JGC Holdings Corporation (JGCCF) Q4 2024 Earnings Call

Investor webinar replay

Replay transcript excerpt

I'm Taguchi of Finance Unit. I'll explain the outline of financial results. Please turn to page 4. This is the highlights of FY2023. Due to the continued difficulties in some overseas projects in total engineering business, additional expenses were posted in Q4 as well, and partly also due to the additional risk contingencies cost, operating loss was incurred. Orders were sluggish as clients' investment decision for large contracts expected at the end of the fiscal year slid to the next fiscal year. Page 5 shows consolidated income statement. Net sales increased to 832.5 billion yen, up 37% year-on-year, but gross profit decreased 56 billion yen to 10.6 billion yen. This is due to the substantial decline in profitability in total engineering business. operating loss was 18.9 billion yen, ordinary profit was 0.3 billion yen, and loss attributable to owners or parent was 7.8 billion yen. Please take a look at slide 6. I'm going to talk about earnings by segments. Total engineering segment saw progress of large projects, and the net sales grew 40% year-on-year to 773.1 billion yen. Large oil and gas-related and chemical plant projects underway in the Middle East and Southeast Asia resulted in a loss of 22 billion yen due to additional expenses and a large loss provision resulting from estimated cost for countermeasures on risks. Functional materials manufacturing segment saw sales increase of 4.2 billion yen from the previous year to 52 billion yen, driven by increase in catalyst-related sales. The segment income remained flat at 7.2 billion yen due to a lack of recovery in demand for fine chemical products for semiconductor and hard disk-related applications, and as well, increase in depreciation. Please refer to slide 7. Orders for total engineering segment summed up ...