Consolidated Financial Results for the year ended December 31, 2023 [IFRS]March 27, 2024
Note: The following report is an English translation of the Japanese-language original.
Company name

: INPEX CORPORATION

Stock Exchange on which the Company is listed

Code number
Representative: 1605: Takayuki Ueda, President

URL https://www.inpex.co.jp

Contact person: Yoshihiro Wakita, General Manager, Corporate Communications Unit
TEL+81-3-5572-0750: Tokyo Stock Exchange(Amounts less than one million yen are rounded off)
1. Consolidated Financial Results for the year ended December 31, 2023 (January 1, 2023 through December 31, 2023)(1) Consolidated operating results(Figures in % represent the changes from the previous fiscal year)

Revenue
For the year ended
December 31,
2023
December 31,
2022

Millions ofyen%

2,164,516(6.5)

2,316,086–

Operating profit

Profit before tax

Millions ofyen%Millions ofyen%

1,114,189 (25.9)

1,253,384(13.3)

1,503,667

1,445,382––

Millions ofyen%Profit attributableto owners ofparentTotal
comprehensive
incomeMillions ofyenMillions of
yen

%

%

332,576 (31.6)

321,708 (35.5)

616,945 (38.0)

485,955

498,452

994,545–––

Return on equity
Ratio of profit before Ratio of operating
attributable totax to total assets
profit to revenue
owners of parent

Basic earnings per Diluted earnings per
share
share
For the year ended
December 31, 2023
December 31, 2022

Profit

Yen

Yen

%

%

%

248.55364.73248.38364.57

8.0
14.6

19.0
24.6

51.5
64.9

(Reference): Share of profit (loss) of investments accounted for using equity method:

for the year ended December 31, 2023, ¥18,389 million
for the year ended December 31, 2022, ¥166,253 million(2) Consolidated financial position
Total assets

As of December 31,
2023
As of December 31,
2022

Total equity

Ratio of equity
Equity attributable toEquity attributable to attributable to owners
owners of parent per
owners of parentof parent to total
shareassetsMillions of yen

Millions of yen

Millions of yen%

Yen

6,739,476

4,499,033

4,209,101

62.5

3,345.22

6,448,414

4,068,560

3,807,381

59.0

2,915.31(3) Consolidated cash flows
Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities

Cash and cash equivalents
at end of the year

For the year ended
December 31, 2023

Millions of yen

Millions of yen

Millions of yen

Millions of yen

788,130(320,116)(487,272)

201,149

December 31, 2022

782,274(535,123)(246,597)

208,238

2. Dividends
Ratio ofdividends to
Payout ratio
equity(Consolidated) attributable toowners of parent(Consolidated)

Cash dividends per share
At 1st
At 2ndAt 3rdAt fiscal
quarter end quarter end quarter end year end
For the year ended
December 31, 2022

Total

Total cash
dividends(Annual)

Yen

Yen

Yen

Yen

Yen

Millions of yen

%

%

30.00

62.00

83,420

17.0

2.4

37.00

–
–

32.00

December 31, 2023

–
–

37.00

74.00

94,94329.8

2.4

For the year ending
December 31, 2024

–

38.00

–

38.00

76.00

29.0

(Forecasts)(Note):“Dividends” as stated above refer to common stock. For information regarding Class A stock (not listed), please refer to Exhibit “Dividends of ClassA stock.”

3. Forecasts for Consolidated Financial Results for the year ending December 31, 2024 (January 1, 2024 through December 31, 2024)(Figures in % represent the changes from the corresponding period of the previous fiscal year)

Revenue
Millions of yen

For the six months ending
June 30, 2024
For the year ending
December 31, 2024

Operating profit% Millions of yen

Profit attributable to Basic earnings
owners of parent
per share

Profit before tax% Millions of yen% Millions of yen%

Yen

1,043,000(3.3)

544,000(10.4)

559,000(21.2)

155,000(37.6)

123.191,931,000(10.8)

1,010,000(9.4)

1,043,000(16.8)

330,000

2.6

262.27*Notes(1) Significant changes in scope of consolidation: None(Changes in the specified subsidiaries during the period due to change in scope of consolidation)(2) Changes in accounting policies and changes in accounting estimates
1. Changes in accounting policies required by IFRS

: None2. Other changes in accounting policies
3. Changes in accounting estimates: None: None(3) Number of shares issued (Common stock)
1. Number of shares issued at the end of the period(including treasury stock):

1,386,667,167 shares as of December 31, 2023
1,386,667,167 shares as of December 31, 2022

2. Number of treasury stock at the end of the period:

128,422,706 shares as of December 31, 2023
80,672,863 shares as of December 31, 2022

3. Average number of shares:

1,294,325,142 shares for the year ended December 31, 2023
1,366,647,207 shares for the year ended December 31, 2022

(Note): The shares held by “the Board Incentive Plan Trust” are included in number of treasury stock at the end of the period.
(As of December 31, 2023: 891,560 shares As of December 31, 2022: 910,363 shares)*This financial report is not subject to audit by certified public accountants or audit firms.
*Explanation regarding the appropriate use of estimated consolidated financial results
1. The Group has voluntarily adopted the International Financial Reporting Standards (IFRS) instead of accounting principles generally accepted in Japan(Japanese GAAP), starting with the consolidated financial statements in the Annual Securities Report for the year ended December 31, 2023. This financial
results and attachments are being voluntarily disclosed as important financial information based on IFRS from the items provided in the Annual Securities
Report. Furthermore, the Group released the financial results based on the Japanese GAAP (Consolidated Financial Results for the year ended December 31,2023) on February 13, 2024.
2. The aforementioned forecasts “3. Forecasts for Consolidated Financial Results for the year ending December 31, 2024” are based on the currently available
information and contain many uncertainties. The final results might be significantly different from the aforementioned forecasts due to changes in businessconditions including oil and natural gas price levels, production and sales plans, project development schedules, government regulations and financial and tax
schemes.

Exhibit:
Dividends of Class A stock
Cash dividends per share
At 1st quarter end At 2nd quarter end At 3rd quarter end

At fiscal year end

Total

For the year ended
December 31, 2022

Yen

Yen

Yen

Yen

Yen

–

12,000.00–

12,800.00

24,800.00

December 31, 2023–

14,800.00–

14,800.00

29,600.00–

15,200.00–

15,200.00

30,400.00

For the year ending
December 31, 2024
(Forecasts)(Note): The Company conducted a stock split at a ratio of 1:400 of common stock effective October 1, 2013. However, for Class A stock (not listed), no stock
split was implemented. The article specifying that dividends of Class A stock are equivalent to dividends of common stock prior to the stock split isincluded in the Articles of Incorporation.

