Translation

November 11, 2010

Consolidated Financial Results
for the Second Quarter of the Fiscal Year Ending March 31, 2011
Company name: CHIYODA CORPORATION
Listing:First Section of the Tokyo Stock Exchange
Stock code:
6366
URL:
http://www.chiyoda-corp.com/
Representative: Takashi Kubota, President & CEO
Inquiries:
Nobuo Sekita, General Manager, Accounting Department
TEL: +81-45-506-9410 (from overseas)
Scheduled date to file Quarterly Report: November 12, 2010
(Millions of yen with fractional amounts discarded, unless otherwise noted)

1.

Consolidated performance for the second quarter of the fiscal year ending March 31,
2011 (from April 1, 2010 to September 30, 2010)(1) Consolidated operating results (cumulative)
Net sales

Operating income

Millions of yen
2Q ended September 30,
2010
2Q ended September 30,
2009% Millions of yen

Ordinary income% Millions of yen

111,916 (32.0)

5,329

-

3,024

164,658 (31.6)(2,382)-(380)Net income per share

2Q ended September 30,
2010
2Q ended September 30,
2009(Percentages indicate year-on-year changes.)
Net income% Millions of yen-%2,886-(1,745)-Fully diluted net
income per share

Yen

Yen

11.14

-(6.73)-(2) Consolidated financial position
Total assets

Net assets

Equity ratio

Net assets per share

Millions of yen

Millions of yen%

Yen

As of September 30,
2010

308,995

150,63748.6

579.15

As of March 31, 2010

328,174

149,25345.3

573.61

Reference: Equity

As of September 30, 2010:

150,109 million yen–1–

As of March 31, 2010:

148,683 million yen

2.

Cash dividends
Cash dividends per share
Record date

First quarter

Second quarter

Third quarter

Fiscal year-end

AnnualYen
YenYenYen
Fiscal year ended3.50
March 31, 2010
Fiscal year ending
March 31, 2011
Fiscal year ending
5.00
March 31, 2011
(Forecast)
Note: Revision of the forecast in the second quarter of the fiscal year ending March 31, 2011: None

3.

Yen
3.50

5.00

Consolidated earnings forecasts for the fiscal year ending March 31, 2011 (from April
1, 2010 to March 31, 2011)(Percentages indicate year-on-year changes.)
Net sales
Millions ofyen

Fiscal year ending
March 31, 2011%

240,000 (23.3)

Operating income

Ordinary income

Millions ofyen

Millions ofyen%

16,000 840.0

Net income pershare

Net income%Millions ofyen%

Yen

13,000 168.7

4,00035.4

15.43

Note: Revision of the forecasts in the second quarter of the fiscal year ending March 31, 2011: Yes

4.

Others(1) Significant changes in subsidiaries during the period (changes in specified subsidiaries resulting in
the change in scope of consolidation): None
(2) Application of simplified accounting as well as specific accounting for preparing the quarterly
consolidated financial statements: None
(3) Changes in accounting policies, procedures, and methods of presentation for preparing the quarterly
consolidated financial statements (changes described in the section of “Changes in significant
matters forming the basis of preparing the quarterly consolidated financial statements”)
a. Changes due to revisions to accounting standards: Yes
b. Changes due to other reasons: None–2–(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, 2010
260,324,529 shares
As of March 31, 2010
260,324,529 sharesb. Number of treasury stock at the end of the period
As of September 30, 20101,134,872 shares
As of March 31, 2010
1,117,239 sharesc. Average number of shares during the period (cumulative from the beginning of the fiscal year)
For the second quarter of the fiscal year ending March 31, 2011
259,196,265 shares
For the second quarter of the fiscal year ended March 31, 2010
259,340,373 shares* Proper use of earnings forecasts, and other special directions
The forward-looking statements, including earnings forecasts, contained in these materials are basedon information currently available to the Company and on certain assumptions deemed to bereasonable. Actual business and other results may differ substantially due to a number of factors.

–3–5.

