Business Overview for Fiscal
Year ended March 2011
Takashi Kubota
President and CEO
May 12, 2011

All Rights Reserved. CHIYODA 2011

We wish to convey our deepest sympathy tothose affectedby the Great East Japan Earthquake.

We have organized a “Reconstruction
Reconstruction Support Task Team”Team
to support our clients for the earliest resumption of their operations.

All Rights Reserved. CHIYODA 20111

Table of Contents
1 Business1.
B siness OOverview
er ie of FY 2011/3
2. Mid-term Management Plan “Engineering
Excellence Value Creation 2012”
Excellence,-Mid-pointp
Review-Way Forward for the Second-Half

All Rights Reserved. CHIYODA 20112

1 Business Overview of FY 2011/3
 Completion of mega LNG plants in Qatar (7.8MM ton per annum/train capacity)
 Qatargas/ LNG Trains 4&5 : Completed in 2008-2009
 RasGas/ LNG Trains 6&7:
Completed in 2009
 Qatargas/ LNG Trains 6&7: Completed in 2010

 Construction of two new LNG trains in Papua
p New Guinea ((to be completedpin 2014))
 Successful completion of several domestic projects
 SecuringSi new ordersd UnsatisfactoryUti f tresult.
lt Business development in new area Securing
Si ordersdiin new bbusinessisegmentt andd new regioni Established “Technology Development Business Operation” section

 Strengthen Chiyoda Group operation
 Established “Global Operation Division”
 Expansion of business field as Chiyoda Group (ex. CAEL, CSL)All Rights Reserved. CHIYODA 20113

2-1 Mid-Point Review((1)) Business Environment
Observation in May 2009 (Start of the Plan)(May2009)
・Steadygrowth in energy demand, followed by continuous strategic investment in energy plants
・More stringent environmental regulations and harsh conditions for resource development
・Increasing presence of national oil company (NOC)
・Various strategic initiatives and accelerated overseas investment by domestic customers

Additional phenomena observed in the past two years
・Rapid growth of South Korean companies, more formidable competition amongfi t tierfirstti engineeringii companiesi・Continued appreciation of Japanese Yen
・Increase of infrastructure pprojects
jin emerging
g g countries and Japanesepgovernment’s support
・Concerns over nuclear power, signs of shift toward gas, coal and renewable energy

All Rights Reserved. CHIYODA 201142-1 Mid-Point Review((2)) Concept
p of Mid-Term Management
gPlan; For Stable Growth
Further strengthen core businesses⇒Maintain top tier position in gas value chain projects
Diversification of business model/segment/region⇒Business model (EPC, Operation & Maintenance, Investment)⇒Segment （LNG, Hydrocarbon, Renewable energy, Non-ferrous metal, Pharmaceutical, Newtechnology）⇒Region（Middle East & Asia → Oceania, Latin America etc.）

Not chasing the volume, but placing more importance on quality and income
growthAll Rights Reserved. CHIYODA 201152-1 Mid-Point Review((3)) Performance and Results
Domestic projects and clients  better performance than planned
Successful entry into new businesses (such as polysilicon,power, nickel
polysilicon solar powerrefining, lithium ion batteries, etc.)
Too many resources allocated to completing the Qatar mega LNG projects

 Limited new orders, especially in conventional overseas market
 Decline in profitability
 Affected Mid-term Management Plan

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2-2 For the Second-Half[Further Growth]
Maintaining top tier position inGas Value Chain projects(Core business)

Business Environment (Original Observation)
Steady growth in energy demand, followed byg investment in energy
gy pplants
continuous strategicMore stringent environmental regulations andharsh conditions for resource development

Additional phenomena
Rapid growth of South Korean companies,
hard competition among 1st tier contractors

Continued appreciation of Japanese Yen
Increase of infrastructure projects in emerging
countries and Japanese government support
Concerns over nuclear power, signs of shift
toward gas, coal and renewable energy

Non-hydrocarbon projects
Entry into infrastructurebusiness
New business segments/ model

Strengthen the relationship withclients
Expandingpgg
global operationpInvestments[Reinforcement]
Improve competitiveness andexecution capacity/ capability
HR development

SStablee Grow
wth

Various strategic initiatives and accelerated
overseas investment by domestic customers

Diversification

Mid-Poiint Reeview

Increasing presence of NOC

Goal

2-3 Focus in the Second-Half((1)) Achieving
g Further Growth
Maintaining top tier position in Gas Value Chain projects
 Continue to secure LNG projects
 Involved in the projects from the early stage such as FEED*1
 Joint Venture operation to meet the requirements of each project

Diversification
 Non-Hydrocarbon projects
 Entryy into infrastructure business New business segments / modelStrengthen
the relationships
gp with clients
 The relationship with IOC*2, NOC
 As “partner”, supporting the Japanese clients aiming for overseas operation*1: Front-End Engineering and Design*2:
2: International Oil Company

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2-3 Focus in the Second-Half((1)) Achieving
g Further GrowthExpanding Global Operations
 Overseas group operation: Reinforcing existing operations, establishing in newllocation,tiandd iincreasingi cooperation/ti / iintegration
tti among group companiesi Re-defining the mission of each group company
 JV operationsInvestments
 Strategicg Investment for Growth Reinforce and expand global operation bases
 Investment in new business segments such as infrastructure, CSP*, water recycling etc.
 PLE business Investment in Corporate Infrastructure IT management system Office integration

