Slide 48: Metal Spread Trend (Chinese Spot Basis)
Overseas Metal Spread Trend JFE Steel Market Environment (Chinese Spot Basis) （$/t) （$/t) 1000 1000 900 900 800 800 700 HRC 700 600 600 500 500 400 400 300 300 200 200 Metal Spread 100 100 0 0 Metal Spread ＝ HRC Price － Raw Materials Cost *HRC Price： Chinese Spot basis Raw Materials Cost： Calculated
Slide 49: Raw Materials Trend of Sub Material's Market Price
(￠/lb) 60 110 160 210 260 1,000 1,400 1,800 2,200 2,600 600 2016.4 2016.4 2016.10 FeCr (US$/t)FeMn 2016.10 2017.4 2017.4 2017.10 2017.10 2018.4 2018.4 2018.10 2018.10 2019.4 2019.4 2019.10 2019.10 2020.4 2020.4 2020.10 2020.10 2021.4 2021.4 2021.10 2021.10 2022.04 2022.04 2022.10 2022.10 2023.04 202
Slide 50: Raw Materials Trend of Sub Material's Market Price
JFE Steel Raw Materials Trend of Sub Material’s Market Price （yen/ｔ） Scrap ($/B) Spot Bulker 70,000 100,000 90,000 60,000 80,000 50,000 70,000 60,000 40,000 50,000 40,000 30,000 30,000 20,000 20,000 10,000 10,000 0 2016.1 2016.7 2017.1 2017.7 2018.1 2018.7 2019.1 2019.7 2020.1 2020.7 2021.1 2021.7 2
Slide 51: Orders by Business Field
JFE Engineering Orders by Business Field （billion yen） Business FY2022 FY2023 Main orders received in 1H of FY2023 Change Field Actual Outlook ★・・・New projects received in 2Q of FY2023 Waste Construction works of domestic waste treatment facility [★Mie] to 216.9 238.0 21.1 Resource Renewal works of
Slide 52: Appendix(3) The 7th Medium-Term Business Plan
Appendix(3) The 7th Medium-Term Business Plan Copyright © 2023 JFE Holdings, Inc. All Rights Reserved. 52
Slide 53: Mid/long-term directions
JFE-HD Mid/long-term directions Biggest transformation in company’s history aimed at achieving global success JFE’s corporate vision Contributing to society with the world’s most innovative technology JFE’s mission To be essential to society’s sustainable development and to create safe, comfortable
Slide 54: JFE Group Environmental Vision for 2050
JFE-HD Initiatives to achieve environmental and social sustainability (helping to solve critical issues) E JFE Group Environmental Vision for 2050 • Aim to realize carbon neutral by 2050, taking climate change as an extremely important business concern for JFE • Accelerate R&D in new technologies an
Slide 55: JFE Group Environmental Vision for 2050
JFE-HD JFE Group Environmental Vision for 2050 Toward Carbon Neutrality by 2050 JFE Group Environmental Vision for 2050 （GX Investment during 7th mid-term business plan：340 billion yen) GX：Green transformation 1. Key environmental initiative under 7 th mid-term business plan • Steel business：Reducti
Slide 56: JFE Group's activities for Carbon Neutrality
JFE-HD JFE Group’s activities for Carbon neautrality Steel Business: CO₂ emission reduction by 18% at the end of FY2024 (vs. FY2013) Through decarbonization in steel manufacturing processes etc., JFE Group aims to be carbon neutral. Engineering Business: Contribute to carbon neutrality in society on
Slide 57: [Steel Business] Roadmap for Carbon Neutrality
JFE Steel [Steel Business] Roadmap for Carbon Neutrality Revised our roadmap for realizing carbon neutrality in 2050, considering installing the technologies below in the concrete: Carbon recycling blast furnace: Each established technology to be installed in order (late 2030s） Hydrogen-based ir
Slide 58: Carbon-recycle Blast Furnace
JFE Steel Carbon-recycle Blast Furnace • Technologies for reducing CO₂ emissions from blast furnaces are necessary to maximize blast furnaces’ advantages such as mass production, high-efficiency production, and high-grade steel production • Combining carbon-recycling blast furnace with CCU enables t
Slide 59: Groupwide commercialization of offshore wind-power business
JFE-HD Groupwide commercialization of offshore wind-power business (Study feasibility) • Become a pioneer in offshore wind-power generation business by commercializing manufacture of monopile and other seabed-fixed structures. • Establish groupwide supply-chain such as monopile-structure manufacturi
Slide 60: Social sustainability: Safety management, HR issues
