ANNUAL R EP O RT 2020
Year Ended March 31, 2020

Japan Oil Transportation Co.,Ltd.

To Our Shareholders

Shift for the Next
We fulfill our responsibility to the futurewith thorough safety and high-quality service
Before presenting the business report for the 103rd term (April 1, 2019 to March 31, 2020), I would like totake this opportunity to thank our shareholders for your support throughout the year.
The worldwide spread of the novel coronavirus disease (COVID-19) has impacted many fields, raising fears
of further downside for the domestic and overseas economies. As a result, we expect the Japanese
economy will continue to face extremely tough conditions.
The Business environment for the JOT Group also appears likely to remain uncertain as the impact of
COVID-19 on the economy could greatly influence future logistics demand and other factors.
Under these conditions, we will strive to remain as a corporate group that is chosen by customers bysecuring human resources, strengthening safety education, and expanding our line-up of vehicles andcontainers to ensure safe and stable transportation. We additionally plan to establish a stable earnings basein existing businesses and expand our business fields and enhance profitability in growing areas.
In parallel with these initiatives, we will work on group-wide operational reforms such as work-style reforms andpromotion of digitalization, and strive to practice ESG(environmental, social, and governance) management tocontribute to solving social issues through our business activities.
In terms of addressing the challenges of COVID-19, we will
fulfill our mission as an infrastructure company group tasked
with transporting energy and food to protect people’s
livelihoods and the economy, while at the same time doing
our utmost to safeguard our employees and all relatedparties from infection.
We have decided to postpone formulating the new mediumterm management plan starting from Fiscal 2021 as theCOVID-19 pandemic is dramatically altering the expectedbusiness environment.
We intend to formulate the plan after carefully assessing andreviewing the business environment based on upcoming
trends.
I continue to count on your generous support andcooperation.

Shoichiro Hara
President and Representative Director

1

ANNUAL REPORT 2020

August 2020

Results for the 103rd term (Consolidated)With the aim of achieving the objectives of the medium-term management plan (Fiscal 2018 – Fiscal 2020:
at least ¥33,000 million in net sales, ¥1,200 million in operating income, and ¥1,500 million in ordinaryincome), we worked to strengthen profitability by maintaining and expanding our transportation market
share, and promote growing areas such as LNG transportation, hydrogen transportation, and international
chemical transportation.
In parallel with these initiatives, in order to maintain the stability of transportation we have focused on
improving the employment environment to secure drivers and on expanding the number of vehicles.
As a result, net sales in the fiscal year under review showed a year-on-year increase of 0.2%, to ¥34,326
million.
Furthermore, operating income rose by 29.1% year-on-year to ¥1,303 million, ordinary income rose by
29.2% year-on-year to ¥1,699 million due to a fall in operating expenses, and profit attributable to ownersof parent rose by 34.1% year-on-year to ¥1,115 million, all of which came in above the targets of themedium-term management plan.

Net Sales

32,951(Millions of yen)34,240

34,326

Operating Income(Millions of yen)

Ordinary Income

1,699

1,303

1,224

1,467
1,315

1,009

101st term
- Fiscal 2018

102nd term
- Fiscal 2019

103rd term
- Fiscal 2020

Profit Attributable to Owners(Millions of yen)of Parent

101st term
- Fiscal 2018

1,037

102nd term
- Fiscal 2019

103rd term
- Fiscal 2020

Total Assets / Net Assets
(Millions of yen)
Total Assets

1,115

34,111(Millions of yen)

Net Assets

33,279101st term
- Fiscal 2018

102nd term
- Fiscal 2019

Dividend Per ShareFirst six months (Interim period)

33,301103rd term
- Fiscal 2020

(Yen)
Year-end

80

80

80404040404040

101st term
- Fiscal 2018

102nd term
- Fiscal 2019

103rd term
- Fiscal 2020

831
19,163

101st term
- Fiscal 2018

102nd term
- Fiscal 2019

103rd term
- Fiscal 2020

101st term
- Fiscal 201819,110102nd term
- Fiscal 201919,240103rd term
- Fiscal 2020

ANNUAL REPORT 2020

2

Segment overview (consolidated)
Business description

OilTransportation
Business

High-Pressure
Gas
Transportation
Business

Chemical andContainer
Transportation
Business

OtherBusiness3

Overview of the period

Making use of two
different modes oftransportation, namely
rail tank cartransportation, whichenables thetransportation of highvolumes at low cost andwith little environmental
impact, and truck transportation, which is agile and flexible,
the JOT Group conducts transportation of fuel oils such as
gasoline, diesel, and kerosene.

