Chiyoda Corporation (6366)
Consolidated Financial Results for the six months Ended September 30, 2019

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 Six Months Ended September 30, 2019
November 5, 2019
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+81-45-225-7745

Scheduled date to file Quarterly Report: November 5, 2019
Preparation of Quarterly Supplementary Explanation Material: Yes
Quarterly Financial Results Presentation Held: Yes (for Analysts and Institutional Investors)(Millions of yen with fractional amounts discarded, unless otherwise noted)
1. Consolidated performance for the six months ended September 30, 2019
(Percentages indicate year-on-year changes)(1) Consolidated operating results
Profit attributable to
Revenue
Operating income
Ordinary income
owners of parent
MillionsofMillions of yen%%
yen % Millions of yen % Millions of yen
For the Six months
ended September 30,
174,903 19.5
14,051 －
6,883 －
4,788 －
2019
For the Six months
ended September 30,
146,387 (41.6)(96,267) －(96,271) －(108,606) －2018
Note: Comprehensive Income: the six months ended September 30, 2019: 8,930 million yen
the six months ended September 30, 2018: (107,888) million yen

For the Six months ended
September 30, 2019
For the Six months ended
September 30, 2018

Net income per
share
Yen

Fully diluted net
income per share
Yen

16.45

7.84

(419.38)－(2) Consolidated financial position
Total assets
Net assets
Equity ratio
Millions of yen
Millions of yen%
As of September 30, 2019
387,911
19,533
4.9
As of March 31, 2019352,341(59,154)(17.1%)
Reference: Equity
As of September 30, 2019:
18,996 million yen
As of March 31, 2019:(60,114) million yen
2. Cash dividends
Record date
FY ended March 31, 2019
FY ending March 31, 2020
FY ending March 31, 2020

Cash dividends per shareFirst quarter Second quarter Third quarter Fiscal year-end
Yen
Yen
Yen
Yen
0.00
-

(Forecast)
Note: Revision to the latest forecast announcement 2019: None

-

0.00

Annual
Yen
0.00
0.00

Chiyoda Corporation (6366)
Consolidated Financial Results for the six months Ended September 30, 2019

3. Consolidated earnings forecasts for the fiscal year ending March 31, 2020 (from April 1, 2019 toMarch 31, 2020)(Percentages indicate year-on-year changes)
attributable to Net income
Revenue
Operating income Ordinary income Profit
owners of parent per share
Millions of yen% Millions of yen % Millions of yen % Millions of yen %YenFiscal year ending
390,000
14.1
19,00012,0006,000
17.07
March 31, 2020
Note: Revision to the latest forecast announcement 2019: None
4. Others(1) Changes in Significant Subsidiaries during the Period (changes in specified subsidiaries accompanying
changes in the scope of consolidation): None
(2) Adoption of Specified Accounting Methods for the Preparation of Quarterly Consolidated Financial
Statements: None
(3) Changes in Accounting Policies and Accounting Estimates / Restatements
a. Changes in accounting policies due to revisions of accounting standards, etc.: Yes
b. Changes in accounting policies other than a. above: Nonec. Changes in accounting estimates: None
d. Restatements: None
(4) Number of issued shares (common stock)a. Total number of issued shares at the end of the period (including treasury stock)
As of September 30, 2019
260,324,529 shares
As of March 31, 2019
260,324,529 sharesb. Number of treasury stock at the end of the period
As of September 30, 2019
1,357,419 shares
As of March 31, 2019
1,357,156 sharesc. Average number of shares during the period
For the Six months ended September 30, 2019258,967,257 shares
For the Six months ended September 30, 2018258,967,593 shares*Presentation of Implementation Status of Quarterly Review Procedure
The review procedure of quarterly financial statements based on the Financial Instruments and Exchange Law
has not been completed at the time of the disclosure of these Consolidated Financial Statements.
*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 other results may differ substantially due to a number of factors.
Dividend Status of Class A SharesClass A Share
Record dateFiscal year ended
March 31, 2019
Fiscal year ending
March 31, 2020
Fiscal year ending
March 31, 2020 (Forecast)First quarter
Yen-

Cash dividends per share
Second quarter
Yen

Third quarter
Yen

-

-

-

-

Fiscal year-end
Yen

Annual

Yen

0.0

0.0

Chiyoda Corporation (6366)
Consolidated Financial Results for the six months Ended September 30, 2019

Table of Contents for the appendices
1.

