Introduction

10-Year Consolidated Financial Highlights*1
2016.32017.32018.32019.32020.32021.32022.32023.3

2,112,117

2,292,548

1,884,656

1,587,085

1,777,344

1,962,308

1,925,235

1,765,146

2,154,860

3,289,634

Operating Profit (¥ million)

166,044

171,753

192,008

58,365

116,30293,704

101,418

77,675

127,525

421,477

Operating Profit Margin (%)

7.86

7.49

10.19

3.68

6.54

4.78

5.27

4.40

5.92

12.81

Ordinary Profit (¥ million)

159,613

168,169

188,80955,688111,546

89,386102,645

70,500136,481408,846

Profit attributable to owners of parent (¥ million)

108,451

95,828111,936

53,13474,98784,55543,29349,50595,702

280,916

Net Sales (¥ million)

1,100,271

1,101,498

1,136,027

1,159,055

1,147,747

1,153,813

1,251,781

1,558,404

Total Assets (¥ million)

2,176,816

2,257,662

2,251,518

2,230,269

2,334,316

2,428,149

2,539,919

2,738,348

3,187,627

3,581,425

Interest-bearing Debt (¥ million)

713,823

730,739715,769

713,596

724,940

803,216

905,066

1,065,988

1,220,589

1,263,233

Operating Cash Flow (¥ million)

248,831237,680

257,122

217,439

240,328

246,436

213,171229,315

296,648490,216827

13,08425,08914,081

31,58322,655(13,887)(17,116)

89,422276,983

EBITDA (¥ million)

306,424

313,605

337,194

222,670

281,643

255,585

271,296

257,485

328,471

630,777

Capital Expenditure (¥ million)

248,004

224,596

232,033

203,358

208,745

223,781

227,058

246,431207,226

213,233

Depreciation (¥ million)*2

140,380

141,852

145,187

164,305

165,342

161,881

169,878

179,810

200,946

209,300

EPS (Earnings per Share) (¥)

43.10

39.15

46.68

23.02

164.12*3

187.6097.86

112.26217.67646.99

BPS (Book Value per Share) (¥)

402.91438.28460.35479.742,487.58*3

2,575.99

2,602.53

2,616.37

2,847.88

3,595.60

2,517,551

2,446,778

2,396,778

2,302,856

458,073*3

451,356

442,436

442,436440,997434,875

10

10

11

11

55*3

60

60

60

65

65

2.59

2.34

2.42

2.29

2.25

2.35

2.29

2.30

2.38

2.01

Free Cash Flow (¥ million)

Number of Issued Shares (Common Stock)(thousands of shares)
Dividend per Share (¥)
DOE (Dividends on Equity) (%)

Notes: *1 The financial information contained in this integrated report is based on annual securities report. However, it has not been audited by Audit firms etc.
*2 Depreciation includes amortization of long-term prepaid expenses.
*3 T
 he Company carried out a share consolidation at a ratio of 5 common shares to 1 on October 1, 2017.
The dividend per share of ¥55.0 is calculated on the post-consolidation basis (the interim dividend of ¥5.50 per share before the share consolidation and the year-end dividend of ¥27.50 per share after the share consolidation).

Contents

CEO’s Message

How We Create ValueThe Value Creation Process
Promoting Sustainability and Material issues

Business Strategy
Compass2030 & Compass Action
Compass Transformation 23-25
Introduction of Internal Companies
CFO’s Message

Corporate Strategy
Sustainability
Corporate Governance

Financial Data
Financial Data

1,069,515

Corporate Strategy

1,011,787

Business Strategy

Equity (¥ million)

How We Create Value

2015.3CEO’s Message

2014.3Introduction

10-Year Consolidated Financial Highlights
Consolidated Balance Sheets
Consolidated Statements of Income
C onsolidated Statements ofComprehensive Income
C onsolidated Statements of Cash FlowsD elayed Impact of Gas Rate Adjustment
SystemWeb Site
Investor Relations Website
Investors’ Guide(Financial Data and Industry Data)
Financial Results Presentation Materials
Financial Results Bulletin
Corporate Governance Report

67

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2017.3

2018.32019.32020.32021.32022.32023.3

Payout Ratio (%)

23.2

25.5

23.6

47.8

33.5

32.0

61.3

53.4

29.9

10.0

Total return ratio (%)

60.0

60.9

60.1

60.7

60.2

60.3

61.0

60.1

46.6*4

50.3

Current Ratio (%)