Qualitative Information related to Consolidated Performance(1) Analysis Results
During the cumulative second quarter of the current consolidated fiscal year, the market environment
surrounding the Chiyoda Group was characterized by the realization of large-scale investment projects
in various locales against the backdrop of growth in future oil and gas demand. At the same time,
however, business was affected by the continuing appreciation of yen, and the Group was exposed toincreasingly sharp competition from Korean and European contractors.
Given these circumstances, the Chiyoda Group continued to focus on activities aimed at securing
orders for projects that enable the Group to take maximum advantage of its technological superiority,
and worked to execute backlog projects, including construction work on Qatargas LNG (LiquefiedNatural Gas) Plant Trains 6 and 7, and on an LNG plant in Papua New Guinea.
Consolidated New Contracts for the cumulative second quarter of the current consolidated fiscal year
amounted to ¥124.283 billion (year-on-year increase of 69.7%), while the consolidated Backlog
amounted to ¥523.553 billion (year-on-year increase of 59.6%). The main new contracts received werefor construction of a polycrystalline silicon plant in Malaysia and a domestic LNG receiving terminal.
Consolidated Revenues amounted to ¥111.916 billion (year-on-year decrease of 32.0%), Operating
Income amounted to ¥5.329 billion (compared with an Operating Loss of ¥2.382 billion for the same
cumulative quarter in the prior consolidated fiscal year) and Ordinary Income amounted to ¥3.024billion (compared with an Ordinary Loss of ¥380 million for the same period one year earlier). Net
Income for the cumulative consolidated second quarter amounted to ¥2.886 billion (compared with acumulative Net Loss of ¥1.745 billion for the same period one year earlier).
A summary of the operating results for the engineering business, which is the Chiyoda Group’s main
business segment, is provided below.
(Natural Gas, Electric Power)
Overseas, the Chiyoda Group continued to execute EPC (Engineering/Procurement/Construction)
activities for an LNG plant in Papua New Guinea and LNG/gas processing plants in Qatar, plus basic
design services for a floating LNG plant in Brazil and for multiple other projects. In addition, theGroup’s subsidiary in Qatar is providing EPCm (Engineering/Procurement/Construction management)
activities under a long-term service contract for remodeling and renovation projects at the LNG/gas
processing plants constructed by the Chiyoda Group, and developing business operations to provide
similar services for other LNG/gas processing plants in Qatar.
Domestically, the Chiyoda Group received contracts for a project related to CO2 separation andcapture facilities and several study works related to reduction of CO2 for the coming low-carbon
society. The Group also proceeded smoothly with the execution of existing contracts, including
construction work for a newly awarded LNG receiving terminal project in addition to three similar
projects under construction in Niigata Prefecture and Okayama Prefecture.
(Petroleum, Petrochemicals, Gas Chemicals)
Overseas, the Chiyoda Group directed its concerted efforts toward investment plans for refinery
projects in the Middle East and Southeast Asia. We engaged ourselves in diligently executing an EPC
project for a heavy oil cracking unit in Saudi Arabia and a basic design work for a desulfurization plantin Singapore, and also initiating tank terminal EPC activities. We aim to drive our global operations bystrengthening the group companies through execution of these projects.
On the domestic front, the movement for refinery restructuring is accelerating which follows the law
enacted last year entitled “Sophisticated Methods of Energy Supply Structures” for enhancement ofenergy supply systems.kou Therefore, projects for reinforcing heavy oil cracking capacities andfacilities integration and/or demolition are undertaken. Against this background, the Group isdeveloping business operations for projects following clients’ needs for enhancement of efficiency andcompetitiveness of refineries, and the reduction of energy consumption. In addition, from an execution
perspective the Group proceeded as planned with efforts such as RFCC (Resid Fluid CatalyticCracking) unit construction work, HS-FCC (High Severity Fluid Catalytic Cracking) semi-commercial
unit construction work (for fiscal year 2010) and a cooperative project within an industrial complex forhydrogen.

