Tokyo Gas Co., Ltd. · TSE:9531
Tokyo Gas — Q1 FY2023 Earnings Presentation
29 slides from Tokyo Gas's earnings presentation, Jul 27, 2023
Slide 1: FY2023 1Q Financial Results
Lf FY2023 1Q Financial Results ended June, 2023 July 27, 2023 "E TOKYO GAS TSE:9531
Slide 2: Today's Key Messages
Today’s Key Messages 2 H @ Consolidated FY2023 1Q saw a YoY rise in both sales and profits, driven by an increase in city gas unit price due to resource costs adjustment, etc. Our consolidated forecast for FY2023 anticipates lower sales but higher profits versus the previous forecast. Factors includ
Slide 3: FY2023 Consolidated Financial Results
o1 FY2023 Consolidated Financial Results ended June, 2023 "FTOKYO GAS
Slide 4: Both sales and profits increased in 1Q FY2023
Both sales and profits increased in 1Q FY2023 compared to the corresponding period of the previous fiscal year. Net sales increased by ¥39.7 billion. This was mainly attributable to an increase in city gas unit prices due to resource cost adjustments in the Energy Solution segment. Operating expense
Slide 5: Net sales and segment profit by segment
This slide shows net sales by segment and segment profit, which is operating profit plus equity income/loss of subsidiaries, and changes thereof. 5
Slide 6: Segment profit changes by segment
The ¥43.8 billion increase in profit of the Energy Solution segment mainly reflects a rise in the gross margin of city gas due to a sliding time lag effect and a decrease in procurement costs due to the softening of the impact of JEPX prices in the electricity business. The Network segment saw a dro
Slide 7: City gas sales volume decreased 13.7%
The city gas sales volume in 1Q FY2023 decreased by 13.7% overall, mainly reflecting reduced demand from power generation customers for industrial use and a fall in sales volume to residential customers due to high temperatures compared to the corresponding period of the previous fiscal year. 7
Slide 8: Electricity sales volume decreased 29.2%
Total electricity sales volume in 1Q FY2023 decreased by 29.2%. Retail electricity sales rose by 7.8% due to an increase in the number of customers, while the sales volume to wholesale fell by 45.6%. 8
Slide 9: FY2023 Full Year Forecast
02 FY2023 Full Year Forecast "FTOKYO GAS
Slide 10: FY2023 full year forecast revisions
For the FY2023 full year, we have downgraded our sales forecast and upgraded our profit forecast. The economic framework for July onward, which serves as a basis of our forecast, has been changed as follows: the foreign exchange rate has been revised from ¥130/$ to ¥135/$, and the crude oil price fr
Slide 11: Forecast of key indicators on a consolidated basis
This slide shows our forecast for key indicators on a consolidated basis, including the status of assets and cash flows. 11
Slide 12: Expected use of cash flows in FY2023
This slide details the expected use of cash flows in FY2023. 12
Slide 13: FY2023 Investments (Capex, Investments and financing)
FY2023 Investments (Capex, Investments and financing) Reference: Breakdown of the Medium-Term Management Plan for FY 2023-2025 une bition vers FY2023 Previous FY2020-22 FY2023-25 Forecast Main Items Forecast Results Plan 475.8 650.0 Overseas, Renewable power, Urban Development, etc. Breakdown) porti
Slide 14: Forecast for net sales and profit by segment
This slide shows our forecast for net sales and profit of each segment and changes from our previous forecast. Our forecast for total segment profit remains unchanged from our previous forecast. 14
Slide 15: Segment forecast changes from previous forecast
We have upgraded our forecast for the Energy Solution segment by ¥13.5 billion. This mainly reflects a sliding time lag effect in city gas due to the sharp rise in crude oil prices in late FY2022 and an increase in gross margin due to a reduction in resource costs in FY2023 in the city gas business.
