ITOCHU ENEX CO., LTD.
(TSE First Section, 8133)

FY2021 Financial Resultsfor First Six Months
November 12, 2021

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ITOCHUENEX CO.,LTD.
All rights
reserved.
Copyright©2020
ITOCHUENEX CO.,LTD.
All rights
reserved.

Note
We pay close attention to the content of the material, but the Company and information providers will not be liable
for any damage caused by errors in the information posted or damage suffered based on the information posted inthis material.
The current plans and strategies of the Company posted in this material are forecasts prepared by the Company
based on information currently available, and these future forecasts include risks and uncertainties. Accordingly, theactual results may differ materially from the forecasts posted. Please note that the Company does not guarantee
the certainty of these forecasts.
・Unless otherwise noted, all the numerical values in this material are based on the International Financial ReportingStandards (IFRS).
・In this material, the notation has been replaced as follows.
“Profit from operating activities”  “Operating profit”“Net profit attributable to Itochu Enex’s shareholders” “Net profit”

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1

Results Highlights

Overview of Consolidated Financial Results for First Six Months of FY2021■ Net profits in the first six months decreased 0.7 billion yen to 5.5 billion yen, down 11.3% year on year.
Profit decreased partly because of a rebound from the temporary earnings from operations in response tofluctuations in crude oil prices in the same period of the previous fiscal year. However, the impact of COVID19 has been on a downward trend, and sales have been recovering, resulting in firm results overall in eachbusiness, with the exception of special factors.
■ The ratio of SG&A expenses to gross profit suggests that the ratio of SG&A expenses was properly
controlled (78.8%) as in the previous year, despite a recovery in sales activities in certain sectors.

Net sales

398.1 billion yen(+24.6% year on year)

Grossprofit41.7 billion yen(-1.1% year on year)

Operatingprofit

9.1 billion yen(-10.1% year on year)

Net profit

5.5 billion yen(-11.3% year on year)

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2

The Impact of the COVID-19 Coronavirus Pandemic
Impact on business performance (Year on year change)
Oil❏ Sales of gasoline and diesel oil increased although the impact of remote working and stay at home advisories remained.

LP gas❏ The operating rates of stores/factories, etc. have been recovering, having led to an increase in the sales volume of LP gas (forbusiness and industrial use).
❏ Demand driven by those refraining from going out was subsiding, but the sales volume of LP gas for household use remained
unchanged from the year-ago level.
❏ The sales volume of industrial gas remained unchanged year on year.

Power❏ Operating rates of stores/factories, etc. have been recovering, having led to an increase in the sales volume of high voltage power.
❏ Sales volume of low voltage power, including that for household use, increased due to an increase in the number of contracts,
although demand driven by those refraining from going out was subsiding.

Salesof cars❏ Sales volume increased due to a recovery in sales of new model cars, etc.

Sales volume (company-wide) Gasoline

1,277,000 KL

 LP gas(-1.5% year on year)(+6.9% year on year) Diesel oil

1,604,000 KL(+8.1% year on year)

204,000 tons

 Industrial gas

33,000 tons(+1.0% year on year) Electricity
Retail

1,195 GWh(+9.1 year on year, including agency quantity)

 New cars

12,000 units(+11.1% year on year)
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3

Contents◇ Overview of Consolidated Financial Resultsfor First Six Months of FY2021(1) Overview of the Entire Company(2) Overview by Segment◇ Appendix
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4

Overview of Consolidated Financial Resultsfor First Six Months of FY2021(1) Overview of the Entire Company

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5

Summary of Financial Results for the First Six Months of FY2021

Firm results excluding a rebound from temporary earnings in Industrial Business, etc.

(100 million yen)

FY2020/1H
Results

FY2021/1H
Results

FY2021
Plan

Changes

Net sales

3,195

3,981

+786

Gross profit

421

417

-5

Selling, general andadministrative expenses

-319

-328

-9

Operating profit

102

91

-10

4

10

+6

62

55

-7

75.8%

78.8%

+3.0pt22

23+1

Share of profit (loss) ofinvestments accounted for using
the equity method
Net profit
Ratio of SG&A expenses to grossprofitDividends (yen/share)

Achievement rate

8,000

50%

205

45%

125

44%

[Reference] Quarterly results (net profit) Net profits in the first six months decreased 0.7 billion yen, to 5.5 billion yen, down 11.3% year on year.
Profit decreased partly because of the absence of the temporary earnings from operations in response tofluctuations in crude oil price in the same period of the previous fiscal year. However, the impact of COVID-19
decreased year on year, and sales volumes were recovering, resulting in firm results in each business with the
exception of special factors.
 The ratio of SG&A expenses to gross profit came to 78.8%, a 3.0% increase year on year. The ratio rose,reflecting a recovery in sales activities in certain sectors.

