Tokyo Gas Co., Ltd. · TSE:9531
Tokyo Gas — Q1 FY2020 Earnings Presentation
18 slides from Tokyo Gas's earnings presentation, Jul 29, 2020
Slide 1: FY2020 1Q Financial Results
Ly FY2020 1Q Financial Results ended June, 2020 July 29, 2020 [Revised on November 5,2020] "F TOKYO GAS TSE:9531
Slide 2: FY2020 Consolidated Financial Results
o1 FY2020 Consolidated Financial Results ended June, 2020 "F TOKYO GAS
Slide 3: Both sales and profits decreased in 1Q FY2020
Both sales and profits decreased in 1Q FY2020. Net sales were ¥415.6 billion, a decrease of ¥51.6 billion year on year. This was mainly attributable to a drop in city gas sales volume of the gas segment due from the impact of the new coronavirus (COVID-19) and a decrease in city gas unit price due t
Slide 4: City gas sales volume in 1Q FY2020
City gas sales volume in 1Q FY2020 was 2,656 million m3, down 716 million m3 or 21.2% year on year. This mainly reflected a 475 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 the n
Slide 5: Total electricity sales volume in 1Q
Total electricity sales volume in 1Q was 5,231 million kWh, up 35.3% year on year. Retail electricity sales increased 30.6% year on year due to an increase in the number of customers, while wholesale and other electricity sales volume increased 38.8% on the back of an increase in sales to the wholes
Slide 6: Net sales and 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. Total segment profit dropped by ¥17.9 billion, which was mainly attributable to a ¥18.5 billion decrease in the gas segment. 6
Slide 7: Segment profit changes: gas, electric power, overseas
The ¥18.5 billion drop in profit of the gas segment mainly reflected a ¥12.4 billion deterioration of the sliding time lag effect and a ¥13.0 billion drop in gross margin due to a decrease in sales volume which included the effect of COVID-19. In the electric power segment, profit increased by ¥1.0
Slide 8: Full year forecast presented in segment profit
We have decided to present our full year forecast in segment profit. Since the impact of COVID-19 differs between segments, we have calculated the impact in terms of segment based on gross margin and reflected it and the factors for changes from the previous fiscal year to our initial full- year for
Slide 9: Full year forecast of ¥75.0 billion including COVID-19 impact
Our full year forecast is ¥75.0 billion, which includes a -¥30.0 billion impact of COVID-19 in addition to factors for changes in segment profit from that of the previous fiscal year. The figures for cost structure reform, one-time expenses and other profit increase and decrease were those that were
Slide 10: Factors offsetting sliding time lag effect and cost reform
The positive impact of the sliding time lag effect and cost structure reform is expected to be offset by one-time expenses in FY2020 such as data migration expenses as well as a decline in demand for gas, an increase in depreciation, and a decrease in profits on overseas projects. In addition, the i
Slide 11: Expected segment profit changes for full year
Although we expect an increase in profit for the electric power business due to an expected rise in the number of retail customers, an increase in operation at the Moka Power Plant and a reduction in operating expenses, we expect more than a ¥10.0 billion drop in profit in the gas segment on the bac
Slide 12: Reference materials
Reference materials include the trend of crude oil prices and exchange rates, a list of major press releases from April 1, 2020 to July 29, 2020, a list of major overseas projects, and the trend of the number of switches to other electricity and city gas providers. 12
Slide 13: Gas Gross Margin Sensitivity to Crude Oil Price and Exchange Rate
Gas Gross Margin Sensitivity to Change in Crude Oil Price and Exchange Rate 1 3 H Impact of rising JCC by $1/bbl Impact on earnings (Unit: billion yen) 2Q 3Q 4Q Full year 2Q -0.1 -0.8 +0.8 -0.1 3Q —_ -0.1 -0.9 -1.0 Period 4Q _ _ -0.1 -0.1 Full year -0:1 -0:9 -0.2 -1.2 Impact of depreciation by ¥1/$
Slide 14: Crude oil price - Exchange rate
Crude oil price - Exchange rate Crude oil price (Japan Crude Cocktail Prices) ($/bbl) 80.00 70.00 re 60.00 50.00 40.00 30.00 20.00 & & x £ oS eS es S F SS FF FF F SF FSF SF SF SS Fe FSF LS SF LK SK -*X —e-FY2020 —e-FY2019 & RS ¥ <« Exchange rate (¥/$) 115.0 110.0 105.0 100.0 & & £ es S£ SF SF SF Ff
Slide 15: Key Topics in FY2020
Key Topics in FY2020 (Excerpted from Press Releases up to 29th July) Gas Electric Power (Including ESG) + Launched free solar power system provision service “Zuttomo Solar x Toyota Home” (Apr.20) + Tokyo Gas Invests In Principle Power, A Leading Floating Wind Power Technology Company (May.27) + Bega
Slide 16: Overseas Projects
Overseas Projects A) 9° e 69 ° 17) Country Subject Main Business Participation year Barnett Upstream —_Shale gas Eagle Ford Upstream Shale gas usa Fast Texas Upstream Shale gas . TGES America Downstream Energy Service Birdsboro Power Plant Downstream _Natural gas power Acario Ventures Other Open Inn
Slide 17: Trends in city gas/electricity switching
Trends in city gas/electricity switching(published data), Number of customers 1 7 for city gas retail sales(Tokyo gas consolidated) Electricity switchers (based on applications) City gas switchers (based on applications) Monthly(1,000s) Cumulative(1,000s) Monthly(1,000s) Cumulative(1,000s) 500 20,00
Slide 18: Cautionary Statement regarding Forward-looking Statements
"E 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