Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

Abridged Translation:
The report is not audited and this translation is an abridged version prepared based on the statutory format
in Japan for reference purpose only. If there is any discrepancy between this translation and the original
Japanese version, the Japanese shall prevail.

Consolidated Financial Results
for the Fiscal Year Ended March 31, 2021
May 7, 2021
Company name:
Listing:
Stock code:
URL:
Representative:
Inquiries:TEL:

CHIYODA CORPORATION
Second Section of the Tokyo Stock Exchange
6366
http://www.chiyodacorp.com/
Masaji Santo, President& COO
Masaru Akiyama, GM, Accounting Department+81-45-225-7281

Date of general shareholders' meeting:
Dividend payable date:
Supplementary Explanation Material:
Financial Results Presentation:

June 23, 2021
Yes
Yes

Annual securities report filing date: June 23, 2021-

(Millions of yen with fractional amounts discarded, unless otherwise noted)

1. Consolidated performance for the fiscal year ended March 31, 2021
(1) Consolidated operating results(Percentages indicate year-on-year changes)

Net sales

Operating income

Millions of yen

Fiscal year ended
March 31, 2021
Fiscal year ended
March 31, 2020
Note: Comprehensive Income:%Millions of yen

Profit attributable toowners of parent

Ordinary income%

Millions of yen%

Millions of yen%

315,393 (18.3)

7,015 (73.8)

8,462 (54.6)

7,993 (34.4)

385,925

26,78918,644

12,177

12.9

Fiscal year ended March 31, 2021:
Fiscal year ended March 31, 2020:

Net income Fully diluted net
per share income per share
Yen

11,847
14,374Return on
Equity(ROE)Yen

Fiscal year ended
22.76
8.20
March 31, 2021
Fiscal year ended
40.94
15.51
March 31, 2020
Reference: Equity Gains (Losses) of Affiliated Companies--

million yen / ((17.6)%)
million yen / (－%)

Ratio of ordinary
Ratio of operating
Income to Total assets income to revenue
%

%

%

26.3

2.4

2.2

-

5.1

6.9

Fiscal year ended March 31, 2021:
Fiscal year ended March 31, 2020:

33 million yen
361 million yen(2) Consolidated financial position
Total assets
Millions of yen

As of March 31, 2021
As of March 31, 2020
Reference: Equity

Net assets

Equity ratio

Millions of yen

329,583
36,747385,051
24,943Fiscal year ended March 31, 2021:
Fiscal year ended March 31, 2020:

36,399 million
24,423 million

Net assets per share
%

Yen

11.0
6.3

(143.94)(182.07)

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

(3) Consolidated Cash Flow
Net cash provided by

Investing Activities

Millions of yen

Millions of yen

Millions of yen

Millions of yen(20,806)(2,250)9,478

98,738(32,217)(7,828)89,200115,932

Fiscal year ended
March 31, 2021
Fiscal year ended
March 31, 2020

Financing Activities

Cash and equivalents,
end of period

Operating activities

2. Cash dividends
Cash dividends per share
Record date

First quarter

SecondquarterThird quarter

Fiscal yearend

AnnualPayment of Payout ratio Dividend on
cash(consolidate) equity ratio
dividends

Yen

Yen

Yen

Yen

Yen Millions of yen%%

Fiscal year ended
March 31, 2020

－

－

－

0.00

0.00

0

0.0

－

Fiscal year ended
March 31, 2021
Fiscal year ending
March 31, 2022
(Forecast)

－

－

－

－

－

－

－

－

－

－

－

－

－

－

3. Consolidated earnings forecasts for the fiscal year ending March 31, 2022
(from April 1, 2021 to March 31, 2022)(Percentages indicate year-on-year changes)

Net sales
Fiscal year ending
March 31, 2022

Operating income

Profit attributable toowners of parent

Ordinary income

Net income
per share

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

Yen

300,000(4.9)

11,000

56.8

9,000

6.4

6,000

(24.9)

15.06

4. Others(1) Changes in Significant Subsidiaries during the Period(Changes in specified subsidiaries accompanying changes in the scope of consolidation): None
(2) Changes in Accounting Policies and Accounting Estimates / Restatements
a. Changes in accounting policies due to revisions of accounting standards, etc.:
b. Changes in accounting policies other than a. above:c. Changes in accounting estimates:
d. Restatements:

None
None
None
None

(3) Number of issued shares (common stock)a. Total number of issued shares at the end of the period (including treasury stock)
As of March 31, 2021
260,324,529 shares
As of March 31, 2020
260,324,529 sharesb. Number of treasury stock at the end of the period
As of March 31, 2021
1,357,723 shares
As of March 31, 2020
1,357,497 sharesc. Average number of shares during the period
Year ended March 31, 2021
258,966,906 sharesYear ended March 31, 2020
258,967,168 shares##This report is not reviewed by auditor.
Proper use of earnings forecasts, and other special directions
The forward-looking statements, including earnings forecasts, contained in these materials are based on information
currently available to the Company and on certain assumptions deemed to be reasonable. Actual business and otherresults may differ substantially due to a number of factors.

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

Dividend Status of Class A SharesClass A Share
Cash dividends per share
Record date
First quarter Second quarter Third quarter Fiscal year-end
Yen
Yen
Yen
Yen
Fiscal year ended
0.00
March 31, 2020
Fiscal year ending
20.78
March 31, 2021
Fiscal year ending
March 31, 2022
(Forecast)

Annual
Yen
0.00
20.78
-

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

Table of Contents for the appendices1.

