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Outline of 3rd Quarter
Financial Resultsfor Fiscal Year 2019
April 1, 2019 – December 31, 2019

Feb 13, 2020
JGC HOLDINGS CORPORATION

My name is Taguchi, General Manager of the Group Finance and Accounting
Department.
I am going to give you an outline of the third quarter financial results for Fiscal
Year 2019 which ends in March, 2020.

Contents1.

Highlights of Fiscal Year 2019 3Q

2.

Income and Comprehensive Income

3.

Segment Information

4.

Balance Sheets

5.

Outline of Contracts

6.

Forecasts for Fiscal Year 201921. Highlights of Fiscal Year 2019 3Q•The pace of the progress for the quarter is in line with theforecast for Fiscal Year 2019 and there is no change in theforecasts for the full year.

•We are expecting the conclusion of the FIDʼs for the LNG
Plant Project in Mozambique and other large-scale EPC
projects. At the same time, we are actively working towards
attaining our target for new contracts.

3I will begin with a review of the highlights for the third quarter.
The progress of operating results for the quarter are in line with the full-year
forecast.
Regarding new contract orders, we have been nominated as contractor for largescale EPC projects and other items in the second quarter, but as final investment
decision by the clients are still to be made, the amounts of new contract awarded
are still relatively small.

2. Income and Comprehensive Income【Unit: Billions of Yen】

Forecast

FY2018 3Q

FY2019 3Q

Difference

Net sales

424.6

342.2

△ 82.4500.0

Gross profit

30.829.8

△ 0.9

40.0

Proﬁt ratio

7.3%

8.7%+1.5pt

8.0%

Operating income

15.2

13.4

△ 1.7

19.0

Ordinary income

22.6

18.3

△ 4.2

26.0

9.9

4.7

△ 5.1

10.0

10.0

4.8

△ 5.2

△ 5.3

△ 2.6

+2.6

4.7

2.2

△ 2.5

Profit attributable toowners of the parent
ProfitOther comprehensive
incomeComprehensive income

FY 2019

4We move to the Statement of Income and the Statement of Comprehensive
Income.
There was a decrease in sales and profits on a year-on-year basis, but thefigures are in line with the full-year forecast.
Net sales of 342.2 billion yen fell by 82.4 billion yen from the same quarter of lastyear.
Gross profits fell by 900 million yen to 29.8 billion yen.
Gross profit ratio rose by 1.5 points to 8.7%.
Operating income fell by 1.7 billion yen to 13.4 billion yen.
Affected by foreign exchange losses, ordinary income experienced a drop of 4.2
billion yen to 18.3 billion yen.
Profits attributable to the owners of the parent was 4.7 billion yen.
Although net sales reached only 68% of annual forecast, further growth isexpected in the fourth quarter due to the forecast that sales progress for large
projects is expected to rise in the second half of the fiscal year.
At levels of progress 71% for operating income and 70% for ordinary income,these are on track to reach the forecast levels.

Profit attributable to the owners of the parent, as part of the sale of assets taking
place this fiscal year, the loss on sale together with the foreign tax effect is bookedas part of the third quarter results and, while this bears a temporary downside, theprofit on sale of other items is moved to the fourth quarter, overall effect on fullyear forecasts remain unchanged is expected.
With the review of the profitability of individual projects, our profit ratio is slightly
above the forecast level.

