Consolidated Financial Results for the Fiscal Year Ended March 31, 2020
<under Japanese GAAP>May 14, 2020
Note: The following report is a summary of the Japanese-language original.

Company name: Japan Petroleum Exploration Co., Ltd.
Listing:
Tokyo Stock Exchange, First Section
Securities code: 1662
URL:
https://www.japex.co.jp/
Representative: Masahiro Fujita, Representative Director and President
Inquiries:
Masaru Asai, General Manager, Media and Investor Relations Department
TEL: +81-3-6268-7110 (from overseas)
Scheduled date of ordinary general shareholders’ meeting:June 26, 2020
Scheduled date to commence dividend payments:
June 29, 2020
Scheduled date to file Securities Report:
June 26, 2020
Presentation of supplementary material on financial results:
Yes
Holding of financial results presentation meeting (for institutional investors and analysts): Yes
1.
(1)(Millions of yen with fractional amounts discarded, unless otherwise noted)

Consolidated financial results for the fiscal year ended March 31, 2020
(April 1, 2019 – March 31, 2020)
Consolidated operating results(Percentages indicate year-on-year changes.)
Net sales

Operating profit

Fiscal year ended

Millions of yen

March 31, 2020

318,82219.0

14,283 517.4

32,635 160.6

26,815

81.5

March 31, 2019267,980

16.2

2,313

12,523 227.1

14,770–Note: Comprehensive income:% Millions of yen

Profit attributable toowners of parent

Ordinary profit

FY2020/3: (6,254) million yen (– %)% Millions of yen(73.6)% Millions of yen%

FY2019/3: (7,804) million yen (– %)Ratio ofRatio ofordinary profit to operating profit tototal assets
net sales

Basic earnings per
share

Diluted earnings
per share

Return on equity

Fiscal year ended

Yen

Yen

%

%

%

March 31, 2020

469.18

–

6.5

5.1

4.5

March 31, 2019258.44

–

3.5

1.8

0.9

Reference: Equity in earnings (losses) of affiliates:(2)

FY2020/3: 11,960 million yen

FY2019/3: 12,550 million yen

Consolidated financial position
Total assets

Net assets

Equity ratio

Net assets per share

Millions of yen

Millions of yen%

Yen

As of March 31, 2020

627,132

440,15764.2

7,046.18

As of March 31, 2019655,288

450,156

63.6

7,287.32

Reference: Equity

As of March 31, 2020: 402,706 million yen

As of March 31, 2019: 416,488 million yen

-1-

(3)

Consolidated cash flows
Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities

Cash and cash
equivalents at end of
periodFiscal year ended

Millions of yen

Millions of yen

Millions of yen

Millions of yen

March 31, 2020

69,895(18,701)(13,743)

138,259

March 31, 2019

30,970(13,969)(15,493)

100,633

2.

Cash dividends
Annual dividends

Ratio of
Dividend
dividends topayout ratio
net assets(consolidated) (consolidated)First
quarter

Secondquarter

Third
quarter

Fiscalyear-end

AnnualTotalannual cash
dividends

Yen

Yen

Yen

Yen

Yen

Millions of
yen

%

%

Fiscal year ended
March 31, 2019

–

10.00

–

30.00

40.00

2,286

15.5

0.5

Fiscal year ended
March 31, 2020

–

25.00

–

25.00

50.00

2,857

10.7

0.7

Fiscal year ending
March 31, 2021
(Forecast)

–

25.00

–

25.00

50.00

3.

–

Consolidated financial forecasts for the fiscal year ending March 31, 2021 (April 1, 2020 – March 31, 2021)(Percentages indicate year-on-year changes.)

Net sales

Ordinary profit%

Millionsof yen%Millionsof yen%Millionsof yen%Yen

223,685 (29.8)(8,222)–(2,139)–(3,193)–(55.87)

Millionsof yenFiscal year ending
March 31, 2021

Profit attributable Basic earnings per
to owners of parent
share

Operating profit

*
(1)

Notes
Changes in significant subsidiaries during the period under review (changes in specified subsidiaries resulting
in the change in scope of consolidation): Yes
Exclusion: one company (JAPEX UK E&P CENTRAL Ltd.)(2)

Changes in accounting policies, changes in accounting estimates, and restatementa. Changes in accounting policies due to revisions to accounting standards and other regulations: Noneb. Changes in accounting policies due to other reasons: Nonec. Changes in accounting estimates: None
d. Restatement: None(3)

Number of issued shares (common shares)
a. Total number of issued shares at the end of the period (including treasury shares)
As of March 31, 2020
57,154,776 shares
As of March 31, 201957,154,776 sharesb. Number of treasury shares at the end of the period
As of March 31, 2020
2,303 shares
As of March 31, 2019
2,207 sharesc. Average number of shares during the period
Fiscal year ended March 31, 2020
57,152,522 sharesFiscal year ended March 31, 201957,152,632 shares-2-Reference: Summary of non-consolidated results
Non-consolidated financial results for the fiscal year ended March 31, 2020
(April 1, 2019 – March 31, 2020)(1) Non-consolidated operating results(Percentages indicate year-on-year changes.)
Net sales

Operating profit% Millions of yen

Ordinary profit

ProfitFiscal year ended

Millions of yen% Millions of yen

March 31, 2020

217,079

20.6

7,893

(16.4)

29,71838.0

25,413

6.9

March 31, 2019180,024

9.0

9,440

(18.8)

21,536

6.1

23,765–

Basic earnings per share

Diluted earnings per
share

Fiscal year ended

Yen

Yen

March 31, 2020

444.66–

March 31, 2019415.82–(2)% Millions of yen%

Non-consolidated financial position
Total assets

Net assets

Equity ratio

Net assets per share

Millions of yen

Millions of yen%

Yen

As of March 31, 2020

442,637

380,44285.9

6,656.63

As of March 31, 2019467,656

391,22583.7

6,845.27

Reference: Equity

As of March 31, 2020: 380,442 million yen

As of March 31, 2019: 391,225 million yen* Financial results reports are not required to be audited by certified public accountants or an audit
corporation.
* Proper use of financial forecasts, and other special matters
The forward-looking statements, including the financial forecasts shown in this document are based on
information currently available to the Company and on certain assumptions deemed to be reasonable. As such,they do not constitute guarantees by the Company of future performance. Actual performance and other results
may differ materially from these forecasts due to various factors.
For the suppositions that form the assumptions for financial forecasts and cautions concerning the use thereof,
please refer to the section of “(4) Future outlook” of “1. Overview of operating results and others” on page 7 of
the attached material to the financial results report.