Net sales - ¥16,612 million

The JOT Group conducts
multimodaltransportation by tanker
truck and rail tankcontainers.
We link our customers’satellite stations andplants, etc., to LNG
import terminals aroundJapan, as well as todomestic gas fields.

Net sales - ¥8,790 million

In the chemicaltransportation business, theJOT Group is developing
the leasing of containers
for the transport of liquidand powder chemicals andfoodstuffs, as well as
multimodal transportation,combining various methodsof transportation.

Net sales - ¥8,748 million

In the containertransportation business,
the JOT Group is also
engaged in rental andleasing of various types ofrail containers, such as foragricultural products, foodproducts, industrialproducts, and courier
services, in order to meetthe needs of ourcustomers.

With regard to the solar
power generation
business, we currently
have four solar power
plants located aroundJapan.

ANNUAL REPORT 2020

Operating income - ¥681 million
In the oil transportation business, the record-setting warm
winter depressed demand, with suspension of freight train
services due to natural disasters and increases in personnel
expenses and costs associated with investment in vehicles,
leading to a fall in both net sales and operating income.
As a result, net sales in the oil transportation business fell by
2.4% year-on-year to ¥16,612 million, and operating income
fell by 31.7% year-on-year to ¥681 million.

Operating income - ¥349 million
In the high-pressure gas transportation business, in addition
to freight revisions with our main customers, the acquisitionof new LNG transportation and increased revenue in LPG
transportation resulted in higher net sales and operatingincome.
As a result, net sales in the high-pressure gas transportation
business rose by 3.5% year-on-year to ¥8,790 million, andoperating income rose by 261.4% year-on-year to ¥349
million.

Operating income - ¥212 million
In the chemical transportation business, a boost in revenues
from the acquisition of new domestic transportation andfreight revisions with our main customers were outweighedby measures focused on improving income and expenses ininternational transportation, resulting in lower net sales.
In the container transportation business, there was an impact
by natural disasters again this fiscal year, but a reversal fromthe decline in revenue in the previous fiscal year and a boost
in revenues from revisions of usage fees resulted in higher
net sales.
As a result, net sales in the chemical and containertransportation business showed a year-on-year increase of
2.3% to ¥8,748 million.
In addition, operating income rose to ¥212 million (from aloss of ¥151 million in the previous fiscal year) because ofmeasures to improve income and expenses for internationaltransportation and higher revenues in the containertransportation business.

Net sales - ¥174 million
Operating income - ¥60 million
In the solar power generation business, net sales andoperating income fell due to unfavorable weather and theimplementation of large-scale periodic inspections.
As a result, net sales in the other business fell by 2.5%
year-on-year to ¥174 million, and operating income fell by
8.5% year-on-year to ¥60 million.

TOPICS & COLUMN
Container transportation business: Topics for Fiscal 2020
We have newly developed a container with lashing rings
The JOT Group’s container transportation business engages in the rental and leasing ofcontainers in order to meet the needs of our customers. We have developed various types ofcontainers since starting the business.
This time, we have newly introduced a container with lashing rings.
Goods stacked in a container can collapse due to shaking and vibrations that occur while
being transported by truck or rail.
In order to prevent this problem, we have installed lashing rings inside the container.
Securing goods with ropes and chains that pass through these rings reduces risk of goods
Exterior appearance of container
collapsing, enabling safe transportation of customers’ goods.
We have 500 of these containers nationwide, with an exterior design featuring beautiful
cherry blossom petals, for which we have received much praise from customers.
We will continue to develop and improve a wide variety of containers to meet the needs of our customers, and put all our efforts into
further expanding our business platform.