Index of the Attachments
1. Consolidated Financial Statements and Principal Notes........................................................................................................................ 2(1) Consolidated Statement of Financial Position ................................................................................................................................. 2(2) Consolidated Statement of Profit or Loss and Consolidated Statement of Comprehensive Income ................................................ 4
Consolidated Statement of Profit or Loss .......................................................................................................................................... 4
Consolidated Statement of Comprehensive Income .......................................................................................................................... 5(3) Consolidated Statement of Changes in Equity ................................................................................................................................. 6(4) Consolidated Statement of Cash Flows............................................................................................................................................ 8(5) Notes to Consolidated Financial Statements .................................................................................................................................. 10(Conditions or events that indicate there could be substantial doubt about the Company’s ability to continue as a going concern)......................................................................................................................................................................................................... 10(Segment information)..................................................................................................................................................................... 10(Per share information) .................................................................................................................................................................... 12(Significant subsequent events) ....................................................................................................................................................... 12(First-time adoption)........................................................................................................................................................................ 13-1-

1. Consolidated Financial Statements and Principal Notes(1) Consolidated Statement of Financial Position(Millions of yen)Accounts

As of January 1, 2022
(date of transition)

As of December 31, 2022 As of December 31, 2023

AssetsCurrent assets
Cash and cash equivalents

192,254208,238

201,149

Trade and other receivables

198,454

287,452

232,017

Inventories

47,393

71,907

69,856

Income taxes receivable

2,619

5,948

10,640Loans receivable

38,36632,17942,350

Other financial assets

13,87285,039227,068

Other current assets

32,616

41,41737,992525,576

732,183

821,075

Assets held for sale–

26,422

17,341

Total current assets

525,576

758,605

838,417

3,292,382

3,540,507

3,601,558

27,75727,39025,481

Subtotal

Non-current assets
Oil and gas assets
Other property, plant and equipment
Goodwill–

19,706

20,471

6,048

6,775

9,033

325,139

636,582

751,903

1,011,804

1,279,140

1,306,529

50,58760,14995,890

–

1,734

896

Deferred tax assets

27,276

77,541

72,977

Other non-current assets

18,48340,28016,316

Total non-current assets

4,759,479

5,689,809

5,901,058

5,285,056

6,448,414

6,739,476

Intangible assets
Investments accounted for using equity
methodLoans receivable
Other financial assets
Asset for retirement benefits

Total assets-2-

(Millions of yen)Accounts

As of January 1, 2022
(date of transition)

As of December 31, 2022 As of December 31, 2023

Liabilities and equity
Liabilities
Current liabilities
Trade and other payables

146,524

210,836

207,913

Bonds and borrowings

80,49375,878161,059

Other financial liabilities

39,34581,83340,808

Income taxes payable

50,845

126,745

131,721

Asset retirement obligations

1,266

10,10019,018Other current liabilities

38,57031,122

11,690Subtotal

357,045536,517572,212

–

4,213

–

357,045

540,730

572,212

Liabilities directly related to assets held
for sale
Total current liabilities
Non-current liabilities
Bonds and borrowings

1,099,721

1,194,369

895,923

Other financial liabilities

72,29170,80566,025

Liability for retirement benefits

7,052

689

803

Asset retirement obligations

364,830

334,234

369,483

Deferred tax liabilities

137,437

234,556

332,940

Other non-current liabilities

1,773

4,466

3,054

Total non-current liabilities

1,683,105

1,839,123

1,668,230

2,040,151

2,379,854

2,240,442

Common stock

290,809290,809290,809

Capital surplus

678,949

679,113679,131

Retained earnings

2,180,837

2,521,998

2,746,530

Treasury stock(75,425)(121,358)(221,330)

Other components of equity(41,490)436,818

713,959

3,033,680

3,807,381

4,209,101

211,224

261,178

289,932

3,244,904

4,068,560

4,499,033

5,285,056

6,448,414

6,739,476

Total liabilities
EquityTotal equity attributable to owners ofparentNon-controlling interests
Total equity
Total liabilities and equity-3-(2) Consolidated Statement of Profit or Loss and Consolidated Statement of Comprehensive Income
Consolidated Statement of Profit or Loss
(Millions of yen)
For the year ended
December 31, 2022

Accounts

For the year ended
December 31, 2023

Revenue

2,316,086

2,164,516

Cost of sales(818,130)(848,080)

Gross profit

1,497,956

1,316,435

Exploration expenses(12,702)(25,901)

Selling, general and administrative expenses(91,975)(95,747)

Other operating income

95,97125,094

Other operating expenses(151,836)(124,081)

166,253

18,389Operating profit

1,503,667

1,114,189

Finance income

73,820217,310

Finance costs(132,105)(78,116)

Profit before tax

1,445,382

1,253,384

Income tax expense(959,427)(920,807)

Profit485,955

332,576

498,452

321,708

Share of profit (loss) of investments accounted for using
equity method

Profit (loss) attributable to
Owners of parent
Non-controlling interests(12,497)

10,867

Profit485,955

332,576

Basic earnings per share (Yen)364.73248.55

Diluted earnings per share (Yen)364.57248.38

Earnings per share-4-Consolidated Statement of Comprehensive Income(Millions of yen)
For the year ended
December 31, 2022

Accounts
Profit

For the year ended
December 31, 2023

485,955

332,576

Financial assets measured at fair value through othercomprehensive income

3,035

2,460

Remeasurement gains (losses) on defined benefit plans

1,634(1,406)

Share of other comprehensive income of investments
accounted for using equity method

(74)

–

Total items that will not be reclassified to profit or loss

4,595

1,054

195

337

455,403285,720

Financial assets measured at fair value through othercomprehensive income

–

(209)

Share of other comprehensive income of investments
accounted for using equity method

48,397(2,533)503,995

283,315

508,590

284,369

994,545616,945

Owners of parent

975,145591,848

Non-controlling interests

19,40025,096Comprehensive income

994,545616,945

Other comprehensive income
Items that will not be reclassified to profit or loss

Items that may be reclassified subsequently to profit or loss
Cash flow hedges
Exchange differences on translation of foreign operation

Total items that may be reclassified subsequently to
profit or loss
Other comprehensive income, net of tax
Comprehensive income
Comprehensive income attributable to-5-(3) Consolidated Statement of Changes in Equity(Millions of yen)
Equity attributable to owners of parent
Other components of equity
Common stock

As of January 1, 2022

Capital surplus Retained earnings Treasury stock

Exchangedifferences on
Cash flow hedges
translation offoreign operation

290,809

678,949

2,180,837(75,425)–(16,171)

Profit––498,452–––

Other comprehensive income

–

–

–

–

423,504

48,592––

498,452–

423,504

48,592

Total comprehensive income
Purchase of treasury stock

–

–

–

(121,191)––

Disposal of treasury stock

–

(10)

–

10

–

–

Cancellation of treasury stock––(75,248)

75,248––Dividends––(80,426)

–

–

–

–

–

–

–

–

–

–

19

–

–

–

–

Share-based payment transactions

–

154

–

–

–

–

Transfer from other components of equity toretained earnings––(1,616)

–

–

–

–

163

(157,291)(45,932)––

290,809679,113

2,521,998(121,358)

423,504

32,421

Increase (decrease) by businesscombination
Changes in ownership interest in
subsidiaries

Total transactions with owners
As of December 31, 2022

Equity attributable to owners of parent
Other components of equity
Financial assets
measured at fair Remeasurement
value through gains (losses) on
other
defined benefit
comprehensive
plansincomeAs of January 1, 2022

Non-controllinginterests

Total

Total

Total

(25,319)–(41,490)

3,033,680

211,2243,244,904–––

498,452(12,497)

485,955

2,961

1,633

476,692

476,692

31,898508,590

Total comprehensive income

2,961

1,633

476,692

975,145

19,400994,545

Purchase of treasury stock

–

–

–

(121,191)–(121,191)

Disposal of treasury stock

–

–

–

–

–

–

Cancellation of treasury stock

–

–

–

–

–

–

Dividends–––(80,426)(11,140)(91,567)

–

–

–

–

20,061

20,061

–

–

–

19

21,63321,653

–

–

–

154

–

154

3,250

(1,633)

1,616

–

–

–

3,250

(1,633)

1,616(201,443)

30,553(170,890)(19,107)–436,818

3,807,381

261,178

4,068,560

ProfitOther comprehensive income

Increase (decrease) by businesscombination
Changes in ownership interest in
subsidiaries
Share-based payment transactions
Transfer from other components of equity toretained earnings
Total transactions with owners
As of December 31, 2022

-6-

(Millions of yen)
Equity attributable to owners of parent
Other components of equity
Common stock

As of January 1, 2023

Capital surplus Retained earnings Treasury stock

Exchangedifferences on
Cash flow hedges
translation offoreign operation

290,809679,113

2,521,998(121,358)

