Idemitsu Kosan Co., Ltd. · TSE:5019

Idemitsu Kosan — Q1 FY2023 Earnings Presentation

45 slides from Idemitsu Kosan's earnings presentation, Aug 8, 2023

Slide 1: Presentation on Results for the 1st Quarter FY2023
Presentation on Results for the 1st Quarter FY2023 August 8, 2023 Idemitsu Kosan Co.,Ltd.
Slide 2: Table of Contents
Table of Contents ◼ Highlights ◼ Results for the 1Q FY2023 ◼ Reference ✓ Progress in the mid-term management plan ✓ Financial results ✓ Volume ✓ Crude/product price and operation ✓ Business overview 2
Slide 4: Results for the 1Q FY2023
Results for the 1Q FY2023 ◼ Summary ✓ Operating + equity income (segment income) decreased by ¥191.4 billion y-o-y, due to reversal of inventory impact resulting from increased crude oil prices in the previous fiscal year, etc. ✓ Segment income excluding inventory impact decreased by ¥27.5 billion d
Slide 5: Results for the 1Q FY2023
@Results for the 1Q FY2023 €& idemitsu
Slide 6: Key Topics (1/2)
Key Topics(1/2) ◼ Trends in Petroleum Demand and Sales ✓ Demand for core products, particularly gasoline, has stabilized after recovery from reduction under COVID-19 ✓ Jet fuel demand has remained on a recovery trend since FY2020 1Q FY2020 FY2021 FY2022 FY2023 Core products 94.6％ 98.6％ 100.9％ 98.9％
Slide 7: Key Topics (2/2)
Key Topics(2/2) ◼ Solid Electrolytes for Next-generation Batteries ~for early practical application of EVs ~ <Idemitsu’s Strengths> <Recent Initiatives and Outlook> ✓ Integrated manufacturing technology from raw materials to finished products based on long history of oil refining ✓ Competitive advan
Slide 8: Operating Environment
Operating Environment Dubai Crude Australian Coal Exchange Rate [USD/bbl] Oil Price [USD/ton] Spot Price [JPY/USD] (USD) 120.0 450.0 150.0 FY2023 FY2022 420.0 420.7 390.0 110.0 145.0 376.8 379.5 108.1 360.0 141.6 330.0 100.0 140.0 300.0 96.9 137.4 138.4 270.0 263.7 90.0 135.0 240.0 247.8 84.8 210.0
Slide 9: Overview
Overview ◼ Crude Oil/Coal/Exchange Rate [USD/bbl, USD/ton, JPY/USD] 1Q FY2022 1Q FY2023 Change Crude Oil (Dubai) 108.1 77.8 (30.3) (28.0%) Crude Oil (Brent)* 101.4 81.3 (20.2) (19.9%) Australian Coal Spot Price* 263.7 247.8 (15.9) (6.0%) Exchange Rate (TTM) 129.6 137.4 +7.8 +6.0% *Brent prices and A
Slide 10: Segment Information
Segment Information ◼ Operating ＋ Equity Income [¥ billions] 1Q FY2022 1Q FY2023 Change Petroleum 216.6 13.7 (202.9) (93.7%) Excluding inventory impact 57.4 18.4 (39.0) (67.9%) Basic Chemicals 8.1 (1.4) (9.5) － Functional Materials 3.3 5.5 +2.2 +68.4% Power and Renewable Energy (3.7) (0.5) +3.2 － Re
Slide 11: Segment Information
Segment Information ◼ Factors Affecting Operating + Equity Income (excluding inventory impact, y-o-y) [￥billions] core products margin (time-lag) fuel cost, etc. non-core products margin Export Consolidated adjustment, etc. Exchange rate, etc. Cost, Power, etc. etc. Norway Price Volume Vietnam, Lubr
Slide 12: Segment Information: Petroleum
Segment Information [Petroleum] YoY-¥39.0bn (1Q FY22：¥57.4bn ➡ 1Q FY23：¥18.4bn) [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 (domestic spot –crude oil) [Thousand KL] (YoY) [￥
Slide 13: Segment Information: Chemicals, Materials, Power
Segment Information [Basic Chemicals] YoY-¥9.5bn (1Q FY22: ¥8.1bn ➡ 1Q FY23: -¥1.4bn) ✓ Decreased as a result of volume reduction in sales and cost increase due to shut down maintenance ✓ Product margin was unchanged in total [USD/ton] Product 1Q FY22 1Q FY23 Change Price Margin Price Margin Price M
Slide 14: Segment Information: Oil E&P and Coal
Segment Information [Oil E&P] YoY -¥0.9 bn [Coal] YoY +¥9.6 bn (1Q FY22：¥6.5bn ➡ 1Q FY23：¥5.7 bn) (1Q FY22：¥25.1bn ➡ FY23：¥34.7 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 tons] [
Slide 15: Balance Sheet