156.7

150.6

155.5

142.7

135.6

156.0

152.0

132.7

163.0

200.9

D/E (Debt-Equity) Ratio (times)

0.71

0.68

0.65

0.65

0.64

0.69

0.79

0.92

0.98

0.81

Equity Ratio (%)

46.5

47.4

48.9

49.4

48.7

47.7

45.2

42.1

39.3

43.5

ROE (Return on Equity) (%)

11.2

9.2

10.3

4.8

6.7

7.4

3.8

4.3

7.9

20.0

ROA (Return on Assets) (%)

5.2

4.3

5.0

2.4

3.3

3.6

1.7

1.9

3.2

8.3

Total Asset Turnover (times)

1.01

1.03

0.84

0.71

0.78

0.82

0.78

0.67

0.73

0.97

WACC (%)

3.2

3.6

3.4

3.0

3.1

3.0

2.7

2.6

2.3

2.4

9,982

10,125

10,26910,209

9,821

9,129

8,863

8,688

8,701

Gas sales volume (million m3)

14,735

15,541

15,436

15,72015,56815,19813,855

12,99013,146

12,574

17,22518,36018,587

19,05319,052

18,397

17,666

17,577

17,102

17,392

—

—

—

635

1,105

1,742

2,350

2,717

3,014

3,475

97.1

106.1

109.6

126.5

146.6

154.8

206.0

247.6

282.9

344.5

Gas Sales Volume, Gas
Volume used in-house*5
Number of electricity retail customers (thousand)Electric power sales volume (100 million kWh)Corporate Strategy

9,844

Business Strategy

Number of city gas retail customers (thousand)

How We Create Value

2016.3CEO’s Message

2015.3Introduction

2014.3*4 The total return ratio for the year ended March 2022 based on the profit attributable to owners of parent prior to the retrospective application (as of April earnings announcement) is 50.2%.
*5 It is the amount that added self-consuming volume, LNG sales volume (excluded volume for Nijio) to a consolidated gas sales volume.

Operating Cash Flow = Profit attributable to owners of parent + Amortization of Long-term Prepaid Expenses + Depreciation
Free Cash Flow = Profit attributable to owners of parent + Amortization of Long-term Prepaid Expenses + Depreciation – Capital Expenditure
Current Ratio = Current Assets (year-end) / Current Liabilities (year-end) x 100
Debt-Equity Ratio = Interest-bearing Debt (year-end) / Equity (year-end)
Equity Ratio = Equity (year-end) / Total Assets (year-end) x 100
Total Asset Turnover = Net Sales / Total Assets (average)

WACC calculation data (FY2022 results)a) Cost of interest-bearing debt: Real interest rate of 0.56% (after tax)b) Cost of shareholders’ equity
Risk-free rate: 10-year JGB yield of 0.30%
Risk premium: 5.5%, Beta coefficient of 0.75

Contents

CEO’s Message

How We Create ValueThe Value Creation Process
Promoting Sustainability and Material issues

Business Strategy
Compass2030 & Compass Action
Compass Transformation 23-25
Introduction of Internal Companies
CFO’s Message

Corporate Strategy
Sustainability
Corporate Governance

Financial Data
Financial Data

Computations

Introduction

10-Year Consolidated Financial Highlights
Consolidated Balance Sheets
Consolidated Statements of Income
C onsolidated Statements ofComprehensive Income
C onsolidated Statements of Cash FlowsD elayed Impact of Gas Rate Adjustment
SystemWeb Site
Investor Relations Website
Investors’ Guide(Financial Data and Industry Data)
Financial Results Presentation Materials
Financial Results Bulletin
Corporate Governance Report

68

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(Million yen)2022.3.31(Million yen)2023.3.31

Assets2022.3.31

2023.3.31

63,845Current liabilities
179,769

453,502

Notes and accounts payable-trade76,229Notes and accounts receivable-trade, and contract assets

364,683

446,061

Short-term borrowings

6,385

6,674

Lease receivables and investments in leases

17,824

17,125—20,000

10

10

3,467

6,030

Current portion of bonds payable
Current portion of long-term borrowings

48,972

59,973

Income taxes payable

33,830118,636

12,083

15,653

Other current liabilities

386,573

337,028

67,135

135,769

Total current liabilities

551,990

606,158

Other current assets

258,610

145,882

Allowance for doubtful accounts(3,714)( 2,122)