423,504

32,421

Profit––321,708–––

Other comprehensive income

–

–

–

–

271,491(2,196)

Total comprehensive income––

321,708–

271,491(2,196)

Purchase of treasury stock

–

–

–

(99,999)––

Disposal of treasury stock

–

(28)

–

28

–

–

Dividends––(90,176)–––

Changes in ownership interest in
subsidiaries

–

(159)

–

–

–

–

Share-based payment transactions

–

205

–

–

–

–

Transfer from other components of equity toretained earnings––(7,000)

–

–

–

–

18

(97,176)(99,971)––

290,809679,1312,746,530(221,330)

694,996

30,224

Total transactions with owners
As of December 31, 2023

Equity attributable to owners of parent
Other components of equity
Financial assets
measured at fair Remeasurement
value through gains (losses) on
other
defined benefit
comprehensive
plansincomeAs of January 1, 2023

Non-controllinginterests

Total

Total

Total

(19,107)–436,818

3,807,381

261,178

4,068,560–––

321,708

10,867

332,5762,251(1,406)

270,140

270,140

14,229284,369

Total comprehensive income

2,251(1,406)

270,140

591,848

25,096

616,945

Purchase of treasury stock

–

–

–

(99,999)–(99,999)

ProfitOther comprehensive income

Disposal of treasury stock

–

–

–

–

–

–

Dividends–––(90,176)(8,294)(98,471)

Changes in ownership interest in
subsidiaries

–

–

–

(159)

11,952

11,792

Share-based payment transactions

–

–

–

205

–

205

5,594

1,406

7,000

–

–

–

5,594

1,406

7,000

(190,129)

3,657(186,472)(11,261)–

713,959

4,209,101

289,932

4,499,033

Transfer from other components of equity toretained earnings
Total transactions with owners
As of December 31, 2023

-7-

(4) Consolidated Statement of Cash Flows(Millions of yen)
For the year ended
December 31, 2022

Accounts

For the year ended
December 31, 2023

Cash flows from operating activities
Profit before tax

1,445,382

1,253,384

Depreciation and amortization

306,063319,608

Impairment loss

146,343

100,890

Increase (decrease) in asset retirement obligations(26,617)

9,597

Finance costs (income)

58,285(139,194)

Foreign exchange loss (gain)(45,354)(12,437)

Share of loss (profit) of investments accounted for using
equity method(166,253)(18,389)

Decrease (increase) in inventories(18,649)

4,204

Decrease (increase) in trade and other receivables(52,407)75,828

Increase (decrease) in trade and other payables

32,684(28,888)

Other operating activities(36,951)

6,243

1,642,525

1,570,847

Interest received

49,806

107,978

Dividends received

20,281

9,079

Interest paid

(24,768)(63,059)

Income taxes paid

(905,570)(836,716)

Net cash provided by (used in) operating activities

782,274

788,130

Payments into time deposits(47,755)(38,145)

Proceeds from withdrawal of time deposits

43,772

26,831(18,052)(47,985)(221,530)(202,665)(4,101)(1,484)

Payments for purchases of investments(78,118)(432,325)

Proceeds from sale and redemption of investments

19,830312,727(68,380)(76,549)

27,311–(31,410)–

Subtotal

Cash flows from investing activities

Payments for acquisition of exploration and evaluation
assetsPayments for acquisition of development and production
assetsPayments for purchases of other property, plant andequipment

Payments for purchases of investments accounted for using
the equity method
Proceeds from sale of investments accounted for using theequity method
Payments for acquisition of subsidiaries

399(1,999)Long-term loans madeNet decrease (increase) in short-term loans receivable(335,298)(4,027)

Collection of long-term loans receivable

158,440

152,153

Other investing activities

19,769(6,645)(535,123)(320,116)

Net cash provided by (used in) investing activities-8-

(Millions of yen)
For the year ended
December 31, 2022

Accounts

For the year ended
December 31, 2023

Cash flows from financing activities
Net increase (decrease) in short-term borrowings(5,450)20,121

Proceeds from long-term borrowings

164,716

102,895

Repayments of long-term borrowings(215,157)(403,599)

Repayments of lease liabilities(19,384)(20,119)

Purchase of treasury stock(121,191)(99,999)

Cash dividends paid

(80,399)(90,147)

Capital contribution from non-controlling interests

21,653

11,792

Cash dividends paid to non-controlling interests(11,140)(8,294)

Other financing activities

19,75680

Net cash provided by (used in) financing activities(246,597)(487,272)

Net increase (decrease) in cash and cash equivalents

553(19,258)

Cash and cash equivalents at beginning of the year

192,254208,238

Effect of exchange rate changes on cash and cash equivalents

19,673

12,169Net increase (decrease) in cash and cash equivalents resulting
from transfer to assets held for sale

(4,243)–

Cash and cash equivalents at end of the year

208,238

201,149-9-

(5) Notes to Consolidated Financial Statements(Conditions or events that indicate there could be substantial doubt about the Company’s ability to continue as a going concern)
None(Segment information)
For the year ended December 31, 2022 (January 1, 2022 through December 31, 2022)(Millions of yen)
Reportable segments
Other
*1

Oil & Gas Overseas
Oil & Gas Japan

Total

Adjustments*2

Consolidated

Ichthys Project

Other Projects

214,600

368,503

1,712,751

20,2312,316,086–

2,316,086

6,102

23,348–

5,513

34,964(34,964)–

Total

220,703391,851

1,712,751

25,744

2,351,051(34,964)

2,316,086

Exploration expenses(829)(2,683)(9,189)–(12,702)–(12,702)–148,587

16,066

1,599

166,253–

166,253549

62,1389,960

132

72,7801,039

73,820

Revenue
Revenue from external customers
Intersegment revenue

Share of profit (loss) of investments
accounted for using equity method
Finance income
Finance costs(808)(105,254)(25,745)(204)(132,014)(91)(132,105)

Income tax expense(18,581)(44,399)(896,935)(5,426)(965,342)

5,915(959,427)

Segment profit (loss)

45,205288,388

117,772(4,856)446,51051,942

498,452

Depreciation and amortization

17,820111,106

174,212894

304,033

2,029

306,063

Impairment loss *3

9,707

3,732

132,903–

146,343–

146,343

19,20286,746

186,881

75,834

368,665–

368,665(Other items)

Investments for exploration anddevelopment, etc. *4
Notes:

1.

The “Other” category consists of the operating segments that are not included in the reportable segments, and includes the five net-zerobusinesses, etc.

2.

Adjustments are as follows:(1) Adjustments of segment profit (loss) include corporate profit (loss) of ¥50,322 million that is not allocated to reportable segments or the“Other” category and elimination of intersegment transactions of ¥1,620 million. Corporate profit (loss) mainly consists of foreign exchange
gains (losses) of ¥39,745 million managed on a Group-wide basis and ¥5,915 million as the portion of the amount of the income tax expense of
the parent and the financial subsidiary attributable to all companies.
(2) Adjustments of depreciation and amortization are depreciation and amortization that are not allocated to reportable segments or the “Other”
category.
3.

Impairment loss consists of impairment loss on oil and gas assets, and does not include impairment loss on investments accounted for using
equity method.

4.

Investments for exploration and development, etc., consist of mainly payments for acquisition of exploration and evaluation assets anddevelopment and production assets among oil and gas assets, and the total amount incurred during the fiscal year for payments to acquire shares
to participate and make additional investments in projects such as oil, natural gas, and renewable energy. The amount corresponding to theGroup’s investment stake in Ichthys LNG Pty Ltd, a jointly controlled entity, is included in this amount.

