Tokyo Electric Power Company Holdings, Incorporated · TSE:9501

Tokyo Electric Power — Q2 FY2018 Earnings Presentation

44 slides from Tokyo Electric Power's earnings presentation, Oct 30, 2018

1. Slide 1: FY2018 2nd Quarter Financial Results

   FY2018 2nd Quarter Financial Results (April 1 – September 30, 2018) Tokyo Electric Power Company Holdings, Inc. ©Tokyo Electric Power Company Holdings, Inc. All Rights Reserved.

2. Slide 2: Regarding Forward-Looking Statements

   Regarding Forward-Looking Statements Certain statements in the following presentation regarding TEPCO Group’s business operations may constitute “forward-looking statements.” As such, these statements are not historical facts but rather predictions about the future, which inherently involve risks an

3. Slide 3: Overview of FY2018 2nd Quarter Financial Results

   Overview of FY2018 2nd Quarter Financial Results (Released on October 30, 2018) ©Tokyo Electric Power Company Holdings, Inc. All Rights Reserved.

4. Slide 4: Key Points of FY2018 2nd Quarter Financial Results

   Key Points of FY2018 2nd Quarter Financial Results 1 < FY2018 2nd Quarter Financial Results >  Although electricity sales volume from TEPCO group companies decreased due to a decline in electricity sales volume caused by intensifying competition, operating revenue increased due to an increase in fu

5. Slide 5: Consolidated Financial Results

   1. Consolidated Financial Results 2 (Unit: Billion kWh) FY2018 FY2017 Comparison Apr-Sep (A) Apr-Sep (B) (A)-(B) (A)/(B) (%) Electricity Sales Volume 116.1 118.1 -2.1 98.3 (Unit: Billion yen) FY2018 FY2017 Comparison Apr-Sep (A) Apr-Sep (B) (A)-(B) (A)/(B) (% ) Operating Revenue 3,055.5 2,831.6 223.

6. Slide 6: Key Points of Each Company

   2. Key Points of Each Company 3 < TEPCO Holdings >  Ordinary income increased due to an increase in dividend income and other areas. < TEPCO Fuel & Power >  Although fixed costs decreased from cost reduction efforts and other areas, ordinary income decreased due to an increase in fuel costs. < TEP

7. Slide 7: Overview of Each Company

   3. Overview of Each Company 4 (Unit: Billion kWh, yen/dollar) ・Decrease in other FY2018 FY2017 electricity revenue -11.6 Comparison Apr-Sep Apr-Sep ・Increase in sold power A r e a D e m a n d 137.8 134.9 2.9 to other suppliers ＋111.3 Foreign Exchange Rate (TTM) 110.3 111.1 - 0.8 (Unit: Billion yen)

8. Slide 8: Consolidated Extraordinary Income/Loss

   4. Consolidated Extraordinary Income/ Loss 5 (Unit: Billion yen) FY2018 FY2017 Comparison Apr-Sep Apr-Sep Extraordinary Income/ Loss -84.6 18.3 -103.0 Extraordinary Income － 128.6 -128.6 Grants-in-aid from NDF* － 128.6 -128.6 Extraordinary Loss 84.6 110.2 -25.5 Expenses for Nuclear Damage Compensati

9. Slide 9: Consolidated Financial Position

   5. Consolidated Financial Position 6 Total assets decreased 111.9 billion yen primarily due to decreases in grants-in-aid receivable from NDF. Total liabilities decreased 203.3 billion yen primarily due to decreases in current liabilities such as accounts payable-other. Total net assets increased

10. Slide 10: FY2018 Full-Year Financial Forecasts

    6. FY2018 Full-Year Financial Forecasts 7 (Unit: Billion Yen) FY2018 Projections FY2018 Projections (released on Oct. 30, (released on Jul. 30, FY2017 Results 2018) 2018) Operating Revenue 6,099 6,099 5,850.9 Ordinary Income/ Loss 285 285 254.8 Extraordinary Income/ Loss － － 73.8 Net Income attribut

11. Slide 11: Key Factors Affecting Performance (Results)

    <Reference> Key Factors Affecting Performance（Results） 8 Area Demand (Unit: Billion kWh) FY2018 FY2017 Comparison Apr-Sep (A) Apr-Sep (B) (A)-(B) (A)/(B) (%) Area Demand 137.8 134.9 2.9 102.2 Foreign Exchange Rate / CIF FY2018 FY2017 (A)-(B) Apr-Sep (A) Apr-Sep (B) Foreign Exchange Rate (Interbank,