Bonds payable

548,619

548,976

Total current assets

899,870

1,217,914

Long-term borrowings

568,725

607,262

Non-current assets

Deferred tax liabilities

29,64133,901

Property, plant and equipment

Retirement benefit liability
Provision for share awards for Directors (and otherofficers)
Provision for gas holder repairs

66,19564,570

Buildings and structures, net

338,517346,262

Machinery, equipment and vehicles, net

892,515921,572

14,484

10,714Land

192,455

197,245

5,899

8,231

125,501

98,8781,569,373

1,582,904

Leased assets, net
Construction in progress
Total property, plant and equipment
Intangible assets
Goodwill

6,410

294,296308,122

Total intangible assets

300,315

314,533

Provision for point card certificates
Asset retirement obligations
Other current liabilities
Total non-current liabilities
Total liabilities

236,303

278,497

Share capital

Long-term loans receivable

48,65356,550Capital surplus

Retirement benefit asset

5,864

8,809

Retained earnings

Deferred tax assets

34,67032,849Treasury shares

Other investments

94,22393,649Total shareholders’ equity

Total assets

531

654

27,692

27,559106,31093,7091,354,486

1,385,965

1,906,477

1,992,124(1,647)(4,283)418,068

466,073

2,287,757

2,363,511

3,187,627

3,581,425

141,844

141,844846—

1,076,184

1,310,908(3,524)( 3,658)

1,215,350

1,449,094

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

18,86630,954

Deferred gains or losses on hedges(11,904)( 9,626)
86,226

Foreign currency translation adjustment

32,545Remeasurements of defined benefit plans(3,076)

1,754

Total accumulated other comprehensive income

36,430109,309

Non-controlling interests

29,36830,896

Total net assets

1,281,150

1,589,301

Total liabilities and net assets

3,187,627

3,581,425

CEO’s Message

How We Create ValueThe Value Creation Process
Promoting Sustainability and Material issues

Business Strategy
Compass2030 & Compass Action
Compass Transformation 23-25
Introduction of Internal Companies
CFO’s Message

Corporate Strategy
Sustainability
Corporate Governance

Financial Data
Financial Data

Total non-current assets

527
5,176

Net assets

Investment securities

Total investments and other assets

637
2,620

Shareholders’ equity

Investments and other assets

Allowance for doubtful accounts

183
3,444

Corporate Strategy

6,018

Other intangible assets

Provision for safety measures
Provision for contract loss in regards to appliance warranties

84
3,427

Business Strategy

Tools, furniture and fixtures, net

Non-current liabilities

How We Create Value

Work in process
Raw materials and supplies

CEO’s Message

Cash and deposits

Merchandise and finished goods

Contents

Liabilities

Current assets

Securities

Introduction

Consolidated Balance Sheets

Introduction

10-Year Consolidated Financial Highlights
Consolidated Balance Sheets
Consolidated Statements of Income
C onsolidated Statements ofComprehensive Income
C onsolidated Statements of Cash FlowsD elayed Impact of Gas Rate Adjustment
SystemWeb Site
Investor Relations Website
Investors’ Guide(Financial Data and Industry Data)
Financial Results Presentation Materials
Financial Results Bulletin
Corporate Governance Report

69

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(Million yen)

Consolidated Statements of Comprehensive Income

2022.4.1-2023.3.31

2,154,860

3,289,634

ProfitCost of sales

1,766,392

2,596,462

Other comprehensive income

Gross profit

388,467

693,172

Valuation difference on available-for-sale securities

Selling, general and administrative expenses

260,941

271,695

Operating profit

127,525

421,477

Interest income

1,032

2,463

Dividend income

1,692

2,797

Non-operating income

3,725

—

Foreign exchange gains

14,5505,089

Gain on derivatives

13,725

6,639

Miscellaneous income

14,673

11,510Total non-operating income

49,39928,500Non-operating expenses
Interest expenses

14,46615,138Loss on derivatives

11,864

10,308—4,450

Miscellaneous expenses

14,113

11,233

Total non-operating expenses

40,444

41,130136,481408,846

Ordinary profit
Extraordinary income

2,226

—

Gain on sale of investment securities

4,118

3,795

Gain on sale of businesses

—

3,506

Total extraordinary income

6,344

7,301

Extraordinary losses
Impairment losses

3,742

4,093

Loss on valuation of investment securities

2,468

2,420

Loss on valuation of long-term loans receivable

2,154

6,211

8,669

Profit before income taxes

136,614

407,479

Income taxes-current

32,951

122,208

Total extraordinary losses

Income taxes-deferred

6,429

3,748

Total income taxes

39,381

125,956
281,522

Profit97,233

Profit attributable to non-controlling interests

1,530

605

Profit attributable to owners of parent

95,702

280,916

Foreign currency translation adjustment

25,00651,756

Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income(10,964)