 InvestmentItt ini ResearchR
h anddD
Developmentlt Continue strategic R&D investment* Concentrated Solar Power (generation)

All Rights Reserved. CHIYODA 201192-3 Focus in the Second-Half((2)) Reinforcement
Improve competitiveness and execution capacity / capability
 Data Management System
 GES * operationsti
 Collaboration among group companies

Human resource (HR) development
 Create qualified “Chiyoda” personnel through on-the-job training, off-the-job training and a career path program Introduce global HR management system* Global Engineering Satellite

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2-4 Business Evolution & Portfolio
Global Operations

Local project execution
by Group Companies

PLE*1businesses

Strengthen competitiveness andexecution capacity for core fields(LNG/gas)yg
Hydrocarbon
Segment

New businessmodel(Investment etc.)

Non-Hydrocarbon Fields

Core Field
Conventional
EPC business

CSP, PV*2/ water
recycling etc.

Support Japaneseclients' overseas
clientsbusiness
expansion

Pharmaceutical/Environment/ Nonferrous metal
refining etc.

Infrastructure
and other
new fields

Partneering withhother companie
ces

Expandbusiness model

New Businessyg
Non-Hydrocarbon
Segment[Core Fields ]Enhance competitiveness, execution capacity and capability

Further expansion[Non H drocarbon Fields] Pharmaceutical,
Pharmace tical enironment nonferro s metal[Non-Hydrocarbonenvironment,non-ferrous
metal, etc
Partnering with clientsDiversifyby EPC model[Global Operations] Strengthen functions of group companies

Expand business
model[New Business] New Business segments (CSP, PV, water recycling etc.)
New business model

Bases for future
growthygg*1: Plant Lifecycle
Engineering*2: Photo Voltaic (generation)

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2-5 Consolidated Net Income (projections)Target of 23 billion yen in consolidated net income
for fiscal year ending March 2013 is going to be
tough to achieve
Actual:

FY 2010/3
FY 2011/33 billion yen
8 billion yen

Projected: FY 2012/3

8 billion yen

Through taking measures stated above,
improve Chiyoda Group profitability

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2-6 Main target fields/projects in short/medium-term
Overseas： ・New EPC projects
Mega LNG plants in Oceania （Ichthys , Browse, etc.)
Refinery in Vietnam
Hydrocarbon projects in Latin America/Russia/Africa, etc
FLNG* project（Petrobras and others）

・Expansion of existing LNG plants
・Japanese clients’ overseas investment (incl. PLE)
・Small/mid-sized projects by overseas group companiesDomestic：

・LNG receiving terminals (new & upgrading)・Pharmaceutical / environmental related projects
・Upgrading projects in petroleum and petrochemicals
PLE business by domestic group companies
・PLE

New fields： ・Non-hydrocarbon
・Infrastructure businesses
・New technology related businesses
・CSP, PV and water recycling business*: Floating LNG

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2-7 “Vigorous” Company with “Vigorous” People“Energy and Environment in Harmony”
SocietySi t andd ththe bbusinessi
environment
it iis rapidlyidl ttransforming,fiandd manyclients place more importance on engineering functions than ever before.
Energy and resource development needs to be increased to meet global
demand but due consideration needs to be given to environmental
sustainability.
party Chiyoda,y, as an engineeringgg company,
p y, is eager
g to take p
with its concept of “Energy and Environment in Harmony”.
In order to achieve this, our people have to be “Vigorous”
Vigorous in all aspects tomake Chiyoda “Vigorous” company.

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Reference Materials

All Rights Reserved. CHIYODA 2011

LNG Supply/ Demand Projections
Demand increase on the order of several million tons expected inJapan in the short term.
Over the mid-long
mid long term
term, demand for LNG will increase more rapidly
than forecasted due to the incident at Fukushima nuclear power plant.
400？

350

MMtpa

300

250

200
Capacity under Construction
Existing Capacity

150

Demand Range

100
2010

2012

2014

2016

2018

2020

Source: Made by Chiyoda Corporation based on various data

All Rights Reserved. CHIYODA 201116

Major Potential LNG Projects (Before Final Investment Decision)

Yamal

Shtokman
Snohvit

Sakhalin T3

Damietta T2
Idku T3

KitimatVladivostok
Arzew

Das Island

Delta Caribe

FLNG

Liquid Niugini Gas
７＋
BrassOKCameroon
Angola T2
Pluto2・3
Ichthys
BBrowseScarboroughWheatstone
Darwin2MaselaGreater Sunrise
Petrobras etc.

Australia Pacific
Arrow Energy

Source: Made by Chiyoda Corporation based on various data

All Rights Reserved. CHIYODA 201117

Please address inquiries to;

IR and Public Relations Office
TEL
FAX+81-45-506-7538+81-45-506-7085

URL https://ssl
https://ssl.chiyodachiyodacorp.com/contact/index.php

Forward-looking Statements
The forecasts
Th
ft andd planslin
i thisthi presentationt ti are bbasedd on iinformation
fti available
il bl tto managementt on
May 12, 2011, the date these materials were prepared. Actual results may differ significantly fromthese forecasts for a number of factors, including but not limited to changes in economic conditions
and operation environment in Japan and overseas.

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