Idemitsu Kosan Co., Ltd. · TSE:5019

Idemitsu Kosan — Q3 FY2024 Earnings Presentation

52 slides from Idemitsu Kosan's earnings presentation, Feb 12, 2025

  1. Slide 1: Presentation on Results for the 3rd Quarter FY2024

    Presentation on Results for the 3rd Quarter FY2024 February 12, 2025 Idemitsu Kosan Co.,Ltd.

  2. Slide 2: Table of Contents

    Table of Contents ◼ Highlights ◼ Results for the 3Q FY2024 ◼ Forecasts for FY2024 ◼ Progress on the Medium-Term Plan ◼ Reference ✓ Financial results ✓ Volume ✓ Crude/product price and operation ✓ Business overview 2

  3. Slide 3: Highlights

    €& idemitsu B Highlights # © Idemitsu Kosan Co, Ltd. All Rights Fi

  4. Slide 4: Results for the 3Q FY2024

    Results for the 3Q FY2024 ◼ Summary ✓ Operating + equity income (segment income) excluding inventory impact decreased by ¥65.6 billion y-o-y, mainly due to lower coal price, lower sales volume in Basic Chemical and deteriorate Basic Chemical products market margin ✓ Operating + equity income includi

  5. Slide 5: Revision of Forecasts for FY2024

    Revision of Forecasts for FY2024 ◼ Overview ✓ Revised forecasts upward mainly due to robust domestic margin and JPY depreciation despite of downturn in Basic Chemical, Power and Renewable Energy segments [¥ billions] 5/14 Revised Change Forecast Forecast Operating Income + Equity Income 185.0 220.0

  6. Slide 6: Results for the 3Q FY2024

    @ Results for the 3Q FY2024 €& idemitsu

  7. Slide 7: Topics

    Topics ◼ Trends in Petroleum Demand and Sales ✓ Gasoline demand decreased due to improved fuel efficiency. Diesel oil demand also decreased due to streamlined logistics ✓ Decline in Jet fuel sales, although at the same level as last year for airlines, due to decrease in tender sales, etc. FY2022 FY2

  8. Slide 8: Operating Environment

    Operating Environment Dubai Crude Australian Coal Exchange Rate [USD/bbl] [USD/ton] [JPY/USD] Oil Price Spot Price (USD) 95.0 360.0 160.0 FY2024 FY2023 330.0 155.9 155.0 90.0 300.0 152.4 270.0 150.0 85.3 149.4 85.0 86.7 247.8 148.6 240.0 83.6 147.9 145.0 144.6 210.0 80.0 81.3 78.3 77.8 180.0 140.0 1

  9. Slide 9: Overview

    Overview ◼ Crude Oil/Coal/Exchange Rate [USD/bbl, USD/ton, JPY/USD] 3Q FY2023 3Q FY2024 Change Crude Oil (Dubai) 82.7 79.1 (3.6) (4.4%) Crude Oil (Brent)* 82.1 82.8 +0.7 +0.9% Australian Coal Spot Price* 185.5 133.9 (51.6) (27.8%) Exchange Rate (TTM) 143.3 152.6 +9.3 +6.5% *Brent prices and Australi

  10. Slide 10: Segment Information

    Segment Information ◼ Operating ＋ Equity Income 3Q FY2023 3Q FY2024 Change Petroleum 187.2 86.6 (100.6) (53.8%) Excluding inventory impact 114.1 109.6 (4.4) (3.9%) Basic Chemicals 21.4 (4.2) (25.5) － Functional Materials 22.8 22.7 (0.1) (0.5%) Power and Renewable Energy (2.3) (7.1) (4.8) － Resources

  11. Slide 11: Segment Information: Factors Affecting Income

    Segment Information ◼ Factors Affecting Operating + Equity Income (excluding inventory impact, y-o-y) [￥billions] purchase cost, etc. 27.5 Export 36.3 (34.1) Volume Non-core 234.1 Margin Power, products etc. margin (34.1) etc. Norway Volume (11.9) Price 0.5 (13.6) (0.1) Core products (4.8) (0.2) (1.