-3-

(Attached Material)
1. Overview of operating results and others(1) Overview of operating results for the fiscal year under review
In the fiscal year ended March 31, 2020, the Japanese economy remained on a moderate recovery trend
continuing from the previous fiscal year while showing weakness in exports and production, but shifted to a
substantial plunge due to the effect of novel coronavirus disease (COVID-19) at the end of the fiscal year, andfaces a severe condition.
The Japan Crude Cocktail (JCC) price was on an uptick, starting the fiscal year with the mid-$60 level per
barrel, but later, the price trended downwards due to the effects of the trade issue between the United States
and China, and annual average was $68, $4 lower from the previous fiscal year. The price again declined
sharply this year with the business confidence affected by the spread of COVID-19 and coinciding events
such as failure of oil producing countries to agree with coordinated reduction in the beginning of March, theDubai crude oil price was standing at the level of around mid-$20 at the end of the fiscal year.
In the currency exchange market, the yen was hovering around ¥110 /US$ at the beginning of the fiscal year,
but then appreciated to the mid ¥100 level subsequently. Although the yen was getting weaker during thesecond half of the year, it was traded at the higher ¥100 level as of the end of the fiscal year. As a result, the
JAPEX Group’s average oil sales price for the fiscal year declined compared to the previous fiscal year.
On the other hand, the JAPEX Group continued to face a severe domestic market environment with respect tonatural gas sales. In addition to competition with prices of other petroleum products, that was due tointensifying competition amid efforts reinforced by other companies in JAPEX’s market domain to promotenatural gas infrastructure projects such as LNG receiving terminals and related pipelines, progress in
expansion outside traditional supply areas in the entire energy industry using the full retail liberalization ofelectricity and gas as an opportunity, and other factors.
Under such circumstances, the JAPEX Group has been promoting business based on “Long-Term Vision
2030 and Mid-Term Business Plan 2018-2022” announced in May, 2018.
During the fiscal year, net sales was ¥318,822 million, an increase of ¥50,842 million (+19.0%) year on year.
Gross profit was ¥47,042 million, an increase of ¥12,196 million (+35.0%) year on year. Major factors behindthe year-on-year increases for net sales were growth in sales volume of crude oil and diluted bitumen in Japan
Canada Oil Sands Limited (JACOS) Hangingstone leases. The major factor behind the year-on-year increasefor gross profit was an increase of diluted bitumen sales price and leading to improved profit, stemming froman increase in sales volume in the oil sands business and a narrowing of the light-heavy differential (*1).
Exploration expenses was ¥893 million, an increase of ¥104 million (+13.3%) year on year. Selling, generaland administrative expenses was ¥31,864 million, an increase of ¥121 million (+0.4%) year on year. Despite
these increases, operating profit was ¥14,283 million, an increase of ¥11,970 million (+517.4%) year on year.
Ordinary profit was ¥32,635 million, an increase of ¥20,112 million (+160.6%) year on year, due mainly to
an increase in dividend income and the turnaround from foreign exchange losses to foreign exchange gains,
despite a decrease in share of profit of entities accounted for using equity method and a decrease in gain on
reversal of asset retirement obligations in the previous fiscal year.
Profit before income taxes increased by ¥18,829 million year on year to ¥31,903 million, due mainly to adecrease in gain on sales of non-current assets and the recognition of impairment loss on business assets
related to Amarume Oil Field. Profit attributable to owners of parent increased by ¥12,044 million year on
year to ¥26,815 million.
(*1) The differential between Western Canadian Select (WCS), which is the reference price for heavy crude
oil from the oil sands, and the WTI, which is the reference price of light crude oil-4-Below is a breakdown of net sales.
(i) Oil and Gas
Net sales from oil and gas (including liquefied natural gas (LNG) and diluted bitumen) came to ¥259,804
million, an increase of ¥44,374 million (+20.6%) year on year. This was mainly the result of growth insales volume of crude oil and diluted bitumen.
(ii) Contract Services
Net sales from contract services (drilling and geological surveys, etc.) came to ¥15,003 million, an
increase of ¥7,661 million (+104.3%) year on year.
(iii) Other Businesses
Net sales from other businesses, such as the sale of oil products, including liquefied petroleum gas (LPG),
fuel oil and the like, the transportation of natural gas, etc., as well as other subcontracted tasks, came to¥44,014 million, a decrease of ¥1,193 million (-2.6%) year on year.
Below is a summary of performance by segment (before elimination of intersegment transactions).
(1) Japan
Net sales in the Japan segment are mainly composed of crude oil and natural gas (including LNG), contract
services, oil products and the like. In the fiscal year under review, net sales were at ¥268,373 million, an
increase of ¥36,266 million (+15.6%) year on year, due mainly to growth in sales volume of crude oil andnatural gas, despite a decrease in sales prices of crude oil and natural gas. Segment profit decreased by ¥474
million (-2.5%) year on year to ¥18,834 million, due to a decrease in sales prices of crude oil and natural gas,and other factors.
(2) North America
Net sales in the North America segment are mainly composed of crude oil and natural gas (including diluted
bitumen). In the fiscal year under review, net sales came to ¥48,703 million, an increase of ¥14,433 million(+42.1%) year on year due mainly to growth in sales volume of diluted bitumen in Japan Canada Oil Sands
Limited (JACOS) Hangingstone leases. With respect to segment profit (loss), there was a segment profit of¥3,422 million (compared to segment loss of ¥9,751 million in the previous fiscal year) due to improvementin profit from diluted bitumen sales stemming from the narrowing light-heavy differential in the oil sands
business.
(3) Europe
In the Europe segment, exploration activities have been conducted in the UK North Sea block locatedoffshore Aberdeen. In the fiscal year under review, there was segment loss of ¥164 million (compared tosegment loss of ¥157 million in the previous fiscal year).
(4) Middle East
Net sales from the Middle East segment are composed of crude oil. In the fiscal year under review, net sales
came to ¥43,890 million, an increase of ¥29,073 million (+196.2%) year on year, due mainly to growth insales volume. Segment profit came to ¥612 million, a decrease of ¥342 million (-35.9%) year on year. Thiswas due to an increase in cost of sales, despite the above-mentioned increase in net sales.

