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Outline of 3rd Quarter
Financial Results forFiscal Year 2018
April 1, 2018 – December 31, 2018

Feb 13, 2019
JGC CORPORATION

My name is Shinichi Taguchi, General Manager of the Finance and Accounting
Department.
I am going to give you an outline of the third quarter financial results for Fiscal
Year 2018 which ends in March, 2019.

Contents1.

Income and Comprehensive Income

2.

Segment Information

3.

Balance Sheets

4.

Outline of Contracts

5.

Forecasts for Fiscal Year 201821. Income and Comprehensive Income【Unit: Billions of Yen】

ForecastFY2017
3Q

FY20183Q

Difference

Net sales

531.0

424.6

△ 106.4

640.0

Gross profit

38.1

30.8

△ 7.3

43.0

Profit ratio

7.2%

7.3%

+0.1pt6.7%

Operating income

21.6

15.2

△ 6.4

22.0

Ordinary income

27.8

22.6

△ 5.1

29.0

Profit attributable toowners of the parent

19.8

9.9

△ 9.9

10.0

Profit

19.9

10.0

△ 9.9

Other comprehensiveincome5.7△ 5.3△ 11.1

Comprehensive income

25.7

4.7

△ 21.0FY 2018

3Firstly, the statements of consolidated income and comprehensive income.
Due to the drop in the amount of backlog up to the last fiscal year, there was a
reduction in both revenue and profit on a year-on-year basis, but profit items arein line with the full-year forecast.
The net sales for the third quarter of the current fiscal year totaled 424.6 billion
yen, with gross profits of 30.8 billion yen.
Sales have progressed to 66% of the full-year forecast thus far, but gross profits
have shown high progress of 72% supported by higher profit ratio than expected.
Operating income was 15.2 billion yen and ordinary income was 22.6 billion yen.
Profit attributable to the owners of the parent was 9.9 billion yen for the quarter,
close to the full-year forecast.
For this fiscal year, an increase in tax expenses was projected at the beginning of
the year, but through the introduction of tax consolidation and other improvement
efforts, a slight decrease in the effective tax rate is expected.

For this reason, an improvement in net income to this quarter is achieved.
For other comprehensive income, the fall in share prices combined with unrealized
gains in other securities has resulted in a minus result of 5.3 billion yen.

2. Segment Information
Segment profit

Net sales【Unit: Billions of Yen】

TotalEngineering

495.9【Unit: Billions of Yen】

15.2

△22.2%△45.5%

386.0

FY2017 3Q

FY2018 3Q

8.2

FY2017 3Q

FY2018 3Q※

Functional
Materials
Manufacturing

29.8+15.3%FY2017 3Q

34.3

FY2018 3Q※Segment name changed from ” Catalysts & fine products ”.

5.0

FY2017 3Q+17.4%

5.9FY2018 3Q
4

Next is the segment information.
The total engineering segment, because of the reduction in the amount ofbacklog, has suffered lower revenue and profits when compared with the same
period in the previous year.
Total revenue was 386 billion yen and the segment profit was 8.2 billion yen.
The functional materials segment continues to perform well. Hydrogenation
catalysts and other materials such as chemical catalysts have continued toperform well, and both revenue and profits have shown good growth. Total sales
were 34.3 billion yen, with a segment profit of 5.9 billion yen.

3. Balance Sheets

Total liabilities & net assets

Assets【Unit: Billions of Yen】

686.3

684.9

【Unit: Billions of Yen】

215.7

△0.0

215.7

73.3

+0.1

73.4

395.7

+1.3

397.1

Current
assets
521.3

+2.9.

686.3

684.9

524.2

Current
liabilities

Noncurrent
liabilities

Total net
assets163.6

FY2017

△1.5

162.0

FY2018 3Q

Noncurrent
assets

FY2017FY2018 3Q

5

Next are the consolidated balance sheets which show little change from those at
the end of last fiscal year.
Total assets remain almost unchanged from the amount recorded at the end of
the last fiscal year at 686.3 billion yen.
Net assets grew by 1.3 billion yen to total 397.1 billion yen with a capital
adequacy ratio of 57.7% compared with 57.6% at the end of last fiscal year.
The account balance was 120.8 billion yen in cash and bank deposit, andtogether with short term investment balance on loans receivable, this shows atotal cash and cash equivalent of 140.8 billion yen which represents a decreaseof 94.5 billion yen from the balance at the beginning of the year.
The major reasons for the decrease were the payment conditions for equipment
costs for projects in Algeria, the advance payments made for the Ichthys LNG
project and short-term debt repayments.
In addition, we have Joint Venture accounts which amount to 102.1 billion yen
according to our interest base, but which are not booked on our balance sheets.

4. Outline of Contractsⅰ）New Contracts【Unit: Billions of Yen】

FY20183Q

FY2018
Forecast

Overseas

783.0

850.0

Domestic

95.1

150.0

Total

878.1

1,000.0

6

Next, we introduce the amount of new contracts.
With the award of a large-scale LNG plant construction project in Canada, thetotal cumulative value of new contracts for the period to the end of the thirdquarter reached 878.1 billion yen.
We intend to focus strongly on obtaining new contracts to reach our full-year
forecast of 1 trillion yen in orders.