2.

3.

Qualitative Information Related to Consolidated Performance2(1)

Qualitative Information on Business Performance2(2)

Financial Information on Business Performance4(3)

Outlook for the Next Fiscal Year

4

Consolidated quarterly financial statements

5(1)

Consolidated balance sheets

5(2)

Consolidated statement of income and comprehensive income

7(3)

Consolidated quarterly statements of cash flow

9(4)

Notes on Consolidated Quarterly Financial Statements

10

Production, Contracts and Revenue

11Chiyoda Corporation (6366)
Consolidated Financial Results for the six months Ended September 30, 2019

1. Qualitative Information Related to Consolidated Performance(1) Qualitative Information on Business Performance
The price of oil remained relatively stable during the second quarter of this fiscal year with only temporary
increases due to factors such as geopolitical instability in the Middle East. In the Liquefied Natural Gas(LNG) market, customers have been considering Final Investment Decisions (FID) for new large-scale
projects, reflecting the continued demand for LNG, especially in the developing world.
Responding to this environment, the Group continues to execute large-scale LNG projects worldwide. In theUSA, the first train of the Cameron LNG project is in commercial operation and on Freeport LNG the firsttrain has commenced production and export and engineering, procurement and construction (EPC) for theGolden Pass LNG project is underway. Elsewhere, we are providing technical support for design reviews
conducted by EPC partners in the Mozambique Offshore Area 1 project which reached FID in June this year.
Chiyoda is also developing EPC proposals for the Qatar expansion and Nigeria Train 7 LNG projects.
In the global environment field, EPC works are ongoing for the world's largest storage battery system, as
well as in in the renewable energy, pharmaceutical and life science field.
In the field of digital technology innovation, Chiyoda is also developing AI technology that contributes toimproving the productivity and reliability of customer plants.
Chiyoda launched a new medium-term management plan: “Chiyoda’s Revitalization Plan – Initiatives for
Revitalization and the Future” in May this year which includes promoting fresh initiatives under the newly
As a first step, Chiyoda have begun reorganization and are
established risk management structure.
implementing a wide range of initiatives for business reform.
A third party allocation of shares to Mitsubishi Corporation, valued at JPY70 billion and approved at theGeneral Shareholders Meeting on 25 June 2019, was executed in July as part of the financial strengtheningplan.
On consolidated basis, for the 2nd quarter of the fiscal year ending March 31, 2019, New Orders amounted
to 79,93 million yen (down 75.9% YoY), Backlog to 904,482 million yen (down 11.0% from last FY) and
Revenues to 174,930 million yen (up 19.5% YoY). Operating income came to 14,051 million yen (comparedwith previous quarter’s consolidated operating loss of -96,267 million yen), Ordinary income amounted to6,883 million yen (compared with previous quarter’s consolidated ordinary loss of -96,271 million yen) andProfit attributable to owners of parent came to 4,788 million yen (compared with previous quarter’s
consolidated loss attribute to owners of parent of -108,600 million yen).This is mainly due to the agreementwith the client for contract amendment for Cameron LNG, and foreign exchange loss.
The summary of activities in the engineering business; reportable segments below:
Energy
LNG / Gas
【Overseas】
The Company is executing EPC on projects in Australia, the USA and Indonesia. The first train of the
Cameron LNG project is in commercial operation and on Freeport LNG the first train has commenced
production. The second and third trains on Cameron and Freeport are progressing as planned and EPC
work on Golden Pass LNG is continuing. Chiyoda will provide technical support for design reviews for JV
partners on LNG projects in Mozambique Offshore Area 1 which reached FID in June this year and iscurrently preparing EPC proposals for the Qatar expansion project (4 x 7.8 million ton/year trains) andFEED/EPC for Nigeria LNG.
In Qatar we are also engaged in EPC for a helium production facility and are modifying and revamping an
LNG/gas processing plant which we previously constructed.