- 10 -

For the year ended December 31, 2023 (January 1, 2023 through December 31, 2023)(Millions of yen)
Reportable segments
Other
*1

Oil & Gas Overseas
Oil & Gas Japan

Ichthys Project

Other Projects

373,173

1,528,264

Total

Adjustments*2

Consolidated–

2,164,516

Revenue
Revenue from external customers
Intersegment revenue

232,897

30,181

2,164,516

6,974

20,446–

13,976

41,397(41,397)–

Total

239,872

393,619

1,528,264

44,1582,205,914(41,397)

2,164,516

Exploration expenses(7,112)(8,976)(9,811)–(25,901)–(25,901)–

39,2196,614(27,444)

18,389–18,389Finance income

9191,271

22,772

1,924

215,977

1,332

217,310

Finance costs(844)(29,437)(44,757)(2,477)(77,516)(600)(78,116)

Income tax expense(15,581)(87,610)(796,261)(3,849)(903,303)(17,504)(920,807)

Segment profit (loss)

42,035309,898746(18,028)

334,652(12,944)

321,708

19,185

128,596

168,547

1,061

317,390

2,218

319,608––

100,890–

100,890–

100,890

10,975104,254

142,527

77,357335,115–

335,115

Share of profit (loss) of investments
accounted for using equity method(Other items)
Depreciation and amortization
Impairment loss *3
Investments for exploration anddevelopment, etc. *4
Notes:

1.

The “Other” category consists of the operating segments that are not included in the reportable segments, and includes the five net-zerobusinesses, etc.

2.

Adjustments are as follows:(1) Adjustments of segment profit (loss) include corporate profit (loss) of ¥(14,949) million that is not allocated to reportable segments or the“Other” category and elimination of intersegment transactions of ¥2,005 million. Corporate profit (loss) mainly consists of foreign exchange
gains (losses) of ¥(2,738) million managed on a Group-wide basis and ¥(17,504) million as the portion of the amount of the income tax
expense of the parent and the financial subsidiary attributable to all companies.
(2) Adjustments of depreciation and amortization are depreciation and amortization that are not allocated to any reportable segment or the “Other”
category.
3.

Impairment loss consists of impairment loss on oil and gas assets, and does not include impairment loss on investments accounted for using
equity method.

4.

Investments for exploration and development, etc., consists of mainly payments for acquisition of exploration and evaluation assets anddevelopment and production assets among oil and gas assets and the total amount incurred during the fiscal year for payments to acquire shares
to participate and make additional investments in projects such as oil, natural gas, and renewable energy. The amount corresponding to theGroup’s investment stake in Ichthys LNG Pty Ltd, a jointly controlled entity, is included in this amount.

- 11 -

(Per share information)
Basic and diluted earnings per share are calculated based on the following:
For the year ended
December 31, 2022
Profit attributable to owners of parent (Millions of yen)
Profit not attributable to common stock of parent
Dividends on Class A stock (Millions of yen)
Profit used to calculate basic earnings per share (Millionsof yen)Profit adjustments (Millions of yen)
Profit used to calculate diluted earnings per share(Millions of yen)
Average number of shares of common stock during theperiod (Shares)
Effect of dilutive potential shares of common stock
Board Incentive Plan Trust (Shares)
Average number of dilutive potential shares (Shares)
Basic earnings per share (Yen)
Diluted earnings per share (Yen)(Note)For the year ended
December 31, 2023

498,452

321,708(0)(0)

498,452

321,708––

498,452

321,708

1,366,647,207

1,294,325,142

603,363897,292

1,367,250,570

1,295,222,434

364.73364.57248.55248.38The Company’s shares (common stock) held by the Board Incentive Plan Trust are recognized as treasury stock, and thus the number of shares isdeducted from the average number of shares of common stock during the period when calculating basic earnings per share and diluted earnings per
share.

(Significant subsequent events)
None- 12 -

(First-time adoption)
Starting from the year ended December 31, 2023, the Group discloses consolidated financial statements in accordance with IFRS.
The most recent consolidated financial statements prepared in accordance with Japanese GAAP is for the year ended December
31, 2022, and the date of transition to IFRS is January 1, 2022.
In principle, under IFRS, a company adopting IFRS for the first time (hereinafter “first-time adopter”) is required to apply thestandards under IFRS retrospectively. However, IFRS 1 “First-time Adoption of International Financial Reporting Standards”(hereinafter “IFRS 1”) provides optional exemptions to retrospective application and mandatory exceptions prohibiting
retrospective application of certain standards required under IFRS. The effect of the adoption of these provisions is adjusted inretained earnings or accumulated other comprehensive income at the date of transition to IFRS. The exemptions adopted by theGroup for the transition from Japanese GAAP to IFRS are as follows:(1) Exemptions to IFRS 1- Business combination
A first-time adopter may elect not to apply IFRS 3 “Business Combinations” (hereinafter “IFRS 3”) retrospectively tobusiness combinations that occurred before the date of transition to IFRS. The Group has adopted this exemption and elects
not to apply IFRS 3 retrospectively to business combinations that occurred before the date of transition. As a result,amounts of goodwill and amounts equivalent to goodwill in affiliates and joint ventures arising in business combinations
that occurred before the date of transition are based on carrying amounts as of the date of transition in accordance withJapanese GAAP. Goodwill is tested for impairment as of the date of transition regardless of whether there is indication of
impairment.
- Deemed cost
IFRS 1 permits the use of fair value of property, plant and equipment and intangible assets at the date of transition to IFRS
as deemed cost at that date. The Group uses the fair value of certain oil and gas assets at the date of transition as thedeemed cost under IFRS at that date.
- Exchange differences on translation of foreign operations
IFRS 1 permits the cumulative exchange differences on translation of foreign operations to be deemed zero at the date oftransition to IFRS. The Group elects to deem zero the cumulative exchange differences on translation of foreign operations
at the date of transition.
- Leases
IFRS 1 permits a first-time adopter to assess whether a contract contains a lease at the date of transition to IFRS. The
Group has adopted this exemption and determines whether a contract contains a lease based on the facts and circumstances
existing at the date of transition.
- Decommissioning liabilities included in the cost of property, plant and equipment
For liabilities related to obligations of decommissioning, etc. included in the cost of property, plant and equipment, IFRS 1
permits a first-time adopter to either apply retrospectively from when the obligations of decommissioning, etc. occur or
measure obligations of decommissioning, etc. at the date of transition.
The Group elects to measure obligations of decommissioning, etc. included in the cost of property, plant and equipment at
the date of transition.
- Borrowing costs
IFRS 1 permits the use of the date of transition to IFRS as the commencement date for capitalization of borrowing costs on
qualifying assets. The Group has adopted this exemption and continues to expense borrowing costs for construction
projects started prior to the date of transition.

- 13 -

(2) Mandatory exceptions to IFRS 1
Under IFRS 1, retrospective application of IFRS is prohibited for “estimates,” “derecognition of financial assets andfinancial liabilities,” “hedge accounting,” “non-controlling interests,” and “classification and measurement of financial
assets.” The Group has adopted these items prospectively from the date of transition.
(3) Reconciliations
Reconciliations of equity as of January 1, 2022 (date of transition to IFRS)(Millions of yen)Line items under Japanese GAAP
AssetsCurrent assets
Cash and deposits
Accounts receivable-trade andcontract assets
Inventories
Accounts receivable-other

Other
Allowance for doubtful
accounts
Total current assets

Japanese GAAP
(Note)

Reclassification

Effects ofdifferences inrecognition andmeasurement

IFRS

Notes

Line items under IFRS

201,765(9,772)

261

192,254(a)(l)

AssetsCurrent assets
Cash and cash equivalents

168,224

28,635

1,593

198,454(b)(l)

Trade and other receivables

47,81742,309–––70,852

3,803(42,309)
2,646
35,474
12,707(35,509)(4,228)
–
(26)
2,891
1,165
(2,726)47,393–2,619
38,366
13,872
32,616(l)(b)(c)(d)(d)(c)(a)(c)(c)(l)