36
27

33

26 27 29

1Q 2Q 3Q 4Q
FY20201Q 2Q 3Q 4Q
FY2021

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6

Net Profit by Segment

Profit decreased despite the recovery in sales volume, given the absence ofthe temporary earnings in the Industrial Business seen in the previous year.
Major factors for increase/ decrease

FY2019/1H(100 million yen)
Results70

FY2020/1H
Results

62

55

60

52
50

40

2

FY2021/1H
Results

19

6
16

25
23

30

20

7

10

17

0

1

Includingtemporaryearnings

15

18

17

3

2

▋Home-Life (YoY: +¥500 million, Percent of the plan achieved: 22%)
The number of customers under direct contract rose slightly from the end of the previous fiscal year, to approx. 553,000. For
LP gas sales volume, demand for gas for business and industrial use was recovering. The overall sales volume remained
unchanged from the year-ago level, reflecting decreases in wholesale sales and sales of gas for automobile use.
Profit increased chiefly due to a recovery in the industrial gas business and overseas business, reflecting the resumption of
normal economic activity and the effect of inventories given a rise in import prices of LP gas.
▋Car-Life (YoY: -¥300 million, Percent of the plan achieved: 41%)
The number of filling stations decreased by 15 from the end of the previous fiscal year to 1,672.
The sales volume of kerosene fell year on year, while demand for gasoline and diesel oil increased chiefly due to theresumption of normal economic activity. The overall sales volume of oil products increased year on year. The number of newcars sold increased year on year due to a recovery in sales of new model cars, etc. Profit declined due to the significant
effect of a decrease in retail margins in the oil business, despite a recovery in the car dealer business.

▋Industrial Business (YoY: -¥800 million, Percent of the plan achieved: 58%)
The sales volume in the asphalt business decreased year on year due to comprehensive measures to ensure profitablesales. Sales volume in the marine fuel business was also down year on year, as the supply of fuel for inland vessels for new
routes of existing customers was offset by a decrease in the supply of fuel for ocean going vessels. The sales volume ofcorporate fleet refueling cards increased year on year, reflecting activities to find new customers. Profit decreased, as anincrease in profit in the asphalt business was offset by the absence of the temporary earnings from operations in response tofluctuations in crude oil prices as well as financial income in the previous fiscal year.
▋Power & Utility (YoY: -¥0 million, Percent of the plan achieved: 45%)
Among electricity retail sales, high-voltage power sales volume increased year on year due to the winning of large projects.
Low-voltage power sales volume increased year on year with a rise in the number of contracts, mainly for household use.
Demand in the heat provision business declined year on year due to a far lower average temperature in the summer than the
year-ago level. Profit was on a par with the year-ago level, with a fall in heat demand and a decline in capacity utilization at
power plants due to regular inspection offset by a rise in earnings of associates accounted for by the equity method.
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7

Analysis of Net Profit in 1H by Segment(100 million yen)▋Home-Life
Major factors
for increase/decrease

Effect of inventories
Overseas businessIndustrial gas business
Other

+3.2
+0.8
+0.3
+1.1

▋Car-Life
Dealer business
Oil business, etc.

▋Industrial
Business+2.5-5.9

Asphalt+3.1
Exports/imports of products-6.5
Marine fuel-1.1
Fuel cards, etc.
-2.3
Other
-0.8

▋Power & Utility
Provision of heat
Development projects
and others-1.0▋OtherExpenses

-1.1

+0.7

+5.4

62.3
-3.4

55.3
-7.6

-0.3

-1.1

-7.0
FY2020/1H
Results

FY2021/1H
Results
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8

Financial Position

Trade receivables/trade payables decreased due in part to seasonal factors.
❏ Total assets: Decreased 17.2 billion yen from the end of the previous year due todecreases in trade receivables/trade payables and came to 391.2
billion yen.

(100 million yen)

4,500
4,000

❏ Net DER:

3,000(100 million yen)

End of March
2021 Results

Total assets

4,083

End of
September 2021
Results

3,912

Changes

0.2

0.1

2,500
2,000
1,500
1,000

0

1,362

1,384

-0.13

-174

-234

-60

Shareholders’ equity

1,362

1,384

+22

Net DER

3,912

3,500

-172

Net interest-bearing
debt

Ratio of shareholders’equity to net assets

0.3

4,083

❏ Shareholders' equity:
Increased 2.2 billion yen, to 138.4 billion yen, mainly reflecting a risein net profit.
Net DER is a negative value due to an increase in cash and deposits.

(Times)35.4%+2.0pt
-500

-0.13

-0.17

-0.04

-0.17

500
0

33.4%

-0.1

-0.2

-174

-234

End of March 2021

End of September 2021

Total assets

Net interest-bearing debt

Shareholders’ equity

Net DER-0.3

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9

Cash Flows

Continued to create ample cash flows from operating activities,
excluding special factors.
(100 million yen)

FY2018/1H Results

FY2019/1H Results

FY2020/1H Results

FY2021/1H Results

Cash flows from operating activities

97

71

221

181

Cash flows from investing activities

-18

-72

59

-27

(Free cash flows)

79

-1

280

154

Cash flows from financing activities

-57

28

-104

-95

102

182

170

182

Substantive cash flows

Substantive operating cash flows (*)(*) Operating CF – Increase/decrease in working capital(100 million yen)

300

280

182
Operating CF
Investing CF

200

FCF
Substantive
operating CF

102
221

100

Financing CF

97
0

182

170

79

-18

71
-57

-1
28

154

181
59

-72

-27
-104

-95

-100
-200

FY2018/1H
Results

FY2019/1H
Results

FY2020/1H
Results

FY2021/1H
Results

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10

Investment Trends

Investments in maintenance of plant and equipment were started.
Growth investments are planned in 3Q or later.
Company-wide (100 million yen)

Investment results for the first half of FY2021 by segment

400

350

50
45
40
35
30
25
20
15
10
5
0

Investment results

300

250

200

23
20
16
3
Home-Life

Car-Life

150

244

Power &
Utility

Other

Major investment results

223

100

Industrial
Business

1▋Home-Life

Investment in plant and equipment,
acquisition of business rights, etc.