2

Chiyoda Corporation (6366)
Consolidated Financial Results for the six months Ended September 30, 2019

【Japan】
Renovations and modifications are underway on Chiyoda constructed LNG receiving terminals and seismic
upgrades of facilities under the Basic Act for National Resilience are progressing.
Refinery/Petrochemical/Metal【Overseas】
We have commenced EPC on a large-scale ethylene plant on the Gulf Coast in the USA. In Malaysia, weare executing EPC plus Commissioning (EPCC) for a Residue Fluid Catalytic Cracking (RFCC) project andEPC on a petrochemical tank terminal. In Southeast Asia we are managing downstream projects, including
refineries and petrochemical plants.
【Japan】
In Japan the Group is executing EPC for the renovation of existing refining facilities aiming to reduce sulfur
content in bunkering fuel as per new regulations effective in 2020, as well as other revamping andmodification work.
Environment
Pharmaceutical/Biochemistry/General Chemistry【Japan】
Chiyoda is executing EPC for production facilities of middle molecule pharmaceuticals and synthetic raw
materials for medicines and for functionalized chemical facilities and a hydrogenated petroleum resin
production plant.
Environment/New Energy/Infrastructure【Overseas】
The Company implemented the Chiyoda Thoroughbred 121 (CT-121) Process to flue gas desulfurization
facilities on existing coal fired plants in India.
Business development activities for a vegetable growing facility using artificial light are ongoing aiming to
introduce commercial facilities in the Middle East and Russia in collaboration with MIRAI Co. Ltd, a leading
company in this field.
【Japan】
Chiyoda is executing EPC for the world's largest Battery Energy Storage System Project, flue gas
desulfurization facilities on existing coal fired plants, demonstration facilities for CO2 separation units,
photovoltaic (mega solar) facilities and for the largest capacity biomass firing plant in Japan.
Work is underway on a demonstration project commercializing the hydrogen supply chain through theAdvanced Hydrogen Energy Chain Association for Technology Development, an organization establishedjointly with Mitsubishi Corporation, Mitsui & Co., Ltd. and Nippon Yusen (NYK Line).



Digital Technology
A new Digital Transformation Division was established on 1 July 2019 to implement the Revitalization Plan
based on digital technology and to promote digital transformation.
The Company is implementing projects using AI technologies to improve plant productivity in a tie-up
agreement with GRID Inc. and has developed AI technology to optimize the productivity of PT. DonggiSenoro LNG (Indonesia) plants aiming to introduce the technology worldwide.

3

Chiyoda Corporation (6366)
Consolidated Financial Results for the six months Ended September 30, 2019

Chiyoda has signed a Memorandum of Understanding (MoU) with Abu Dhabi Gas Liquefaction Co. (UAE)to provide state-of-the-art digital technologies for their LNG Plant, targeting early introduction of digitaltechnologies improving plant reliability.
We are also implementing the internal "Target 20" campaign seeking to further utilize digital technology
and are striving to strengthen competitiveness based on enhanced operations through digitization in each
EPC business area and corporate management practices. Specifically, Chiyoda is applying Advanced
Work packaging (AWP) and has commenced system development on current projects and Robotic Process
Automation (RPA) for domestic service payments.

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

(3) Outlook for the Next Fiscal Year

The initial the full-year consolidated financial forecast for the Fiscal Year ending March 31, 2020, as
announced on May 9, 2019 has been revised. For details, please refer to “Notice of Revisions to the
Forecast of Consolidated Results” announced on November 1, 2019.
In addition the anticipated foreign exchange rate has been changed to JPY 105/ USD.

4

Chiyoda Corporation (6366)
Consolidated Financial Results for the six months Ended September 30, 2019

2. Consolidated quarterly financial statements(1) Consolidated balance sheets(Millions of yen)
As of March 31, 2019

AssetsCurrent assets
Cash and deposits
Notes receivable, accounts receivablefrom completed construction contracts
Costs on construction contracts inprogress
Accounts receivable - other
Jointly controlled assets of joint venture
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
Land
Other, net
Total property, plant and equipment
Intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

5

As of September 30,
201969,457

99,952

68,611

55,900

7,494

8,650

65,945110,967
5,707△1,254
326,929

68,99588,98441,068(1,243)362,308

5,461
4,952
1,300
11,714
5,298

6,393
5,183
1,195
12,772
4,671

6,393
701
1,478
△174
8,398
25,411
352,341

6,414
603
1,311
(170)
8,159
25,603387,911

Chiyoda Corporation (6366)
Consolidated Financial Results for the six months Ended September 30, 2019