Inventories(12,104)

12,104––

518,864

7,782(1,069)525,576(b)
Total current assets

Fixed assets

Non-current assets
2,259,849

871,893

160,638

3,292,382(e)(l)(m)(n)(q)(u)–27,753

3

27,757(e)(n)–
446,660

29,550(440,612)(29,550)
0

–
6,048

(f)(o)(e)(f)–

342,874(17,734)

325,139(g)(r)

Investment securities
Long-term loans receivable
Recoverable accounts under
production sharing
Deferred tax assets
Other
Allowance for doubtful
accounts
Allowance for recoverable
accounts under production
sharing
Allowance for investments in
exploration

397,953
1,011,801(350,444)
–

3,078
2

50,587
1,011,804(c)(g)

548,170(548,170)––(e)(l)

21,713
11,704

–
6,968

5,563
(189)

27,27618,483

(s)
(l)

(652)

652

–

–

(61,871)

61,871––(1,400)

1,400

–

–

Total fixed assets

4,633,928

3,737

121,8124,759,479

5,152,792

11,519120,743

5,285,056

Tangible fixed assets

Intangible assets

Total assets(Note)

Income taxes receivable
Loans receivable
Other financial assets
Other current assets

Oil and gas assets
Other property, plant andequipment
Goodwill
Intangible assets
Investments accounted forusing equity method
Other financial assets
Loans receivable

Deferred tax assets
Other non-current assets(e)Total non-current assets
Total assets

Some of the Group’s foreign consolidated subsidiaries and foreign equity-method affiliates have applied IAS 12 “Income Taxes” (amended in May2021) from the year ended December 31, 2023. The amendments have been applied retrospectively, and Japanese GAAP as of January 1, 2022 (dateof transition to IFRS) provides figures after retrospective application.

- 14 -

(Millions of yen)Line items under Japanese GAAP

Liabilities
Current liabilities
Accounts payable-trade
Short-term loans
Income taxes payable
Accounts payable-other
Provision for bonuses
Provision for bonuses to
officers
Provision for loss on business
Provision for exploration
projects
Asset retirement obligations

Japanese GAAP
(Note)

Reclassification

Effects ofdifferences inrecognition
andmeasurement

IFRS

Notes

14,88880,49351,35098,518
1,386

136,877––(98,518)(1,386)(5,241)
–
(504)
–
–

146,524
80,49350,845
–
–

200

(200)

–

–

9,400

(9,400)

–

–

9,444

(9,444)

–

–

Other

672
–
82,533–30,498(36,906)

593
8,847(7,057)

1,266
39,34538,570Total current liabilities

348,888

11,519(3,362)357,045

30,0001,069,721
109,565100

1,069,721(1,069,721)
–
(100)

–
–
27,872–

1,099,721–
137,437
–

650

(650)

–

–

7,048

–

4

7,052

258,339–
15,845–
14,953(14,303)

106,491
57,337
231

364,830
72,291
1,773

Long-term liabilities
Bonds payable
Long-term debt
Deferred tax liabilities
Provision for stocks payment
Provision for special repair
and maintenance
Liability for retirement
benefits
Asset retirement obligations
Other
Total long-term liabilities
Total liabilities
Net assets
Common stock
Capital surplus
Retained earnings
Treasury stock
Accumulated othercomprehensive income
Non-controlling interests(h)(l)

Line items under IFRS

Liabilities and equity
Liabilities
Current liabilities
Trade and other payables
Bonds and borrowings
Income taxes payable

(h)

(q)
(i)(n)(h)(i)(l)Asset retirement obligations
Other financial liabilities
Other current liabilities
Total current liabilities

(j)
(j)
(s)

(q)
(i)(n)(i)

Non-current liabilities
Bonds and borrowings
Deferred tax liabilities

Liability for retirement
benefits
Asset retirement obligations
Other financial liabilities
Other non-current liabilities

1,491,270(100)

191,936

1,683,105

1,840,159

11,418

188,573

2,040,151

Total liabilities

Total non-current liabilities

290,809681,398
1,750,065(75,425)

–
100
–
–

–
(2,549)430,771–

290,809
678,949
2,180,837(75,425)

EquityCommon stock
Capital surplus
Retained earnings
Treasury stock

443,441–(484,932)(41,490)(p)(u)(v)(t)(w)

Other components of equity

222,344–(11,119)

211,224

Total net assets

3,312,633

100(67,830)

3,244,904

Total equity

Total liabilities and net assets

5,152,792

11,519120,743

5,285,056

Total liabilities and equity(Note)

Non-controlling interests

Some of the Group’s foreign consolidated subsidiaries and foreign equity-method affiliates have applied IAS 12 “Income Taxes” (amended in May2021) from the year ended December 31, 2023. The amendments have been applied retrospectively, and Japanese GAAP as of January 1, 2022 (dateof transition to IFRS) provides figures after retrospective application.

- 15 -

Reconciliations of equity as of December 31, 2022 (date of most recent consolidated financial statements prepared underJapanese GAAP)(Millions of yen)Line items under Japanese GAAP
AssetsCurrent assets
Cash and deposits
Accounts receivable-trade andcontract assets
Securities
Inventories
Accounts receivable-other

Other
Allowance for doubtful
accounts
Total current assets

Japanese GAAP
(Note)

Reclassification

Effects ofdifferences inrecognition andmeasurement

IFRS

Notes

Line items under IFRS

227,829(19,628)37

208,238(a)(k)(l)AssetsCurrent assets
Cash and cash equivalents

252,938

34,320193

287,452(b)(k)(l)Trade and other receivables

58,152
68,15461,758–––73,588(58,152)
4,883(61,758)
5,948
32,18084,635(31,750)–(1,130)
–
–
(1)
404
(419)

–
71,907–
5,948
32,17985,03941,417(c)(k)(l)(b)(c)(d)(d)(c)(a)(c)(c)(k)(l)(13,020)

13,020––729,401

3,697

(915)

732,183–

26,422–

26,422

729,401

30,118(915)

758,605

Intangible assets

Investment securities
Long-term loans receivable
Recoverable accounts under
production sharing
Deferred tax assets
Asset for retirement benefits
Other
Allowance for doubtful
accounts
Allowance for recoverable
accounts under production
sharing
Allowance for investments in
exploration
Total fixed assets
Total assets(Note)

Income taxes receivable
Loans receivable
Other financial assets
Other current assets(b)
Subtotal(k)

Assets held for sale
Total current assets

Fixed assets
Tangible fixed assets

Inventories

Non-current assets
2,473,118

855,338

212,050

3,540,507(e)(k)(l)(m)(n)(q)(u)–

27,387

3

27,390(e)(k)(n)–482,704

40,332(475,929)(20,626)0

19,706
6,775(f)(o)(e)(f)–

656,287(19,704)

636,582(g)(r)

742,914
1,279,383(679,963)–(2,801)(243)

60,1491,279,140(c)(g)

521,541(521,541)––(e)(l)

69,705
1,734
15,765––23,871

7,836
–
643

77,541
1,734
40,280

(s)

(690)

690

–

–

(53,873)

53,873––(1,852)

1,852

–

–

5,530,452(17,800)

177,157

5,689,809

6,259,853

12,318176,2416,448,414(k)(l)

Oil and gas assets
Other property, plant andequipment
Goodwill
Intangible assets
Investments accounted forusing equity method
Other financial assets
Loans receivable

Deferred tax assets
Asset for retirement benefits
Other non-current assets(e)Total non-current assets
Total assets

Some of the Group’s foreign consolidated subsidiaries and foreign equity-method affiliates have applied IAS 12 “Income Taxes” (amended in May2021) from the year ended December 31, 2023. The amendments have been applied retrospectively, and Japanese GAAP as of December 31, 2022
(date of the most recent consolidated financial statements prepared under Japanese GAAP) provides figures after retrospective application.