–4–

(General Chemicals, Industrial Machinery, Environment, and Other)In the General Chemicals, Industrial Machinery and Environment sector the Chiyoda Group
concentrated its business activities on the low-carbon technology field, and successfully linked this to
the receipt of orders for a plant to produce polycrystalline silicon, a basic material for photovoltaic
cells, and for a facility related to lithium ion batteries for electric vehicles and hybrid automobiles.
In the pharmaceutical field, there has been an increase in investment plans for highly bioactive
pharmaceuticals such as antibody drugs and anti cancer drugs, and the Group aggressively pursued
sales activities in response to these increasing demands.
(Note) See Page10 for more information about segment New Orders, Revenues, and Contract Backlog.

–5–6.

Consolidated quarterly financial statements(1) Consolidated balance sheets(Millions of yen)
As of September 30, 2010

As of March 31, 2010
(Summary)

27,971

43,002

49,11251,31889,841

96,841

12,346

7,283

70,504

69,91722,882

22,357(3)(2)

272,656

290,719

AssetsCurrent assets
Cash and deposits
Notes receivable, accounts receivable fromcompleted construction contracts
Short-term investment securities
Costs on uncompleted construction
contracts
Jointly controlled assets of joint venture
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings and structures, net

7,884

8,042

Land

11,938

11,938Other, net

1,237

1,468

Total property, plant and equipment

21,061

21,450

4,840

5,142

Investment securities

7,385

7,855

Other

3,385

3,339

Allowance for doubtful accounts

(333)

(333)

Total investments and other assets

10,437

10,86136,33937,454308,995

328,174

Intangible assets
Investments and other assets

Total noncurrent assets
Total assets–6–(Millions of yen)
As of September 30, 2010

As of March 31, 2010
(Summary)

83,84489,523Liabilities
Current liabilities
Notes payable, accounts payable forconstruction contracts
Current portion of long-term loans payable-4

Income taxes payable
Advances received on uncompleted
construction contracts
Provision for warranties for completed
construction

808

4,675

40,20648,168

4,345

4,486

Provision for loss on construction contracts

2,946

4,427

Provision for bonuses

2,999

3,252

Other

9,720

11,421

144,870

165,960Long-term loans payable

10,162

10,000

Provision

2,428

2,428

896

532

13,487

12,960158,358

178,921

Capital stock

43,39643,396

Capital surplus

37,112

37,112Retained earnings

72,73970,759Total current liabilities
Noncurrent liabilities

Other
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders' equity

Treasury stock(1,228)(1,215)

Total shareholders' equity

152,019150,053

Valuation and translation adjustments
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges

(349)

102

101

(156)Foreign currency translation adjustment(1,662)(1,315)

Total valuation and translation adjustments(1,910)(1,369)527

569

150,637

149,253

308,995

328,174

Minority interests
Total net assets
Total liabilities and net assets–7–(2) Consolidated statement of income(Millions of yen)
Second quarter ended September 30, 2009 Second quarter ended September 30, 2010
(From April 1, 2009
(From April 1, 2010
to September 30, 2009)
to September 30, 2010)
Net sales of completed construction contracts

164,658

111,916

Cost of sales of completed construction contracts

161,056

100,196

Gross profit on completed construction contracts

3,601

11,719Selling, general and administrative expenses

5,983

6,390

Operating income (loss)(2,382)

5,329

Interest income

633

307

Dividends income

51

51

Equity in earnings of affiliates

104

10

Real estate rent

71

67

Non-operating income

Foreign exchange gains

1,257-

97

166

2,215

603

126

126

Foreign exchange losses

-

2,692

Rent expenses on real estates

49

48

Other

38

41

Total non-operating expenses

213

2,907(380)

3,024

Other
Total non-operating income
Non-operating expenses
Interest expenses

Ordinary income (loss)
Extraordinary income
Surrender value of insurance-

109

Total extraordinary income

-109

-

146

-

146

(380)

2,987

Extraordinary loss
Loss on adjustment for changes of accounting
standard for asset retirement obligations
Total extraordinary losses
Income (loss) before income taxes and minority
interests
Income taxes-current

2,656

832

Income taxes-deferred(1,329)(704)

Total income taxes

1,327

128

Income before minority interests

-

2,859

Minority interests in income (loss)