4,795

3,113

5,560

4,879

8,583

76,608105,816

358,130

Comprehensive income attributable to owners of parent

108,198

353,795

Comprehensive income attributable to non-controlling interests(2,381)

4,334

Comprehensive income
Comprehensive income attributable toContents

CEO’s Message

How We Create ValueThe Value Creation Process
Promoting Sustainability and Material issues

Business Strategy
Compass2030 & Compass Action
Compass Transformation 23-25
Introduction of Internal Companies
CFO’s Message

Corporate Strategy
Sustainability
Corporate Governance

Financial Data
Financial Data—

(4,178)(6,841)

12,063

Deferred gains or losses on hedges

Corporate Strategy

Gain on sale of non-current assets

281,522

Business Strategy

Share of loss of entities accounted for using equity method2022.4.1-2023.3.31

97,233

How We Create Value

Share of profit of entities accounted for using equity method2021.4.1-2022.3.31

CEO’s Message

2021.4.1-2022.3.31

Net sales(Million yen)

Introduction

Consolidated Statements of Income

Introduction

10-Year Consolidated Financial Highlights
Consolidated Balance Sheets
Consolidated Statements of Income
C onsolidated Statements ofComprehensive Income
C onsolidated Statements of Cash FlowsD elayed Impact of Gas Rate Adjustment
SystemWeb Site
Investor Relations Website
Investors’ Guide(Financial Data and Industry Data)
Financial Results Presentation Materials
Financial Results Bulletin
Corporate Governance Report

70

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(Million yen)

(Million yen)2021.4.1-2022.3.31 2022.4.1-2023.3.31

2021.4.1-2022.3.31 2022.4.1-2023.3.31

Contents

Cash flows from financing activities(2,724)
14,466(7,757)(3,725)(147,505)(22,491)
10,132
2,305(12,587)542(57)(2,796)
8,835
11,906
166,852
9,068(14,483)(16,209)145,227(5,260)15,138(1,910)4,450(114,253)(78,491)
7,107(2,594)
6,541
12,761(3,587)(1,789)(2,223)53,814
526,622
14,915(14,069)(40,437)
487,030(16,214)8,841(167,197)(29,777)(6,584)
6,334(399)(3,180)2,158(13,189)
9,846(15,074)(28,011)
13,574(150,647)(34,294)(5,237)
5,769(1,520)(10,922)
6,642(8,128)14,706(1,303)

263

2,718

—
—
(482)
(224,656)

4,112(3,914)(7,065)(203,522)

13,839(30,000)

Repayments of lease liabilities(2,683)(2,928)Proceeds from long-term borrowings

165,014

97,366

Repayments of long-term borrowings(123,252)(72,241)

Proceeds from issuance of bonds
Purchase of shares of subsidiaries resulting in change in scope of
consolidation
Purchase of treasury shares

73,62019,791(3,620)(1,867)(3,326)(16,031)

Dividends paid

(26,424)(29,474)

Other, net(19,515)(857)

Net cash provided by (used in) financing activities

90,490(22,403)

Effect of exchange rate change on cash and cash equivalents

9,117

12,628Net increase (decrease) in cash and cash equivalents

20,179273,733

Cash and cash equivalents at beginning of period

157,811

179,699

1,708—

179,699

453,432

Increase (decrease) in cash and cash equivalents resulting from change inscope of consolidation
Cash and cash equivalents at end of period

CEO’s Message

How We Create ValueThe Value Creation Process
Promoting Sustainability and Material issues

Business Strategy
Compass2030 & Compass Action
Compass Transformation 23-25
Introduction of Internal Companies
CFO’s Message

Corporate Strategy
Sustainability
Corporate Governance

Financial Data
Financial Data

2,556

679
30,000

Corporate Strategy

2,620

Net increase (decrease) in short-term borrowings
Net increase (decrease) in commercial paper