- 16 -

(Millions of yen)Line items under Japanese GAAP

Liabilities
Current liabilities
Accounts payable-trade
Short-term loan
Income taxes payable
Accounts payable-other
Provision for bonuses
Provision for bonuses to
officers
Provision for loss on business
Provision for exploration
projects
Asset retirement obligations

Japanese GAAP
(Note)

Reclassification

Effects ofdifferences inrecognition andmeasurement

IFRS

Notes

47,18375,878
126,675
118,448
1,458

163,127––(118,448)(1,458)

526
–
69
–
–

210,836
75,878
126,745
–
–

130

(130)

–

–

8,631

(8,631)

–

–

3,391

(3,391)––

15,504–(37)
74,271(5,366)
7,562

10,10081,833

Other

129,439(96,005)(2,311)

31,122

Total current liabilities

526,740

9,296

480

536,517Long-term liabilities
Bonds payable
Long-term debt
Deferred tax liabilities
Provision for stocks payment
Provision for special repair
and maintenance
Liability for retirement
benefits
Asset retirement obligations
Other
Total long-term liabilities
Total liabilities
Net assets
Common stock
Capital surplus
Retained earnings
Treasury stock
Accumulated othercomprehensive income
Non-controlling interests(h)(k)(l)Line items under IFRS
Liabilities and equity
Liabilities
Current liabilities
Trade and other payables
Bonds and borrowings
Income taxes payable(h)(k)(q)(i)(n)(h)(i)(k)(l)

Asset retirement obligations
Other financial liabilities
Other current liabilities
Subtotal(k)

Liabilities directly related toassets held for sale

–

4,213

–

4,213

526,740

13,508480

540,730

30,0001,164,369
192,507245

1,164,369(1,164,369)
–
(245)

–
–
42,048–1,194,369–
234,556
–

705

(705)

–

–

689

–

–

689

303,159–
19,064(1,190)15,366(14,660)

32,26655,43962334,234
70,8054,466

1,710,742(1,435)

129,816

1,839,123

2,237,483

12,073130,296

2,379,854

Total liabilities

290,809683,382
2,055,459(121,358)

–
245
–
–

–
(4,514)
466,538–

290,809679,113
2,521,998(121,358)

EquityCommon stock
Capital surplus
Retained earnings
Treasury stock

852,558–(415,739)

436,818(p)(u)(v)(t)

Total current liabilities

(j)
(j)
(s)

(k)(q)(i)(n)(i)

Non-current liabilities
Bonds and borrowings
Deferred tax liabilities

Liability for retirement
benefits
Asset retirement obligations
Other financial liabilities
Other non-current liabilities
Total non-current liabilities(w)

Other components of equity

261,517–(339)

261,178

Total net assets

4,022,370

245

45,944

4,068,560

Total equity

Total liabilities and net assets

6,259,853

12,318176,2416,448,414

Total liabilities and equity(Note)

Non-controlling interests

Some of the Group’s foreign consolidated subsidiaries and foreign equity-method affiliates have applied IAS 12 “Income Taxes” (amended in May2021) from the year ended December 31, 2023. The amendments have been applied retrospectively, and Japanese GAAP as of December 31, 2022
(date of the most recent consolidated financial statements prepared under Japanese GAAP) provides figures after retrospective application.

- 17 -

Notes on reconciliations of equity(i) Reclassification(a) Cash and cash equivalents
Time deposits with deposit terms of more than three months, which were included in “Cash and deposits”
under Japanese GAAP, have been reclassified as “Other financial assets” in current assets under IFRS.
(b)

Trade and other receivables
Part of “Accounts receivable-other” and “Allowance for doubtful accounts” in current assets, which were
presented separately under Japanese GAAP, have been reclassified as “Trade and other receivables” under
IFRS.

(c)

Other financial assets“Securities” and part of “Accounts receivable-other,” which were presented separately, and loans receivable
included in “Other” in current assets under Japanese GAAP, have been reclassified as “Other financial
assets” in current assets and “Loans receivable” under IFRS.
In addition, investment securities other than “investments accounted for using equity method,” which were
included in “investment securities” under Japanese GAAP, have been reclassified as “Other financial assets”
in non-current assets under IFRS.

(d)Income taxes receivable“Income taxes receivable,” which was included in “Accounts receivable-other” under Japanese GAAP, ispresented separately under IFRS.

(e)

Oil and gas assets
Assets related to oil and gas exploration, evaluation, development, and production activities, which were
presented as “Intangible assets,” “Recoverable accounts under production sharing,” and “Allowance forrecoverable accounts under production sharing” under Japanese GAAP, have been reclassified as “Oil andgas assets” under IFRS.
In addition, property, plant and equipment other than assets related to oil and gas, which was included in“Tangible fixed assets” under the Japanese GAAP, has been reclassified as “Other property, plant andequipment” under IFRS.

(f)

Goodwill“Goodwill,” which was included in “Intangible assets” under Japanese GAAP, is presented separately under
IFRS.

(g)

Investments accounted for using equity method“Investments accounted for using equity method,” which was included in “Investment securities” underJapanese GAAP, is presented separately under IFRS.

(h)

Trade and other payables“Accounts payable-other,” which was presented separately under Japanese GAAP, and part of accrued
expenses included in “Other” in current liabilities under Japanese GAAP, have been reclassified as “Tradeand other payables” under IFRS.

(i)Other financial liabilities
Lease liabilities and deposits payable, which were included in “Other” in current liabilities and “Other” inlong-term liabilities under Japanese GAAP, have been reclassified as “Other financial liabilities” in current
liabilities and “Other financial liabilities” in non-current liabilities under IFRS.

(j)

Bonds and borrowings“Bonds payable” and “Long-term debt,” which were presented separately under Japanese GAAP, have been
reclassified as “Bonds and borrowings” in non-current liabilities under IFRS.

- 18 -

(k)Assets held for sale and liabilities directly related to assets held for sale
“Assets held for sale” and “Liabilities directly related to assets held for sale” are presented separately inaccordance with IFRS presentation rules.

(l)

Invested capital for joint operations
Invested capital related to production sharing contract projects, which was included in “Recoverable
accounts under production sharing” under Japanese GAAP, is measured as the Group’s equivalent share of
the assets and liabilities of joint operations and included in the appropriate account to represent the rights andobligations with respect to the assets and liabilities of joint operations under IFRS.

(ii) Effects of differences in recognition and measurement(m) Oil and gas assets
Under Japanese GAAP, oil and gas assets were accounted for differently depending on the type of contract.
However, under IFRS, payments related to oil and natural gas exploration and evaluation are accounted forusing the successful efforts method, and payments related to development wells and related production
facilities are recognized as oil and gas assets and depreciated using the unit-of-production method.
For certain “Oil and gas assets,” the fair value at the date of transition or the carrying amount calculated inaccordance with previous GAAP is used as the deemed cost, which is ¥83,407 million higher compared tothe carrying amount under Japanese GAAP. In addition, the fair value at the date of transition considering theincrease, etc. from the recognition of lease assets (right-of-use assets) and the capitalization of asset
retirement obligation costs is ¥693,892 million. Fair value is estimated using the discounted cash flow
method and is classified as Level 3. The main unobservable inputs used in the fair value measurement are theoutlook for future oil prices and the reserves.
(n)Lease assets and lease liabilities
Under Japanese GAAP, operating lease transactions by a lessee are expensed as rental transactions. However,under IFRS, in principle, lease assets (right-of-use assets) and lease liabilities are recognized for all leasetransactions by a lessee. Lease assets (right-of-use assets) are included in “Oil and gas assets” and “Other
property, plant and equipment,” and lease liabilities are included in “Other financial liabilities” in current
liabilities and “Other financial liabilities” in non-current liabilities.