3. Segment Information
Segment profit

Net sales【Unit: Billions of Yen】

Total
Engineering

386.0△21.1％FY2018 3Q

Functional
Materials
Manufacturing

34.3

+1.2%

FY2018 3Q【Unit: Billions of Yen】

8.2
304.4

FY2019 3Q

FY2018 3Q

34.7

5.9

FY2019 3Q

FY2018 3Q

△3.0%

8.0

FY2019 3Q△12.7%

5.1

FY2019 3Q
5Next is the segment information.
In the Total Engineering segment, with the completion of large projects such as
the Ichthys and Yamal large-scale LNG projects by last year end, net sales were304.4 billion yen, 21.1% lower than figure for the same period of the previousyear.
The main projects included in the net sales figure are the LNG Canada Project,
the Mozambique FLNG Project and a domestic solar power plant project.
Segment profit showed a year-on-year drop of 3% at 8 billion yen.
The percentage drop in profits was small relative to that of sales due to the resultof improvements in the gross profit ratio.
For the Functional Materials Manufacturing segment, net sales were 1.2% higher
than the same period of the previous year at 34.7 billion yen and segment profit
was 12.7% lower at 5.1 billion yen.
Sales of chemicals and environmental protection catalysts, especiallydenitrification catalysts, were strong both domestically and overseas.
On the other hand, apart from the rising material and fuel costs for petroleum
refining catalysts, exports to China of high-profit products such as functional
coatings have dropped markedly as a result of the trade friction between the U.S.
and China, bringing about a slight fall in the profit ratio.

4. Balance Sheets

Total liabilities & net assets

Assets【Unit: Billions of Yen】

708.8

541.7

167.1

FY2018JV Cash122.3
JGC Portion

708.8

686.4

+0.4

542.2

△22.8

144.2

【Unit: Billions of Yen】

Current
assets

686.4

223.5

+8.0

231.6

74.9

△24.6

50.2

410.3

△5.7

404.5

Current
liabilities

Non-current
liabilities

Total netassets

Non-current
assets

FY2019 3Q

FY2018FY2019 3Q

149.96

Next are the consolidated balance sheets.
Total assets show a fall of 22.3 billion yen from the amount recorded at the end of
the last fiscal year at 686.4 billion yen.
Fixed assets fell by 22.8 billion yen as a result of the sale of power generation
related business assets.
In addition, we have JV accounts which amount to 149.9 billion yen according to
our interest base, but which are not booked on our balance sheets.
Principally, this reflects our JV interest in the LNG Canada Project.
On the total liabilities and net assets side, as a result of changing the straightbonds due for repayment this year to current liabilities, fixed liabilities have been
reduced.
The growth of current liabilities was restricted to 8 billion yen due to the reductionof accounts payable for construction and other factors.
The Shareholders Equity Ratio was 58.9%.

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

FY2019 3Q

FY2019Forecast

Overseas

38.2

650.0

Domestic

89.2

150.0

Total

127.5

800.0

7

The next topic deals with new contracts.
For the consolidated cumulative third quarter, the amount was 127.5 billion yenmainly for a domestic medical facility and early work for the Mozambique LNG
Project.
The EPC contract amount for the Mozambique LNG Project itself for which anorder was secured in October of last year will not be included until the final
investment decision is made by the client.
The full-year forecast is 800 billion yen but, as indicated in the initial forecast, thedecision on major projects is expected toward the end of the year, we will keep tomake an effort toward our target.

ⅱ）Outstanding Contracts
By Region

By Business Area
【Unit: Billions of Yen】

8%5%12%6%5%9%8%

1,023.2

61%■Oil & Gas development■Petroleum refining□LNG■Chemical■Power generation, nuclearpower■Others

FY20193Ｑ
Major
Contracts

52%

1,208.3

8%6%

1,023.2

56%

FY2018FY2019 3Q

144.5
64.8
730.8
109.1

84.7
55.5
643.2
104.9

■Japan95.7

57.6■Oceania

63.2

77.1

4%2%2%FY2019 3Q

7%

13%

15%

63%

FY2018

18%

17%

5%

10%

1,208.3

FY2018

8%【Unit: Billions of Yen】

FY2019 3Q

FY2018■South East Asia
□Middle East■Africa■North America & Others

Over 100 Billion YenOver 50 Billion Yen

Over 30 Billion Yen

LNG（Canada）

FLNG（Mozambique）

Chemicals (Thailand)
Gas Booster（Algeria）

204.4
102.6
68.1
177.5
31.2
624.2

FY2019 3Q

188.5
76.4
35.5
128.3
21.6
572.6

8

Next, we refer to our outstanding contracts.
Outstanding contracts as of the end of December, 2019, amounted to 1,023.2
billion yen, showing a decrease of 185.1 billion yen from the previous year.
Their composition did not show any great change.
For segments, LNG accounted for the largest amount at 63%, and in terms ofregions, North America accounted for 56%.
For contract amounts, the largest were the LNG Canada Project, theMozambique FLNG Project, the Thai chemical project and the Algeria gas
booster project, reflecting the same position as at the end of the last fiscal year.

