Idemitsu Kosan Co., Ltd. · TSE:5019
Idemitsu Kosan — Q3 FY2020 Earnings Presentation
38 slides from Idemitsu Kosan's earnings presentation, Feb 9, 2021
Slide 1: Presentation on Results for the 3rd Quarter FY2020
Presentation on Results for the 3 rd Quarter FY2020 February 9, 2021 Idemitsu Kosan Co.,Ltd.
Slide 2: Summary of Financial Results
Summary of Financial Results FY2020 3Q Financial overview FY 2020 3Q segment income* continued to decrease mainly due to inventory impact *Segment income = operating income + equity income Segment income excluding inventory impact (April-December) decreased by ¥23.9 billion year-on-year, refle
Slide 3: Summary of Financial Results: Forecast overview
Summary of Financial Results FY2020 Forecast overview Forecasted segment income for FY 2020 is expected to exceed the previously announced forecast by ¥60 billion, in part due to a change in the Arabian Light crude oil price assumption from February onward to $51/bbl. Net income is revised upw
Slide 4: Inventory Impact and Crude Oil Price Trends
Inventory Impact 80 [USD/BBL] <Crude Oil Price Trends (Arabian light)> 70 4Q Average 60 68 price≒$52 2Q 3Q 58 Average Average price 50 price≒$41 ≒$42 55 49 51 51 40 45 44 42 43 40 30 37 35 20 25 10 19 0 Mar May Mar Jun Feb Dec Apr Jul Feb Nov Oct Aug Jan-20 Jan-21 Sep [FY2020 3Q] The crude oil pri
Slide 5: Key Topics
Key Topics Impact of COVID 19 Pandemic on Idemitsu’s Operations While sales volume for the 4 core fuel oil products and jet fuel recovered in 3Q (October- December), future demand trends must be observed cautiously as the re-declaration of a state of emergency in January [％] 4Q 1Q 2Q 1H 3Q Forec
Slide 6: Key Topics
Key Topics The new service station brand “apollostation” to be launched in April 2021 apollostation is a future-oriented SS which provides various services to support the community’s lifestyle and transportation based on the concept of becoming a “life partner which supports regional society whi
Slide 7: Operating Environment
Operating Environment Dubai Crude Oil Australian Coal Exchange Rate [USD/bbl] Price [USD/ton] Spot price [JPY/USD] (USD) 80.0 120.0 112.0 67.4 111.0 70.0 110.0 62.1 61.2 109.9 110.0 60.0 100.0 95.8 108.8 50.7 109.0 50.0 90.0 108.9 80.2 108.0 40.0 44.6 80.0 42.9 107.3 107.0 65.4 67.3 107.6 30.0 70.0
Slide 8: Overview
Overview Crude Oil / Coal / Exchange Rates [USD/bbl, USD/ton, JPY/USD] FY2019 3Q FY2020 3Q Change Crude Oil (Dubai) 63.5 39.4 (24.1) (38.0%) Crude Oil (Brent)* 64.9 40.8 (24.1) (37.1%) Thermal Coal * 81.3 58.1 (23.2) (28.5%) Exchange Rate 108.7 106.1 (2.6) (2.4%) *Brent prices and thermal coal pri
Slide 9: Segment Information
Segment Information Operating Income + Equity Income [￥billions] FY2019 3Q FY2020 3Q Change Petroleum 16.8 5.5 (11.3) (67.1%) Excluding inventory impact 26.1 64.9 38.9 149.2% Basic Chemicals 18.0 (1.0) (19.0) － Functional Materials 20.2 9.5 (10.7) (52.9%) Power and Renewable Energy (0.5) (1.7) (1.