12. Slide 12: Key Factors Affecting Performance (Financial Forecasts)

    <Reference> Key Factors Affecting Performance (Financial Forecasts) 9 Key Factors Affecting Performance FY2018 Projections FY2018 Projections (released on Oct. 30, 2018) (released on Jul. 30, 2018) Electricity Sales Volume (Billion kWh) 232.3 232.4 Crude Oil Prices (All Japan CIF; dollars per barrel

13. Slide 13: Consolidated Ordinary Income/Loss – Year on Year Comparison

    <Reference> Consolidated Ordinary Income/ Loss –Year on Year Comparison 10 Ordinary Income / Loss (Unit: Billion Yen) Factors related to Power Supply and Demand Others (Including renewable energy) + 96.5 - 101.8 + 0.8 yen/$ Foreign exchange rate CIF + 22.4$/b Decrease + 5.0 Fuel cost - 137.0 in Prof

14. Slide 14: Consolidated Ordinary Revenue

    <Reference> Consolidated Ordinary Revenue 11 (Unit: Billion Yen) FY2018 FY2017 Comparison Apr-Sep (A) Apr-Sep (B) (A)-(B) (A)/(B) (%) (Operating Revenue) 3,055.5 2,831.6 223.9 107.9 Electricity Sales Revenue 2,350.2 2,292.2 58.0 102.5 Power Sold to Other Utilities and 178.5 125.5 52.9 142.2 Supplier

15. Slide 15: Consolidated Ordinary Expenses

    <Reference> Consolidated Ordinary Expenses 12 (Unit: Billion Yen) FY2018 FY2017 Comparison Apr-Sep (A) Apr-Sep (B) (A)-(B) (A)/(B) (%) Personnel Expenses 149.7 163.9 -14.2 91.3 Fuel Expenses 748.7 609.2 139.5 122.9 Maintenance Expenses 122.0 135.3 -13.3 90.2 Depreciation 264.0 273.4 -9.4 96.6 Power

16. Slide 16: Supplemental Material

    Supplemental Material ©Tokyo Electric Power Company Holdings, Inc. All Rights Reserved.

17. Slide 17: Table of Contents

    Table of Contents Financial Results Detailed Information The Current Status of Fukushima Daiichi NPS and Future Initiatives Consolidated Statements of Income 13 Current Situation and Status of Units 1 through 4 23 Financial Impact of the Great East Japan Earthquake 14 Key Points from the 4th Revisio

18. Slide 18: FY2018 2nd Quarter Financial Results Detailed Information

    FY2018 2nd Quarter Financial Results Detailed Information ©Tokyo Electric Power Company Holdings, Inc. All Rights Reserved.

19. Slide 19: Consolidated Statements of Income

    13 Consolidated Statements of Income (Unit: Billion Yen) FY2018 FY2017 Comparison Apr-Sep (A) Apr-Sep (B) (A)-(B) (A)/(B) (%) Operating Revenue 3,055.5 2,831.6 223.9 107.9 Operating Expenses 2,835.9 2,593.9 242.0 109.3 Operating Income / Loss 219.6 237.7 -18.0 92.4 Non-operating Revenue 27.4 22.8 4.

20. Slide 20: Financial Impact of the Great East Japan Earthquake

    Financial Impact of the Great East Japan Earthquake 14 (Unit: Billion Yen) FY2018 Cumulative Item FY2010 to FY2017 Apr-Sep Amount ◇Grants–in-aid from Nuclear Damage Compensation and Decommissioning Facilitation Corporation ○Grants-in-aid based on Nuclear Damage Compensation and Decommissioning * * F

21. Slide 21: Consolidated Balance Sheets

    Consolidated Balance Sheets 15 (Unit: Billion Yen) <Interest-bearing debt outstanding> (Unit: Billion Yen) Sep. 30 Mar. 31 Comparison Sep. 30 Mar. 31 (A)-(B) 2018 (A) 2018 (B) (A)-(B) (A)/(B) (%) 2018 (A) 2018 (B) Bonds 2,174.2 2,230.8 -56.6 Total Assets 12,479.8 12,591.8 -111.9 99.1 Long-term Debt