50

▋Car-Life

Investment in plant and equipment, etc.

0▋Industrial Business

Investment in plant and equipment, etc.

▋Power & Utility

Investment in plant and equipment,
development projects, etc.

▋OtherInvestment in plant and equipment, etc.

186

164

64

134

FY2016(Full year)

FY2017(Full year)

FY2018(Full year)

FY2019(Full year)

FY2020(Full year)

FY2021(First half)

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11

FY2021 Shareholder Returns

The mid-term dividend and annual dividend are
expected to be 23 yen and 46 yen, respectively.
60

Commemorative
dividends
50

50

46

Dividend policy

23

Consolidated
dividend
payout ratio

640Continue stablepayment

40% or more

30

20

20

10

Commemorative
dividends

40

4
16

16

42

44

44

32
16

16

20

22

24

23

0
FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021(Plan)
Dividend
payout ratio
(%)

42.7%

58.6%

46.8%

32.4%

30.5%

45.2%

36.3%

34.8%

41.0%

41.0%

41.2%

46.4%

Providing shareholder returns
stably under the dividend policy of
ensuring the dividend payout ratio
at 40% or more

Annual dividend at 46 yen will
be maintained in FY2021.

40% ormore

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12

(Reference) Market Trends

Crude oil prices have been on the rise since they bottomed out
at the beginning of the previous year.
Year ago value

Recent value

Trends in Dubai crude oil price

Average price($/bbl)
59.37

61.97

40.66

43.39

2020/102020/11

64.29

64.89

60.86

64.41

54.22

33.7

2021/22021/362.89

2020/122021/1

69.49

72.61

60.8

49.82
54.77

72.90

71.57

66.31

43.28

40.79
30.47

43.99

41.5

46.6

Year ago value
Change from theprevious year: +14.2

20.39
2021/42021/52021/62021/72021/82021/9660

665

Average price

Trends in propane CP price($/MT)
420

605

565
430

625

2020/11

620

495

530

340

350

547

550
505

430

375
2020/10

560

450
440

430

Recent value

2020/122021/12021/2

360

365

365

400

230

2021/32021/47.50

6.642021/5

Recent value

2021/62021/72021/82021/9

7.12

8.05

Year ago value
Change from theprevious year: +147

Electricity wholesale transactions market
63.07(Yen/KWh)

13.93
8.24

5.05
2020/107.75
5.56

2020/11

8.22

7.68

6.86
2020/122021/12021/2

5.98
2021/3

6.69
5.24
2021/46.74
4.18
2021/55.01
2021/64.31
2021/78.58
7.04
2021/87.91
6.31
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13

Overview of Consolidated Financial Resultsfor First Six Months of FY2021(2) Overview by Segment

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14

Results by Segment(100 million yen)

FY2020/1H
Results

FY2021/1H
Results

Rate of change%

Changes

FY2021
Plan

Achievement
rate

Net sales
Operating profit
Net profit

3,195
102
62

3,981
91
55

+786
-10
-7

+24.6
-10.1
-11.3

8,000
205
125

50%
45%
44%

▋Home-Life

Net sales
Operating profit
Net profit

302
0
0

347
4
6

+45
+3
+5

+14.8
↑
↑

―
―
25

―
―
22%

▋Car-Life

Net sales
Operating profit
Net profit

1,835
34
19

2,362
31
16

+528
-2
-3

+28.8
-6.9
17.8

―
―
38

―
―
41%

▋Industrial BusinessNet sales
Operating profit
Net profit

685
28
23

904
22
15

+219
-6
-8

+31.9
-22.9
-33.6

―
―
26

―
―
58%

▋Power & Utility

Net sales
Operating profit
Net profit

374
34
17

368
31
17

-5
-3
-0

-1.4
-9.4
-1.4

―
―
39

―
―
45%

Company-wide

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15

▋Home-Life Division

Profit increased due to the effect of inventories
reflecting rising LP gas import prices.
(100 million yen)
FY2020/1H
Results

FY2021/1H
Results

Changes

Major factors for increase/decrease
The number of customers under direct contract roseslightly from the end of the previous fiscal year, toapprox. 553,000. For LP gas sales volume, demand
for gas for business and industrial use wasrecovering. The overall sales volume remained
unchanged from the year-ago level, reflecting
decreases in wholesale sales and sales of gas forautomobile use. Profit increased chiefly due to arecovery in the industrial gas business and overseas
business, reflecting the resumption of normal
economic activity and the effect of inventories givena rise in import prices of LP gas.