Slide 10: Segment Information
Segment Information Factors Affecting Operating Income + Equity Income (excluding inventory impact, year on year) [￥billions] Oil Exploration Coal and Production (23.0) (7.0) Cost etc. FX Volume etc. Margin Volume FX Margin etc. Synergies, Income from Lubricants subsidiaries etc. etc. Pricing Volu
Slide 11: Segment Information: Petroleum
Segment Information [Petroleum] YoY ¥38.9 bn (FY19 3Q：¥26.1 bn ➡ FY20 3Q：¥64.9 bn) <Year-on-year Change in Petroleum <Trends in Domestic Petroleum Product Margins*> sales volume (4 Core Products)> *Average of gasoline, diesel oil, kerosene, and heavy oil A margins [Thousand KL] (domestic spot –crude
Slide 12: Segment Information
Segment Information [Basic Chemicals] YoY-¥19.0 bn (FY19 3Q：¥18.0 bn ➡ FY20 3Q：-¥1.0 bn) Deteriorated product margins led to decline in profit [USD/ton] Product FY2019 3Q FY2020 3Q Change Price Margin Price Margin Price Margin PX 840 316 534 174 (306) (142) MX 701 176 432 72 (269) (104) SM 982 457
Slide 13: Segment Information: Oil E&P and Coal
Segment Information [Oil E&P] YoY -¥7.0 bn [Coal] YoY-¥23.0 bn (FY19 3Q：¥12.2bn ➡ FY20 3Q：¥5.2 bn) (FY19 3Q：¥22.3 bn ➡ FY20 3Q：-¥0.7 bn) <Crude Oil Production Volume and Brent <Coal Production Volume and Australian Coal Crude Oil Price Trends> Spot Price Trends> [Thousand BOE] [USD/bbl] [Thousand to
Slide 14: Balance Sheet
Balance Sheet [¥ billions] 3/31/2020 12/31/2020 Change 3/31/2020 12/31/2020 Change Total Current Cash and Deposits 132.2 100.1 (32.1) Liabilities 1,648.4 1,614.4 (34.0) Receivables, Inventory, etc. 1,418.1 1,428.0 9.9 Total Fixed Liabilities 1,038.0 1,103.0 65.1 Total Current Assets 1,550.3 1,528.1
Slide 15: Overview
Overview Crude Oil / Coal / Exchange Rates [USD/bbl, USD/ton, JPY/USD] 11/10 Revised Assumptions Change Forecast Forecast (4Q) Crude Oil (Dubai) 38.4 42.4 4.0 10.4% 51.5 Crude Oil (Brent)* 42.6 41.7 (0.9) (2.2%) － Thermal Coal * 56.6 60.4 3.8 6.7% － Exchange Rate (TTM) 106.0 105.7 (0.2) (０.2%) 105
Slide 16: Segment Information
Segment Information Operating Income + Equity Income [¥ billions] 11/10 Revised Change Forecast Forecast Petroleum (3.0) 60.0 63.0 － Excluding inventory impact 47.0 70.0 23.0 48.9% Basic Chemicals (6.0) (2.0) 4.0 － Functional Materials 10.0 11.0 1.0 10.0% Power and Renewable Energy (5.0) (12.0) (7
Slide 17: Segment Information
Segment Information Factors Affecting Operating Income + Equity Income [¥ billions] (excluding inventory impact, Compared to the previous forecast) Performance chemicals Oil Exploration Income Margin etc. and Production Coal From [±0] [±0] Subsidiaries, Cost etc. Cost etc. Volume Petroleum Basic F
Slide 18: Segment Information
Segment Information [Petroleum] ¥23.0 bn (11/10 Forecast：¥47.0 bn ➡ Revised Forecast：¥70.0 bn) Slight increase in forecasted sales volume for core products, reflecting recent resurgence of COVID-19 and cold weather No change in forecasted refining margins Upward revision due to cost reductions
Slide 19: Reference Materials
Reference Materials € idemitsu
Slide 20: Overview of the Company
Overview of the Company ∎ Petroleum Segment ∎ Functional Materials Segment Refining Capacity 945,000 BD *1) (Lubricants, performance chemicals, electronic Domestic fuel oil sales volume materials, functional asphalt, agricultural- 41 million KL/year biotechnology, solid electrolyte) Number of
Slide 21: Financial Data
Financial Data Net Sales by Segment [¥ billions] FY2019 3Q FY2020 3Q Change Petroleum 3,630.4 2,509.6 (1,120.8) (30.9%) Basic Chemicals 350.0 222.6 (127.4) (36.4%) Functional Materials 294.0 251.7 (42.3) (14.4%) Power and Renewable Energy 94.6 90.2 (4.4) (4.6%) Resources* 189.0 132.4 (56.6) (30.0%
Slide 22: Financial Data
Financial Data Quarterly segment income（accumulated, excluding inventory impact） [¥ billions] FY2019 1Q FY2019 2Q FY2019 3Q FY2019 FY2020 1Q FY2020 2Q FY2020 3Q Petroleum 3.5 15.4 26.1 (20.1) (9.4) 27.3 64.9 Equity income (2.7) (14.9) (26.0) (32.7) (27.2) (28.8) (37.2) Basic Chemicals 5.9 14.3 18.
