Management Messages

JGC Group's Growth Strategy

Reinforcing Management
Resources for Continuous Growth"Sustainability Management"

Reinforcing Management
Results of Value Creation
Resources for Continuous Growth"Corporate Governance"

Results ofValue Creation
The JGC Group’s value-creation mechanism creates economic, social, and environmental value while supporting
our sustainable growth, with outcomes gauged and evaluated through financial and non-financial metrics. Here, we
present business results for fiscal 2022 and chronicle thisvalue creation.

81

Financial Highlights

83

ESG Data Highlights

85

Consolidated Segment Information

86

Operational Review: Total Engineering Business

87

Operational Review: Functional Materials
Manufacturing Business

90

Analysis of Performance and Financial Position

91

Consolidated Financial Statements

95

Group Companies

102

Stock Information

103

Outline of JGC

104

JGC Report 2023

JGC Report 2023

82

Management Messages

JGC Group's Growth Strategy

Reinforcing Management
Resources for Continuous Growth"Sustainability Management"

Reinforcing Management
Results of Value Creation
Resources for Continuous Growth"Corporate Governance"

Results of Value Creation

Financial Highlights
JGC Holdings Corporation and its consolidated subsidiaries*1(Millions of yen)

Years ended March 31

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

  Net Sales

675,821799,076879,954

693,152

722,987

619,241

480,809433,970

428,401

606,890   Operating Profit (Loss)

68,25329,74049,661(21,496)

21,49523,24920,23422,88020,68836,699  Profit (Loss) Attributable to
Owners of the Parent*2

47,178

20,62842,793(22,057)

16,58924,005

4,117

5,141

(35,551)

30,665  New Contracts*3

818,161

769,680

320,626

506,293547,826

935,451

189,643

683,068

315,956

878,789

1,767,814

1,772,036

1,192,625

1,045,684

846,157

1,208,365

941,618

1,241,204

1,215,911

1,571,093   Total Current Assets

575,886

533,538

522,747

480,865

521,320541,747

537,955

548,359

533,343

539,493   Total Current Liabilities

333,353

286,533

225,203

226,457

215,773

223,559

228,386

197,055

253,836

272,206  Working Capital

242,533

247,005

297,544

254,408

317,200

318,188309,569

351,304

279,507267,287   Net Property, Plant and Equipment

70,29078,56076,25569,87755,22255,44049,794

66,65469,534

72,234  Total Assets

746,102719,754689,782646,291

684,921708,855

671,273702,529694,274

713,127   Long-Term Loans Payable

13,001

22,71520,991

12,631

4,294

3,949

347

16,783

11,496

13,891  Net Assets

379,882

388,496

419,673

383,260

395,779

410,350

390,979

417,616

387,662

397,981  Shareholders’ Equity

374,654

387,480

418,695

382,215394,701

409,254

390,516

417,120

387,145397,343   Cash Flows from Operating Activities

120,576(71,416)(49,764)(28,884)

5,539(55,259)

92,442

12,467

19,311

110,769   Cash Flows from Investing Activities(18,728)(23,411)

8,696(12,979)

11,736(4,662)

19,364(13,520)(7,695)(11,471)   Cash Flows from Financing Activities(10,687)

3,836(4,374)(19,674)

33,781(13,878)(7,699)

196

(148)

(61,288)   Cash and Cash Equivalents at End of Year385,252

297,707247,947

185,603

235,394

160,841

261,898

268,281

288,009332,755   Return on Assets (ROA) (%)

12.2

6.1

7.4

(2.3)

3.8

4.6

3.2

3.7

4.3

7.2

   Return on Equity (ROE) (%)

13.3

5.4

10.6

(5.5)

4.3

6.0

1.0

1.3

(8.8)

7.8

   Net Income (Loss) per Share (yen)186.9081.73

169.60(87.42)

65.75

95.14

16.32

20.37

(140.77)