22. Slide 22: Consolidated Statements of Cash Flows

    Consolidated Statements of Cash Flows 16 (Unit: Billion Yen) FY2018 FY2017 Comparison Apr-Sep (A) Apr-Sep (B) (A)-(B) Cash flow from operating activities 210.6 291.2 -80.5 Income / loss before income taxes and minority interests 126.2 234.2 -107.9 Depreciation and amortization 269.7 278.8 -9.1 Inter

23. Slide 23: Overview of Consolidated Cash Flows

    Overview of Consolidated Cash Flows - Year on Year Comparison 17 Cash and cash equivalents as of September 30, 2018 decreased 125.1 billion yen to 1,059.2 billion yen. - Cash flow from operating activities increased 210.6 billion yen mainly due to income before income taxes and minority interests -

24. Slide 24: Key Factors Affecting Performance and Financial Impact

    Key Factors Affecting Performance and Financial Impact 18 Key Factors Affecting Performance Financial Impact (Sensitivity) （Unit: Billion Yen） FY2018 【Reference】 FY2018 【Reference】 Apr-Sep Full-year Projections FY2017 Actual Performance Full-year Projections FY2017 Full-year Results Actual Performan

25. Slide 25: Seasonal Breakdown of Electricity Sales Volume and Total Power Generated

    Seasonal Breakdown of Electricity Sales Volume and Total Power Generated 19 Electricity Sales Volume Unit: Billion kWh FY2018 Apr-Jun Jul Aug Sep Jul-Sep Apr-Sep Lighting 15.60 6.04 7.37 6.33 19.74 35.34 Power 37.01 14.75 15.10 13.87 43.73 80.74 Total 52.60 20.79 22.48 20.20 63.47 116.07 FY2017 [Ref

26. Slide 26: Fuel Consumption Data

    Fuel Consumption Data 20 Fuel Consumption 【Reference】 FY2015 FY2016 FY2017 FY2018 FY2017 Actual Actual Actual Apr-Sep Apr-Sep LNG(million t) 21.55 21.06 20.80 10.18 9.57 Oil (million kｌ) 2.48 2.05 0.91 0.38 0.33 Coal (million t) 8.34 8.14 8.31 4.13 4.19 Note: The oil data is total of crude oil and h

27. Slide 27: Feed-in Tariff Scheme for Renewable Energy

    Feed-in Tariff Scheme for Renewable Energy (Purchase Cost Collection Flow) 21 （FY2018 Apr.- Sep. ) Avoidable Cost 88.1 billion yen * Renewable Subsidy Purchase Cost Energy 219.0 billion yen 307.1 billion yen Generators Cost Bearing Adjustment (Recorded as (Recorded as Power Organization Other Revenu

28. Slide 28: Schedules for Public Bond Redemption

    Schedules for Public Bond Redemption 22 (Billion Yen) Amount at Maturity (As of Sep. 30, 2018) TEPCO Public Bond TEPCO Power Grid Public Bond (FY) Note: The amount redeemed for Apr.- Sep. of FY2018 totaled 257.3 billion yen. ©Tokyo Electric Power Company Holdings, Inc. All Rights Reserved.

29. Slide 29: The Current Status of Fukushima Daiichi Nuclear Power Station and Future Initiatives

    The Current Status of Fukushima Daiichi Nuclear Power Station and Future Initiatives ©Tokyo Electric Power Company Holdings, Inc. All Rights Reserved.

30. Slide 30: Current Situation and Status of Units 1 through 4

    Current Situation and Status of Units 1 through 4 23 - At Units 1, 2 and 3, it was evaluated that the comprehensive cold shutdown condition had been maintained, judging from the temperatures of the reactors and spent fuel pools as well as the density of radioactive materials. To facilitate the remov

31. Slide 31: Key Points from the 4th Revision of the Mid-and-Long-Term Roadmap

    Key Points from the 4th Revision of the Mid-and-Long-Term Roadmap (Sep. 2017) 24 ●The revised version of the Mid-and-Long-Term Roadmap is available here (TEPCO website). 1. Basic Approach toward Revision (1) Maintain approach that prioritizes safety and emphasizes risk reduction (2) Optimize overall