Gross profit

92

96

+4

Selling, general andadministrative expenses

-91

-93

-2

Operating profit

0

4

+3

Share of profit (loss) ofinvestments accounted forusing the equity method

2

7

+5

Net profit

0

6

+5

Profit (loss) ofmajor affiliates

FY2020/1H
Results

FY2021/1H
Results

Changes

ITOCHU ENEX
HOME-LIFE NISHI-NIHON

3

2

-1

ECORE (The Company’s
equity 51%)

2

3

+1

ENEARC (The Company’s
equity 50%)

2

3

+0

Quarterly results (net profit)

11
7

4

2
-2

2

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
FY2020
FY2021

FY2021
Plan

Achievement
rate

25

22%

End ofMarch 2021

End of
September
2021

Number of customers
under direct LP gas supply
contracts

552

553

+1

Number of customers
for electricity retail

109

114

+5

FY2020/1H
Results

FY2021/1H
Results

201

199

Number ofcustomers (1,000)

Sales volumes
LP gas (thousand tons)

Changes

Changes-1%

Industrial gas
33
33
+1%
(thousand tons)
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16

▋Car-Life

Profit decreased due to a decline in retail margins in the oil business,despite a recovery in the car dealer business.
(100 million yen)
FY2020/1H
Results

FY2021/1H
Results

Changes

The number of filling stations decreased by 15 fromthe end of the previous fiscal year to 1,672. The
sales volume of kerosene fell year on year, while
demand for gasoline and diesel oil increased chiefly
due to the resumption of normal economic activity.
The overall sales volume of oil products increased
year on year. The number of new cars soldincreased year on year due to a recovery in sales of
new model cars, etc. Profit declined due to thesignificant effect of a decrease in retail margins in theoil business, despite a recovery in the car dealer
business.

Gross profit

223

221

-2

Selling, general andadministrative expenses

-189

-189

-0

34

31

-2

0

1

+0

19

16

-3

Profit (loss) ofmajor affiliates

FY2020/1H
Results

FY2021/1H
Results

Changes13

6-6Operating profit
Share of profit (loss) ofinvestments accounted forusing the equity method

Net profit

Quarterly results (net profit)

13 12

ENEX FLEET

10
6

7

8
Osaka Car Life Group(The Company’s equity 51.95%)

FY2021Plan

Major factors for increase/decrease

2

4

+2

Achievement
rate

38

41%

FY2020/1H
Results

FY2021/1H
Results

Gasoline (thousand KL)

830

848

+2%

Kerosene (thousand KL)

81

63

-22%

Diesel oil (thousand KL)

963

1,006

+4%

New cars (thousand units)

11

12

+11%

Used cars (thousand units)

10

11

+5%

Sales volumes

Changes1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
FY2021
FY2020
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17

▋Industrial BusinessProfit decreased year on year due to the absence of temporary earnings, etc.,
but the asphalt business recovered.
(100 million yen)
FY2020/1H
Results

FY2021/1H
Results

Changes

Gross profit

48

46

-2

Selling, general andadministrative expenses

-20

-23

-3

Operating profit

28

22

-6

0

-0

-0

23

15

-8

Share of profit (loss) ofinvestments accounted forusing the equity method
Net profit

FY2021Plan

Major factors for increase/decrease
The sales volume in the asphalt business decreased year
on year due to comprehensive measures to ensureprofitable sales. Sales volume in the marine fuel business
was also down year on year, as the supply of fuel forinland vessels for new routes of existing customers wasoffset by a decrease in the supply of fuel for ocean goingvessels. The sales volume of corporate fleet refuelingcards increased year on year, reflecting activities to findnew customers. Profit decreased, as an increase in profit
in the asphalt business was offset by the absence of thetemporary earnings from operations in response tofluctuations in crude oil prices as well as financial incomein the previous fiscal year.

Achievement
rate

26

58%

Quarterly results (net profit)
FY2020/1H
Results

Sales volumes

15

7

7

9

9

6

2Q 3Q 4Q
FY20201Q

2Q 3Q 4Q
FY2021

Changes

Gasoline (thousand KL)

355

421

+19%

Kerosene (thousand KL)

122

125

+3%

Diesel oil (thousand KL)

516

595

+15%

1,063

812

-24%

139

126

-10%

Heavy fuel oil (thousand KL)

1Q

FY2021/1H
Results

Asphalt (thousand tons)

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18

▋Power & Utility Division

Profit was almost the same as the year-ago level chiefly due to a rise in earnings ofassociates accounted for by the equity method, despite a fall in heat demand.
(100 million yen)
FY2020/1H
Results

FY2021/1H
Results

Changes

Major factors for increase/ decrease

Gross profit

59

54

-5

Selling, general andadministrative expenses

-24

-26

-1

Operating profit

34

31

-3

2

3

+2

18

17

-0

Share of profit (loss) ofinvestments accounted forusing the equity method
Net profit

Profit (loss) ofmajor affiliates

Quarterly results (net profit)

11

10
6

6

8

3
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
FY2021
FY2020

FY2021
Plan

Among electricity retail sales, high-voltage powersales volume increased year on year due to thewinning of large projects. Low-voltage power sales
volume increased year on year with a rise in thenumber of contracts, mainly for household use.
Demand in the heat provision business declined year
on year due to a far lower average temperature in thesummer than the year-ago level. Profit was on a parwith the year-ago level, with a fall in heat demand anda decline in capacity utilization at power plants due toregular inspection offset by a rise in earnings ofassociates accounted for by the equity method.