-5-(2) Overview of financial position for the fiscal year under review
Total assets at the end of this fiscal year decreased by ¥28,155 million from the previous fiscal year-end to¥627,132 million.
Current assets increased by ¥46,966 million from the previous fiscal year-end, mainly due to increases in cash
and deposits, and notes and accounts receivable - trade. Non-current assets decreased by ¥75,122 million
from the previous fiscal year-end. This was mainly due to a decrease in investment securities resulting fromthe fall in market values and a decrease in property, plant and equipment resulting from the progress in the
depreciation.
Liabilities decreased by ¥18,155 million from the previous fiscal year-end to ¥186,975 million.
Current liabilities increased by ¥3,359 million from the previous fiscal year-end. This was mainly due to anincrease in notes and accounts payable - trade despite a decrease in advances received included in other incurrent liabilities. Non-current liabilities decreased by ¥21,515 million from the previous fiscal year-end. Thiswas mainly due to a decrease in deferred tax liabilities resulting from the above-mentioned fall in market
values of investment securities and a decrease in long-term borrowings resulting from the reclassification ofborrowings with repayments due in one year or less to current liabilities.
Net assets decreased by ¥9,999 million from the previous fiscal year-end to ¥440,157 million.
The main factor was a decrease in valuation difference on available-for-sale securities, despite an increase inretained earnings.

(3) Overview of cash flows for the fiscal year under review
As of March 31, 2020, cash and cash equivalents (hereinafter “net cash”) increased by ¥37,625 million
compared to the end of the previous fiscal year to ¥138,259 million. Below is a summary of cash flows foreach activity.
(Cash flows from operating activities)
Net cash provided by operating activities amounted to ¥69,895 million. The main factors were recovery ofrecoverable accounts of ¥41,040 million and ¥31,903 million in profit before income taxes.
(Cash flows from investing activities)
Net cash used in investing activities amounted to ¥18,701 million. Net cash was mainly used in payments ofrecoverable accounts of ¥30,226 million and purchase of property, plant and equipment of ¥7,566 million,
while net cash was mainly provided by interest and dividends received of ¥18,820 million.
(Cash flows from financing activities)
Net cash used in financing activities was ¥13,743 million. Net cash was mainly used in repayments of longterm borrowings of ¥6,307 million, interest paid of ¥4,729 million and dividends paid of ¥3,141 million.

-6-

Reference: Trend of cash flow indicators
Fiscal years ended March 31

2016

2017

2018

2019

2020

Equity ratio (%)

59.5

58.6

60.8

63.6

64.2

Equity ratio on mark-to-market basis (%)

20.4

19.5

19.8

20.9

16.2

Interest-bearing debt to cash flow ratio (years)

2.3

3.4

2.8

4.3

1.8

Interest coverage ratio (times)

83.6

48.7

28.4

8.0

14.8

Equity ratio: Equity/Total assets
Equity ratio on mark-to-market basis: Total market capitalization/Total assets
Interest-bearing debt to cash flow ratio: Interest-bearing debt/Cash flows
Interest coverage ratio: Cash flow/Interest paid
Notes:*1. The “Partial Amendments to Accounting Standard for Tax Effect Accounting” (ASBJ Statement No. 28, February 16, 2018) andrelevant Guidances have been applied from the beginning of the fiscal year ended March 31, 2019. Accordingly, with regard to“Reference: Trend of cash flow indicators” for the fiscal year ended March 31, 2018, the indicators represent those after thisaccounting standard, etc. was applied retrospectively.
*2. The above indicators are calculated based on consolidated financial figures.
*3. Total market capitalization is calculated based on the number of shares outstanding (excluding treasury shares).
*4. Cash flow here is cash flows from operating activities.
*5. Interest-bearing debt is all debt subject to interest payments within liabilities (excluding lease obligations) shown on the consolidatedbalance sheet.

(4) Future outlook
The latest financial forecasts are based on a JCC price of $40 per barrel for the whole fiscal year, and an
exchange rate of ¥108/$ for the whole fiscal year. Actual non-consolidated results for the fiscal year underreview came to $68.11 per barrel and ¥109.15/$.
Net sales for the fiscal year ending March 31, 2021 is expected to decrease by ¥95,138 million (-29.8%) fromthe fiscal year under review to ¥223,685 million. This is mainly due to the projected decline in the sales
prices of crude oil and natural gas (including diluted bitumen), despite the expectation of electricity sales
upon the commencement of the operation of the Fukushima Natural Gas Power Plant (Unit 1 and Unit 2 arescheduled to commence in late April, and in summer, respectively).
Operating profit is expected to deteriorate by ¥22,506 million from the fiscal year under review to operating
loss of ¥8,222 million. This is primarily due to the above-mentioned decline in the sales prices of crude oiland natural gas, and the projection of deteriorated sales profitability resulting from the wider light-heavy
differential in diluted bitumen.
Ordinary profit is expected to deteriorate by ¥34,774 million from the fiscal year under review to ordinary
loss of ¥2,139 million. This mainly reflects the projection of a decrease in share of profit of entities accounted
for using equity method, and the reversal of foreign exchange gains recorded in the fiscal year under review.
Profit attributable to owners of parent is expected to deteriorate by ¥30,008 million from the fiscal year underreview to loss attributable to owners of parent of ¥3,193 million.
Regarding the impact of COVID-19 on operating results, the above forecast has factored in a decrease inproduction volume of crude oil due to the temporary suspension of production operations in the Garraf Oil
Field in the south of the Republic of Iraq. Details are as described on page 25 (Significant subsequent events).
Moreover, while there is the potential for decreases in sales volumes and in prices of crude oil, natural gas,
diluted bitumen, and electricity in a case where economic depression is prolonged both in Japan and overseas,
the severity of the impact is difficult to forecast at this point, and it has not been factored into the above
forecast.