(o)

Goodwill
Under Japanese GAAP, limited to cases where there are indications of impairment in the group of cashgenerating units, including goodwill, the Group had determined whether to recognize an impairment loss bycomparing the carrying amount of the asset with the total undiscounted future cash flows expected from thegroup of cash-generating units, including goodwill in question. However, under IFRS, the recoverable
amount is calculated as value in use based on the discounted future cash flows expected from the group of
cash-generating units, including goodwill in question, and an impairment loss is recognized if therecoverable amount is less than the carrying amount.
As a result of the goodwill impairment test performed on the date of transition, for ¥29,550 million of
goodwill allocated to the group of cash-generating units of “Oil & Gas Japan” segment, the carrying amountof the group of cash-generating units was reduced to its recoverable amount, and the entire amount of
goodwill was reduced from retained earnings, as the initially anticipated future cash flow was no longer
expected.
The recoverable amount is measured by value in use and is ¥281,163 million Value in use is calculated bydiscounting estimated cash flows to present value for the period covered by the business plans approved bymanagement and for the subsequent period considered for the volume of LNG received from natural gas
production from mining areas in Japan, the Group’s own mining areas, etc. The key assumptions used in thiscalculation are future sales volume and crude oil and natural gas prices, and the assumptions are based on thebest estimates by management taking into account various factors, such as the impact of the spread of
COVID-19, that are considered reasonable on the date of transition. The discount rate is determined based on
the pre-tax weighted average cost of capital of the group of cash-generating units, and the discount rate used
to calculate value in use is 6.4%.

- 19 -

(p)Financial assets measured at fair value through other comprehensive income
Under Japanese GAAP, gains (losses) on sale or impairment losses on investment securities were treated as
profit or loss. However, under IFRS, for equity financial instruments designated to be measured at fair value
through other comprehensive income, changes in fair value are recognized in other comprehensive income
and transferred to retained earnings when they are derecognized.

(q)

Asset retirement obligations and the corresponding asset retirement costs
Under Japanese GAAP, asset retirement obligations and the corresponding asset retirement costs related to
production sharing contract projects were not recognized. However, under IFRS, in principle, asset
retirement obligations and the corresponding asset retirement costs related to all projects, including
production sharing contracts, are recognized.
In addition, under Japanese GAAP, discount rates were subject to review in the event of significant changes
to estimates associated with increases in undiscounted cash flows used in the calculation of asset retirement
obligations. However, under IFRS, adjustments are made to reflect the latest and best estimates, which
entails reassessing asset retirement obligations at the end of each reporting period and accordingly reviewing
the discount rate.

(r)

Investments accounted for using equity method
Due to the adoption of IFRS, the carrying amount of “Investments accounted for using equity method” hasdecreased compared to Japanese GAAP due to changes in the adjustments to the financial statements of somejoint ventures when the accounting policies differ from those adopted by the Group.

(s)

Deferred tax assets and deferred tax liabilities
With the adoption of IFRS, the recoverability of all deferred tax assets has been reassessed. In addition,deferred tax assets and deferred tax liabilities have been recognized for temporary differences arising fromthe adjustments from Japanese GAAP to IFRS.

(t)

Non-controlling interests
The related non-controlling interests have been adjusted for the differences in recognition and measurement
arising from the reconciliations from Japanese GAAP to IFRS.
Under Japanese GAAP, if the amount of losses of a subsidiary that is allocated to non-controlling interests inthe subsidiary exceeds the amount that should be borne by the non-controlling shareholders, the excess
amount is borne by the parent company’s equity. However, under IFRS, regardless of whether or not
subsidiaries have recognized losses, total comprehensive income from the date of transition and onwards isborne by both equity attributable to owners of parent and non-controlling interests.

(u)Functional currency of subsidiaries
Under Japanese GAAP, financial statements were prepared based on the currency of the country where thesubsidiary is located. However, under IFRS, the functional currency is determined, and financial statements
are prepared based on the functional currency of each company. For consolidation purposes, exchange
differences arising from translation to Japanese yen, which serves as the Group’s presentation currency forthe consolidated financial statements, are recorded in other comprehensive income.
In accordance with the aforementioned, for subsidiaries incorporated in Japan for whose functional currency
is deemed to be the US dollar under IFRS, whereas under Japanese GAAP, the exchange rate on thetransaction date was used for translation to Japanese yen for transactions in US dollars, under IFRS, certain
non-monetary items denominated in US dollars (including oil and gas assets) within those subsidiaries aretranslated to Japanese yen using the exchange rate at the end of the fiscal year in the process of translating
the assets and liabilities of those subsidiaries to Japanese yen, given that the currency used for transaction
and functional currency are both US dollars.

(v)

Accumulated exchange differences on translation of foreign operations
The Group has elected the exemption provided in IFRS 1 at first-time adoption, and transferred allaccumulated exchange differences on translation of foreign operations to retained earnings at the date oftransition.

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(w) Reconciliations of retained earnings(Millions of yen)
As of January 1, 2022

As of December 31, 2022(m) Oil and gas assets

62,737(43,119)(o) Goodwill(p) Financial assets measured at fair value through other(29,550)(20,586)

28,09919,470(86,720)

8,124

comprehensive income(q) Asset retirement obligations and the corresponding
asset retirement costs(r) Investments accounted for using equity method(14,342)(13,781)(s) Deferred tax assets and deferred tax liabilities(t) Non-controlling interests(20,817)
11,119(32,618)
27,238(u) Functional currency of subsidiaries(v) Accumulated exchange differences on translation of

15,611

65,671456,972

456,972

7,662

(832)

430,771466,538

foreign operations
Other
Total

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Reconciliations of profit or loss and comprehensive income for the year ended December 31, 2022 (January 1, 2022
through December 31, 2022) (year of most recent consolidated financial statements prepared under Japanese GAAP)(Millions of yen)

Net sales
Cost of sales

2,324,660
943,414–
8,391

Effects ofdifferences inrecognition andmeasurement(8,573)(133,675)

Gross profit

1,381,245(8,391)

125,102

1,497,956

29,202–(16,500)

12,702(e)

105,634(184)(13,475)

91,975(f)––

88,90536,731

7,066
115,104

95,971
151,836(a)(j)(a)(g)–

165,684

569

166,253(a)1,246,408
335,638
140,051
25,799––209,650(335,638)(140,051)(25,799)
80,850120,815

47,608–––(7,030)11,2901,503,667–––
73,820132,105

(a)
(a)
(a)
(a)(h)(a)(i)

Income before income taxes
Income taxes-current
Income taxes-deferred

1,416,196
952,982(1,476)(102)(1,578)1,476

29,2888,022–

1,445,382
959,427–(b)(b)

Net income
Other comprehensive income

464,689–

21,265

485,955

1,581

–

1,454

3,035

–

–

1,634

1,634

–

(73)

0

(74)

Deferred gain (loss) onhedges

195

–

–

195

Translation adjustments

355,243–

100,159

455,403

Share of other comprehensive
income of affiliates accounted
for by the equity-method

59,06073(10,737)

48,397

Total other comprehensive
income416,081–

92,509508,590

880,770–

113,775

994,545

Line items under Japanese GAAP Japanese GAAP
(summary)(Note)

Exploration expenses
Selling, general andadministrative expenses

Operating income
Other income
Other expenses
Extraordinary loss

Unrealized holding gain (loss)
on securities

Comprehensive income(Note)

Reclassification

IFRS

Notes

2,316,086
818,130(j)(a)(c)(d)Line items under IFRSRevenue
Cost of sales
Gross profit
Exploration expenses
Selling, general andadministrative expenses
Other operating income
Other operating expenses
Share of profit (loss) ofinvestments accounted for using
equity method
Operating profit(h)Finance income
Finance costs
Profit before tax
Income tax expense
ProfitOther comprehensive income
Items that will not bereclassified to profit or loss
Financial assets measured atfair value through othercomprehensive income
Remeasurement gains (losses)
on defined benefit plans
Share of other comprehensive
income of investments
accounted for using equity
methodItems that may be reclassified
subsequently to profit or loss
Cash flow hedges(j)Exchange differences ontranslation of foreign
operations
Share of other comprehensive
income of investments
accounted for using equity
methodOther comprehensive income,net of tax
Comprehensive income

Some of the Group’s foreign consolidated subsidiaries and foreign equity-method affiliates have applied IAS 12 “Income Taxes” (amended in May2021) from the year ended December 31, 2023. The amendments have been applied retrospectively, and the year ended December 31, 2022 underJapanese GAAP (January 1, 2022 through December 31, 2022) (year of most recent consolidated financial statements prepared under JapaneseGAAP) provides figures after retrospectively application.