Balance Sheet [¥ billions] 3/31/2023 6/30/2023 Change 3/31/2023 6/30/2023 Change Total Current Cash and Deposits 105.2 133.7 +28.5 Liabilities 2,164.0 1,981.4 (182.5) Receivables, Total Fixed Inventory, etc. 2,626.9 2,421.8 (205.1) Liabilities 1,072.1 1,071.3 (0.7) Total Current Assets 2,732.1 2,555
Slide 16: 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 16
Slide 17: Topics related to Progress on the Medium-term Plan (1/4)
Progress on the Medium-term Plan Topics related to Progress on the Medium-term Plan (1/4) ◼ Additional investment in an Australia-based lithium exploration ✓ Australia is rich in mineral resources and has reserves of many kinds of rare metals, including lithium and vanadium ✓ Leveraging the business
Slide 18: Topics related to Progress on the Medium-term Plan (2/4)
Progress on the Medium-term Plan Topics related to Progress on the Medium-term Plan (2/4) ◼ Commission a CCS Study in Tomakomai Area as JOGMEC’s Business Feasibility Study ✓ JAPEX, HEPCO, and Idemitsu signed a contract ✓ The public solicitation is held by JOGMEC, based on the policy of the Japanese
Slide 19: Topics related to Progress on the Medium-term Plan (3/4)
Progress on the Medium-term Plan Topics related to Progress on the Medium-term Plan (3/4) ◼ Create a Bio Material Supply Chain ✓ Idemitsu, KUMHO and Sumitomo Corp. have signed MOU ✓ Producing styrene monomers made from bio-naphtha (biomass SM) and synthetic rubber made from solution styrene butadien
Slide 20: Topics related to Progress on the Medium-term Plan (4/4)
Progress on the Medium-term Plan Topics related to Progress on the Medium-term Plan (4/4) ◼ Study on Producing and Supplying System of Synthetic Fuel (e-fuel) ✓ Singed MOU with Saudi Aramco and ENEOS ✓ Engaging in joint discussions for technological cooperation relating to synthetic fuel (e-fuel) in
Slide 22: Financial Results: Net Sales by Segment
Financial Results Financial Results ◼ Net Sales by segment [¥ billions] 1Q FY2022 1Q FY2023 Change Petroleum 1,754.2 1,422.9 (331.3) (18.9%) Basic Chemicals 187.7 126.6 (61.1) (32.5%) Functional Materials 120.4 122.3 +1.9 +1.6% Power and Renewable Energy 36.4 32.2 (4.1) (11.4%) Resources* 105.4 114.
Slide 23: Quarterly Segment Income (Cumulative)
Financial Results Financial Results ◼ Quarterly segment income (cumulative, exc. inventory impact) [¥ billions] FY2022 FY2023 1Q 2Q 3Q 4Q 1Q Petroleum 57.4 61.1 1.2 17.3 18.4 Equity income 7.0 12.4 12.8 12.9 4.9 Basic Chemicals 8.1 14.2 11.4 10.1 (1.4) Equity income (0.1) (0.1) 0.5 (0.1) (0.6) Funct
Slide 24: Quarterly Segment Income (Q on Q)
Financial Results Financial Results ◼ Quarterly segment income (Q on Q, exc. inventory impact) [¥ billions] FY2022 FY2023 1Q 2Q 3Q 4Q 1Q Petroleum 57.4 3.7 (59.9) 16.1 18.4 Equity income 7.0 5.4 0.4 0.1 4.9 Basic Chemicals 8.1 6.1 (2.8) (1.3) (1.4) Equity income (0.1) (0.0) 0.6 (0.6) (0.6) Functiona
Slide 25: Sensitivity
Financial Results Sensitivity ◼ Major items affecting performance by changes in assumptions (2-4Q) Revised Income Assumption Range of assumption Segment impact Major Factors Items fluctuation （5/9 Forecast） (¥ billions) Fuel cost, Crude oil price 80.0$/bbl ±10$/bbl ±9.0 time-lag Singapore ー ±5$/bbl
Slide 26: Sales Volume: Petroleum
Volume Sales Volume ◼ Petroleum [thousand KL,％] 1Q FY2022 1Q FY2023 Change Gasoline 3,148 3,084 (64) (2.0%) Naphtha 111 101 (9) (8.4%) Jet Fuel 534 589 +55 +10.4% Kerosene 479 455 (24) (5.0%) Diesel Oil 2,456 2,434 (22) (0.9%) Heavy Fuel Oil A 694 728 +35 +5.0% Heavy Fuel Oil C 652 580 (72) (11.0%)
Slide 27: Sales Volume
Volume Sales Volume ◼ Basic Chemicals [kt,%] 1Q FY2022 1Q FY2023 Change Basic Chemicals 890 714 (176) (19.7%) ◼ Functional Materials [KKL,kt,%] 1Q FY2022 1Q FY2023 Change Lubricants 293 279 (14) (4.6%) Performance Chemicals 184 148 (37) (20.0%) *Lubricants include sales overseas ◼ Power/Renewable En