(Millions of yen)
As of March 31, 2019
Liabilities
Current liabilities
Notes payable, accounts payable forconstruction contracts
Short-term borrowings
Current portion of long-term borrowings
Income taxes payable
Advances received on construction
contracts in progress
Provision for warranties for completed
construction
Provision for loss on construction
contracts
Provision for bonuses
Provision for business restructuring
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Provisions
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

6

As of September 30,
2019

175,277

136,474

－
118
708

120
1,273

122,252

123,880372

399

67,637

45,105

3,011
1,825
21,300392,505

3,149
1,796
16,574
328,774

15,870
267
1,546
1,305
18,989411,495

35,809
245
1,289
2,259
39,603368,378

43,396
37,112(139,956)(1,435)(60,882)

78,396
72,112(135,167)(1,435)
13,905

(5)

37

(50)
(102)

(78)
4,338

926

793

767

5,090

960
(59,154)352,341537
19,533387,911

Chiyoda Corporation (6366)
Consolidated Financial Results for the six months Ended September 30, 2019(2)

Consolidated statement of income and comprehensive income(Consolidated statement of income)(Millions of yen)Six months ended
September 30, 2018
Net sales of completed construction contracts
Cost of sales of completed construction contracts
Gross Profit (Loss) on completed construction
contracts
Selling, general and administrative expenses

Six months ended
September 30, 2019

146,387
233,757

174,903
152,855(87,370)

22,047

8,897

7,996

(96,267)

14,051

Interest income
Dividend income
Share of profit of entities accounted for using
equity method
Other

1,376
81

1,336
17

63

301

131

123

Total non-operating income

1,652

1,778

Operating Profit (Loss)
Non-operating income

Non-operating expenses
Interest expenses

113

315

Foreign exchange losses
Other

1,511
30

7,948
681

Total non-operating expenses

1,655

8,945

(96,271)

6,883

－

355

－

-

－

355

Profit (Loss) before income taxes(96,271)

7,239

Income taxes - current
Income taxes - deferred

1,618
10,717

2,739
(119)

Total income taxes

12,3362,619(108,607)

4,619

Ordinary Profit (Loss)
Extraordinary income
Gain on sales of investment securities
Reversal of provision for loss on business of
subsidiaries and associates
Total extraordinary income

Profit (loss)
Profit (loss) attributable to non-controlling interests
Profit (loss) attributable to owners of parent

7

(0)

(168)

(108,606)

4,788

Chiyoda Corporation (6366)
Consolidated Financial Results for the six months Ended September 30, 2019

(Millions of yen)Six months ended
September 30, 2018
Profit (loss)
Other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Measurements of defined benefit plans, net oftax
Share of other comprehensive income ofentities accounted for using equity method
Total other comprehensive income

Six months ended
September 30, 2019(108,607)

4,619

(27)

42

2,759
(2,244)

(28)
4,497

337

(132)

(106)

(67)

718

4,311

Comprehensive income(107,888)

8,930

Comprehensive income attributable toComprehensive income attributable to ownersof parent
Comprehensive income attributable to noncontrolling interests(107,974)

9,110

86

(179)

8

Chiyoda Corporation (6366)
Consolidated Financial Results for the six months Ended September 30, 2019(3) Consolidated quarterly statements of cash flow
(Millions of yen)

Cash flows from operating activities
Profit (Loss) before income taxes
Depreciation
Amortization of goodwill
Increase (decrease) in provision for loss on
construction contracts
Interest and dividend income
Share of loss (profit) of entities accounted for using
equity method
Loss (gain) on sales of investment securities
Decrease (increase) in notes and accounts receivable trade
Decrease (increase) in costs on uncompleted
construction contracts
Increase (decrease) in notes and accounts payable trade
Increase (decrease) in advances received on
uncompleted construction contracts
Decrease (increase) in accounts receivable - other
Decrease (increase) in jointly controlled asset of joint
ventureOther, net
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes (paid) refund
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
Purchase of intangible assets
Purchase of investment securities
Proceeds from sales of shares of subsidiaries andassociates
Collection of loans receivable
Other, net
Net cash provided by (used in) investing activities
Cash flows from financing activities
Proceeds from long-term borrowings
Proceeds from issuance of shares
Dividends paid
Dividends paid to non-controlling interests
Repayments of lease obligations
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

9

Six months ended
September 30, 2018

Six months ended
September 30, 2018

(96,271)
1,361
20

7,239
1,593
20

22,903(20,627)(1,457)(1,353)