FY2020/1H
Results

FY2021/1H
Results

Changes

ENEX Electric Power Group

6

4

-1

ENEX LIFE SERVICE

2

1

-1

9

8

-1

Oji-Itochu Enex power retailingCo., Ltd.
(The Company’s equity 60.0%)

4

4

-0

39

45%

FY2020/1H
Results

FY2021/1H
Results

Changes

1,096

1,195

+9%

Sales of highvoltages*

837

886

+6%

Sales of low
voltages*

259

309

+20%

Steam (thousand tons)

250

249

-0%

Heat quantity (TJ)

755

703

-7%

Sales volumes
Electricity Retail (GWh)*

Breakdown
Tokyo Toshi Service Company(The Company’s equity 66.6%)

Achievementrate* Calculated based on preliminary values* Electricity retail includes agency quantity.
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19

2. Progress on Medium-Term Business Plan

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Medium-Term Business Plan, SHIFT! 2022
■ Period: Two years from April 2021 to March 2023

Basic Policy

Maintaining andexpandingbases- Further enhancement of domestic sale network andcustomer base
- Active promotion of B-to-C business utilizing digitaltransformation- Strengthening of overseas business development witha focus on Asia

Quantitative Plan
Targets for FY2021

Net profit¥12.5 billion

ROE

9.0% or more

Deepening theenvironment& energy
businesses

Management Indicators for FY2021 to FY2022

Consolidated dividend
payout ratio

40% or more

Substantive operating CF ¥30 billion each fiscal period

Investment (2-year total)¥60.0 billion

Cultivatingnext-generation

human
resources- Forays into untapped areas with environmental
products, electricity and various other forms of energy- Further expansion of the electric power business fromgeneration to selling, especially with renewableenergy- Enhancing environmental technical capabilities andexpand offerings of low-carbon and decarbonizedproducts- Cultivating multi-talened human resources who will
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21

Progress of Medium-Term Business Plan /Maintaining and Expanding BasesBusiness alliance agreementwith WP Energy

Launch of new plans under
TERASEL Denki* We acquired part of the issued shares of WP Energy
Public Company Limited, a large LP gas business
operator listed in Thailand, in May 2021 to enter thecountry's LP gas market.

* ENEX LIFE SERVICE, a group company, launched
new plans under its TERASEL Denki electricity retailservice.

* In November 2021, ENEX FLEET, a groupcompany, embarked on a truck body business,
specifically a painting business.

· Cho-TERASEL Plan in July
(A new plan under which the unit rate is lower for largerconsuming households)· Cho-TERASEL Re-energy Plan in September(A new plan added with environmental value* under which
virtually CO2-free electric power is supplied)* With an eye towards expanding the truck transaction
business and entering the truck auction business,
we will work to produce synergies with existing
businesses.

* We aim to establish an LP gas supply chain in
Thailand and will consider pursuing renewableenergy initiatives and expansion into neighboring
countries.

* Using non-fossil fuel energy certificates attesting to electricity derivingfrom renewable energy

Participation in truck painting
business

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Progress of Medium-Term Business Plan /Deepening of the Environment & Energy Business
Gas to Liquids (GTL) fuel

AdBlue®

Ammonia fuel for ships

A clean diesel replacement fuel with low
environmental impacts refined from naturalgas

A high quality urea aqueous solution that
decomposes and detoxifies NOx in
exhaust gas from diesel vehicles

A next-generation fuel that attracts
attention for emitting no greenhouse gases
from ship operation

A next-generation fuel used for trucks,
buses and other vehicles for minimizing
costs* Since it was registered on the New Technology
Information System (NETIS) in 2019, its sales area
has been expanded.

* As of November 2021, there are 24 distribution
centers in the country to transport it to every cornerof the country.

* It is adopted by various corporate and otherconsumers across the country, including the City of
Yokohama's new municipal government building
and large constructors.

* In July 2021, we erected an AdBlue® plant toembark on the manufacturing business.

* A council was established for the purpose of jointly
considering common issues such as safety forships, safety in supply, specifications for ammonia
as a marine fuel and environmental impact
assessment throughout the life cycle.

* In May 2021, we achieved Japan's first applicationof renewable diesel (RD) fuel to convenience stores'delivery vehicles in collaboration with ITOCHU
Corporation, FamilyMart Co., Ltd. and Neste OYJ.

* GTL fuels are recommended as part of themeasures taken by the City of Yokohama
government for combating global warming.

* In November, we released Japan's first carbonneutral GTL fuel.

* The five-liter container won the Minister of
Economy, Trade and Industry award at the 2021
Japan Packaging Competition for its recyclability
and environmental considerations.
* ®AdBlue is a registered trademark of Verband derAutomobilindustrie e.V. (VDA).

* It was launched by 23 businesses andorganizations, including us. It is now joined by 34
businesses and organizations. Deliberations areunderway towards quickly realizing the use ofammonia marine fuels in society.

Renewable diesel (RD)* In November 2021, we started operation of Japan's
permanent RD refueling station for commercial
trucks in collaboration with ITOCHU Corporation
and Tohbu Network Co., Ltd.