Qualitative Information Related to Consolidated Performance ................................................... 2(1)

Qualitative Information on Business Performance .............................................................. 2(2)

Financial Information on Business Performance ................................................................. 4(3)

Outlook ............................................................................................................................... 4(4)

Basic Dividend Policy and Dividend Distributions for the Year ended March 31, 2021 andthe Year ending March 31, 2022 ................................................................................................... 5
(5)
2.

3.

Business Risks ................................................................................................................... 6

Consolidated quarterly financial statements ............................................................................. 10(1)

Consolidated balance sheets ............................................................................................ 10(2)

Consolidated statement of income and comprehensive income ......................................... 12(3)

Consolidated statement of changes in equity ..................................................................... 14(4)

Consolidated statement of cash flows ................................................................................ 16

Production, Contracts and Sales .............................................................................................. 191

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

1. Qualitative Information Related to Consolidated Performance(1) Qualitative Information on Business Performance
In the year ended March 31, 2021, the global economy remained at a standstill due to the widening COVID19 pandemic, and although there are signs of a recovery, the outlook remains uncertain.
Under such circumstances, the Group has prioritized the health and safety of our employees and others,
and we are executing ongoing projects while promptly taking any necessary actions in cooperation with ourcustomers.
In accordance with our “Revitalization Plan – Initiatives for Revitalization and the Future” Medium-Term
Management Plan (MTMP), along with continuing to practice rigorous risk management at every stage of a
project, in April 2020 we established the Construction Division under Energy Business Operations with theaim of strengthening the construction and commissioning functions and enhancing our EPC (engineering,procurement, and construction) execution and management capacity.
On the financial front, in June 2020 the shareholders approved a resolution to decrease the amount of statedcapital and additional paid-in capital and appropriate retained earnings in order to eliminate the parent
company’s accumulated losses (135,494 million yen as of March 31, 2020), improving our financial position.
As part of our effort to elevate and broaden our pool of talent, we have formulated a Human Resource
Development Policy, which will serve as a consistent set of guidelines as we seek to develop personnel who
are skilled both in terms of work execution and organizational management.
In April 2020 we adopted our Declaration of Health and Productivity Management, and along with taking
steps to maintain and promote employee health, we also aim to improve productivity by advancing work-lifebalance reform.
In the MTMP, we see the transition to a decarbonized society as an opportunity for growth, and we regard
the initiatives that we are pursuing to that end as business priorities. The Japanese government's
announcement of its Green Growth Strategy in December 2020 has only accelerated the momentum for
decarbonization. By accelerating our digital transformation as well as business development in the green
energy and environmental fields, while simultaneously pursuing efforts to redefine the value of engineering,
we are transforming our business portfolio and profit structure for sustainable growth.
Information about the engineering businesses which are reportable segments is presented below.
 Energy
LNG / Gas
【Overseas】
Chiyoda is executing the EPC phase of LNG plants in Qatar, the USA, Indonesia, and Nigeria. In Qatar,
Chiyoda has won the order for the EPC phase of the North Field East LNG project, which is the expansionof four LNG trains with capacity of 8 million metric tons per annum. In the USA, commercial production has
started on all trains at the Cameron LNG project. The Golden Pass LNG project is in the EPC phase. In the
Nigeria LNG project, we are providing review and other technical support to our partner, which is performing
the engineering. A group company in Qatar is engaged in a number of renovation and repair projects at
LNG/gas processing plants.
【Japan】
EPC phase work is currently underway to reinforce, modify, and repair existing LNG terminals that werebuilt by Chiyoda, and to newly install and add earthquake and tsunami reinforcement to gas supply facilities
for thermal power plants.

