Tokyo Gas Co., Ltd. · TSE:9531
Tokyo Gas — Q3 FY2020 Earnings Presentation
27 slides from Tokyo Gas's earnings presentation, Jan 28, 2021
Slide 1: FY2020 3Q Financial Results
FY2020 3Q Financial Results ended December, 2020 January 28, 2021 "E TOKYO GAS TSE:9531
Slide 2: FY2020 Consolidated Financial Results
o1 FY2020 Consolidated Financial Results ended December, 2020 "RTOKYO GAS
Slide 3: Sales decreased but profits increased in 3Q FY2020
Sales decreased but profits increased in 3Q FY2020. Net sales were ¥1,233.5 billion, a decrease of ¥128.5 billion year on year. This was mainly attributable to a decrease in the city gas unit price due to gas rate adjustments and a drop in the city gas sales volume of the gas segment due to the impa
Slide 4: Negative goodwill gain and investment securities sales
billion gain on negative goodwill after making Castleton Resources a subsidiary have not changed from 2Q. A gain on sales of investment securities of ¥4.7 billion was posted due to a partial sale of cross-shareholdings in 3Q. 3
Slide 5: City gas sales volume in 3Q FY2020
The city gas sales volume in 3Q FY2020 was 8,912 million m3, down 10.2% year on year. This was mainly attributable to a 614 million m3 decrease in sales volume to power generation customers due to the expiry of a contract with a large customer and a drop in operation owing to the impact of COVID-19.
Slide 6: Total electricity sales volumes in 3Q
Total electricity sales volumes in 3Q was 17,685 million kWh, up 24.9% year on year. Retail electricity sales increased 24.0% year on year to 7,152 million kWh, due to an increase in the number of customers. Wholesale and other electricity sales volumes also increased 25.5% to 10,533 million kWh on
Slide 7: Net sales and segment profit by segment
Slide 6 shows net sales by segment and segment profit, which is operating profit plus equity income/loss of subsidiaries, and changes thereof. In segment profit, a ¥8.3 billion increase in the gas segment and a ¥9.7 billion increase in the electric power segment pushed up the overall profit. 6
Slide 8: Segment profit changes: gas, electric power, overseas
The ¥8.3 billion profit increase of the gas segment constitutes a ¥5.0 billion drop in LNG sales offset by a ¥1.7 billion increase in gross margin of city gas and a ¥11.8 billion decrease in fixed costs for city gas. The profit of the electric power segment increased by ¥9.7 billion, reflecting an i
Slide 9: FY2020 Full Year Forecast
02 FY2020 Full Year Forecast "R TOKYO GAS
Slide 10: Full year forecast: higher sales, lower profits
For the FY2020 full year, we are forecasting an increase in sales and a decrease in profits. With regard to the economic framework for January and later, which serves as a basis of our forecast, we have revised the foreign exchange rate assumption from ¥110/$ to ¥105/$ and the crude oil price assump
Slide 11: City gas sales volume forecast
I would like to describe our forecast of city gas sales volume, the basis of our full-year forecasts. We have made an upward revision to our city gas sales volume forecast by 370 million m3 (+2.9%) from the previous forecast, of which -26 million m3 (-0.4%) is due to a temperature effect. The revisi
Slide 12: Electricity sales volume forecast
Let me now describe the electricity sales volume. The forecast of electricity sales volume has been revised upward from the previous forecast by 1.9% to 24,615 million kWh, mainly reflecting an expected increase in sales volume in wholesale, etc. 11
Slide 13: FY2020 forecasts by segment versus previous forecast
This slide shows our FY2020 net sales and profit forecasts by business segment and changes from the previous forecast. Our segment profit forecast has been revised downward from the previous forecast by ¥9.1 billion to ¥78.8 billion. 12
Slide 14: Major changes in segment profit forecast
I would like to describe the major changes in our segment profit forecast. In the gas segment, we raised our forecast by ¥3.9 billion as the increase in profit due to a rise in gross margin following an increase in the city gas sales volume offset the decrease in profit due to the response to tight