-7-

2. Basic rationale for selecting the accounting standard
The JAPEX Group currently has a policy to prepare the consolidated financial statements based on the generally
accepted accounting standards in Japan (Japanese GAAP), giving consideration to the possibility of comparing theconsolidated financial statements between terms.
Concerning the adoption of International Financial Reporting Standards (IFRS), the JAPEX Group intends to
respond appropriately giving due consideration to the situation in Japan and overseas.

-8-

3. Consolidated financial statements and significant notes thereto(1) Consolidated balance sheet(Millions of yen)
As of March 31, 2019

As of March 31, 2020

117,468
20,825
2,330
4,559
362
7,589
4,575
8,410
(33)
166,087

160,077
27,510
4,000
5,223
167
11,141
19
4,946
(31)
213,054335,648(150,449)
185,198
116,070(85,985)
30,084
146,276(107,257)
39,01816,732
26,82537,316(26,062)
11,254309,114335,240(161,558)
173,682
117,964(90,980)
26,984
146,113(111,983)
34,12916,67031,46637,965(26,861)
11,103
294,038

7,399
7,399

6,823
6,823

137,794
42
7,713
1,319
26,920(46)(1,057)
172,686
489,200
655,288

88,922
43
8,003
971
16,034(44)(715)
113,216
414,078
627,132

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Short-term loans receivable
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Wells
Accumulated depreciation
Wells, net
Machinery, equipment and vehicles
Accumulated depreciation
Machinery, equipment and vehicles, net
LandConstruction in progress
Other
Accumulated depreciation
Other, net
Total property, plant and equipment
Intangible assets
Other
Total intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Deferred tax assets
Retirement benefit asset
Other
Allowance for doubtful accounts
Allowance for overseas investment loss
Total investments and other assets
Total non-current assets
Total assets

9

(Millions of yen)
As of March 31, 2019

As of March 31, 2020

7,666

12,23725

75

24,68632,37823,42535,738

127,715
22,330118,774
9,878

86

88

3,452
15,335
3,831
172,752
205,1313,528
15,432
3,535
151,236
186,975

14,288157
331,306(10)
345,741

14,288–350,934(11)
365,21266,29633,061

(2)
3,338
1,114
70,74733,668450,156
655,288

181
3,494
756
37,49437,450440,157
627,132

Liabilities
Current liabilities
Notes and accounts payable - trade
Provision for bonuses for directors (and otherofficers)
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Deferred tax liabilities
Provision for retirement benefits for directors(and other officers)
Retirement benefit liability
Asset retirement obligations
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 income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

10(2) Consolidated statement of income and Consolidated statement of comprehensive income
Consolidated statement of income(Millions of yen)
Fiscal year ended
March 31, 2019
Net sales
Cost of sales
Gross profit
Exploration expenses
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Gain on sales of securities
Share of profit of entities accounted for using equity
methodForeign exchange gains
Gain on reversal of asset retirement obligations
Other
Total non-operating income
Non-operating expenses
Interest expenses
Loss on sales of securities
Foreign exchange losses
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Total extraordinary income
Extraordinary losses
Loss on sales of non-current assets
Loss on retirement of non-current assets
Impairment loss
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit (loss) attributable to non-controlling interests
Profit attributable to owners of parent*1, *2*3

11267,980
233,133
34,846788
31,743
2,313

Fiscal year ended
March 31, 2020

*1, *2

318,822271,780
47,042893
31,864
14,283

1,598
2,102
2

1,096
5,618
240

12,55011,960

–
3,293
1,258
20,804

2,425
–
2,313
23,654

4,130
–
5,296
1,167
10,594
12,523

4,641
1
–
660
5,303
32,635

716
716

1
1

60
74
30
165
13,074
3,925(5,179)(1,254)
14,328(441)
14,770

14
193
524
733
31,903
4,318
469
4,788
27,114299
26,815*3

Consolidated statement of comprehensive income(Millions of yen)
Fiscal year ended
March 31, 2019
ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners ofparentComprehensive income attributable to noncontrolling interests

12

Fiscal year ended
March 31, 2020

14,328

27,114(20,366)(5)(1,705)(38)(33,236)
184
(34)
(357)

(16)

74

(22,132)(7,804)(33,369)(6,254)(7,455)(6,437)

(348)

183

(3) Consolidated statement of changes in equity
Fiscal year ended March 31, 2019 (April 1, 2018 – March 31, 2019)(Millions of yen)
Shareholders’ equity
Share capital

Capital surplus

Retained earnings

Treasury shares

Total shareholders’equity14,288183317,679(10)

332,140

Balance at beginning of
periodChanges during period
Dividends of surplus(1,143)(1,143)

Profit attributable toowners of parent

14,77014,770Change in ownershipinterest of parent due totransactions with noncontrolling interests

(26)

(26)

Change in scope of
consolidation
Purchase of treasury
shares(0)(0)

Transfer from retained
earnings to capital surplus
Net changes in items otherthan shareholders’ equity
Total changes during period
Balance at end of period

–

(26)

13,627(0)