Refinery/Petrochemical/Metal

2

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

【Overseas】
Chiyoda is executing the EPC phase of an ethylene plant in the USA on the Gulf of Mexico and the EPCC
phase (EPC + commissioning) for a residue fluid catalytic cracking (RFCC) plant in Malaysia.
【Japan】
For oil companies, Chiyoda is retrofitting existing facilities to improve the competitiveness of refineries,
upgrade equipment, and meet restrictions on the sulfur content of bunker fuel for ships. We are also
examining ways to comply with the Basic Act for National Resilience, including seismic reinforcement.
In metal resources, we are executing the EPC phase of a polypropylene polymerization catalyst
manufacturing plant. We will continue to work to grow orders in the field of metal resources, where demandis strong.
 Environment
Pharmaceutical/Biochemistry/General Chemistry
In the area of pharmaceuticals and biochemistry, we completed the first manufacturing line at a recombinant
protein vaccine production facility for Shionogi & Co., Ltd. We are executing the EPC phase of projects to
add another line and ancillary facilities. We are also performing the basic engineering work for abiopharmaceutical substance manufacturing plant. We have completed an active pharmaceutical ingredient(API) production facility. Aside from EPC work, we are also working together with Shionogi Pharma Co., Ltd.
to develop and study continuous production technologies for drug APIs and intermediates.
In the general chemistry area, we have completed a plant for producing high performance materials and aplant for manufacturing hydrogenated hydrocarbon resins. Additionally, to make carbon recycling
technology a reality, as part of collaboration among industry, government, and academia, we are working
to capture and recycle CO2 and use it as a raw material to produce para-Xylene (PX). We are also
conducting the basic engineering work for customers’ waste plastic recycling business.
Through a business alliance with MIRAI Co., Ltd., a leader in indoor vertical farming, we aim to strengthen
our capabilities in this area. In addition to promoting the construction of commercial facilities, we aredelivering demonstration equipment to Qatar University.
Environment/New Energy/Infrastructure【Overseas】
In the environmental protection field, as India tightens its environmental regulations, flue gas desulfurization(FGD) equipment is being deployed at coal-fired power plants, and Chiyoda’s Thoroughbred 121 (CT-121)
FGD process has been used in a number of plants.
【Japan】
We have completed the EPC phase of a demonstration project to separate, recover, and store CO2 (carbon
capture and storage, or CCS) from thermal power plant fuel gas, and the plant remains in operation. We arealso executing the EPC phase for flue gas desulfurization equipment at a coal-fired power plant.
In the new energy area, Chiyoda is executing the EPC phase for the construction of one of the world’s
largest storage battery systems, a number of photovoltaic (mega solar) facilities, and one of Japan’s largest
biomass power plants that uses wood pellets as fuel. We are also considering entering the field of offshore
wind farms, which is expected to become a sizeable market in the future.
In December 2020, Chiyoda signed an agreement to cooperate with Mitsubishi Corp. and the Americancompany Blue Planet Systems Corp. to work together on initiatives to realize a carbon-neutral society.
Together, the companies will promote the development and commercialization of technology to manufacture
the aggregate that serves as the raw material for concrete using the CO2 in exhaust gas.
In December 2020, the demonstration of “Advanced Hydrogen Energy Global Supply and Transportation”
was completed in December 2020, verifying Chiyoda’s SPERA hydrogen technology (MCH-LOHC method)
can be scaled up for a commercial scale. We are seeking to further reduce costs in order to grow demand,and by semi-commercializing or commercializing the system sometime in the mid-2020s we hope to3

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

contribute to the objective of achieving carbon neutrality by 2050. As part of this effort, we participate in the
Hydrogen Utilization Study Group in Chubu, which has begun to study the feasibility of large-scale hydrogenutilization, with the aim of expanding demand for hydrogen in the Chubu region and building a consistent
supply chain. Our technology is highly regarded in Singapore for its safety, and along with five local
companies, Chiyoda and Mitsubishi Corp. are promoting the continued study of the use andcommercialization of hydrogen imports using our technology.
 Digital Technology
Chiyoda is pursuing three strategies for our digital transformation: 1) Launching innovative digital products,
2) Promoting digital EPC, and 3) work process innovation.
1) Launching Innovative digital products: we have combined our engineering expertise with digital AI
technology to develop advanced digital products that maximize the value of our customers’ plant assets.
These products are offered under the EFEXIS® brand name and are being deployed at plants in Japanand overseas.
2) Promoting digital EPC: To evolve our EPC execution management capabilities, we have developed asystem for applying Advanced Work Packaging (AWP) and we are using it in a series of projects that
we are executing. Additionally, by combining the expertise that Chiyoda has accumulated in engineeringand in the fundamental concepts of plant space design with Arent Inc.'s CAD and optimization
technology, we have developed a revolutionary system which has cut the space design processes thatare part of basic plant design work by roughly 80% and also has made it possible to create 3D models
about five times faster than before. Along with Arent Inc., in August 2020 we formed a joint venture,
Plant Stream Inc., to provide this system to the plant engineering industry, and we are marketing it toplant owners and EPC contractors around the world.
3) Work process innovation: Through our “Target 20” initiative we aim to take advantage of digital AI
technology to improve work efficiency by 20%, thus driving company-wide digitalization. Additionally,
after the IT business of our Chiyoda System Technologies Corp. subsidiary was spun off as a separate
company, we formed a new joint venture, TIS Chiyoda Systems, Inc., on October 1, 2020 with IT giant
TIS Inc. to strengthen the Group’s IT operations.

(2) Financial Information on Business PerformanceThis section is not translated.

(3) Outlook
1) Earnings outlook for the year ending March 31, 2022
Bringing ongoing projects to completion by concentrating resources in these projects is a top priority. We
are making steady headway on the Qatar North Field East LNG export terminal (order received in February2021) as well as other major LNG projects in the USA and Indonesia (currently underway).
Additionally, an update to the 2019 “Revitalization Plan – Initiatives for Revitalization and the Future”
Medium-Term Management Plan (MTMP) was approved by the Board of Directors on May 7, 2021. We
will continue to work towards rebuilding our risk management system, evolving our EPC execution
management capabilities, and broadening our pool of talent, all of which are important initiatives. At thesame time, we will also work to address the accelerating transition to a carbon-free society and the oil andgas industry's rapid transformation. Furthermore, we will strengthen our operations in the areas ofrenewable energy and pharmaceutical and life sciences business, while also forging ahead on our effort
to make exhaustive use of digital technologies to transform operations throughout the company.
2) Management policy, business environment, and issues requiring attention
On May 9, 2019, the Board of Directors approved a resolution concerning a third-party allotment of newly
issued shares and new borrowing, and on the same day the company signed a Memorandum ofUnderstanding concerning the framework for turnaround assistance from Mitsubishi Corp. and MUFG Bank,