Container interior (5-ton capacity)

Lashing ring (installed in eight places)

Introduction to chemical transportation business
The chemical transportation business of the JOT Group started in 1958 using rail tank cars for transportation.
We subsequently developed the business to adapt to changes in the times and business environment, and we are currently developing the leasingof various containers, as well as developing “multimodal transportation,” which optimally combines multiple methods of transportation.
ISO tank containers, which comprise the majority of our container line-up, are built in accordance with international standards and can support
three transportation methods: railroads, automobiles, and ships, enabling us to provide the best transportation services depending on conditions.
We also have a variety of other containers such as IBC’s type for transporting small amounts of goods per trip and ISO hopper containers fortransporting powder chemicals, allowing us to meet our customers’ diverse needs.
In 2013, we initiated an international transportation service between Japan, China, South Korea, and Taiwan to help support increasing
globalization of our customers’ businesses.
We have continued to expand this service, establishing a branch in Singapore in 2017 to serve as our operational base in Southeast Asia, and ourtransportation area currently covers 11 countries.
The JOT Group will continue striving to meet the needs of our customers to the greatest extent possible by using the knowledge built up over morethan 50 years of experience, thereby providing optimal transportation services.

Rail tank car used in the early days of the business

ISO tank container used currently

ANNUAL REPORT 20204

Consolidated Financial Statements (Summarized)
Japan Oil Transportation Co., Ltd. and its Consolidated Subsidiaries

CONSOLIDATED BALANCE SHEETSAssets
Current assets:
Cash and depositsNotes and accounts receivable—tradeInvestments in leases
Inventories
OtherTotal current assets
Non-current assets:
Property, plant and equipment
Buildings and structures
Machinery, equipment and vehicles
Containers
Land
Lease assets
Construction in progress
Other
Intangible assets
Software
OtherInvestments and other assets
Investment securities
Deferred tax assets
OtherTotal non-current assets
Total assets

Millions ofU.S. dollars

Millions of yen

As of March 31, 2020 and 2019201920202020¥ 2,046
3,672289
166
196
6,371

¥ 2,546
3,631
375
32
125
6,712

$
23.3
33.3
3.4
0.3
1.1
61.6

21,155
2,003
4,034
3,232
5,513
6,213
92
65
98
41
57
5,653
4,437
712
504
26,908¥
33,27921,366
1,888
4,123
2,718
5,828
6,430
311
64
221
203
18
5,000
3,607
872
519
26,588¥
33,301

196.3
17.3
37.8
24.9
53.5
59.0
2.8
0.5
2.0
1.8
0.1
45.9
33.1
8.0
4.7
244.3
$305.9
Millions of
U.S. dollars

Millions of yen

Liabilities
Current liabilities:
Notes and accounts payable - trade
Short-term loans payable
Lease obligations
Accrued expenses
Income taxes payable
Provision for bonuses
Provision for directors' bonuses
Other
Total current liabilities
Long-term liabilities:
Lease obligations
Deferred tax liabilities
Reserve for vehicle repairs
Net defined benefit liability
Other
Total long-term liabilities
Total liabilities
Net assets
Shareholders’ equity
Common stock
Capital surplus
Retained earnings
Treasury shares, at cost
Accumulated other comprehensive income
Net unrealized gains on other securities
Deferred gains or losses on hedges
Remeasurements of defined benefit plans
Total net assets
Total liabilities and net assets
5ANNUAL REPORT 2020201920202020¥2,021
538
1,699
784
216
696
100
849
6,908