13,60014,288157

331,306(10)

345,741

Accumulated other comprehensive income

Balance at beginning of
periodValuationdifference on
available-forsale
securities
86,667

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustment

3

5,149

Remeasurements ofdefinedbenefit plans

Total
accumulated
othercomprehensive income

1,152

92,973

Non-controllinginterests

34,140Total net assets

459,255

Changes during period
Dividends of surplus(1,143)

Profit attributable toowners of parent

14,770Change in ownershipinterest of parent due totransactions with noncontrolling interests(26)

Change in scope of
consolidation
Purchase of treasury
shares(0)

Transfer from retained
earnings to capital surplus
Net changes in items otherthan shareholders’ equity(20,370)(5)(1,810)(38)(22,225)(472)(22,698)

Total changes during period(20,370)(5)(1,810)(38)(22,225)(472)(9,098)

Balance at end of period

66,296

(2)

3,338

1,114

70,74733,668450,156

13

Fiscal year ended March 31, 2020 (April 1, 2019 – March 31, 2020)(Millions of yen)
Shareholders’ equity
Share capital

Capital surplus

Retained earnings

Treasury shares

Total shareholders’equity14,288157

331,306(10)

345,741

Balance at beginning of
periodChanges during period
Dividends of surplus(3,143)(3,143)

Profit attributable toowners of parent

26,815

26,815

Change in ownershipinterest of parent due totransactions with noncontrolling interests(4,192)(4,192)

Change in scope of
consolidation(7)

Purchase of treasury
shares(7)(0)

Transfer from retained
earnings to capital surplus

(0)

4,035

(4,035)

–

–

(157)

19,628(0)

19,47014,288–350,934(11)

365,212Net changes in items otherthan shareholders’ equity
Total changes during period
Balance at end of period

Accumulated other comprehensive income

Balance at beginning of
periodValuationdifference on
available-forsale
securities
66,296

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustment

(2)

3,338

Remeasurements ofdefinedbenefit plans

Total
accumulated
othercomprehensive income

1,114

70,747

Non-controllinginterests

33,668

Total net assets

450,156

Changes during period
Dividends of surplus(3,143)

Profit attributable toowners of parent

26,815

Change in ownershipinterest of parent due totransactions with noncontrolling interests(4,192)

Change in scope of
consolidation(7)

Purchase of treasury
shares(0)

Transfer from retained
earnings to capital surplus–

Net changes in items otherthan shareholders’ equity(33,235)

184

156

(357)

(33,252)

3,782(29,470)

Total changes during period(33,235)

184

156

(357)

(33,252)

3,782(9,999)Balance at end of period

33,061

181

3,494

756

37,49437,450440,157

14

(4) Consolidated statement of cash flows(Millions of yen)
Fiscal year ended
March 31, 2019
Cash flows from operating activities
Profit before income taxes
Depreciation
Impairment loss
Loss on retirement of property, plant and equipment
Loss (gain) on valuation of short-term and long-term
investment securities
Increase (decrease) in allowance for doubtful
accounts
Decrease (increase) in retirement benefit asset
Increase (decrease) in retirement benefit liability
Increase (decrease) in provision for retirement
benefits for directors (and other officers)
Increase (decrease) in allowance for overseas
investment loss
Gain on reversal of asset retirement obligations
Interest and dividend income
Interest expenses
Foreign exchange losses (gains)
Loss (gain) on sales of short-term and long-term
investment securities
Share of loss (profit) of entities accounted for using
equity method
Recovery of recoverable accounts
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Increase (decrease) in trade payables
Increase (decrease) in accrued consumption taxes
Other, net
Subtotal
Income taxes (paid) refund
Net cash provided by (used in) operating activities

15

Fiscal year ended
March 31, 2020

13,07423,29630
74

31,90325,190
524
136

4

–

(4)

(4)

132
(43)

347
75

2

2

(924)

(342)

(3,293)(3,700)
4,130
5,444

–
(6,714)
4,641(2,986)

(2)

(239)

(12,550)(11,960)

11,1185,217(1,188)(11,131)970
8,443
39,101(8,130)30,97041,040(6,695)(4,029)3,831(668)(2,140)71,914(2,018)69,895

(Millions of yen)
Fiscal year ended
March 31, 2019
Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of securities
Proceeds from sales and redemption of securities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Payments for asset retirement obligations
Purchase of investment securities
Proceeds from sales and redemption of investment
securities
Payments of recoverable accounts
Loan advances
Collection of loans receivable
Interest and dividends received
Proceeds from dividends of residual property
Proceeds from capital reduction of investments
Proceeds from transfer of mining rights
Other, net
Net cash provided by (used in) investing activities
Cash flows from financing activities
Proceeds from short-term borrowings
Repayments of short-term borrowings
Repayments of long-term borrowings
Purchase of treasury shares
Dividends paid
Dividends paid to non-controlling interests
Interest paid
Repayments of lease obligations
Proceeds from share issuance to non-controllingshareholders
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*

16

Fiscal year ended
March 31, 2020

(68,859)
66,992(30)
500(12,955)
1,337
(734)
(221)
(52)

(77,870)
70,869––(7,566)
11
(111)
(78)
(373)

2

1,024

(25,107)(26)
6,912
16,126
21
1,636
543
(56)
(13,969)(30,226)(26)
4,484
18,820
5
2,138
–
196
(18,701)

2,939(7,877)(4,990)(0)(1,143)(183)(3,865)(404)

49,918(48,615)(6,307)(0)(3,141)(516)(4,729)
(357)

32

4

(15,493)(13,743)

(766)

175

740
99,892
100,633

37,625
100,633
138,259*(5) Notes to consolidated financial statements(Notes on premise of going concern)
No item to report.

(Additional information)
Financial covenants
A portion of the borrowing (¥29,690 million) by a consolidated subsidiary, JAPEX Montney Ltd., that was
financed by financial institutions and is subject to the financial covenants, conflicts with the financial covenants
due to the company’s excess liabilities. However, the financial institutions have agreed on a moratorium on theexercise of rights of forfeiture of benefit of time until March 2021.