4

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

Ltd. as well as an agreement with Mitsubishi Corp. to take up the newly issued shares, all of which areintended to strengthen Chiyoda’s financial position and business operations. We also drafted the“Revitalization Plan – Initiatives for Revitalization and the Future” Medium-Term Management Plan
(MTMP). On May 7, 2021, the Board of Directors approved the update to the MTMP, under which we will
simultaneously reinvigorate our existing businesses and explore and unearth new businesses.
When it comes to major projects that are currently underway, all trains at the Freeport LNG project and the
Cameron LNG project began commercial operations last fiscal year. We are also diligently executing theconstruction work needed to bring to completion the Tangguh LNG project in Indonesia, and Texase
Ethylene project and Golden Pass LNG project in the USA. The engineering and procurement phases of
the North Field East LNG project have also moved into high gear.
The Frontier Business Division will focus on three business areas: carbon cycle businesses mainly
revolving around clean tech, utility businesses in the era of data and decentralization, and pharmaceuticaland life sciences businesses revolving mainly around solutions for unsolved technical issues. This division
is commercializing a hydrogen chain business that is largely based on our own technology, as well as
technologies developed by Chiyoda and other companies that effectively utilize carbon dioxide as avaluable resource. It is also building a system and business model to provide optimal energy as a service
by using Chiyoda expertise and digital technologies to connect distributed power sources to diverse energy
demands. It is also commercializing a new technology related to the cell culture process, which is key toadvances in regenerative medicine.
Our Digital Transformation Division is developing digital products that contribute to the optimization andautonomization of plant operations, mainly in the oil & gas industry, by deepening our knowledge of AI
technologies and data analysis, and combining this with our inherent plant engineering technology andexpertise while developing our human resources. In order to grow and evolve the Group’s own IT
infrastructure to keep up during these rapidly changing times, after spinning off the IT unit of Chiyoda
System Technologies Corp. as a separate company, we launched a joint venture with IT giant TIS Inc.
Furthermore, to improve the efficiency of plant space design, we formed a new 50:50 joint venture, Plant
Stream Inc., with Arent Inc. to combine Chiyoda’s experience and knowledge of fundamental concepts
in plant engineering with Arent’s CAD and optimization technology and bring this to plant owners and EPC
contractors around the world.
As part of our effort to elevate and broaden our pool of talent, we have formulated a Human Resource
Development Policy to serve as a consistent set of guidelines. With this policy serving as our guideposts,
we will create a pool of personnel who are skilled both in terms of work execution and organizational
management, and we are now reforming our HR systems to ensure optimal personnel development froma medium to longer term perspective.
To move towards the realization of the Revitalization Plan, in order to change our employees’ thinking
about their work we have also established new fundamental principles that serve as the guidelines for dayto-day individual conduct, covering elements such as a sense of responsibility, social values, risk
management, and the value of human resources. By using various means to instill these principles
throughout the company, we aim to transform the company culture from the inside and realize self-directed,
self-sustaining, and lasting growth.
When it comes to the environment in which we are operating, there are still no prospects for containing thewidening spread of COVID-19. While prioritizing the health and safety of our employees and others, indiscussion with our customers and contractors, we are working to minimize the impact on ongoing projects
such as restricted in-person meetings with customers and contractors, delay in the production andtransportation of procured items, and restricted assignment of work supervisors and on-site workers.

(4) Basic Dividend Policy and Dividend Distributions for the Year ended March 31, 2021 and the Yearending March 31, 2022
The dividend will be paid to class A preferred stock based on the articles of incorporation and the conditions
stipulated at the time of issuance. To the common stock, in light of the level of unappropriated retained
earnings, we regret that there will be no dividend distribution for the year ended March 31, 2021.

5

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

We are making every effort to reinstate our dividend as soon as possible, but we are still in the process of
executing the Revitalization Plan, so at this time no decision has been made about the year-end dividend
for the year ending March 31, 2022. We will promptly disclose our dividend guidance as soon as it isdetermined based on our business outlook.

(5) Business Risks
Risks to our operations and financial affairs with the potential to significantly affect investor decisionmaking, as well as the measures taken to address such risks, are described below.
Recognizing the possibility that these risks could arise, in addition to making every effort to reduce theiroccurrence, the Group also endeavors to respond as quickly as possible to minimize the effects should
they arise.
We have recognized the following risks as of March 31, 2021.