6. Forecasts for Fiscal Year 2019
【Unit: Billions of Yen】

Forecast
New contract

800.0

Net Sales

500.0

Gross Profit

40.0

Profit ratio

8.0%

Operating income

19.0

Ordinary income

26.0

Income attributable toowners of the parent

10.0

Annual dividend per share¥12.00

Forecasts based on¥110.00(￥/US$)

9Regarding the outlook for the fiscal year, there is no change from our previous
report.
For the total engineering segment, taking into account the boost to sales from theLNG Canada Project in the second half of the year, we have seen improved
growth in the third quarter, as expected.
In spite of concerns regarding the area of functional materials manufacturing,
especially functional materials and abrasives due to the effects of trade friction
between China and the U.S., these effects are expected to be countered by sales
expansion of chemical catalysts and environmental protection catalysts.
Forecast of dividends remain unchanged. The company’s policy regarding
dividends calls for an annual dividend payout ratio of 30%. Thus, the dividend of
12 yen per share for this fiscal year is reduced in line with the forecast for lower
profits than last year. However, due to an upswing in our operating cash flow
situation, we expect that the liquidity level at hand will see improvement for thefiscal year, combined with our outlook concerning our financial position, we could
be considering additional shareholder returns through the buy-back of stock.
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 theexchange rate to be 2 billion yen in terms of sales, 100 million yen in terms ofgross profit and 400 million yen terms of ordinary income.
This concludes our explanation of the Financial Results for the Third Quarter ofFiscal Year 2019.

Appendix

10Reference（Net sales & New Contracts by Region）

New Contracts

Net sales【Unit: Billions of Yen】

FY2018 3Q【Unit: Billions of Yen】

FY2019 3Q

FY2018 3Q

FY2019 3QJapan

128.7(30.3%)

126.1(36.9%)

Japan

95.1(10.8%)89.2(70.0%)

South East Asia

47.1(11.1%)

43.7(12.8%)

South East Asia

92.2(10.5%)

15.8(12.5%)

Oceania31.3(7.4%)

6.8(2.0%)

Oceania7.3(0.8%)

0.9(0.7%)

Africa72.0(17.0%)

54.4(15.9%)

Africa1.7(0.2%)

5.9(4.7%)

Middle East

72.8(17.1%)

38.1(11.1%)

Middle East

38.8(4.4%)

5.0(4.0%)

Europe & CIS

55.0(13.0%)

5.7(1.7%)

Europe & CIS

29.6(3.4%)

3.9(3.1%)

17.4(4.1%)

67.0(19.6%)

613.2(69.9%)

6.5(5.0%)424.6(100.0%)

342.2(100.0%)878.1(100.0%)127.5(100.0%)

North America& Others
Total

North America& Others
Total

11

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

Gross profit

Net sales
879.9

693.1

722.9

Operating income

72.9
619.2

49.6

44.9

500.0

44.9

21.4

40.0

23.2

19.01.4△ 21.4FY2015 FY2016 FY2017 FY2018 FY2019

FY2015 FY2016 FY2017 FY2018 FY2019

FY2015 FY2016 FY2017 FY2018 FY2019

Forecast

Forecast

Forecast

Profit attributable toowners of the parentOrdinary income

52.0

42.7
32.3
24.9

26.016.5

New Contracts

935.4

24.0
10.0

506.2

547.8

FY2016FY2017800.0320.6△ 22.0△ 15.2FY2015 FY2016 FY2017 FY2018 FY2019
Forecast

FY2015FY2016FY2017FY2018FY2019Forecast

FY2015FY2018FY2019Forecast

12

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 Holdings Corporation undertakes no obligation to update any forward-looking statements after
the date of this 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 HOLDINGS CORPORATIONGroup Management Development Department
Tel: 81-45-682-1111 Fax: 81-45-682-1112
E-mail：ir@jgc.com