(63)

(301)

－

(355)

6,862

12,467

4,436(1,233)(6,205)(37,547)

45,7183,950(10,678)(3,030)(3,922)

21,741

1,254(36,040)
650
(93)
6,684
(28,799)(2,584)(20,020)689(312)(3,740)(23,383)654(264)(1,067)(104)(7,928)
(400)
(867)

－

375

57
28
(592)

598
120
(8,103)5,000－(1,937)
(26)
(1)
(0)
3,033

20,00070,000
(0)
(270)
(167)
(59)
89,501

(631)

(359)

(26,990)
101,767
74,77757,65468,306125,961Chiyoda Corporation (6366)
Consolidated Financial Results for the six months Ended September 30, 2019(4) Notes on Consolidated Quarterly Financial Statements(Notes on Assumptions for a Going Concern)
None(Notes on Significant Changes in the Amount of Shareholders’ Equity, if Applicable)
On July 1, 2019, Chiyoda has received a third-party allotment of capital increase from Mitsubishi Corporation.
As a result, the capital increased by 35,000 million yen and the capital reserve increased by 35,000 million
yen; in the second quarter of the current consolidated cumulative period the capital increased to 78,396
million yen and the capital surplus at the end of the second quarter of the consolidated fiscal year
accumulated to 72,112 million yen.
(Changes in Accounting Policies)
Excluding U.S. subsidiaries, the Company has applied IFRS 16, “Lease” for overseas consolidated
subsidiaries, from the first quarter of the fiscal year ending March 31, 2019. The effects of the change haveminor impact on the business performance.
(ASU#2014-09 Revenue from Contracts with Customers)
The Company has applied ASU#2014-09. The effects of the change have minor impact on the businessperformance.

10Chiyoda Corporation (6366)
Consolidated Financial Results for the six months Ended September 30, 2019

3. Production, Contracts and Revenue(Millions of yen)
Apr. 1, 2018－Sept. 30, 2018

Apr. 1, 2019－Sept. 30, 2019

New
contracts(ratio)Revenue(ratio)Backlog ofcontracts(ratio)New
contracts(ratio)Revenue(ratio)Backlog ofcontracts(ratio)Engineering

330,378(99.5%)

144,728(98.9%)

832,720(100.0%)79,506(99.5%)

174,505(99.8%)

904,482(100.0%)LNG Plant

26,072(7.9%)

78,574(53.7%)

292,644(35.1%)

29,532(37.0%)

89,710(51.3%)

472,791(52.3%)

Gas Development/
Processing/Receiving

2,459(0.7%)

949(0.7%)

5,294(0.6%)

986(1.2%)

1,590(0.9%)

12,786(1.4%)

Refinery/Petrochemical/
Metal

188,607(56.8%)

33,117(22.6%)

311,848(37.5%)

33,517(41.9%)

45,427(26.0%)

294,019(32.5%)

Pharmaceutical/Biochemistry/
Chemical

10,546(3.2%)

15,651(10.7%)

30,929(3.7%)

2,698(3.4%)

12,365(7.1%)

13,968(1.5%)

Environment/New Energy/
Infrastructure

98,983(29.8%)

13,537(9.2%)

182,105(21.9%)

9,028(11.3%)

19,933(11.4%)

105,754(11.7%)

Others3,708(1.1%)

2,899(2.0%)

9,896(1.2%)

3,743(4.7%)

5,478(3.1%)

5,162(0.6%)

1,659(0.5%)

1,659(1.1%)

0(0.0%)

397(0.5%)

397(0.2%)(-)

Total

332,037(100.0%)146,387(100.0%)832,720(100.0%)79,903(100.0%)174,903(100.0%)904,482(100.0%)

Domestic

144,701(43.6%)

43,907(30.0%)

263,831(31.7%)

40,652(50.9%)

55,971(32.0%)

201,598(22.3%)

Other Business

187,336
102,480
568,888
39,251 118,931
702,884(56.4%)(70.0%)(68.3%)(49.1%)(68.0%)(77.7%)
Note1: The backlog of contracts for the six months ended September 30, 2019 includes a decrease due tochanges in construction contracts acquired in prior fiscal years, and an increase due to foreignexchange translation adjustments.
Note2: The total amount of the above table does not include consumption tax.
Overseas11