JFE-HD Social sustainability：Safety management, HR issues Further increase efforts to prevent accidents not only by using facilities but management also through safety education and obedience of rules, in order to achieve top-priority goal of zero major accidents. Safety Groupwide investment for saf
Slide 61: Social sustainability: Contribution to Regional Societies
JFE Engineering Social sustainability：Contribution to Regional Societies through Engineering Business • Expand bases of local production and local consumption business (Food-recycling business and regional PPS business) • Contribute to the regional society considering to expand combined utility serv
Slide 62: Establish economic sustainability (stable earnings power)
JFE-HD Establish economic sustainability (stable earnings power) Establish sufficient profitability and stable financial base for proactive business operation for the mid/long-term growth 1. Shift focus of domestic steel business from quantity to quality ーPursue world-class earnings power • Achieve
Slide 63: 7th mid-term business plan <Steel Business>
JFE Steel 7 th mid-term business plan <Steel Business> Aim to achieve world-class per-ton profit and enhance strategies for global growth Promote innovation for carbon neutrality Main initiatives 1. Transition to a lean, robust business structure by shifting focus from quantity to quality 2. Expand
Slide 64: Transition to a lean, robust business structure
JFE Steel Transition to a lean, robust business structure by shifting focus from quantity to quality Improve per-ton profit by both fixed cost reduction and increase of high value- added products ratio, and enhance earning base. Achieve world-class cost Expand margins and quality competitiveness and
Slide 65: Expand and Accelerate Overseas Business
JFE Steel Expand and Accelerate Overseas Business • Expand returns from 1. vertical specialization business such as steel production applied for automobiles • Further deepen integrated production in high-demand market (2. “Insider” business) • Expand 3. solution business, in which we provide cutting
Slide 66: Strategy to Capture Growing Demand for Electrical Steel Sheet
JFE Steel Examples of Steel Business’s Critical Initiatives: Strategy to Capture Growing Demand for Electrical Steel Sheet Domestic To expand non-oriented Overseas To conduct FS of grain-oriented electrical steel sheet (N/O) electrical-steel-sheet JV with JSW production capacity Released April 1, 20
Slide 67: JFE Group-wide Strategy for Electrical Steel Sheet
JFE-HD JFE Group-wide Strategy to Capture Growing Demand for Electrical Steel Sheet（Steel Business and Trading Business） JFE Steel JFE Shoji Production of Expand production and supply Processing and electrical steel function of high value-added World’s No.1 global distribution distribution of sheets
Slide 68: 7th mid-term business plan <Engineering Business>
JFE Engineering 7 th mid-term business plan <Engineering Business> Expand sales revenue to 1-trillion-yen level in FY2030 Targets • Revenue 650.0 billion yen FY2024 • Segment Profit 35.0 billion yen （billion yen） （billion yen） 【Segment profit】 【Revenue】 1-trillion-yen level 40 35.0 1,000 650.0 30 24
Slide 69: Engineering Business's Main initiatives
JFE Engineering Engineering Business’s Main initiatives ーEnhancing mid/long-term priority areasー • Expand engineering business as a growth sector by helping to solve pressing issues in global society, in view of increasing importance of the environmental, recycling and renewable- energy fields. • Ex
Slide 70: 7th mid-term business plan <Trading Business>
JFE Shoji 7 th mid-term business plan <Trading Business> Establish growth foundation by enhancing SCM Target FY2024 Segment profit 40bn. （bn.） 40 【Segment Profit】 27.6 ¥40 billion 23.5 20.3 20 Equipment & Business Investment ： Approx. ¥120 billion over 4 years 0 4th mid-term ave. 5th mid-term ave. 6
Slide 71: Trading Business's Main initiatives
JFE Shoji Trading Business’s Main initiatives ーKey Strategies for growth, Strengthen purchasing and sales capabilitiesー Strengthen SCM of Automotive steel Fully Capture steel demand in Japan Enhance SCM for high-tensile steel both in Increase earnings by enhancing JFE Group’s overseas and domestic m