37(27)(1,745)2,886

Net income (loss)–8–(3) Consolidated statement of cash flows(Millions of yen)
Second quarter ended September 30, 2009 Second quarter ended September 30, 2010
(From April 1, 2009
(From April 1, 2010
to September 30, 2009)
to September 30, 2010)
Net cash provided by (used in) operating
activities
Income (loss) before income taxes andminority interests

(380)

2,987

Depreciation and amortization

1,011

1,047

Interest and dividends income
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 jointly controlled assetof joint venture

(684)

(359)

(18,946)

2,089

(468)

(5,067)

11,074(5,523)(4,093)(7,906)

19,825(586)

Other, net(3,074)(1,828)Subtotal

4,263(15,148)317

133

Interest and dividends income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating
activities
Net cash provided by (used in) investing
activities
Payments into time deposits(132)(125)(5,826)(4,734)(1,377)(19,873)-(29)

Purchase of property, plant and equipment

(553)

(653)

Purchase of intangible assets

(483)

(373)

(1)

4(1,038)(1,052)

Proceeds from long-term loans payable-

162

Repayment of long-term loans payable

(14)

(4)

Proceeds from issuance of common stock7-(1,937)(904)

Other, net
Net cash provided by (used in) investing
activities
Net cash provided by (used in) financing
activities

Cash dividends paid
Cash dividends paid to minority shareholders

(7)

(9)

Other, net

(15)

(20)

(1,967)

(776)

285

(359)

(4,097)(22,061)

135,536

139,790290-

131,729

117,728

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 ofperiod
Increase in cash and cash equivalents fromnewly consolidated subsidiary
Cash and cash equivalents at end of period

–9–

7.

Production, Contracts and Sales (Consolidated)
Millions of Yen
Apr. 1, 2010 —September. 30, 2010
Net salesAmt%

New contracts
Amt%

Backlog of contracts
Amt%

Business Segment
Engineering
LNG plants .................................
Gas and power utilities ...............
Gas chemicals............................
Petroleum and petrochemicals...
General chemicals ........................
Industrial machinery......................
Environment and other ...............
Total Engineering

13,69136,726
107
24,48334,767
8,695
2,843
121,316

11.0
29.5
0.1
19.7
28.0
7.0
2.3
97.6

34,787
21,052
54
31,231
8,105
11,9891,835
109,056

31.1
18.8
0.1
27.9
7.2
10.7
1.6
97.4

253,897
138,232637
46,62642,42018,557
22,629522,999

48.5
26.4
0.1
8.9
8.1
3.6
4.3
99.9

Other ..........................................

2,966

2.4

2,859

2.6

553

0.1

Domestic ....................................
Overseas ....................................
Total...........................................

69,23155,051
124,283

55.7
44.3
100.0

61,02450,892111,916

54.5
45.5
100.0

176,972
346,580
523,553

33.8
66.2
100.0

Millions of Yen
Apr. 1, 2009 September. 30, 2009
Net salesAmt%

New contracts
Amt%

Backlog of contracts
Amt%

Business Segment
Engineering
LNG plants .................................
Gas and power utilities ...............
Gas chemicals............................
Petroleum and petrochemicals...
General chemicals ........................
Industrial machinery......................
Environment and other ...............
Total Engineering

6,333
9,320
47
44,891
7,273
936
2,049
70,854

8.7
12.7
0.1
61.3
9.9
1.3
2.8
96.8

55,81428,141
194
53,695
14,810423
9,052
162,132

33.9
17.1
0.1
32.6
9.0
0.3
5.5
98.5

83,746148,279
698
74,775
13,4352,301
4,064
327,301

25.5
45.2
0.2
22.8
4.1
0.7
1.3
99.8

Other ..........................................

2,363

3.2

2,525

1.5

712

0.2

Domestic ....................................
Overseas ....................................
Total...........................................

36,46236,75573,218

49.8
50.2
100.0

79,49085,167
164,658

48.3
51.7
100.0

172,387
155,626
328,014

52.6
47.4
100.0

Note: The backlog of contracts for the six months ended September 30, 2010 includes a decrease due to changes
in construction contracts acquired in prior fiscal years, an increase due to adjustments in new contract
amounts, and an increase due to foreign exchange translation adjustments.

– 10 –