Slide 28: Production Volume
Volume Production Volume ◼ Resources (Oil E&P) [KBOED,%] 1Q FY2022 1Q FY2023 Change Vietnam 14.7 19.0 +4.3 +29.4% Norway 15.6 15.9 +0.3 +1.9% Total('000BOED) 30.3 34.9 +4.6 +15.2% Total('000BOE) 2,725 3,140 +415 +15.2% *The numbers reflect our rights and ownership ratios based on our equity share *T
Slide 29: Crude Oil Prices (Dubai and Brent)
Crude price Crude Oil Prices(Dubai and Brent) [USD/bbl] 130 Brent Dubai 110 90 70 50 30 10 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 29
Slide 30: Gasoline-Crude Oil (Domestic spot price and spread)
Product market price Gasoline-Crude Oil(Domestic spot price and spread) [Price :JPY/L] [Spread：JPY/L] 140 25 Spread Crude oil 120 Gasoline 20 100 15 80 60 10 40 5 20 0 0 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 30
Slide 31: Diesel-Crude Oil (Domestic spot price and spread)
Product market price Diesel-Crude Oil(Domestic spot price and spread) [Price :JPY/L] [Spread：JPY/L] 140 25 Spread Crude oil 120 Diesel oil 20 100 15 80 60 10 40 5 20 0 0 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 31
Slide 32: Gasoline-Crude Oil (Singapore spot price and spread)
Product market price Gasoline-Crude Oil(Singapore spot price and spread) [Price :USD/bbl] [Spread：USD/bbl] 160 40 Spread Dubai 35 140 Gasoline 30 120 25 100 20 80 15 60 10 40 5 20 0 0 -5 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 32
Slide 33: Diesel-Crude Oil (Singapore spot price and spread)
Product market price Diesel-Crude Oil(Singapore spot price and spread) [Price :USD/bbl] [Spread：USD/bbl] 180 70 Spread 160 Dubai 60 Diesel Oil 140 50 120 100 40 80 30 60 20 40 10 20 0 0 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 33
Slide 34: 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 34
Slide 35: Styrene Monomer-Naphtha
Product market price Styrene Monomer-Naphtha (price and spread) [Price :USD/ton] [Spread：USD/ton] 1,600 800 SM spread Naptha SM 1,400 700 1,200 600 1,000 500 800 400 600 300 400 200 200 100 0 0 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 35
Slide 36: Operational Data
Operation Operational Data ◼ Refineries Utilization FY2023 FY2019 FY2020 FY2021 FY2022 （1Q） 87% 78% 77% 83％ 64％ *on BCD basis ◼ Number of Service Stations FY2023 FY2019 FY2020 FY2021 FY2022 （1Q） 6,384 6,311 6,216 6,136 6,122 36
Slide 37: Overview of the Company
Business Overview Overview of the Company FY2022, actual or as of the end of March 2023 ∎ Petroleum Segment ∎ Functional Materials Segment  Refining Capacity 945 KBD *1,2) (Lubricants, Performance Chemicals, Electronic  Domestic fuel oil sales volume Materials, Bitumen (High Performance Asphalt),
Slide 38: Petroleum Segment
Business Overview Petroleum Segment as of the end of March 2023 [KB/D] Operating Refining Refinery RH FCC RFCC FLG Equity Ratio Company Capacity Japan Idemitsu Hokkaido 150 42 33 Kosan Chiba 190 40 45 Aichi 160 60 50 Showa Yokkaichi Yokkaichi 255 45 61 75.0% Sekiyu Toa Oil Keihin 70 42 27 100.0% Sei
Slide 39: Basic Chemicals Segment
Business Overview Basic Chemicals Segment as of the end of March 2023 [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 Tokuyam
Slide 40: 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
Slide 41: 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
Slide 42: 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)
Slide 43: 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 *2,3 [million BOE] 2. Exploration and development of gas in Vietnam and other 150 parts of Southeast Asia to shift to production
Slide 44: 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
Slide 45: 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 — Q1 FY2023 Earnings Presentation on 6ix