(a) COVID-19 pandemic
There are still no prospects for containing the COVID-19 pandemic, and around the world there are
growing restrictions on the movement of people and goods. While prioritizing the health and safety of
our employees and others, after identifying the impact on ongoing projects such as restriction on inperson meetings with customers and contractors, delay in the production and transportation of
procured items, restriction on the assignment of work supervisors and on-site workers, and restriction
on visits by foreign engineers to sites in Japan, and promptly taking necessary steps, we haveentered into discussions with our customers and contractors concerning the burden of increased
costs and delayed deliveries. Furthermore, many of our customers are reviewing their investment
plans due to the uncertainty, and we are endeavoring to analyze the situation because we recognizethat our own order targets will inevitably be considerably affected.
(b) Effects of global trends and economic, political, and social changes
Besides the COVID-19 pandemic, other global economic trends, social and political changes, tradeprotections, economic sanctions, diplomatic tensions, energy policy shifts in various countries, andprice trends in the oil, liquefied natural gas (LNG), and metals markets can cause our customers toterminate, postpone, or change their investment plans or negatively affect their financial condition. As
such, any of these factors may affect the Group’s business performance.
When receiving orders, the Group closely monitors economic and social conditions, and we strive toshare the risk burden with our customers and counterparties in an optimal manner. We endeavor to
mitigate such risks by conducting due diligence on counterparties, verifying the pros and cons as wellas the terms of a transaction, and securing alternative counterparties.
(c) Natural disasters such as earthquakes and Force Majeure events such as terrorism and conflict
The occurrence of a natural disaster such as an earthquake or heavy rain and flooding caused by
global climate change, or a Force Majeure event such as an act of terrorism or armed conflict, may
directly or indirectly result in damages to a worksite where there is an ongoing project or to an office inJapan or overseas by endangering workers' lives, delaying the transport of equipment and materials
to a worksite, or interrupting on-site work.
Health and safety are priorities at the Group, and we have established a Crisis Management Sectionthat is always at the ready. Along with compiling and analyzing data, it assesses the situation inconstantly changing danger zones. We have also taken steps, such as hiring security consultants, tostrengthen the crisis management organization. When there is an emergency, we set up an emergency
response headquarters, and along with promptly sharing information with customers and other involved
parties, we establish emergency response procedures to minimize the impact of a crisis byimplementing appropriate countermeasures in a timely and appropriate manner. Furthermore, we havedrafted a business continuity plan (BCP) to be followed in the event of a major earthquake. We are6Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

working to improve our ability to continue operations by conducting drills so that in the event of adisaster we can conduct immediate safety checks, effect an initial response, and launch priority
operations.
(d) Surging equipment and materials costs
Because of the time lag between a contract estimate and order placement, with lump sum turnkey(LSTK) contracts for plant construction projects there is a risk that equipment and materials costs may
be higher than expected. Specifically, the price of steel, which is a major component in plant
construction, can be greatly affected by fluctuating prices for coking coal and iron ore. It is also difficult
to predict fluctuations in the market prices for materials such as copper, nickel, aluminum, and zinc.
To mitigate such risks, in addition to tracking market trends, the Group takes steps such as diversifying
our suppliers and encouraging competition by ordering from suppliers around the world, placing orders
for equipment and materials early, and building good relationships with top vendors.
(e) Difficulty securing workers, equipment, and materials
In plant construction, work may be delayed if we are unable to secure the necessary humanresources such as construction workers, secure the necessary infrastructure, or procure thenecessary equipment and materials according to plan. Additional expenditures may be required torecover any lost time.
In locations where the labor market is tight or where the climate is harsh, both in Japan andoverseas, the Group mitigates the risk of an unexpected rise in construction costs by devising
construction methods such as modular construction and by forming cooperative relationships withleading contractors and equipment and material suppliers. If construction is unavoidably suspended
due to the worldwide spread of some infection disease or epidemic other than COVID-19, a strike, orsome other factor, we will work with our customers and relevant local agencies to take appropriate
measures to minimize the impact.
(f) Plant accidents
If there is a major accident for any reason, such as an explosion or fire, at plant built by the Group or
one under construction, and the Group is determined to be at fault, our liability for the compensation
for damages could affect our business results.
With safety design and construction site accident prevention as top priorities, the Group takes all
possible quality control, construction safety management, and other measures to prevent such
unforeseen circumstances from arising. But we also seek to mitigate such risks by obtaining
appropriate insurance coverage and securing contract terms that reasonably share the burden of suchlosses with the customer. The Group is committed to fostering a culture of safety and we collectively
refer to our various initiatives to ensure construction safety as “C-Safe” that stands for Chiyoda’s Safety
Culture.
(g) Currency risk
Because amounts to be paid for equipment, materials, and subcontracted work for overseas projects
might be in a different currency than the amounts received from the customer, fluctuating exchange
rates could affect our business results.
The Group endeavors to mitigate currency risk by receiving payments for work in the currencies inwhich we expect to make outlays and also through forward exchange contracts.
(h) Compliance violations
In engaging in plant construction work in Japan and overseas, the Group must comply with the laws