  12. Slide 12: Segment Information: Petroleum

    Segment Information [Petroleum] YoY -¥4.4 bn (3Q FY23：¥114.1 bn 3Q FY24：¥109.6 bn) [Y-o-y change in Petroleum sales volume [Trends in Domestic Petroleum Product Margin*] (core products)] *Average margin of gasoline, diesel oil, kerosene, and heavy oil A (YoY) (domestic spot –crude oil) [Thousand KL]

  13. Slide 13: Segment Information: Chemicals, Materials, Power

    Segment Information [Basic Chemicals] YoY-¥25.5bn (3Q FY23: ¥21.4bn 3Q FY24: -¥4.2bn) ✓ Sales volume decreased due to equipment troubles and scheduled maintenance ✓ Product margin deteriorated in total mainly due to PX and MX margin shrinking [USD/ton] Product 3Q FY2023 3Q FY2024 Change Price Margin

  14. Slide 14: Segment Information: Oil E&P and Coal

    Segment Information [Oil E&P] YoY +¥0.3 bn [Coal] YoY -¥30.5 bn (3Q FY23：¥13.3 bn 3Q FY24：¥13.6 bn) (3Q FY23：¥76.4 bn 3Q FY24：¥46.0 bn) <Crude Oil Production Volume <Coal Production Volume and Brent Crude Oil Price Trends> and Australian Coal Spot Price Trends> [Thousand BOE] [USD/bbl] [Thousand ton

  15. Slide 15: Balance Sheet

    Balance Sheet [¥ billions] 3/31/2024 12/31/2024 Change 3/31/2024 12/31/2024 Change Total Current Cash and Deposits 139.3 188.5 +49.2 Liabilities 2,192.5 2,371.7 +179.2 Receivables, Total Fixed Inventory, etc. 2,777.5 2,811.7 +34.2 Liabilities 1,007.3 915.6 (91.7) Total Current Assets 2,916.8 3,000.2

  16. Slide 16: Forecasts for FY2024

    €& idemitsu mForecasts for FY2024 II Rights Reserved 16

  17. Slide 17: Forecasts for FY2024

    Forecasts for FY2024 ◼ Crude Oil/Coal/Exchange Rate [USD/bbl, USD/ton, JPY/USD] 5/14 Revised Assumptions Forecast Forecast Change (from Jan.) Crude Oil (Dubai) 85.0 79.3 (5.7) (6.7%) 80.0 Crude Oil (Brent)* 85.0 79.9 (5.1) (6.0%) － Australian Coal Spot Price * 125.0 134.7 +9.7 +7.8% － Exchange Rate

  18. Slide 18: Segment Information: Forecast Operating + Equity Income

    Segment Information ◼ Operating ＋ Equity Income [¥ billions] 5/14 Revised Forecast Forecast Change Petroleum 102.0 155.0 +53.0 +52.0% Excluding inventory impact 102.0 155.0 +53.0 +52.0% Basic Chemicals 26.0 0.0 (26.0) (100.0%) Functional Materials 31.0 28.0 (3.0) (9.7%) Power and Renewable Energy (3

  19. Slide 19: Segment Information: Factors Affecting Forecast Income

    Segment Information ◼ Factors Affecting Operating + Equity Income [¥ billions] (excluding inventory impact, Compared to the 5/14 forecasts) 33.0 (10.0) Consolidated 66.0 Volume adjustment, purchase etc. cost, etc. Asphalts, Price (36.0) etc. Vietnam Volume non-core (7.0) 10.0 3.0 220.0 products Expo

  20. Slide 20: Segment Information: Petroleum, Chemicals, Materials

    Segment Information [Petroleum] +¥53 bn (5/14 announcement: ¥102 bn revised forecast: ¥155 bn) ✓ Revised upward mainly due to robust domestic margin despite of increase purchase cost and decline export volume [Basic Chemicals] -¥26 bn (5/14 announcement: ¥26 bn revised forecast: ¥0 bn) ✓ Revised dow

  21. Slide 21: Segment Information: Power, Oil E&P, Coal

    Segment Information [Power/Renewable Energy] -¥7 bn (5/14 announcement: -¥3 revised forecast: -¥10 bn) ✓ Power: Revised downward due to increase purchase cost caused by equipment trouble and rise in cost of biomass materials, etc. ✓ Solar Frontier: No change ✓ Overseas businesses: Revised downward d