Slide 72: JFE Group's DX strategies
JFE-HD JFE Group’s DX strategies • Promote DX in every business area such as advancing productivity through innovation, transforming exiting businesses and creating new businesses. • Proactively invest money and human resource necessary for DX： DX investment approx. 120 billion yen over 4 years JFE
Slide 73: Balance Financial Soundness with Effective Investment
JFE-HD Balance Financial Soundness with Effective Investment based on a “select and concentrate” approach • Selective maintenance investment, focusing on investments for enhancing competitiveness and establishing stable profit base • Ensure earning source by asset compression 1. Equipment & Business
Slide 74: Main Financial Data and Performance & Profitability Targets
JFE-HD Main Financial Data and Performance & Profitability Targets 7 th mid-term FY2020 business plan Actual FY2024 Business profit ¥ 320.0 billion ¥ -12.9 billion Consolidated Profit attributable to owners of the parent ¥ 220.0 billion ¥ -21.8 billion ROE 10% -1.3% Debt/EBITDA About 3x 8.1x D/E*1 A
Slide 75: Appendix(4) JFE Steel Carbon Neutral Strategy Briefing
Appendix(4) JFE Steel Carbon Neutral Strategy Briefing Copyright © 2023 JFE Holdings, Inc. All Rights Reserved. 75
Slide 76: JFE Steel's Transition to Low-carbon Processes
JFE Steel’s Transition to Low-carbon Processes 2050 Develop ultra-innovative technologies for carbon Establish & implement ultra- neutrality 2030 innovative technologies 2024 (GI Use of funds) Transition Period Innovation Period 18% less Use EAFs 30% or more Carbon Adopt optimal processes CO2 Expand
Slide 77: JFE Steel's Carbon Neutrality Vision 2050
JFE Steel’s Carbon Neutrality Vision 2050 Oxygen Fuel/oxygen + Store CO2 in slag/concrete CCS Storage Reduction gas powder material Converter CO2 CCS More energy-saving equipment Increased use of scrap Carbon-free (external conditions) Introduce EAFs electricity (external conditions) CCS Energy savi
Slide 78: JFE's Carbon Neutrality Action Plan
JFE’s Carbon Neutrality Action Plan ▶ JFE Steel is introducing low-carbon steel processes during its “transition period” to 2030. ▶ In its “innovation period” from 2030 to 2050, JFE Steel aims to develop and implement ultra- innovative technologies for carbon neutrality. Transition period Innovation
Slide 79: Transition to Low-carbon Processes
Transition to Low-carbon Processes ▶ Continue to develop ultra-innovative technologies for decarbonized steel processes by 2030 ▶ Increasingly use low-carbon technologies to cut CO2 by 30% or more by FY2030 Energy savings and Low-carbon feedstock & Low-carbon processes high efficiency fuel Upgrade t
Slide 80: Development Project Supported by Green Innovation Fund
Development Project Supported by Green Innovation Fund ▶ This project, targeted at using hydrogen in ironmaking and commissioned and subsidized by NEDO*, was selected in December 2021 to receive support from the Green Innovation Fund. ▶ The fund is helping to accelerate the development of technologi
Slide 81: Overall Scale of GI Fund Projects
Overall Scale of GI Fund Projects ▶ Development toward Stage Gate Reviews scheduled mainly in FY2025–2026 ▶ Studies also underway with a view to actual implementation in 2030–2040s ★ Stage Gate Develop technologies & conduct Medium-scale Large/full-scale small-scale tests tests tests 2021〜2025 2026〜
Slide 82: Stimulating Demand for Green Steel
Stimulating Demand for Green Steel ▶ In the EU, green steel is branded and sold using a mass balance approach. ▶ Achieving 30% CO2 reduction by FY2030 will enable JFE Steel to supply up to 5M tons of green steel per year using the same approach. ▶ To create a carbon-neutral world, government policie
Slide 83: Initiatives for Collaborating with Society
Initiatives for Collaborating with Society • Realizing carbon-neutral steelmaking is a top priority for JFE Steel, but generating environmental value will involve large cost increases, so there are limits on what a single company can do. • Mechanisms are needed so that society, as the beneficiary of
Slide 84: Copyright © 2023 JFE Holdings, Inc. All Rights Reserved
Copyright © 2023 JFE Holdings, Inc. All Rights Reserved 84