17

(Consolidated balance sheet)Contingent liabilities(Millions of yen)

As of March 31, 2019

As of March 31, 2020

(1) Liabilities for guarantees on borrowings to financial institutions
INPEX North Caspian Sea, Ltd.
Employees (borrowings for housing funds)

9,090
97

Kumamoto Mirai LNG Co., Ltd.
Greenland Petroleum Exploration Co.,Ltd.

INPEX North Caspian Sea, Ltd.
Employees (borrowings for housing funds)

51

Kumamoto Mirai LNG Co., Ltd.
Greenland Petroleum Exploration Co.,
Ltd.

16

(2) Guarantees on liabilities related to production facilities
Kangean Energy Indonesia Ltd.
2,382
Total

11,638

8,012
61
44
18

Kangean Energy Indonesia Ltd.

1,364

Total

9,501

(Consolidated statement of income)*1. Below is a breakdown of major expense items and amount of selling, general and administrative expenses:

10,789637(Millions of yen)
Fiscal year ended
March 31, 2020
11,152
506

22

75

24

25

7,517
4,705

6,595
4,446

Fiscal year ended
March 31, 2019
Personnel expenses(of the above, retirement benefit expenses)(of the above, provision for bonuses for directors(and other officers))(of the above, provision for retirement benefits for
directors (and other officers))
Freight costs
Depreciation*2. Total amount of research and development expenses included in general and administrative expenses(Millions of yen)

Fiscal year ended March 31, 2019

Fiscal year ended March 31, 2020
173

360

*3. Impairment loss
For the fiscal year ended March 31, 2020, the JAPEX Group recognized impairment loss on the asset groups asshown below.
Use

Business assets related to
Amarume Oil Field

Impairment loss

Location

Shonai Town,
Yamagata Prefecture

Type

Amount(Millions of yen)

Buildings and structures

148

Machinery, equipment andvehicles

305

Land

67

Other

2

Total
524
The JAPEX Group deems a production facility, etc. as the minimum unit that generates largely independent cash flows forbusiness assets, and groups assets at the level of individual property for idle assets.
As for business assets related to Amarume Oil Field, the carrying value of business assets for production operation is written off
to the recoverable amount, and the write-off is recorded as impairment loss under extraordinary losses, based on a reassessment of
current business status in the Amarume Oil Field given the drop in the crude oil price, and estimated future cash flows.
In addition, the recoverable amount is measured at value in use which is recorded at the memorandum value as the future cash
flows are expected to be negative.

18

(Consolidated statement of changes in equity)
Fiscal year ended March 31, 2019 (April 1, 2018 – March 31, 2019)
1. Class and total number of issued shares and class and number of treasury shares
Number of shares atthe beginning of the
fiscal year (shares)

Increase (shares)

Decrease (shares)

Number of shares atthe end of the fiscal
year (shares)

Common shares

57,154,776––

57,154,776

Total

57,154,776––

57,154,776

Common shares

2,139

68

–

2,207

Total

2,139

68

–

2,207

Record date

Effective date

March 31, 2018

June 29, 2018

Issued shares

Treasury shares

Note The increase of 68 treasury shares of common shares is due to purchases of shares less than one unit.

2. Dividends(1) Cash dividends paid
Resolution

Class of shares

Ordinary General Meetingof Shareholders held on
June 28, 2018
Meeting of the Board of
Directors held on
November 9, 2018

Total dividends Dividends per share(Millions of yen)
(Yen)

Common shares

571

10

Common shares

571

10

September 30, 2018 December 13, 2018

(2) Dividends payments whose record date is in the fiscal year under review but whose effective date is in the following
fiscal year
Resolution
Ordinary General
Meeting of
Shareholders held on
June 27, 2019

Class of shares
CommonsharesTotal dividends(Millions of
yen)
1,714

Resource ofDividends
Retainedearnings

19

Dividends per
share
(Yen)
30

Record date

Effective date

March 31, 2019

June 28, 2019

Fiscal year ended March 31, 2020 (April 1, 2019 – March 31, 2020)
1. Class and total number of issued shares and class and number of treasury shares
Number of shares atthe beginning of the
fiscal year (shares)

Increase (shares)

Decrease (shares)

Number of shares atthe end of the fiscal
year (shares)

Common shares

57,154,776––

57,154,776

Total

57,154,776––

57,154,776

Common shares

2,207

96

–

2,303

Total

2,207

96

–

2,303

Record date

Effective date

March 31, 2019

June 28, 2019

Issued shares

Treasury shares

Note The increase of 96 treasury shares of common shares is due to purchases of shares less than one unit.

2. Dividends(1) Cash dividends paid
Resolution

Class of shares

Ordinary General Meetingof Shareholders held on
June 27, 2019
Meeting of the Board of
Directors held on
November 8, 2019

Total dividends Dividends per share(Millions of yen)
(Yen)

Common shares

1,714

30

Common shares

1,428

25

September 30, 2019 December 16, 2019(2) Dividends payments whose record date is in the fiscal year under review but whose effective date is in the following
fiscal year
Resolution
Ordinary General
Meeting of
Shareholders held on
June 26, 2020

Class of shares
CommonsharesTotal dividends(Millions of
yen)
1,428

Resource ofDividends
Retainedearnings

Dividends per
share
(Yen)
25

Record date

Effective date

March 31, 2020

June 29, 2020

(Consolidated statement of cash flows)* Reconciliation of cash and cash equivalents at end of period and the amount recorded in the consolidated balance sheet(Millions of yen)

Fiscal year ended
March 31, 2019

Fiscal year ended
March 31, 2020

Cash and deposits

117,468

160,077

Time deposits with maturity over three months(19,134)(25,817)