  22. Slide 22: Progress on the Medium-Term Plan

    ◼Progress on the Medium-Term Plan *The icons on topics (from next page) related to progress in the medium-term plan shows business areas below Energy Diverse resource conservation Smart Yorozuya one step ahead /circulation solutions 22

  23. Slide 23: Topics related to Progress on the Medium-term Plan

    Topics related to Progress on the Medium-term Plan ◼ Majority investment in Vecco, a company promoting a vanadium project in Australia, and full -scale entry into a critical minerals business ✓ Increase shareholding in Vecco, a company promoting a vanadium project in Australia to 51% ✓ Vecco will co

  24. Slide 24: Reference

    €& idemitsu mM Reference # © Idemitsu Kosan Co, Ltd. All Rights Fi 24

  25. Slide 25: Financial Results: Net Sales by Segment

    Financial Results Financial Results ◼ Net Sales by segment [¥ billions] 3Q FY2023 3Q FY2024 Change Petroleum 5,142.8 5,760.5 +617.7 +12.0% Basic Chemicals 446.6 430.7 (15.9) (3.6%) Functional Materials 382.1 380.9 (1.2) (0.3%) Power and Renewable Energy 108.5 95.9 (12.6) (11.6%) Resources* 318.0 200

  26. Slide 26: Quarterly Segment Income (Cumulative)

    Financial Results Financial Results ◼ Quarterly segment income (cumulative, exc. inventory impact) [¥ billions] FY2023 FY2024 1Q 2Q 3Q 4Q 1Q 2Q 3Q Petroleum 18.4 105.0 114.1 167.2 47.8 62.8 109.6 Equity income 4.9 3.8 6.9 9.9 5.1 10.8 15.3 Basic Chemicals (1.4) 12.0 21.4 22.0 7.5 3.4 (4.2) Equity in

  27. Slide 27: Quarterly Segment Income (Q on Q)

    Financial Results Financial Results ◼ Quarterly segment income (Q on Q, exc. inventory impact) [¥ billions] FY2023 FY2024 1Q 2Q 3Q 4Q 1Q 2Q 3Q Petroleum 18.4 86.6 9.0 53.1 47.8 14.9 46.9 Equity income 4.9 (1.0) 3.1 3.0 5.1 5.7 4.4 Basic Chemicals (1.4) 13.4 9.4 0.7 7.5 (4.1) (7.6) Equity income (0.6

  28. Slide 28: Sensitivity

    Financial Results Sensitivity ◼ Major items affecting operating profit by changes in assumptions (4Q) Income Assumptions Range of Index Segment impact Major Factors (FY2024) fluctuation (¥ billions) Crude oil price 85.0$/bbl ±10$/bbl ±32.0 Time-lag, fuel cost Excluding Singapore inventory ー ±5$/bbl

  29. Slide 29: Sales Volume: Petroleum

    Volume Sales Volume ◼ Petroleum [thousand KL,％] 3Q FY2023 3Q FY2024 Change Gasoline 9,699 9,529 (170) (1.8%) Naphtha 277 339 +62 +22.3% Jet Fuel 1,882 1,829 (53) (2.8%) Kerosene 1,940 1,768 (171) (8.8%) Diesel Oil 7,651 7,687 +35 +0.5% Heavy Fuel Oil A 2,223 2,187 (36) (1.6%) Heavy Fuel Oil C 1,761

  30. Slide 30: Sales Volume: Chemicals, Materials, Power

    Volume Sales Volume ◼ Basic Chemicals [kt,%] 3Q FY2023 3Q FY2024 Change Basic Chemicals 2,606 2,198 (408) (15.7%) ◼ Functional Materials [KKL,kt,%] 3Q FY2023 3Q FY2024 Change Lubricants 855 780 (75) (8.7%) Performance Chemicals 501 346 (156) (31.0%) *Lubricants include sales overseas ◼ Power/Renewab

