This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy
between the translated version and the Japanese original, the original version shall prevail. The Company assumes noresponsibility for this translation or for any direct, indirect or any other form of damage arising from the translation.

August 5, 2022
MODEC, Inc.
Takeshi Kanamori, President & CEO
Code: TSE 6269
Contact: Corporate Planning & Strategies Dept.
TEL: +81-3-5290-1240

Announcement on Execution of Agreement regarding
Establishment of Joint Venture Company with TOYOMODEC, Inc. (“MODEC”, President & CEO: Takeshi Kanamori) announced today that MODEC and ToyoEngineering Corporation (“TOYO”, President & CEO: Haruo Nagamatsu) have executed the agreementfor the establishment of a joint venture company for the Engineering, Procurement, Construction andInstallation (EPCI) business of Floating Production Storage and Offloading (FPSO) vessels. The
establishment of the joint venture company is subject to obtaining official permits and approvals ofrelevant authorities.
1.

Purpose of Establishment of the Joint Venture Company

MODEC is a leading provider of floating production solutions such as FPSOs to the offshore oil & gas
industry. MODEC performs EPCI activities, and further by owning and operating its own FPSOs, it
provides oil companies around the world with comprehensive and competitive solutions for oil & gas
production services. As offshore oil and gas development projects increase in scale and move into deeper
waters, the durations of the client contracts for FPSOs have become long-term as well as FPSOs haveincreased in size and complexity. As one of the few companies that can address these large-scale FPSO
projects, MODEC recognize the importance of enhancement of its engineering and project management
capabilities to meet clients’ requirements and expectations. Furthermore, MODEC, as a leading company
in the industry, is aiming to develop environmentally-friendly technologies for next-generation FPSOs.
TOYO is a global engineering group that has rich EPC experience in industrial facilities, such as oil & gas
development, refinery, petrochemicals, fertilizer and power generation. There are 6 autonomous EPC
group affiliates widespread across the world. With this global network, TOYO is aiming for solutions
emphasizing both “Aim to realize an environmentally-friendly society” and “Enrich people’s lives”.
For the past 15 years, MODEC has been collaborating with TOYO, which boasts a robust track record asa global engineering group, on the topside EPC scopes for several FPSO projects. Through theestablishment of the joint venture company, MODEC and TOYO will further deepen the form ofcollaboration and jointly strengthen the engineering and project management capabilities in order to carryout the challenging large-scale FPSO projects, and the two companies jointly aim to strengthen thetechnological capabilities and competitiveness in the FPSO industry. Furthermore, synergies between
MODEC and TOYO are expected to be demonstrated in the exploration of new technology and productopportunities in growth markets as well as in the development of environmentally friendly FPSOs forrealization of decarbonized society.

1|3This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy
between the translated version and the Japanese original, the original version shall prevail. The Company assumes noresponsibility for this translation or for any direct, indirect or any other form of damage arising from the translation.

2.

Outline of the joint venture company(1) Name(2) Head Office(3) Representative(4) Business(5) Capital(6) Shareholding ratios (*)

Offshore Frontier Solutions Pte. Ltd.
Singapore
To be nominated
EPCI business for FPSOs
10 million United States dollars
MODEC Offshore Production Systems (Singapore) Pte. Ltd. (“MOPS”,wholly owned subsidiary of MODEC) 65%
TOYO 35%(7) Date of establishment (*)
August 2022 (Planned)(*) The company will initially be established by MOPS, and TOYO plans to invest in the company around
September 2022 (subject to approval by the relevant authorities).
3.
(1)

Outline of the joint venture partner
Name

Toyo Engineering Corporation
HIBIYA FORT TOWER, 16th Floor 1-1, Nishi Shimbashi 1-chome(2) Head office
Minato-ku, Tokyo105-0003, Japan(3) Representative
Haruo Nagamatsu, President & CEO
R&D support, design, engineering, procurement, construction,commissioning, technical assistance for industrial facilities
Business Fields: oil, gas, oil & gas development, petrochemicals,(4) Businesschemicals, water treatment, transportation systems, power generation,
nuclear power, advanced production systems, pharmaceutical, finechemical, distribution systems, biotechnology, environment and others(5) Capital
18,198 million yen(6) Date of establishment
May 1, 1961
Major shareholders and Mitsui & Co., Ltd.:
Ownership voting rights ratio 22.89%(7)
shareholding ratios(Shareholding ratio 14.93 %)CapitalNo
relationship
Relationshipin humanNo
resources
Relationship betweenBusiness(8)
No business transactions in the last 12 months
MODEC and TOYO
relationship
Whether
TOYO falls
Nowithin arelated partyto MODEC(9) Consolidated financial results and financial position for the last 3 years
Accounting period
FY2019FY2020
FY2021
Consolidated total equity
35,980 million yen
40,077 million yen
44,562 million yen
Consolidated total assets
208,719 million yen
218,255 million yen
240,853 million yen
Consolidated net assets
544.16 yen
650.52 yen
766.81 yen
per share
Consolidated revenue
219,094 million yen
184,000 million yen
202,986 million yen

2|3This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy
between the translated version and the Japanese original, the original version shall prevail. The Company assumes noresponsibility for this translation or for any direct, indirect or any other form of damage arising from the translation.

Consolidated operating
profitConsolidated ordinary
incomeComprehensive income
attributable to Owners ofparentConsolidated net income
per share
Dividend per share
4.

1,890 million yen

1,615 million yen

2,963 million yen

2,467 million yen

2,781 million yen

3,126 million yen

1,664 million yen

814 million yen

1,620 million yen

28.40 yen

13.91 yen

27.65 yen

0 yen

0 yen

0 yen

Schedule

Execution of the agreement for the establishment of the joint venture company: August 5, 2022
5.

Future outlook

Although MODEC expects that the impact of this matter on its consolidated financial results for the fiscal
year ending December 2022 will be minor, it will promptly disclose any matters that should be disclosed
when necessary.

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