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Progress of Medium-Term Business Plan /Cultivating next-generation human resources
Promoting diversity

Developing multi-talented human resources

Motoyo Yamane,
Outside Director

Masako Iwamoto, Outside Audit& Supervisory Board Member* Ms. Iwamoto was appointed as Outside Audit & Supervisory Board Member in June
2021.
(She is the second woman to be appointed as our directors and officers after Ms.
Yamane, who was appointed as Outside Director in 2019.)* The Young Talent Appointment System commenced* Diversity Statement prepared* Overseas job training program for cultivating personnel capable of flexibly acting inoverseas and other businesses(For FY2021, six employees were dispatched to Guam, Thailand, Dubai and Singapore.)* A cross-functional team launched(Forging a culture for discovering new items to be commercialized, new businesses andnew structures)
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3. Medium- and Long-Term Actions

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Actions by the Carbon Neutral Strategy Division■Actions for hydrogen stations· Constructing a hydrogen value chain (in collaboration with Air Liquide Japan G.K. and ITOCHU Corporation)· A model hydrogen station for commercial vehicles (featuring quick refill and 24/7 operation) under discussion with car manufacturers and transport operators■Hydrogen and ammonia (decarbonization efforts in industrial sectors)· A resource recycling business aimed at realizing a circular society and effectively using energy
under verification· Development and verification trial of a hydrogen or ammonia combustion system underdiscussion(Deliberations started with device manufacturers and industrial customers)■Storage batteries· A demonstration trial of flywheel storage batteries (planned at the beginning of 2022)· Establishing a renewable energy business for industrial customers (e.g. a combination ofphotovoltaic (PV) power generation, storage batteries and electric vehicles (EVs))■Urban development (participation in community building towards
decarbonization)· Joining the carbon-neutral city initiative to propose decarbonization actions such as the use ofhydrogen and renewable energy in mobility· Participating in the Yokohama Smart Business Association (YSBA) organized by the City of
Yokohama government
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Future of Power Business

Serve 500,000 households byhuman and digital sales
activities· Green electric power sales· Digital marketing· Network of partners

ES· PV panels for private power
consumption· Storage batteries· Local heat supply and local
production of energy for local
consumption

Financial sector
Funds, solar sharing, subscription services for electricvehicles and storage batteries, and others

Power generation sector

Waste power generation, CCU, PV
and others
Prospect of businessexpansion andinvestment in thenext five years

EV· Sharing service (B/C)· Subscription· V2H (Vehicle to Home)

AV (Agri-Voltaic)

B2C

B2B

· Renewable energy· Agriculture-related· Carbon capture and utilization(CCU)

Conventional power and green power retail to consumers,
EV sharing, PV for home use (for direct current power
supply and business continuity planning), subscription
services for energy-efficient devices, and others

Regionally distributed energy, ES business, conventionaland green electricity sales for PVB for private
consumption in Japan and overseas, and others

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4. Initiatives in 1H and Management Policy
for 2H by Segment

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▋Home-Life Division
Changes in quarterly net profits

Management policy for the second half

50
40
30

17

20

2H Results

17

10
0

1H Results

25

Mastering (RENEWING)
household retail, industrial gas and overseas businesses◆Household retail◆ Act as a platform for the gas supply business for households in the whole
ENEX Group

1H Results

06

FY2020 Results

FY2021 Plan

Main initiatives in the first half
◆Household retail◆ Maintaining and cultivating the customer base and actions for the environment
and energy□ Stepping up retail sales
We expanded the platform for selling a combination of LPG with electric power and others.
The LPG customer base increased by 1,000 households from the end of the previous fiscal year to 553,000 households, and the power customer baseincreased 5,000 households, to 110,000.

□ Reforming the retail business structure

We have set up the Platform Management Department. We are making groupwide efforts to reform the retail business model, including operational
improvements.

□ LPWA gas meters introduced to regional companies for streamlining logistics and metering towards CO2 emissions
reduction
We accelerated introduction of LPWA gas meters. An approximate cumulative total of 230,000 has been installed, up 73,000 from the end of previous fiscal
year.
On September 30, Itochu Enex Home-Life Nishi-Nihon Co., Ltd. obtained the gold safety recognition to be a Class 1 recognized LP gas dealer.

◆Industrial gas◆ Expanding into businesses around industrial gas□ New business launched

Itochu Industrial Gas Co., Ltd. opened its Nishiyoshimi Office to start a cylinder storage business and manufacturing of AdBlue®.

◆Overseas◆ Expanding the overseas business□ Developing a restructured retail business model
Disseminate the restructured retail business model to sales companies in the Group on the initiative of the Platform Management
Department.
Achieve CX, gathering, accumulating and using data at multilayered touch points.
□ Accelerate installation of low power wide area (LPWA) gas meters
Continue to accelerate installation for streamlining logistics and metering (towards achieving 100% installation)
Wholly owned sales companies will work towards the goal of reaching the number of installed LPWA gas meters for acquiring socalled gold safety recognition by the end of FY2021.
The ENEARC Group will work towards the goal of reaching the number of installed LPWA gas meters for acquiring so-called silver
safety recognition by the end of FY2021.
□ Strengthen customer contacts
Launch an information distribution service for LP gas operators on the social media and enrich its content.