  31. Slide 31: Production Volume

    Volume Production Volume ◼ Resources (Oil E&P) [KBOED,%] 3Q FY2023 3Q FY2024 Change Vietnam 14.6 13.7 (0.9) (6.3%) Norway 14.2 12.6 (1.6) (11.4%) Total('000BOED) 28.8 26.3 (2.5) (8.8%) Total('000BOE) 7,874 7,219 (655) (8.3%) *The numbers reflect our rights and ownership ratios based on our equity sh

  32. Slide 32: Sales Volume (Forecast): Petroleum

    Volume Sales Volume(Forecast) ◼ Petroleum [KKL,％] 5/14 Revised Change Forecast Forecast Gasoline 12,370 12,380 +10 +0.1% Naphtha 300 560 +260 +86.7% Jet Fuel 2,570 2,420 (150) (5.8%) Kerosene 3,430 3,430 ― ― Diesel Oil 9,850 10,010 +160 +1.6% Heavy Fuel Oil A 3,060 3,080 +20 +0.7% Heavy Fuel Oil C 2

  33. Slide 33: Sales Volume (Forecast): Chemicals, Materials, Power

    Volume Sales Volume(Forecast) ◼ Basic Chemicals [kt,%] 5/14 Revised Change Forecast Forecast Basic Chemicals 3,200 3,140 (60) (1.9%) ◼ Functional Materials [KKL,kt,%] 5/14 Revised Change Forecast Forecast Lubricants 1,135 1,090 (45) (4.0%) Performance Chemicals 570 480 (90) (15.8%) *includes sales o

  34. Slide 34: Production Volume (Forecast)

    Volume Production Volume(Forecast) ◼ Resources (Oil E&P) [KBOED,%] 5/14 Revised Change Forecast Forecast Norway 13.0 13.4 +0.4 +3.0% Vietnam 12.4 12.9 +0.5 +4.1% Total('000BOED) 25.4 26.3 +0.9 +3.6% Total('000BOE) 9,303 9,630 +327 +3.5% *The numbers reflect our rights and ownership ratios based on o

  35. Slide 35: Segment Information: FY2024 Forecast Factors

    Forecasts Segment Information ◼ Factors Affecting Operating + Equity Income (excluding inventory impact, y-o-y) [￥billions] purchase cost, Trading, etc. 33.0 Export 43.0 (39.2) non-core products Margin, 310.6 margin Volume etc. Vietnam, etc Power (49.0) Price Cost for core products margin (10.0) 0.4

  36. Slide 36: Crude Oil Prices (Dubai and Brent)

    Crude price Crude Oil Prices(Dubai and Brent) [USD/bbl] 130 Brent 110 Dubai 90 70 50 30 10 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 Apr-24 36

  37. Slide 37: Gasoline-Crude Oil (Domestic)

    Product market price Gasoline-Crude Oil(Domestic spot price and spread) [Price :JPY/L] [Spread：JPY/L] 140 25 120 20 100 15 80 60 10 40 Spread 5 20 Crude oil Gasoline 0 0 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 Apr-24 37

  38. Slide 38: Diesel-Crude Oil (Domestic)

    Product market price Diesel-Crude Oil(Domestic spot price and spread) [Price :JPY/L] [Spread：JPY/L] 140 25 120 20 100 15 80 60 10 40 Spread 5 20 Crude oil Diesel oil 0 0 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 Apr-24 38

  39. Slide 39: Gasoline-Crude Oil (Singapore)

    Product market price Gasoline-Crude Oil(Singapore spot price and spread) [Price :USD/bbl] [Spread：USD/bbl] 160 40 140 35 30 120 25 100 20 80 15 60 10 40 5 Spread 20 Dubai 0 Gasoline 0 -5 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 Apr-24 39

  40. Slide 40: Diesel-Crude Oil (Singapore)

    Product market price Diesel-Crude Oil(Singapore spot price and spread) [Price :USD/bbl] [Spread：USD/bbl] 180 70 160 60 140 50 120 100 40 80 30 60 20 40 Spread 10 20 Dubai Diesel Oil 0 0 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 Apr-24 40

  41. Slide 41: Para-Xylene, Mixed Xylene-Naphtha

    Product market price Para-Xylene, Mixed Xylene-Naphtha (price and spread) [Price :USD/ton] [Spread：USD/ton] 1,400 600 PX spread Mx spread Naptha PX MX 1,200 500 1,000 400 800 300 600 200 400 100 200 0 0 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 Apr-24 41