Slide 16: New full-year forecast versus previous year actual
This slide shows comparisons between our new full-year forecast and the actual performance in the previous year. 16
Slide 17: FY2023 Forecast: Ordinary Profit Analysis
FY2023 Forecast: Ordinary Profit Analysis FY2023 (Forecast) ¥137.0bn Change -¥271.8bn (-66.5 FY2022 (results) ¥408.8bn Segment profit -¥262.2bn (62.9%) © Decrease in city gas gross margin -¥148.3 bn: Change in volume, etc. 7.1 (incl. change due totemp effect +2.3) + * 3 a c 5 *+/- indicate contribut
Slide 18: Gas sales volume forecast downgraded
Our forecast of gas sales volume has been downgraded by 0.9% from our previous forecast. This mainly reflects an expected decrease in sales to residential customers, given the impact of high temperatures in 1Q, and an expected drop in sales volume to power generation customers due to reduced demand.
Slide 19: Electricity sales volume forecast downgraded
Our forecast of electricity sales volume has been downgraded by 7.2% from our previous forecast, mainly reflecting an expected drop in sales volume to wholesale. 19
Slide 20: Changes in profit by major element
This slide illustrates changes in profit for each major element of change from the previous year. 20
Slide 21: Reference materials
The following reference materials include a table on the sensitivity to the economic framework assumption, the trend of crude oil prices and exchange rates, key topics in 1Q FY2023, a list of major overseas investment projects, etc. From this fiscal period, the key topics are shown in relation to th
Slide 22: Impact of rising JCC and yen depreciation
Impact of rising JCC (Japan Crude Cocktail Prices) by $1/bbl Impact on earnings 2Q 3Q 4Q Full year 2Q -0.1 -0.7 +1.0 +0.2 3Q — -0.1 -1.0 -1.1 Period 4Q = — -0.2 -0.2 Full year -0.1 -0.8 -0.2 -1.1 Impact of depreciation of the yen by ¥1/$ Impact on earnings 2Q 3Q 4Q Full year 2Q -0.6 +0.5 +0.3 +0.2 3
Slide 23: Crude oil price and exchange rate
rude Crude oil price (Japan Crude Cocktail Prices) | price - Exc! ge rate (S/bbl) 120.00 110.00 100.00 90.00 80.00 70.00 60.00 50.00 40.00 30.00 20.00 N RY A ef £ SF Ss —e-FY2023 —e-FY2022 —e=FY2021 Exchange rate (#/s) 150.0 145.0 140.0 135.0 130.0 125.0 120.0 115.0 110.0 105.0 100.0 N a A Ff Se FS
Slide 24: Key Topics in FY2023 1Q
Key Topics in FY2023 1Q (Excerpted from Press Releases) 24 BH change” Below are key initiatives of the 3 core strategies of the FY2023-2025 Medium- term Management Plan, which are based on our material issues. The strategies are: “Achieve both stable energy supply & decarbonization,” “Fully roll out
Slide 25: Key Topics in FY2023 1Q (Excerpted from Press Releases)
Key Topics in FY2023 1Q (Excerpted from Press Releases) 258 FY2023-2025 Medium-term Management Plan: Initiatives for the 3 core strategies Material issues Achieve both stable energy supply & decarbonization |Carbon-negative concrete used at Motomachi Elementary School in lYokohama (Apr. 13) joint ac
Slide 26: Key Topics in FY2023 1Q (Excerpted from Press Releases)
Key Topics in FY2023 1Q (Excerpted from Press Releases) FY2023-2025 Medium-term Management Plan: Initiatives for the 3 core strategies Signing of comprehensive partnership agreement for realizing carbon Fully roll out neutrality in Ota City (June 28) Solutions business figning of comprehensive partn
Slide 27: Key Topics in FY2023 1Q: carbon-negative concrete
Key Topics in FY2023 1Q (Excerpted from Press Releases) One of the three core strategies of the FY2023-2025 Medium-term Management Plan is Achieve both stable energy supply & decarbonization. Here is a look at a key initiative for advancing that strategy. transitioning to a Tokyo Gas and its partner
Slide 28: Overseas Projects
Overseas Projects 28 Ares No e North America ° o Southeast Asi 8 co] 7] Oceania @ sls Gorger Production, liquefaction and sales of LNG 2009 a Curtis ‘and sales of LNG 2011 enthys Production, liquefaction and sales of LNG 2012 Europe © Penmark —TOW:I Renewables ‘Onshore wind power 2022 Copyright® 28
Slide 29: Cautionary Statement regarding Forward-looking Statements
"F 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 t