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Notes on reconciliations of profit or loss and comprehensive income(i) Reclassification(a) Reconciliations of line items
Items that were presented as “Other income,” “Other expenses,” and “Extraordinary loss” under Japanese
GAAP are recorded as “Finance income” and “Finance costs” for financial-related profits and losses under
IFRS. Other items are presented in “Cost of sales,” “Other operating income,” “Other operating expenses,”and “Share of profit (loss) of investments accounted for using equity method.”(b)

Income tax expense“Income taxes-current” and “Income taxes-deferred,” which were presented separately under Japanese
GAAP, are collectively presented as “Income tax expense” under IFRS.

(ii) Effects of differences in recognition and measurement(c)

Depreciation of oil and gas assets
Under Japanese GAAP, depreciation of oil and gas assets was accounted for differently depending on thetype of contract. However, under IFRS, payments related to oil and natural gas development wells andrelated production facilities and asset retirement costs for asset retirement obligations are recognized as oil
and gas assets (development and production assets) and are depreciated using the unit-of-production method
based on the total volume of proved and probable reserves after production begins.

(d)Remeasurement of asset retirement obligations
Under Japanese GAAP, discount rates were subject to review in the event of significant changes to estimatesassociated with increases in undiscounted cash flows used in the calculation of asset retirement obligations.
However, under IFRS, adjustments are made to reflect the latest and best estimates, which entails reassessing
asset retirement obligations at the end of each reporting period and accordingly reviewing the discount rate.

(e)

Exploration expenses
Under Japanese GAAP, exploration expenses were accounted for differently depending on the type ofcontract. However, under IFRS, payments related to oil and natural gas exploration and evaluation areaccounted for using the successful efforts method, and certain payments are recognized as oil and gas assets(exploration and evaluation assets).

(f)Non-amortization of goodwill
Because goodwill was amortized under Japanese GAAP, we recorded ¥8,963 million in amortization, but
because it is not amortized under IFRS, the amount amortized has been retrospectively restated.

(g)Impairment loss
In cases where there are indications of impairment in oil and natural gas development wells and related
production facilities, under Japanese GAAP, the Group had determined whether to recognize an impairment
loss by comparing the carrying amount of the asset in question with the total undiscounted future cash flows
expected from the asset in question. However, under IFRS, the recoverable amount is calculated as the value
in use based on the discounted future cash flows expected from the asset in question, and an impairment loss
is recognized if the recoverable amount is less than the carrying amount.
Furthermore, under Japanese GAAP, payments related to oil and natural gas exploration and evaluation were
accounted for differently depending on the type of contract. However, under IFRS, they are accounted forusing the successful efforts methods, and certain payments are recognized as assets and impairment losses
are recorded when the prospect of commercial profitability is impaired.

(h)Financial assets measured at fair value through other comprehensive income
Under Japanese GAAP, gain (loss) on sale of or impairment loss on investment securities were treated as
profit or loss. However, under IFRS, for equity financial instruments designated to be measured at fair value
through other comprehensive income, changes in fair value are recognized in other comprehensive income
and reclassified to retained earnings when they are derecognized.

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(i)Interest expense
Under Japanese GAAP, interest expenses related to production sharing contract projects were included in“Recoverable accounts under production sharing.” However, under IFRS, in principle, interest expenses
related to all projects, including production sharing contracts, are included in “Finance costs,” except forborrowing costs associated with qualifying assets that fulfill requirements for capitalization.

(j)Functional currency of subsidiaries
Under Japanese GAAP, financial statements were prepared based on the currency of the country where thesubsidiary is located. However, under IFRS, the functional currency is determined, and financial statements
are prepared based on the functional currency of each company. For consolidation purposes, exchange
differences arising from translation to Japanese yen, which serves as the Group’s presentation currency forthe consolidated financial statements, are recorded in other comprehensive income.
In accordance with the aforementioned, for subsidiaries incorporated in Japan for whose functional currency
is deemed to be the US dollar under IFRS, whereas under Japanese GAAP, the exchange rate on thetransaction date was used for translation to Japanese yen for transactions in US dollars, under IFRS, certaintransactions denominated in US dollars (including sales transactions) within those subsidiaries are translated
to Japanese yen using the average exchange rate for the reporting period in the process of translating therevenue and expenses of those subsidiaries to Japanese yen, given that the currency used for transactions andfunctional currency are both US dollars.
In addition, for subsidiaries incorporated in Japan for whose functional currency is deemed to be the US
dollar under IFRS, whereas under Japanese GAAP, exchange differences arising from translation ofmonetary receivables and payables denominated in US dollars were recognized as foreign exchange gains
and losses, under IFRS, for certain monetary items denominated in US dollars within those subsidiaries,
exchange differences arising from the process of translating the assets and liabilities of those subsidiaries toJapanese yen are recognized as other comprehensive income, given that the currency used for transactions
and functional currency are both US dollars.

Reconciliations of cash flows for the year ended December 31, 2022 (year of most recent consolidated financial
statements prepared under Japanese GAAP)
Compared with the consolidated statement of cash flows under Japanese GAAP, the consolidated statement of cash
flows under IFRS for the year ended December 31, 2022 showed an increase of ¥30,990 million in net cash provided
by operating activities, an increase of ¥9,548 million in net cash used in investing activities, an increase of ¥4,668
million in net cash used in financing activities, and a decrease of ¥16,988 million in effect of exchange rate changes
on cash and cash equivalents.
The main differences are as follows:(a) Under Japanese GAAP, payments incurred in connection with oil and natural gas operations are accounted for
differently depending on the type of contract. Cash investments made under a production sharing contract werecategorized as cash flows from operating activities and cash flows from investing activities, depending on thedetails of the contract. Under IFRS, as the Group recognizes assets, liabilities, revenue and expenses in theequivalent amount of the Group’s share regardless of the type of contract, and payments for exploration areaccounted for using the successful efforts method, the Group does not use accounts related to the recoverable
accounts under production sharing, but classifies them as cash flows from operating activities and cash flows
from investing activities according to the nature of payments. As a result, cash flows from operating activities
and cash flows from investing activities have changed.
(b) Under Japanese GAAP, lease payments under operating lease transactions were classified as cash flows fromoperating activities. However, under IFRS, lease liabilities are required to be recognized for all leases inprinciple, and repayments of lease liabilities are classified as cash flows from financing activities. As a result,cash flows from operating activities and cash flows from financing activities have changed.
(c) Under Japanese GAAP, financial statements were prepared based on the currency of the country where thesubsidiary is located. However, under IFRS, the functional currency is determined, and financial statements areprepared based on the functional currency of each company. As a result, the effect of exchange rate changes oncash and cash equivalents and each cash flow have changed.

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