Idemitsu Kosan — Q1 FY2023 Earnings Presentation

Slide 1: Presentation on Results for the 1st Quarter FY2023

Slide 2: Table of Contents

Slide 3: Highlights

Slide 4: Results for the 1Q FY2023

Slide 5: Results for the 1Q FY2023

Slide 6: Key Topics (1/2)

Slide 7: Key Topics (2/2)

Slide 8: Operating Environment

Slide 9: Overview

Slide 10: Segment Information

Slide 11: Segment Information

Slide 12: Segment Information: Petroleum

Slide 13: Segment Information: Chemicals, Materials, Power

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

Slide 15: Balance Sheet

Slide 16: Progress on the Medium-Term Plan

Slide 17: Topics related to Progress on the Medium-term Plan (1/4)

Slide 18: Topics related to Progress on the Medium-term Plan (2/4)

Slide 19: Topics related to Progress on the Medium-term Plan (3/4)

Slide 20: Topics related to Progress on the Medium-term Plan (4/4)

Slide 21: Reference

Slide 22: Financial Results: Net Sales by Segment

Slide 23: Quarterly Segment Income (Cumulative)

Slide 24: Quarterly Segment Income (Q on Q)

Slide 25: Sensitivity

Slide 26: Sales Volume: Petroleum

Slide 27: Sales Volume

Slide 28: Production Volume

Slide 29: Crude Oil Prices (Dubai and Brent)

Slide 30: Gasoline-Crude Oil (Domestic spot price and spread)

Slide 31: Diesel-Crude Oil (Domestic spot price and spread)

Slide 32: Gasoline-Crude Oil (Singapore spot price and spread)

Slide 33: Diesel-Crude Oil (Singapore spot price and spread)

Slide 34: Para-Xylene, Mixed Xylene-Naphtha

Slide 35: Styrene Monomer-Naphtha

Slide 36: Operational Data

Slide 37: Overview of the Company

Slide 38: Petroleum Segment

Slide 39: Basic Chemicals Segment

Slide 40: Functional Materials Segment (1/2)

Slide 41: Functional Materials Segment (2/2)

Slide 42: Power/Renewable Energy Segment

Slide 43: Resources Segment (Gas and Oil E&P)

Slide 44: Resource Segment (Coal)

Slide 45: Precaution statement about forecasts