  42. Slide 42: Styrene Monomer-Naphtha

    Product market price Styrene Monomer-Naphtha (price and spread) [Price :USD/ton] [Spread：USD/ton] 1,600 800 1,400 700 1,200 600 1,000 500 800 400 600 300 400 200 200 100 SM spread Naptha SM 0 0 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 Apr-24 42

  43. Slide 43: Operational Data

    Operation Operational Data ◼ Refineries Utilization 3Q FY2020 FY2021 FY2022 FY2023 FY2024 71% 78% 77% 83% 78% [75%] *on BCD basis including regular maintenances *Refining operation at Yamaguchi Refinery (120KBD) was terminated in March 2024. The official capacity was changed after July. The adjusted

  44. Slide 44: Overview of the Company

    Business Overview Overview of the Company FY2023, actual or as of the end of March 2024 ∎ Petroleum Segment ∎ Functional Materials Segment  Refining Capacity 825 KBD *1,2) (Lubricants, Performance Chemicals, Electronic  Domestic fuel oil sales volume Materials, Bitumen (High Performance Asphalt),

  45. Slide 45: Petroleum Segment

    Business Overview Petroleum Segment [KB/D] Refining Operating Company Refinery RH FCC RFCC FLG Equity Ratio Capacity Japan Idemitsu Hokkaido 140 42 33 Kosan Chiba 195 40 45 Aichi 165 60 50 Showa Yokkaichi Yokkaichi 255 45 61 75.0% Sekiyu Toa Oil Keihin 70 42 27 100.0% 825 187 42 189 27 Overseas Nghi

  46. Slide 46: Basic Chemicals Segment

    Business Overview Basic Chemicals Segment [mil tons/year] Production Capacity for core products Operating Company Complex/Factory/Refinery Styrene Equity Ratio Ethylene Para-Xylene Mixed Xylene Monomer Japan Idemitsu Kosan Chiba 0.374 0.265 0.210 Aichi 0.357 0.170 Tokuyama 0.623 0.214 0.340 Showa Yo

  47. Slide 47: Functional Materials Segment (1/2)

    Business Overview Functional Materials Segment (1/2) Lubricants Performance Chemicals ◆Product categories ◆Product categories ・Automotive lubricants (engine oil, etc.) ・Engineering plastics, adhesives materials, derivative ・Grease products, solvents and functional materials ・Industrial lubricants (h

  48. Slide 48: Functional Materials Segment (2/2)

    Business Overview Functional Materials Segment (2/2) Electronic Materials Bitumen (High Performance Asphalt) ◆Product categories ◆Asphalt manufacturer which aims to develop state-of-the-art ・Organic EL materials technologies ・Display semiconductor materials etc. ・Recycling, longer life, carbon neutr

  49. Slide 49: Power / Renewable Energy Segment

    Business Overview Power /Renewable Energy Segment Stake Owned Power generation capacity* Power Category Power Plant Operating Company (%) (10,000 KW) Solar 34 domestic locations Idemitsu, other ー 18.7 Biomass Keihin Biomass Power Plant (Kanagawa) Keihin Biomass Power 100 4.9 Tosa Power Plant (Kochi)

  50. Slide 50: Resources Segment (Gas and Oil E&P)

    Business Overview Resources Segment (Gas and Oil E&P) Business Overview Production Oil/Gas Reserves 1. Producing and selling crude oil/gas in Vietnam and Norway ◆Reserves *1,2 [million BOE] 2. Exploration and development of gas in Vietnam and other 150 parts of Southeast Asia to shift to production

  51. Slide 51: Resource Segment (Coal)

    Business Overview Resource Segment (Coal) Business Overview Business Structure Reforms [Business Strategy] ◆Idemitsu Green Energy Pellets (black pellets) ◆Stable supply and profit maximization by leveraging the highly competitive Boggabri Mine ・CO2 emissions can be reduced by replacing coal with ◆En

  52. Slide 52: 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

Idemitsu Kosan — Q3 FY2024 Earnings Presentation on 6ix