2,300

4,000

100,633

138,259

Short-term investments, etc. having maturities
within three months from the acquisition date
(Securities) Money management fund andothersCash and cash equivalents

20

(Segment information, etc.)[Segment information]
1. Summary of reportable segments
The JAPEX Group’s reportable segments are segments for which separated financial information is available andwhich are periodically examined by the Board of Directors to determine allocation of managerial resources andassess business performance, among components of the JAPEX Group.
The JAPEX Group’s principal business line is the “oil and natural gas related business.” In addition to businessactivities in Japan, the JAPEX Group has developed business activities overseas through a project company
established at each business location.
Therefore, the JAPEX Group consists of segments by business location and considers “Japan,” “North America,”“Europe” and “Middle East” as reportable segments.
“Japan” consists of business activities such as exploration, development, production, purchase, sale andtransportation for crude oil and natural gas, manufacturing, purchase, sale and transportation of oil products,
contract services for well drilling work, and others in Japan.
“North America” consists of business activities such as exploration, development, production, purchase, sale, etc.
for crude oil, natural gas and bitumen (extra-heavy oil extracted from oil sands) in North America.
“Europe” consists of business activities such as exploration and development for crude oil and natural gas inEurope.
“Middle East” consists of business activities such as development, production, sale, etc. of crude oil and natural
gas in the Middle East.
2. Method for calculating net sales, profit (loss), assets and other items by reportable segment
The method for accounting for reported operating segments is basically the same as the description in “Material
matters that serve as the basis for preparing consolidated financial statements” of the latest securities reportsubmitted on June 27, 2019 (Japanese only). Profit of reportable segments is the figure based on operating profit.
Intersegment revenue and transfers are based on prevailing market prices.
3. Information regarding net sales, profit (loss), assets and other items by reportable segment
Fiscal year ended March 31, 2019 (April 1, 2018 – March 31, 2019)
Reportable segment
Japan

North
America

Net sales
Net sales tooutside232,089
customers
Intersegment
18
sales or transfers

Others(Note) 1

Total(Millions of yen)Amounton theAdjustment consolidated(Note) 2
financialstatements(Note) 3

EuropeMiddleEast

Total

34,270–1,620

267,980–

267,980–

267,980––

13,195

13,213–

13,213(13,213)–

Total

232,10734,270–14,816281,194–

281,194(13,213)

267,980

Segment profit(loss)

19,308(9,751)

(157)

955

10,355(7)

10,348(8,034)2,313

Segment assets

106,848

199,522

4,230

24,736335,337–

335,337

319,950

655,288

12,095

10,3480293

22,738–22,738557

23,296

165

(10)

–

2

157

12,392

12,550–12,550

347

–

–

286

634

22,784

23,419–23,419

8,958

1,619

129

–

10,707–

10,707

195

10,903

Other items
Depreciation
Share of profit(loss) of entities
accounted forusing equity
methodInvestments inentities
accounted forusing equity
methodIncrease inproperty, plantand equipment
and intangible
assets21

Fiscal year ended March 31, 2020 (April 1, 2019 – March 31, 2020)
Reportable segment
Japan

North
America

Net sales
Net sales tooutside268,365
customers
Intersegment
8
sales or transfers

Others(Note) 1

Total(Millions of yen)Amounton theAdjustment consolidated(Note) 2
financialstatements(Note) 3

EuropeMiddleEast

Total

48,703–

1,754

318,822–

318,822–

318,822––

42,13642,144–

42,144(42,144)–

Total

268,373

48,703–43,890360,967–

360,967(42,144)

318,822

Segment profit(loss)

18,834

3,422

(164)

612

22,705(1)

22,703(8,419)14,283

Segment assets

97,780191,611

6,018

13,628309,038–

309,038

318,093

627,132

12,407

12,1380293

24,839–24,839351

25,190

Other items
Depreciation

Share of profit(loss) of entities
152
–
–
(8)
144
11,816
11,960–11,960accounted forusing equity
methodInvestments inentities
347
–
–
286
634
20,494
21,128–21,128accounted forusing equity
methodIncrease inproperty, plant
3,787
4,907
1,697
–
10,392–
10,392
255
10,648and equipment
and intangible
assets(Notes) 1. The “Others” category represents operating segments that are not included in reportable segments, and includes
Southeast Asia, etc.
2. Major components of adjustment are as follows:(1) Segment profit (loss)(Millions of yen)
Fiscal year ended
Fiscal year ended
March 31, 2019
March 31, 2020
Elimination of intersegment transactions
15
16
Corporate expenses *(8,050)(8,436)

Total(8,034)(8,419)Corporate expenses are mainly general and administrative expenses and experimentation and researchexpenses, all of which are not attributable to the reportable segments.
(2) Segment assets(Millions of yen)
As of March 31, 2019
As of March 31, 2020*

Elimination of intersegment transactions

(616)

(600)

Corporate assets *1

3,387

3,204

317,179

315,489

Other assets *2

Total
319,950
318,093*1. Corporate assets are mainly assets for management by the headquarters that do not belong to the reportablesegments.
*2. Assets allocated to segments are recoverable accounts included in property, plant and equipment, intangible
assets, and investments and other assets, whereas other assets are assets other than property, plant andequipment, intangible assets, and recoverable accounts that are not allocated to segments.
3. Segment profit (loss) was adjusted to operating profit in the consolidated statement of income.

22

[Related information]
Fiscal year ended March 31, 2019 (April 1, 2018 – March 31, 2019)
1. Information by product or service

Net sales tooutsidecustomers

Oil

Gas

LNG

Dilutedbitumen94,57967,82022,91330,116(Millions of yen)
Oil products/
OthersTotalmerchandise

Contract
services
7,342

39,8202. Information by geographical area
(1) Net sales
Japan

Canada156,043

267,980(Millions of yen)
Russia33,555

5,387

Iraq

62,612Others

14,829

Total
938

267,980(Note) Net sales are classified into countries or regions based on the place where products, etc. were delivered
and the location where services were rendered.

