Chiyoda Global Headquarters
Minato Mirai Grand Central Tower
4-6-2, Minatomirai, Nishi-ku,
Yokohama 220-8765, Japanwww.chiyodacorp.com/en

The presentation was held in Japanese.

February 7, 2022

This document is a translation/summary

IR, PR & CSR Section

for reference only.

Corporate Services Department
Chiyoda Corporation

Summary of a Q&A session following the Presentation of theThird Quarter Financial Results for Fiscal Year Ending March 31, 2022
The following is a summary of a Q&A session following the presentation (telephone conference) ofChiyoda Corporation’s (Chiyoda) financial results for the third quarter of fiscal year ending March 31,2022, released on February 2, 2022.
Question
1

AnswerGross profit margin
What factor resulted in a gross profit There were positive and negative factors affecting themargin of 7.8%, lower than the full gross profit for the third quarter, with negative factors
year forecast?

slightly surpassing the positive ones.
Positive factors were:1.

Increased

profitfromexceptional

projectmanagement
2.

Steady progress of high profit projects

Negative factors were:1.

Anticipation of lower profits on some projects due
to rapidly increasing equipment/material costs andsupply chain risks

2.

Future expenses related to the Ichthys LNG
project, re-examining claims and obligations, reevaluating project close-out risks and expenses
following the out-of-court settlement with the client

2Ichthys LNG (Completed)
Howwillarbitration

withthe Because the arbitration process is progressing, we aresubcontractor proceed and how will unable to further explain the details for confidentiality
it impact financial results?

reasons.
Chiyoda assessed the arbitration risks and recorded
extraordinary losses in the first quarter. As previously

1Chiyoda Global Headquarters
Minato Mirai Grand Central Tower
4-6-2, Minatomirai, Nishi-ku,
Yokohama 220-8765, Japanwww.chiyodacorp.com/enQuestion

Answerstated, in the third quarter we added future expenses
and are prepared for foreseeable arbitration risks via
project contingencies, accumulated provisions andadditional costs in the third quarter.

3

Influence of surging equipment/material costs
How does the cost escalation of In addition to price escalation of non-ferrous metals
equipment/material affect financial such as copper and nickel, ocean freight costs are also
results?

rapidly increasing. In cooperation with JV partners,
Chiyoda systematically procures equipment/material
within quoted periods.
Chiyodaiscontinuing‘ForceMajeure’ contract

provision discussions with clients for COVID-19 related
cost and schedule impacts.
There are currently no negative profit-and-loss impacts
and we continue to cooperate with clients to minimize
the influence on project execution.
4

Influence of COVID-19 pandemic
How has the Omicron variant The degree of influence differs project by project.
affected financial results?

Engineering is affected by travel restrictions inengineering hubs in India and Philippines and weanticipate procured item delivery delays caused bysupply chain disconnections and a shortage of
construction workers on site.
Chiyodaiscontinuing‘ForceMajeure’ contract

provision discussions with clients for COVID 19 related
cost and schedule impacts and we continue tocooperate with clients to minimize the influence on
project execution.
5

FY2022 forecast
What will the FY2022 financial Chiyoda does not anticipate negative factors inresults be?

FY2022. Following examination of revenue and grossprofit in due course, we expect to record a profit

2Chiyoda Global Headquarters
Minato Mirai Grand Central Tower
4-6-2, Minatomirai, Nishi-ku,
Yokohama 220-8765, Japanwww.chiyodacorp.com/en

Question

Answerbecause NFE LNG in Qatar and the copper smelting
plant in Indonesia are progressing well, coupled withsatisfactory progress in the renewable energy andpharmaceutical/life science fields.

6Order backlog
The order backlog was over 1.3 Chiyoda recognizes the magnitude of the order backlog
trillion JPY. Will this increase in the and will selectively receive ‘Grade A’ orders to not
fourth quarter? If so, will there be overstretch
resource issues?

7

resources,reinforced

from

group

companies and outsourced.

Management strategy
What strategies will be implemented Chiyoda selects projects, regions, clients and fields forto lower business volatility and our EPC business, secures resources and shares risks
expand new business fields?

with clients. Cooperation with partners is essential.
We will accelerate monetization of new businesses atthe same time whilst lowering business volatility
through risk management and engaging in newbusinesses.

-EndPlease address inquiries to:
IR, PR & CSR Section, Corporate Services Department: Tel. +81-45-225-7734

Note: Some additions and corrections have been made to simplify the content for readers. Any
projections included in these materials are based solely on information available at the time thispresentation was prepared. It is possible that actual results may vary significantly from the projections
due to a number of risk factors such as economic conditions. The results projected here should not
be construed in any way as being guaranteed by the Company. Investors are recommended not todepend solely on these projections for making investment decisions.

3