7

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

and regulations of the various countries in which we have our corporate headquarters, subsidiarycompanies, representative offices, and construction sites. In the unlikely event that we violate, or aresuspected of violating, such laws or regulations, there could be a significant impact on project execution
or our business operations.
In order to prevent violations, and also to avoid coming under such suspicion, the Group continuously
educates our employees through programs such as group training and e-learning. In doing so, we
thoroughly disseminate information about the latest laws, regulation, and rules that are relevant to ourbusiness execution, including those pertaining to protecting human rights and preventing corruption.
We also constantly work to assess trends among our stakeholders, including domestic and foreign
agencies and customers.
Furthermore, in order to ensure that compliance is incorporated into our business processes, we haveestablished a Compliance Committee chaired by the Chief Compliance Officer (CCO) with the division
directors as its members, as well as a Group Company Compliance Liaison Committee, also chairedby the CCO, with the subsidiary presidents as its members.
(i) Information security threats
The Group controls a large volume of customer and counterparty information that is necessary to
execute our business, and we also possess confidential information about technologies, sales, andother aspects of our business. Since much of our core work and commercial activity are carried out at
locations around the world by taking advantage of IT systems, a system failure, leak of confidential
information, cyber fraud, or loss of important business information due to a computer virus or
unauthorized external access, phishing emails, cyberattack or other unforeseen event could affect ourbusiness.
The Group works to mitigate these risks through rigorous information security management practices,such as regular education and audits. We have also obtained ISMS certification at not only our
corporate headquarters but also at major group companies.
(j) Business investment losses
The Group makes business investments such as establishing new companies and acquiring existing
companies. In making these investments we may provide substantial amounts of equity capital or credit
in the form of loans or guarantees. As a result, there are certain risks. An investee may fail to meet its
earnings targets due to changes in the business environment, we may incur losses on the investment
due to poor business results, or we may encounter a situation in which additional financing is required.
In addition to thoroughly examining a proposal in advance based on our own internal standard andrules, the Group decides whether to make an investment only after carefully weighing our financial
capacity relative to the risk of losses. After making an investment, in order to prevent or minimize losses
we monitor the investee’s business plan progress and provide support in the form of personnel orcapital if necessary.
(k) Ichthys LNG Project risks
In 2012, JKC, a joint venture of the Group, JGC Holdings Corp., and American company KBR, Inc. ,received the order from Ichthys LNG Pty Ltd (“the Customer”) to perform the engineering, procurement,
and construction work for LNG facilities (“the Project”). This plant has been already completed anddelivered to the Customer.
However, as described below, there are matters between the Customer and some subcontractors thatare currently subject to negotiation and arbitration, and if an outcome or ruling is unfavorable to JKC,
it could affect the Group’s business results by making some of the construction receivables oradvanced monies uncollectible.

8Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

① Disputes with client
Some of the matters concerning the adjustment to the contract amount for costs arising from anincrease in the scope of work and the cost-reimbursable scope are the subject of ongoing negotiations
with the Client, and others are the subject of arbitration.
With respect to the abovementioned reimbursable amounts, as a provisional measure until anagreement could be reached, in December 2016 the Client signed a Funding Deed stating that in
exchange for providing funding to JKC, JKC would not halt work on the project, and it provided thefunding. JKC subsequently filed for arbitration seeking a ruling that the additional expenses were
reimbursable expenses that under the terms of the contract were the responsibility of the Client, andrecognizing that the monies paid under the Funding Deed represented formal payment of the expenses.
However, in December 2020 the arbitrator made a partial ruling to the effect that separate hearings
would be needed to determine whether the additional expenses were reimbursable expenses under
the contract, and that at the present time it was not possible to certify that they were reimbursable
expenses. After this partial ruling, the Client demanded that JKC refund the entire amount of fundingthat had been provided under the Funding Deed. and in mid-January 2021 it submitted a payment
request to JKC's parent companies, Chiyoda, KBR, and JGC Holdings, based on the parent company
guarantees that had been made by the companies. In response, JKC has asked the Client to follow
the reimbursement procedure that is specified in the Funding Deed for the funding provided, while
Chiyoda and the other parent companies are continuing to negotiate with the Client.
② Dispute with subcontractor
JKC placed the order for the engineering and construction of the Combined Cycle Power Plant (CCPP)
that is part of the Project through a fixed-price contract with a consortium of four companies, General
Electric Company and General Electric International, Inc., and UGL Infrastructure Pty Limited andCH2M Hill Australia Pty. Limited (collectively, the “Consortium”).
However, the Consortium unilaterally terminated the contract while executing this work and withdrew
from the construction site without the permission of JKC. The Consortium also filed for arbitration to
demand payment of additional costs related to circumstances prior to its withdrawal. In light of thissituation, JKC has appointed a subcontractor to replace the Consortium in order to fulfill its performanceobligations to the Customer, and while incurring tentatively the construction costs to proceed with theconstruction of the CCPP, JKC is countersuing the Consortium for these construction expenses.

9Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

2. Consolidated quarterly financial statements(1) Consolidated balance sheets(Millions of yen)
As of March 31, 2020

As of March 31, 2021

124,404

106,988

61,182

48,527

5,261

8,767

68,712

77,261

96,02856,845

6,041(1,243)360,387

8,906(1,405)
305,891

15,035(8,857)
6,177
748
(478)
270
6,073
(5,291)
782
5,085
137

14,105(8,849)
5,255
1,295
(913)
382
5,948
(5,119)
829
4,853
106

12,454

11,426

4,912

4,371

5,598
－
599
1,271
(172)

5,701
566
394
1,395
(164)

7,296

7,894

24,663385,051

23,692
329,583

AssetsCurrent assets
Cash and deposits
Notes receivable, accounts
receivable from completed
construction contracts
Costs on construction contracts inprogress
Accounts receivable - other
Jointly controlled assets of joint
ventureOther
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Machinery and vehicles
Accumulated depreciation
Machinery and vehicles, net
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
LandConstruction in progress
Total property, plant andequipment
Intangible assets
Investments and other assets
Investment securities
Retirement benefit asset
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and otherassetsTotal non-current assets
Total assets

10Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

(Millions of yen)
As of March 31, 2020

As of March 31, 2021

137,546

115,187

122

747

1,212

638

119,91174,784860

823

34,871

34,4434,150
401
20,802319,878

3,834
17
14,178244,657

35,747
239
1,986
2,255
40,229360,107

45,000
239
761
2,178
48,178292,836

78,396
72,128(127,778)(1,435)21,31015,014142
15,708(1,435)29,430

58

203

6

30

3,033

5,300

13

1,434

3,112

6,969

519
24,943385,051348
36,747
329,583

Liabilities
Current liabilities
Notes payable, accounts payable forconstruction contracts
Current portion of long-termborrowings
Income taxes payable
Advances received on construction
contracts in progress
Provision for warranties forcompleted construction
Provision for loss on construction
contracts
Provision for bonuses
Provision for business restructuring
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Provision for treatment of PCB waste
Retirement benefit liability
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive
incomeValuation difference on available-forsale securities
Deferred gains or losses on hedges
Foreign currency translation
adjustment
Remeasurements of defined benefit
plans
Total accumulated othercomprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

11

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

(2) Consolidated statement of income and comprehensive income(Consolidated statement of income)(Millions of yen)

Fiscal year ended
March 31, 2020
Net sales of completed construction
contracts
Cost of sales of completed construction
contracts
Gross profit on completed construction
contracts
Selling, general and administrative
expenses
Operating profit
Non-operating income
Interest income
Dividend income
Share of profit of entities accounted forusing equity method
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sale of shares of subsidiaries
and associates
Reversal of provision for businessrestructuring
Total extraordinary income
Extraordinary losses
Loss on valuation of investment
securities
Impairment losses
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit (loss) attributable to non-controllinginterests
Profit attributable to owners of parent

12

Fiscal year ended
March 31, 2021

385,925

315,393

343,101

295,332

42,82320,061

16,033

13,046

26,789

7,015

2,649
201

984
388

361

33

－
289
3,502

820
266
2,492

727
10,192727
11,647
18,644

889
－
155
1,045
8,462

363

413

232

－

595

413

122

－

67
190
19,050
7,120
(105)
7,015
12,034

－
－
8,876
848
33
882
7,993

(142)

0

12,1777,993

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

(Consolidated statement of comprehensive
income)(Millions of yen)
Fiscal year ended
March 31, 2020

ProfitOther comprehensive income
Valuation difference on available-forsale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit
plans, net of tax
Share of other comprehensive incomeof entities accounted for using equity
methodTotal other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable toowners of parent
Comprehensive income attributable tonon-controlling interests

13

Fiscal year ended
March 31, 2021

12,034

7,993

64

144

56
3,197

24
2,324

(912)

1,420

(66)

(60)

2,339
14,374

3,854
11,847

14,522

11,849(148)(1)

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

(3) Consolidated statement of changes in equity
Previous consolidated fiscal year (April 1, 2019- March 31, 2020)(Millions of yen)
Shareholders' equity
Capital surplus

Retained earnings

Treasury shares

Total shareholders'equity43,396

37,112(139,956)(1,435)(60,882)

35,00035,000Share capital
Balance at
beginning of period
Changes during
periodIssuance of newsharesProfit attributableto owners ofparentPurchase oftreasury shares
Purchase ofshares of
consolidated
subsidiaries
Net changes in
items other thanshareholders'equityTotal changes
during period

70,00012,177

12,177
(0)

(0)

15

Balance at end of
period15

35,00035,015

12,177(0)82,19378,396

72,128(127,778)(1,435)21,310

Accumulated other comprehensive income

Balance at
beginning of period

Valuationdifferenceonavailablefor-salesecurities

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustment

Remeasurements ofdefinedbenefit plans

Total
accumulated othercomprehensive income

Noncontrollinginterests

Total net
assets

(5)

(50)

(102)

926

767

960

(59,154)

Changes during
periodIssuance of newsharesProfit attributableto owners ofparentPurchase oftreasury shares
Purchase ofshares of
consolidated
subsidiaries
Net changes in
items other thanshareholders'equityTotal changes
during period
Balance at end of
period70,00012,177
(0)

15

64

56

3,136

(912)

2,344

(440)

1,904

64

56

3,136

(912)

2,344

(440)

84,097

58

6

3,033

13

3,112

519

24,94314

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

Current consolidated fiscal year (April 1, 2020-March 31, 2021)(Millions of yen)
Shareholders' equity
Capital surplus

Retained earnings

Treasury shares

Total shareholders'equity78,396

72,128(127,778)(1,435)21,310(63,381)

63,381

Share capital
Balance at
beginning of period
Changes during
periodCapital reduction(135,494)

Deficit disposition
Profit attributableto owners ofparentPurchase oftreasury shares
Purchase ofshares of
consolidated
subsidiaries
Net changes in
items other thanshareholders'equityTotal changes
during period－
135,494

－

7,993

7,993
(0)

(0)

126

126

(63,381)(71,986)

143,487

(0)

8,119

15,014142

15,708(1,435)29,430

Balance at end of
periodAccumulated other comprehensive income

Balance at
beginning of period

Valuationdifferenceonavailablefor-salesecurities

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustment

Remeasurements ofdefinedbenefit plans

Total
accumulated othercomprehensive income

Noncontrollinginterests

Total net
assets

58

6

3,033

13

3,112

519

24,943

Changes during
periodCapital reduction－

Deficit disposition
Profit attributableto owners ofparentPurchase oftreasury shares
Purchase ofshares of
consolidated
subsidiaries
Net changes in
items other thanshareholders'equityTotal changes
during period－