Slide 15: Segment forecasts compared to previous year
This slide shows net sales forecasts by segment and segment profit forecasts as compared to the results of the previous year. 14
Slide 16: Segment forecast versus previous year by segment
In the gas segment, our forecast is -¥2.3 billion mainly due to a drop in LNG sales following the response to tight LNG supply-demand balance, despite an expected increase in city gas gross margin due to an increase in residential city gas sales volume as customers stay at home. Our forecast for the
Slide 17: Factors for changes from FY2019 at 3Q
As reference information, here are our forecasts as of 3Q in terms of the same items as in “Factors for Changes from FY2019” that we presented in 1Q. Looking at the changes by item, the forecast for “other profit increase and decrease” has been decreased due to the impact of the surge of JEPX prices
Slide 18: Use of cash flow in FY2020
This slide details the use of cash flow in FY2020. We expect our use of cash to substantially exceed the previous year’s level due to capital expenditure and investments and financing that were decided before 3Q. On the other hand, the use of cash is expected to drop significantly from the previous
Slide 19: Key indicators on a consolidated basis
This slide shows key indicators on a consolidated basis. 18
Slide 20: Reference materials
The following reference materials include a table on the sensitivity to the economic framework assumption, plus the trend of crude oil prices and the exchange rate, a list of major year-to-date press releases, a list of major overseas investment projects, and the number of switches to other electric
Slide 21: Gas gross margin sensitivity to crude oil price and exchange rate
Gas Gross Margin Sen: Impact of rising JCC by $1/bbl Period 4Q Impact of depreciation by ¥1/$ Period 4Q rude Oil Price and Exchange Rate (Unit: billion yen) Impact on earnings 4Q -0.1 Impact on earnings 4Q -0.8 (Unit: billion yen) "ETOKYO GAS 20
Slide 22: Crude oil price - Exchange rate
Crude oil price - Exchange rate Crude oil price (Japan Crude Cocktail Prices) ($/bbl) 80.00 ee ee 60.00 s oy ¢ 3 x s s —e-FY2020 e+ FY2019 Exchange rate (¥/$) 115.0 110.0 105.0 100.0 s @ & 3s s s x ss s Ss e-FY2020 ~@=FY2019 "ETOKYO GAS 21
Slide 23: Key Topics in FY2020 (Press Releases)
Key Topics in FY2020 (Excerpted from Press Releases up to 28th Jan.) nt Reform of the Toro Guo Group in View ofthe COVID-19:Pendemie (Hov.30) | Notice of Transition to'a Company with a Nominating Committee, te. (NOV.30) + Notice regarding Company Form after Split of Gas Pipeline Business and Company
Slide 24: Key Topics in FY2020 (Others)
Key Topics in FY2020 (Excerpted from Press Releases up to 28th Jan Others: + Integration of Tokyo Gas Living Engineering Co., Ltd. and Tokyo Gas Remodeling Co., Ltd. (Apr.6)*3 + Tokyo Gas venture Sumilena Co., Ltd, initiates “fixed monthly fees appliances rental services” and implements “Rest HOME”
Slide 25: Overseas Projects
Overseas Projects e G00 ° C6) ° ‘Area__No__ Country Subject Main Business Participation year Upstream Shale gas 2013 Upstream Shale gas 2016 Upstream Shale gas 2017 @ usa Downstream Energy Service 2015 Downstream Natural gas power 2017 North America Downstream Solar power 2020 Other ‘Open Innovation
Slide 26: Trends in city gas/electricity switching
Trends in city gas/electricity switching(published data), Number of customers 25 for city gas retail sales( Tokyo gas consolidated) Electricity switchers (based on applications) City gas switchers (based on applications) Monthiy(1,000s) CCumulative(1,000s) Monthly(1,000s) Cumulative(1,000s) 500 20,0
Slide 27: Cautionary Statement regarding Forward-looking Statements
"TOKYO GAS < Cautionary Statement regarding Forward-looking Statements > Statements made in this presentation with respect to Tokyo Gas’s present plans, forecasts, strategies and beliefs, and other statements herein that are not expressions of historical fact are forward-looking statements about the