(2) Property, plant and equipment
Japan

Canada108,657(Millions of yen)
OthersTotal

194,263

6,193

309,114

3. Information by major customer
Name of customer or individual(Millions of yen)
Related segment

Net sales

BP Singapore Pte. Ltd

7,754

Japan

Fiscal year ended March 31, 2020 (April 1, 2019 – March 31, 2020)
1. Information by product or service

Net sales tooutsidecustomers

Oil

Gas

LNG

Dilutedbitumen

128,152

67,231

19,39545,025(Millions of yen)
Oil products/
OthersTotalmerchandise

Contract
services
15,003

2. Information by geographical area
(1) Net sales
Japan

Canada159,815

48,06237,5026,512

318,822(Millions of yen)
RussiaIraq

66,341Others43,960

Total
642

318,822(Note) Net sales are classified into countries or regions based on the place where products, etc. were delivered
and the location where services were rendered.

(2) Property, plant and equipment
Japan
99,523

Canada186,499

Others(Millions of yen)
Total
8,015

294,038

3. Information by major customer
Name of customer or individual(Millions of yen)
Related segment

Net sales

BP Singapore Pte. Ltd

34,707- 23 -

Japan

[Information on impairment loss on non-current assets by reportable segment]
Fiscal year ended March 31, 2019 (April 1, 2018 – March 31, 2019)
Japan

North America
30

Europe–Middle East–––

Unallocatedamounts andelimination–

Others–(Millions of yen)
Unallocatedamounts andelimination–

Fiscal year ended March 31, 2020 (April 1, 2019 – March 31, 2020)
Japan

North America
524–

EuropeMiddle East–

[Information on amortization and unamortized balance of goodwill by reportable segment]
Fiscal year ended March 31, 2019 (April 1, 2018 – March 31, 2019)No item to report.
Fiscal year ended March 31, 2020 (April 1, 2019 – March 31, 2020)
No item to report.
[Information on gain on bargain purchase by reportable segment]
Fiscal year ended March 31, 2019 (April 1, 2018 – March 31, 2019)No item to report.
Fiscal year ended March 31, 2020 (April 1, 2019 – March 31, 2020)
No item to report.

- 24 -

30(Millions of yen)

Others

–

Total

Total
524

(Per share information)

Fiscal year ended
March 31, 2019
(April 1, 2018 –March 31, 2019)¥7,287.32

Fiscal year ended
March 31, 2020
(April 1, 2019 –March 31, 2020)¥7,046.18

Basic earnings per share¥258.44(Notes) 1. Diluted earnings per share is not presented, since there is no dilutive share.
2. The basis for calculation of basic earnings per share is as follows:
Fiscal year ended
March 31, 2019
(April 1, 2018 –March 31, 2019)
Profit attributable to owners of parent (Millions of yen)
14,770
Amounts not attributable to common shareholders (Millions–of yen)¥469.18

Net assets per share

Fiscal year ended
March 31, 2020
(April 1, 2019 –March 31, 2020)
26,815–

Profit attributable to owners of parent related to commonshares (Millions of yen)

14,77026,815

Average number of shares during the period (Thousands ofshares)57,15257,152(Significant subsequent events)
Temporary suspension of development and production operations at the Garraf Oil Field in the south of the
Republic of Iraq
The Company’s consolidated subsidiary, Japex Garraf Ltd., participates in the Garraf Oil Field development
and production projects (30% participating interest) in the south of the Republic of Iraq. Following the spreadof COVID-19, as a preventative measure to ensure the health and safety of employees from March 16, 2020
all expatriates have been evacuated from the country, necessitating the suspension of development andproduction operations. The schedule for restarting remains undetermined at this time.
The Garraf Oil Field started crude oil production in August 2013. The average daily production volume for
2019, the most recent year, was approximately 96,000 barrels.
It is difficult at this time to rationally calculate the impact of the operational suspensions on the Company’s
financial position, business results, and cash flows for the fiscal year ending March 31, 2021 and onwards.

- 25 -

4. Others
Status of production and sales
1. Production
Fiscal year ended
March 31, 2019
(April 1, 2018 –March 31, 2019)
Crude oil (kl)Oil and gas

Natural gas (thousand m3)
LNG (t)Bitumen (kl)Fiscal year ended
March 31, 2020
(April 1, 2019 –March 31, 2020)

1,157,037

1,215,690(892,535)(913,298)

1,170,457

1,083,862(488,436)(434,194)

5,600

4,405

812,720

1,130,169(812,720)(1,130,169)

Notes: 1. The figures in parentheses represent overseas production and are included in the total.
2. Part of the natural gas production volume is used as a feedstock for LNG.
3. Bitumen is a type of extra-heavy oil extracted from oil sands.

2. SalesOil and gas

Fiscal year ended
March 31, 2019
(April 1, 2018 –March 31, 2019)
AmountVolume(Millions of yen)

Fiscal year ended
March 31, 2020
(April 1, 2019 –March 31, 2020)
AmountVolume(Millions of yen)

Crude oil (kl)

1,888,653

94,5792,924,245

128,152

Natural gas (thousand m3)

1,731,141

67,8201,699,595

67,231

322,331

22,913

273,312

19,395

1,176,091

30,116

1,639,689

45,025

LNG (t)Diluted bitumen (kl)Subtotal

215,429

259,804

7,342

15,003

Oil products/merchandise

39,82037,502Others

5,387

6,512

Subtotal

45,20744,014

Total

267,980

318,822

Contract services
Otherbusinesses

Notes: 1. “Oil products/merchandise” includes liquefied petroleum gas (LPG), fuel oil, gas oil and kerosene, and “Others”
includes the transportation of natural gas and oil products as well as other subcontracted tasks.
2. Diluted bitumen is bitumen diluted by ultra-light crude oil for pipeline transportation.
3. Monetary amounts in the table do not include consumption taxes.

- 26 -