Balance at end of
period

7,993
(0)

126

144

24

2,266

1,420

3,856

(171)

3,684

144

24

2,266

1,420

3,856

(171)

11,804

203

30

5,300

1,434

6,969

348

36,74715

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

(4) Consolidated statement of cash flows(Millions of yen)

Cash flows from operating activities
Profit before income taxes
Depreciation
Impairment losses
Amortization of goodwill
Increase (decrease) in allowance for doubtful
accounts
Increase (decrease) in provision for warranties forcompleted construction
Increase (decrease) in provision for loss on
construction contracts
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for businessrestructuring
Increase (decrease) in retirement benefit liability
Interest and dividend income
Interest expenses
Foreign exchange losses (gains)Share of loss (profit) of entities accounted forusing equity method
Loss (gain) on valuation of investment securities
Loss (gain) on sale of shares of subsidiaries andassociates
Decrease (increase) in trade receivables
Decrease (increase) in costs on construction
contracts in progress
Increase (decrease) in trade payables
Increase (decrease) in advances received on
construction contracts in progress
Decrease (increase) in accounts receivable - other
Decrease (increase) in jointly controlled asset of
joint venture
Other, net
SubtotalInterest and dividends received
Interest paid
Income taxes refund (paid)
Net cash provided by (used in) operating activities
Cash flows from investing activities
Net decrease (increase) in time deposits
Purchase of property, plant and equipment
Proceeds from sale of property, plant andequipment
Purchase of intangible assets
Proceeds from sale of intangible assets

16

Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

19,050
3,174
67
40

8,876
3,281
－
33

(10)

162

491

(15)

(31,906)

902

1,139

(148)

(1,290)

(383)

(146)
(2,851)
727
(59)

398
(1,372)
889
(225)

(361)

(33)

122

－

(363)

(413)

7,291

12,3772,194(3,809)(34,702)(19,115)(1,285)(40,465)(3,960)(11,670)

14,83037,595(1,286)(29,094)
1,439
(719)
(3,841)(32,217)(10,800)(23,937)
1,450
(823)
2,504
(20,806)(7,358)
(560)

348
(608)

91

563

(1,702)17(1,541)746

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

Purchase of investment securities
Proceeds from sale of shares of subsidiaries andassociates
Purchase of shares of subsidiaries resulting inchange in scope of consolidation
Payments for sale of shares of subsidiaries
resulting in change in scope of consolidation
Loan advances
Proceeds from collection of loans receivable
Payment for Corporate division
Other, net
Net cash provided by (used in) investing activities

17

(9)

(659)

1,116

14

－

(18)

－

(8)

(7)
604
－
(19)
(7,828)

(869)
13
(227)
(3)
(2,250)Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

(Millions of yen)

Cash flows from financing activities
Proceeds from long-term borrowings
Repayments of long-term borrowings
Proceeds from issuance of shares
Dividends paid
Other, net
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash
equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

18

Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

20,000(118)
70,000(0)(680)
89,20010,000
(122)
－
(0)
(398)
9,478

(1,528)(3,616)47,626(17,194)

68,306
115,932

115,932
98,738

Chiyoda Corporation (6366)
Consolidated Financial Results for the Ended March 31, 2021

3.

Production, Contracts and Sales(Millions of yen)
Apr. 1, 2020 － Mar 31, 2021

Apr. 1, 2019 － Mar 31, 2020
New
contracts(ratio)Net sales(ratio)Backlog ofcontracts(ratio)New
contracts(ratio)Net sales(ratio)Backlog ofcontracts(ratio)179,056

385,144811,847

898,125

314,684

1,126,072

99.6%

99.8%

100.0%

99.9%

99.8%

100.0%

65,196

179,503435,962

782,809104,839

956,187

36.2%

46.5%

53.7%

87.1%

33.2%

84.9%

5,334

4,545

14,181

3,210

11,274

6,032

3.0%

1.2%

1.7%

0.3%

3.6%

0.5%

63,673

128,599

242,946

51,180123,740

59,601

35.4%

33.3%

29.9%

5.7%

39.2%

5.3%

Pharmaceutical/Biochemistry/
Chemical

19,042

24,922

20,06450,14826,71843,285

10.6%

6.5%

2.5%

5.6%

8.5%

3.9%

Environment/New
Energy/Infrastructure

19,72839,671

96,5836,504

44,06658,755

11.0%

10.3%

11.9%

0.7%

14.0%

5.2%

6,079

7,903

2,109

4,271

4,044

2,209

3.4%

2.0%

0.3%

0.5%

1.3%

0.2%

780

780

-

708

708

-

0.4%

0.2%

-

0.1%

0.2%

-

179,836

385,925

811,847

898,834

315,393

1,126,072

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

95,834133,080

179,559

103,765

146,084

135,190

53.3%

34.5%

22.1%

11.5%

46.3%

12.0%

84,002

252,844632,288795,069

169,308

990,881

46.7%

65.5%

77.9%

88.5%

53.7%

88.0%

Engineering
LNG Plant
Gas
Development/Processing/Receiving
Refinery/Petrochemical/Metal

OthersOther Business

Total

Domestic

Overseas

Note:

The total amount of the above table does not include consumption tax.

19