Slide 23: Sales and Production
Sales and Production Sales Volume(Petroleum Segment) [Thousand KL,％] FY 2019 3Q FY 2020 3Q Change Gasoline 10,902 9,706 (1,197) (11.0%) Naphtha 207 222 15 7.3% Jet Fuel 3,869 1,507 (2,363) (61.1%) Kerosene 2,293 2,400 108 4.7% Diesel Oil 8,089 7,429 (659) (8.2%) Heavy Fuel Oil A 2,338 2,298 (40) (
Slide 24: Sales and Production
Sales and Production Sales Volume (Basic Chemicals Segment) [Thousand tons,%] FY 2019 3Q FY 2020 3Q Change Basic Chemicals 2,961 2,647 (314) (10.6%) Sales Volume (Functional Materials Segment) [Thousand KL, Thousand tons,%] FY 2019 3Q FY 2020 3Q Change Lubricants 897 780 (117) (13.0%) Performanc
Slide 25: Sales and Production
Sales and Production Oil E&P – Production Volume, including Gas (Resources Segment) [Thousand BOED,%] FY 2019 3Q FY 2020 3Q Change Norway 20.9 23.2 2.3 11.0% Total('000BOED) 20.9 23.2 2.3 11.0% Total('000BOE) 5,692 6,370 678 11.9% *Figures based on interest owned by Idemitsu's resource development
Slide 26: Sales and Production - Forecast
Sales and Production ‐ Forecast Sales Volume(Petroleum Segment) [Thousand KL,％] 11/10 Revised Change Forecast Forecast Gasoline 12,710 12,630 (80) (0.6%) Naphtha 280 280 － － Jet Fuel 1,900 2,100 200 10.5% Kerosene 4,250 4,330 80 1.9% Diesel Oil 9,780 9,800 20 0.2% Heavy Fuel Oil A 3,150 3,280 130
Slide 27: Sales and Production - Forecast
Sales and Production ‐ Forecast Sales Volume (Basic Chemicals Segment) [Thousand tons,%] 11/10 Revised Change Forecast Forecast Basic Chemicals 3,760 3,660 (100) (2.7%) Sales Volume (Functional Materials Segment) [Thousand KL, Thousand tons,%] 11/10 Revised Change Forecast Forecast Lubricants 1,
Slide 28: Sales and Production - Forecast
Sales and Production ‐ Forecast Oil E&P Production Volume, including Gas (Resources Segment) [Thousand BOED,%] 11/10 Revised Change Forecast Forecast Norway 22.9 23.0 0.1 0.5% Vietnam 0.3 0.9 0.3 244.2% Total('000BOED) 23.2 23.9 0.7 3.2% Total('000BOE) 8,460 8,750 290 3.3% *Figures based on intere
Slide 29: Sensitivity
Sensitivity Impact on FY earnings Items Range Impact on earnings Petroleum (¥4.0 billion) Crude Fuel cost, etc. ¥1.0 billion １$/bbl Inventory impact (¥5.0 billion) Decrease Oil Oil Exploration & Production (¥1.0 billion) Petroleum (¥2.5 billion) Foreign Exchange Fuel cost, etc. ¥0.5 billion １JPY/$
Slide 30: Crude Oil Prices (Dubai and Brent)
Crude Oil Prices (Dubai and Brent) [USD/bbl] 90 Brent 80 Dubai 70 60 50 40 30 20 10 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20 30
Slide 31: Gasoline – Crude Oil (Domestic spot prices and Spreads)
Gasoline – Crude Oil (Domestic spot prices and Spreads) [JPY/L] Prices Spreads [JPY/L] 80 18 70 16 14 60 12 50 10 40 8 30 6 20 4 Spread 10 Crude oil 2 Gasoline 0 0 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20 31
Slide 32: Diesel Oil – Crude Oil (Domestic spot prices and Spreads)
Diesel Oil – Crude Oil (Domestic spot prices and Spreads) Spreads [JPY/L] [JPY/L] Prices 80 20 18 70 16 60 14 50 12 40 10 8 30 6 20 Spread 4 10 Crude oil 2 Diesel oil 0 0 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20 32
Slide 33: Gasoline – Crude Oil (Singapore spot prices and Spreads)
Gasoline – Crude Oil (Singapore spot prices and Spreads) [USD/bbl] Prices Spreads [USD/bbl] 100 16 90 14 80 12 70 10 60 8 50 6 40 4 30 2 20 Spread 10 Dubai 0 Gasoline 0 -2 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20 33
Slide 34: Diesel Oil – Crude Oil (Singapore Spot prices and Spreads)
Diesel Oil – Crude Oil (Singapore Spot prices and Spreads) [USD/bbl] Prices Spreads [USD/bbl] 100 20 90 18 80 16 70 14 60 12 50 10 40 8 30 6 20 Spread 4 Dubai 10 2 Diesel Oil 0 0 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20 34
Slide 35: Paraxylene, Mixed xylene – Naphtha (Prices and Spreads)
Paraxylene, Mixed xylene ー Naphtha (Prices and Spreads) [USD/ton] Prices Spreads [USD/ton] 1,400 700 PX spread Mx spread Naptha PX 1,200 MX 600 1,000 500 800 400 600 300 400 200 200 100 0 0 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20 35
Slide 36: Styrene Monomer – Naphtha (Prices and Spreads)
Styrene Monomer ー Naphtha (Prices and Spreads) [USD/ton] Prices Spreads [USD/ton] 1,600 1,200 1,400 1,000 1,200 800 1,000 800 600 600 400 400 200 200 SM spread Naptha SM 0 0 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20 36
Slide 37: Operational data
Operational data Refineries Utilization FY 2020 FY 2016 FY 2017 FY 2018 FY 2019 3Q Idemitsu Kosan 88% 88% 88% 87% 74% Former Showa Shell 85% 88% 93% * Utilization rate based on BCD Number of Service Stations FY 2020 FY 2016 FY 2017 FY 2018 FY 2019 3Q Idemitsu Kosan 3,589 3,545 3,501 3,446 3,430
Slide 38: 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