Business Strategy

407,479
205,076
4,093
4,224
1,658
10,904(3,347)2,420
2,154(3,506)
3,207

How We Create Value

136,614
196,810
3,742
4,136
2,574
(15,362)(3,983)
2,468——(11,312)CEO’s Message

Cash flows from operating activities
Profit before income taxes
Depreciation
Impairment losses
Amortization of long-term prepaid expenses
Loss on retirement of property, plant and equipment
Loss (gain) on derivatives
Loss (gain) on sale of investment securities
Loss (gain) on valuation of investment securities
Loss on valuation of long-term loans receivable
Loss (gain) on sale of businesses
Decrease (increase) in retirement benefit asset
Increase (decrease) in provision for contract loss in regards toappliance warranties
Interest and dividend income
Interest expenses
Foreign exchange loss (gain)
Share of loss (profit) of entities accounted for using equity method
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Increase (decrease) in trade payables
Decrease (increase) in contract assets
Increase (decrease) in contract liabilities
Increase (decrease) in accrued consumption taxes
Decrease (increase) in accounts receivable - other
Decrease (increase) in prepaid expenses
Increase (decrease) in long term advances received
Other, net
SubtotalInterest and dividends received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of investment securities
Proceeds from sale and redemption of investment securities
Purchase of property, plant and equipment
Purchase of intangible assets
Purchase of long-term prepaid expenses
Proceeds from sale of non-current assets
Net decrease (increase) in short-term loans receivable
Long-term loan advances
Proceeds from collection of long-term loans receivable
Payments of guarantee deposits
Proceeds from refund of guarantee deposits
Purchase of shares of subsidiaries resulting in change in scope of consolidation
Proceeds from sales of subsidiaries’ shares resulting in change in scopeof consolidation
Profits due to transfer of business
Payment for settlement of contingent consideration
Other, net
Net cash provided by (used in) investing activities

Introduction

Consolidated Statements of Cash Flows

Introduction

10-Year Consolidated Financial Highlights
Consolidated Balance Sheets
Consolidated Statements of Income
C onsolidated Statements ofComprehensive Income
C onsolidated Statements of Cash FlowsD elayed Impact of Gas Rate Adjustment
SystemWeb Site
Investor Relations Website
Investors’ Guide(Financial Data and Industry Data)
Financial Results Presentation Materials
Financial Results Bulletin
Corporate Governance Report

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Introduction

Delayed Impact of Gas Rate Adjustment System

Introduction
Contents

Gas Rate Adjustment System’s Medium- to Long-Term Neutralizing Effect on Crude Oil Price and Exchange Rate Formation
between the payment of raw material costs and the reflection of such changes in gas rates.
Consequently, fluctuations in crude oil prices and exchange rates may result in the underrecovery or over recovery of raw material costs if this lag cuts across a fiscal year, thereby
affecting income. Looking at the medium- to long-term, however, the gas rate adjustment
system has a neutralizing effect on the income impacts of fluctuations in raw material costs.

How We Create Value

Timing of the Standard Average Raw Material Cost Calculation and Reflection in Gas Rates

How the Sliding Time Lag in Rates Works

Timing of standard average raw material cost calculation

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Business Strategy

Jan.

CEO’s Message

Gas prices are determined using the gas rate adjustment system. Through this system,
average raw material prices over a three-month period according to trade statistics arecompared with the raw material cost that is used as the standard (standard average raw
material cost), and the gas rates are adjusted using a defined calculation method based on
the differences. A time lag of four months on average (called a sliding time lag) exists

Dec.

Average raw material price

Average raw material priceCorporate Strategy

Over recovery

Under recovery
Average raw material price

CEO’s Message

How We Create ValueThe Value Creation Process
Promoting Sustainability and Material issues

Business Strategy
Compass2030 & Compass Action
Compass Transformation 23-25
Introduction of Internal Companies
CFO’s Message

Corporate Strategy
Sustainability
Corporate Governance

Financial Data

Reflection in gas rates

Jun.

Jul.

Aug.

The average raw material price over the past three months is calculated every month andthen reflected in the gas rate three months later.

FY N

FY N+1

Financial Data

Average all Japan LNG price
Average raw material price reflected in gas rate

10-Year Consolidated Financial Highlights
Consolidated Balance Sheets
Consolidated Statements of Income
C onsolidated Statements ofComprehensive Income
C onsolidated Statements of Cash FlowsD elayed Impact of Gas Rate Adjustment
SystemWeb Site
Investor Relations Website
Investors’ Guide(Financial Data and Industry Data)
Financial Results Presentation Materials
Financial Results Bulletin
Corporate Governance Report

72

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Sustainability Factbook