◆Industrial gas◆ Enhance the functions of the industrial gas business and expand the business□ Strengthen the supply chain
Consider streamlining of logistical functions for mainstay products and develop and carry out M&A projects.

□ Implement digitalization ahead of the industry
Launch of an e-commerce site is planned for streamlining operations, strengthening the sales promotion functions and enhancing
services for customers.

◆Overseas◆ Spread the expertise and implement actions based on it□ Evolution
Thailand-based WP Energy will introduce a Japanese-style sales approach to expand its business scale while improving its
operations.

□ ExpandWe dispatched two more personnel to WP Energy in Thailand, in which we had invested in the previous fiscal year. Measures for business expansion are
under consideration.

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▋Car-Life
Changes in quarterly net profits

50
40
30

41

38

2H Results

Shrinking demand and growing Car Life:
Maintain the platform and invest in growth

22

20
10
0

Management policy for the second half

1H Results

1H Results

19

16

FY2020 Results

FY2021 Plan

Main initiatives in the first half
■ Maintaining the customer base
◇ TERASEL Denki: 2,964 subscriptions◇ Corporate brokerage: 10,387 kW◇ New CSs added to the affiliated network: 3Total number of CSs in the affiliatednetwork: 1,672■ Efforts continued on new businesses associated with CSs◇ CSs newly introducing Smartphone fueling: 124◇ Imported tires sold: 4,255 An e-commerce site for non-petroleum products came into
service in August.

■ Improve productivity through business efficiency improvement◇ Actions for streamlining sales administrative operations carried out with the active useof information and digital technologies
e.g.: Online orders and introduction of electronic invoices◇ Efficient sales activities that use real activities and virtual spaces properly
e.g.: Holding of the kickoff meeting online■ Respond to shrinking demand for petroleum products◇ Continue new business expansion around Car Life Stations (CSs) toincrease transactions in the affiliated network.
◇ Expand the scale of the fleet business◇ Positively introduce information and digital technologies to accelerate
operational streamlining.
■ Invest positively in growing businesses◇ Expand new businesses centering on mobility.
◇ Invest positively for expanding car and truck trading and peripheralbusinesses.
◇ Strengthen the the car dealer business centered around Nissan Osaka.

■ Preparations for the future◇ Cultivate overseas business (Enex Fleet Vietnam and IP&E Palau)◇ Continue to enlarge TERASEL Denki

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▋Industrial BusinessChanges in quarterly net profits
50

40

2H Results

30

Management policy for the second half

39
16

26

20
10

1H Results

1H Results

23

15

FY2020 Results

FY2021 Plan

0

Main initiatives in the first half
■Expand products that reduce the environmental impact◇ Structure for supplying AdBlue® expanded· A new AdBlue® manufacturing plant constructed in Saitama in collaboration with Itochu
Industrial Gas Co., Ltd.
· We entered the manufacturing domain and diversified procurement to establish acompetitive advantage and to build a solid supply system.
◇ Foundations enlarged for GTL sales expansion· To expand the delivery area, new shipping points were launched at Hiroshima and at Mojiand sales activities commenced.
■Transition to a decarbonized society pushed◇ Renewable fuel supply business commenced· We embarked on a full-scale renewable fuel business in partnership with ITOCHU
Corporation.
The service for convenience stores' delivery vehicles for FamilyMart Co., Ltd.

Combining Professional Expertise and Environmental
Technology for a Carbon-Free Society■Changing the structure of existing business and enhancing profitability◇ Accelerate the digital shift of existing businesses for streamlining◇ Increase products and services with low environmental impacts amid mounting
demand for them
· Continuously enlarge the supply area of GTL fuels (service for Hokkaido underconsideration)
Start dealing with carbon-neutral GTL fuels· Increase the number of filling stations for renewable fuels (A station to be launched in
Kanagawa in November)· Construct and improve the system for supplying AdBlue® (An SP to be launched in
Shizuoka Prefecture in November)· Study participation in caustic soda dilution and expansion into peripheral businesses· Sign a memorandum of understanding for joint study regarding LNG fuels for ships with
Kyushu Electric Power Co., Inc., Nippon Yusen K.K. and Saibu Gas Co., Ltd.
Embark on full-scale consideration of LNG bunkering in the Kyushu and Setouchi regions■Creating new businesses (environment, technology, co-creation)◇ Create businesses helpful to a carbon-free society· Develop personnel with environmental expertise· Quickly launch a business for CO2 visualization and reduction solutions through multiindustrial collaboration· Discover new fuels
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▋Power & Utility Division
Changes in quarterly net profits
50
40
30

39
27
9

10

1H Results0Power to Connect Customers, Environmental
Business for the Future

2H Results

20

Management policy for the second half

1H Results

18

17

FY2020 Results

FY2021 Plan

Main initiatives in the first half

[PU Vision] Contribute to life in local communities and the environment■Serve 500,000 households by human and digital sales activities· Green electric power· Digital marketing· Network of partners■Cho-TERASEL plan and Cho-TERASEL Re-energy plan launched for
TERASEL Denki operated by Enex Life Service Co., Ltd.