32. Slide 32: Revised Mid-and-Long-Term Roadmap Milestones

    Revised Mid-and-Long-Term Roadmap Milestones 25 Maintain Overall Framework of Decommissioning Schedule Nov. 2013 Dec. 2011 (Fuel removal initiated at Unit 4) Dec. 2021 30 to 40 years later Stabilization initiatives Phase 1 Phase 2 Phase 3 Cold shutdown achieved Period until start of spent Period unt

33. Slide 33: Contaminated Water Management

    Contaminated Water Management 26 − In December 2013, the government’s Nuclear Disaster Response Headquarters arranged a set of preventative and multi-tiered measures based on the three basic policies for addressing contaminated water issues. <Main countermeasures> < Major Progress> Please visit our

34. Slide 34: The Current Status of Kashiwazaki-Kariwa Nuclear Power Station and Future Initiatives

    The Current Status of Kashiwazaki-Kariwa Nuclear Power Station and Future Initiatives ©Tokyo Electric Power Company Holdings, Inc. All Rights Reserved.

35. Slide 35: Main Measures to Secure Safety – 1 [Outline]

    Main Measures to Secure Safety – 1 [Outline] 27  We promote the following measures to secure further safety after the Great East Japan Earthquake. I. Installation of flooding embankment III. Further enhancement of heat removal and III. Further enhancement of heat III. Further enhancement of heat re

36. Slide 36: Main Measures to Secure Safety – 2 [Implementation Status]

    Main Measures to Secure Safety - 2 [Implementation Status] 28 As of October 10, 2018 Item Unit 1 Unit 2 Unit 3 Unit 4 Unit 5 Unit 6 Unit 7 Ⅰ. Installation of flooding embankment [banks] Completed *2 Completed Ⅱ. Countermeasures against inundation into buildings (1) Installation of tide embankments (

37. Slide 37: Compliance Review under the New Regulatory Requirements

    Compliance Review under the New Regulatory Requirements 29 Latest Review Status ・On September 27, 2013, the applications for permission changes in reactor installation were presented to receive the regulatory standard compliance examination for Units 6 and 7. ・After the application for permission ch

38. Slide 38: Key License/Permit Steps in Enforcement of New Regulatory Requirements

    30 Pre-use inspection(※2) Successful passage of pre-use inspection TEPCO Application for pre-use inspection Key License/Permit Steps in Enforcement of New Regulatory Requirements Construction plan & safety regulations(※1) Construction plan authorization Safety regulation revision authorization NRA ※

39. Slide 39: Other Initiatives

    Other Initiatives ©Tokyo Electric Power Company Holdings, Inc. All Rights Reserved.

40. Slide 40: Implementation of the Streamlining Policy

    Implementation of the Streamlining Policy 31 <Cost reduction> − In addition to the cost reductions that has been made under the New Comprehensive Special Business Plan (TEPCO *1 : 4.8 trillion yen/10 years), TEPCO has been executing, under the Revised New Comprehensive Special Business Plan, unprece

41. Slide 41: Efforts towards Nuclear Reform - 1

    Efforts towards Nuclear Reform - 1 32 - Framework for Nuclear Reform − Since April 2013, TEPCO has advanced the Nuclear Safety Reform Plan so that it may realize its determination that “the Fukushima nuclear accident will never be forgotten and we will be a nuclear operator which continues to create

42. Slide 42: Efforts towards Nuclear Reform – 2

    Efforts towards Nuclear Reform – 2 33 - Report on Status of the Nuclear Safety Reform Plan With respect to the Nuclear Safety Reform Plan, in addition to measures to make up for the inadequacies in "safety awareness", "interaction capabilities", "technical capabilities" that were the underlying fac

43. Slide 43: Main Efforts to Increase Corporate Value -1

    Main Efforts to Increase Corporate Value -1 34 <TEPCO Holdings> July 26, 2018 "Eruboshi certification" based on the Act on Promotion of Women's Participation and Advancement in the Workplace obtained. July 27, 2018 Establishment of the "TEPCO Decommissioning Archive Center", and the center planned t

44. Slide 44: Main Efforts to Increase Corporate Value -2

    Main Efforts to Increase Corporate Value -2 35 <TEPCO Power Grid> July 26, 2018 "Eruboshi certification" based on the Act on Promotion of Women's Participation and Advancement in the Workplace obtained. August 1, 2018 A Value Engineering proposal related to optimization of the business operations at

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