¥1,785
451
1,833
417
396
758
111
968
6,722

$16.4
4.1
16.8
3.8
3.6
6.9
1.0
8.9
61.7

4,559
351
286
1,583
479
7,260
¥14,169

4,649
255
295
1,657
480
7,338
¥14,060

42.7
2.3
2.7
15.2
4.4
67.4
$129.1

18,3281,661
290
16,412
(35)
781
908
(0)
(127)
19,110¥33,279

19,1791,661
290
17,263
(36)
61
245
(3)
(181)
19,240¥33,301

176.2
15.2
2.6
158.6
(0.3)
0.5
2.2
0.0(1.6)
176.7$305.9

CONSOLIDATED STATEMENTS OF INCOME
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Rent income on fixed assets
Gain on sales of non-current assets
Share of profit of entities accounted for using equity method
Other
Non-operating expenses
Interest expenses
Rent expenses on fixed assets
Loss on sales and retirement of non-current assets
Other
Ordinary income
Extraordinary income
Extraordinary expenses
Profit before income taxes
Income taxes - current
Income taxes - deferred
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

2019

2020

2020

¥34,240
31,144
3,095
2,086
1,009
558
0
116
256
51
43
89
252
73
93
39
46
1,315
70
97
1,288
503
(47)
831
—
¥831

¥34,326
30,844
3,481
2,178
1,303
646
0
193
307
52
37
55
250
74
96
51
27
1,699
71
32
1,738
649
(27)
1,115
—
¥1,115$315.4
283.4
31.9
20.0
11.9
5.9
0.0
1.7
2.8
0.4
0.3
0.52.2
0.6
0.8
0.4
0.2
15.6
0.6
0.3
15.9
5.9(0.2)
10.2—$10.2

CONSOLIDATED STATEMENTS OF CASH FLOWSMillions ofU.S. dollars

Millions of yen

Years ended March 31, 2020 and 2019

Net cash provided by operating activities
Net cash used in investing activities
Net cash used in financing activities
Effect of exchange rate change on cash and cash equivalents
Increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year

Millions ofU.S. dollars

Millions of yenYears ended March 31, 2020 and 2019201920202020¥3,547(3,150)(1,213)7(810)
2,856¥2,046¥5,143(3,076)(1,589)
(2)
474
2,046
¥2,546$47.2(28.2)(14.6)
(0.0)
4.3
18.8
$23.3

Note: The approximate exchange rate in effect on March 31, 2020 was ¥108.83 = U.S. $1.

ANNUAL REPORT 20206

Corporate Information

Company Profile (As of March 31, 2020)
Company Name:Japan Oil Transportation Co., Ltd.

Established:

March 27, 1946

Head Office:

WEST BLDG. Gate City Ohsaki
11-1, Ohsaki 1-chome, Shinagawa-ku, Tokyo 141-0032, Japan
TEL: 81-3-5496-7671
URL: https://www.jot.co.jp/en

Paid-in Capital:¥1,661 million

Number of Employees: 1,551 (consolidated); 163 (non-consolidated)

Primary Business1. Transportation of oil products (gasoline, kerosene, etc.) by rail tank car and truck
2. Transportation of high-pressure gas (LNG, etc.) by rail container, truck, and intermodal transportation
3. Transportation of petrochemical and related products by rail container, truck, and domestic and international intermodal transportation;leasing of a range of containers
4. Rental and leasing of railway refrigerated containers and freezer containers and related items
5. Solar power generation business

Major Subsidiaries (As of March 31, 2020)
Paid-in
CapitalEquityOwnership

ENEX, Inc.

¥100 million

100.0%

Trucking transportation of oil products, high-pressure gas, and relatedproducts, site management of oil depots and related places

Kinki Oil Transportation Co., Ltd.

¥ 75 million

100.0%

Trucking transportation of oil products, high-pressure gas, andrelated products

NICHIYU Co., Ltd.

¥ 40 million

100.0%

Sales and leasing of rail vehicle and container accessories, insuranceagency

New J’s Co., Ltd.

¥ 48 million

100.0%

Trucking transportation of petrochemical, high-pressure gas, and relatedproducts, automobile services

JK TRANS Co., Ltd.

¥100 million

100.0%

Trucking transportation of oil products, petrochemical andrelated productsCompany Name

Primary BusinessJapan Oil Transportation Co., Ltd.
WEST BLDG. Gate City Ohsaki
11-1, Ohsaki 1-chome, Shinagawa-ku, Tokyo 141-0032, Japan
Printed in Japan