■Invest in energy service (ES)· PV panels for private power consumption· Storage batteries· Local
heat supply and local production of energy for local consumption■First PV panels for private consumption installed on the Nishinomiya
CS run by Enex Fleet Co., Ltd.

■Focus technological strength on EVs and IT· Sharing service· Subscription· V2H■Reliance Energy Okinawa, Inc., an affiliate of Tokyo Toshi Service
Company, commenced its energy service at its sixth location.

■Invest in renewable energy (RE) and Agri-Voltaic (AV)· Agriculture-related· CCU■Construction of a 65-megawatt large photovoltaic facility reachedcompletion in the city of Takasaki in Gunma Prefecture.
It commenced operation in September.
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Appendix

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33

Appendix[Reference] Shipments of gasoline and diesel oil in Japan (national statistics)
Weekly shipment volume of gasoline

Year ago value

Unit: Thousand kiloliters

Recent value

1100
1000
900

920

860
849

819

800
700

908

846
729

807

792

774

864

813
797

993

957

891

911

757

853

942

826

755

852

850

701

781

720

673
661

785

675
801

743

600
500

822

786

887

862

736

850

857

769

852

695

712

737

746

572

554

First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week ofOctober
OctoberNovemberNovember
December
DecemberJanuary
January
February
February
March
March
April
April
May
May
June
June
July
July
AugustAugustSeptember
September

Weekly shipment volume of diesel oil

Unit: Thousand kiloliters

900
728

800
700

655

597

644

500

597
648

400
300

540

596

661

629

600
611

695

736
631

659

617
442

647

720

753

627

631

671

607
595

622

612

589

572
543

385

557

557

583

546

582

495

483

533

513

670

608
541
629

590

605

437

321
First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week of First week of Third week ofOctober
OctoberNovemberNovember
December
DecemberJanuary
January
February
February
March
March
April
April
May
May
June
June
July
July
AugustAugustSeptember
September* Created based on statistics from Petroleum Association of Japan
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34

Appendix[Reference] Monthly sales volume of LP gas (September to August, national statistics)
September
2019

2020

For
householdandbusiness
use

438

401

For cars

47

Total

485

October

Changes

2019

2020

-8%

514

526

35

-26%

47

436

-10%

561

March
2020

2021

For
householdandbusiness
use

749

764

For cars

41

Total

790

November

Changes

2019

2020

+2%

608

616

36

-23%

46

562

+0%

654

April
Changes

2020

2021

+2%

646

616

31

-24%

29

795

+1%

675

December

Changes

2019

2020

+1%

804

828

33

-28%

51

649

-1%

855

May
Changes

2020

2021

-5%

513

522

30

+3%

22

646

-4%

535

January

Changes

2020

2021

+3%

780

813

37

-27%

45

865

+1%

825

June
Changes

2020

2021

+2%

454

494

26

+18%

31

548

+2%

485

February

Changes

2020

2021

+4%

747

736

-1%

29

-36%

42

27

-36%

842

+2%

789

763

-3%

July
Changes

2020

2021

+9%

451

458

30

-3%

37

524

+8%

488

Changes

Unit: Thousand tons

AugustChanges

Total
Year
Last one
Changes
Changes before
year
last

2020

2021

+2%

412

405

-2%

7,116

7,179

+1%

33

-11%

35

31

-11%

473

378

-20%

491

+1%

447

436

-2%

7,589

7,557

-0%

* Created based on statistics from Japan LP Gas Association
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35

Appendix[Reference] Monthly sales of new cars (Standard-sized cars, compact cars and kei (light) cars)(October to September, national statistics)
October
2019

2020

Standardsized andcompact
cars

165

221

Kei cars

95

Total

260

November

Changes

2019

2020

+35%

206

219

118

+24%

110

339

+30%

316

April
2020

2021

Standardsized andcompact
cars

193

208

Kei cars

108

Total

301

December

Changes

2019

2020

+6%

195

211

118

+7%

90

337

+7%

285

May
Changes

2020

2021

+8%

233

227

116

+7%

129

324

+8%

362

January

Changes

2019

2020

+8%

193

208

105

+17%

108

316

+11%

301

June
Changes

2020

2021

-3%

322

329

135

+5%

163

362

+0%

485

February

Changes

2019

2020

+8%

233

227

116

+7%

129

324

+8%

362

July
Changes

2020

2021

+2%

145

183

181

+11%

75

510

+5%

220

March

Changes

2019

2020

-3%

322

329

+2%

135

+5%

163

181

+11%

362

+0%

485

510

+5%

AugustChanges

2020

2021

+26%

124

166

106

+42%

51

289

＋32%

175

Changes

Unit: Thousand units

September
Changes

Total

ChangesYear
before
last

198

+9%

2,525

2,590

+3%

102

99

-3%

1,317

1,436

+9%

284

297

＋4%

3,842

4,026

＋5%

2020

2021

+34%

182

96

+89%

282

＋50%

Last one
Changesyear* Compiled based on statistical data issued by the Japan Automobile Dealers Association Japan Light Motor Vehicle and Motorcycle Association
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36

Contact
Investor Relations Office
Staff：Imaizumi or Nakamura[E-MAIL] enex_irpr@itcenex.com[TEL] +81-3-4233-8025 [FAX] + 81-3-4533-0103

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37