ⅱ）Outstanding Contracts
By Region

By Business Area
【Unit: Billions of Yen】
6%
17%

7%

29%

5%

11%

15%

9%

7%

FY2017FY2018 3Q

886.6

1,367.96%3%FY2017FY2017■Petroleum refining□LNG■Chemical■Power generation, nuclear power
and new energy■Others

199.2
75.7
799.6
121.1

153.7

101.7

50.0

70.3

5% 1%

FY2017FY2018 3Q

253.4
97.9
270.4
61.0

11%

1,367.9

13%58%■Oil & Gas development

FY2018 3Q

46%

6%11%30%

30%

17%

27%5%

886.6

11%

FY20183Q
Major
Contracts【Unit: Billions of Yen】

■Japan■South East Asia
□Middle East
■Africa■Oceania■Europe & CIS■North America & Others

240.3
98.1
112.3
264.5
40.5
101.2
29.3

14%

FY2018 3Q

226.2
144.9
84.5
198.4
16.6
66.7
630.4

Over 100 Billion Yen

Over 50 Billion Yen

Over 30 Billion Yen

LNG（Canada）

FLNG（Mozambique）
LNG（Russia）
Gas Booster（Algeria）

Chemicals (Thailand)
Crude Oil Gathering, Processing（Algeria）
7

Next, we refer to our consolidated outstanding contracts.
Outstanding contracts as of the end of December, 2018, amounted to 1 trillion
367.9 billion yen.
With the award of the contract for project involving the construction of a largescale LNG plant in Canada, the largest business area was LNG at 58% of thetotal, and in terms of regions, North America accounted for the largest amount at46%.

5. Forecasts for Fiscal Year 2018

【Unit: Billions of Yen】

Forecast
Net Sales

640

Gross Profit

43

Profit ratio

6.7%

Operating income

22

Ordinary income

29

Income attributable toowners of the parent

10New contract
Annual dividend per share
Forecasts based on(￥/US$)

1,000¥12.00¥110.00
８

In conclusion, regarding the outlook for the fiscal year there is no change fromour previous report.
Although the sales for the third quarter was limited to 66% of the forecast, theforecast for the fiscal year remains unchanged in the light of the projects
expected for completion in the fourth quarter.
At the same time, while having been able to achieve 99% progress in our profits
after tax by the end of the third quarter due to a decrease in the effective tax rate,
we have left our profits after tax forecast unchanged because of the presence offactors subject to change, such as currency exchange rates, etc.
Our forecasts are based on an exchange rate of 110 yen to the US dollar. For
reference purposes only, we assess the effect of a 1 yen change in the exchange
rate to be 3 billion yen in terms of sales, 900 million yen in terms of gross profit
and in terms of operating income.
This concludes our comments on the financial results for the third quarter of thecurrent fiscal year.

Appendix９

Reference（Net sales & New Contracts by Region）

New Contracts

Net sales【Unit: Billions of Yen】

FY2017 3Q

FY2018 3Q

Japan

97.6

(18.4%)

128.7(30.3%)South East Asia

55.6(10.5%)

47.1

Oceania

115.9(21.8%)

Africa46.3

Middle East

【Unit: Billions of Yen】

FY2017 3Q

FY2018 3Q

Japan

92.8(22.8%)

95.1(10.8%)(11.1%)South East Asia

10.0(2.5%)

92.2(10.5%)

31.3(7.4%)

Oceania

74.3(18.3%)

7.3(0.8%)(8.7%)

72.0(17.0%)

Africa178.5(43.9%)

1.7(0.2%)

87.6(16.5%)

72.8(17.1%)

Middle East

26.1(6.4%)

38.8(4.4%)

Europe & CIS

85.6(16.1%)

55.0(13.0%)

Europe & CIS

20.1(4.9%)

29.6(3.4%)

North America& Others

42.0(8.0%)

17.4(4.1%)

North America& Others

4.5(1.2%)

613.2(69.9%)

Total

531.0

(100.0%)424.6(100.0%)

406.5(100.0%)878.1(100.0%)

Total

10

Reference（Historical data chart）【Unit: Billions of Yen】

Gross profit

Net sales

799.0

Operating income

72.9879.9
693.1

722.9

640.0

49.6

52.8

44.9

29.7

21.4

43.0

1.4

22.0

△ 21.4FY2014 FY2015 FY2016 FY2017 FY2018
Forecast

FY2014 FY2015 FY2016 FY2017 FY2018
Forecast

FY2014 FY2015 FY2016 FY2017 FY2018
Forecast

Ordinary income

Profit attributable toowners of the parent

New Contracts

44.8

42.7

52.0
24.9

29.0

1,000.0

20.6

16.5

769.6
10.0

506.2

547.8

FY2016FY2017320.6△ 22.0△ 15.2FY2014 FY2015 FY2016 FY2017 FY2018
Forecast

FY2014FY2015FY2016FY2017FY2018
Forecast

FY2014FY2015FY2018
Forecast

11Cautionary Statement
This presentation may contain forward-looking statements that reflect JGC’s plans and expectations.
Such statements are based on currently available information and current assumptions of future
events which may not prove to be accurate. Such statements are also subject to various risks anduncertainties that could cause actual results to differ materially from those forward-looking statements.
JGC Corporation undertakes no obligation to update any forward-looking statements after the date ofthis presentation. These potential risks and uncertainties include, but are not limited to:•changes in general economic conditions, including foreign currency exchange rates, interest rates
and other factors that could affect our profitability•changes in government regulations or tax laws in jurisdictions where we conduct business

For questions concerning this material please contact:
JGC Corporation
PR and IR Department
Tel: 81-45-682-1111 Fax: 81-45-682-1112
E-mail：ir@jgc.com