122.28   Cash Dividends per Share (yen)

46.5

21.0

42.5

30.0

25.0

28.5

12.0

12.0

15.0

38.0

   Gross Profit Ratio (%)

13.1

6.6

8.3

0.2

6.2

7.3

9.0

10.1

10.6

11.0

   Operating Income Ratio (%)

10.1

3.7

5.6

(3.1)

3.0

3.7

4.2

5.3

4.8

6.0

   Equity Ratio (%)

50.2

53.8

60.7

59.1

57.6

57.7

58.2

59.4

55.8

55.7

   Current Ratio (%)

172.8

186.2

232.1

212.3

241.6

242.3

235.5

278.2

210.1

198.2

   Payout Ratio (%)

24.9

25.7

25.1

—

38.0

30.0

73.5

58.9

—

31.1

   Number of Employees

7,005

7,332

7,489

7,554

7,610

7,841

7,607

7,371

7,275

7,876

Performance Highlights  Outstanding Contracts

Financial Position at Year-End

Cash Flows

Financial Highlights*4*1 As of March 31, 2023, there were 25 consolidated subsidiaries.
*2 As a consequence of applying “Accounting Standard for Business Combinations” (ASBJ Statement No. 21, September 13, 2013), “Net income (loss)” is referred to as“Net income (loss) attributable to owners of the parent” from fiscal 2015 onward.
*3 The method of aggregating orders received has been changed to include orders in Functional Materials Manufacturing Business since fiscal 2022.
*4 The “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29, March 31, 2020) has been applied from the beginning of fiscal 2021.

83

JGC Report 2023

JGC Report 2023

84

Management Messages

JGC Group's Growth Strategy

Results of Value Creation

Results of Value Creation

ESG Data Highlights

Consolidated Segment Information
JGC’s Main KPIs

Units

Fiscal 2018

Fiscal 2019

Fiscal 2020*1

Fiscal 2021*1

Fiscal 2022*1
Functional Materials
Manufacturing Business

E Report on Environmental Initiatives
Environment-related Initiatives• Contribution to environmental
protection• Environmental improvement
activities in line with ourbusiness• Promotion of the zero
emissions initiative

Scope 1 and 2 GHG emissions*2

t

—

—

132,546

133,573

134,004

Scope 3 GHG emissions*2

t

—

—

—

702,873975,775

Industrial waste recycling rate (Domestic construction sites)

%

96.1

85.2

88.3

98.4

99.0

Functional Materials
Manufacturing Business

Other

7.9%

1.2%

¥47.7 billion

Incidents

0

0

0

0

0

Energy-related CO2 emissions (Domestic construction sites)

kg CO2/hour

2.39

0.61

0.40

1.91

1.35

Net Sales

%

79.5

69.5

85.9

93.9

99.6

Fiscal 2022

Energy consumption (Yokohama Head Office)*3

Crude oilequivalent (kl)

2,224

2,139

2,091

2,022

2,035

Yokohama Head Office power consumption

1,000 kWh

5,497

5,221

4,756

4,658

4,819

Consumption of chilled water by Yokohama Head Office1,000 MJ

15,353

15,503

14,34913,327

14,970Consumption of steam by Yokohama Head Office1,000 MJ

7,724

7,170

10,377

9,963

7,708

Volume of waste disposed by Yokohama Head Office1,000 kg

206

191

109

129

149

Rate of recycling of waste by Yokohama Head Office

%

61.4

59.5

65.5

68.6

61.4

Persons

21

26

30

35

39

%

—

2.2

2.5

2.8

3.1

Other

16.9%

¥7.5 billion

Number of incidents of leaks of hazardous substances, etc.
(Domestic and overseas construction sites)
Rate of diffusion of electronic manifests

Reinforcing Management
Results of Value Creation
Resources for Continuous Growth"Corporate Governance"

Reinforcing Management
Resources for Continuous Growth"Sustainability Management"

4.2%¥7.1 billion¥1.7 billion

Operating
IncomeFiscal 2022

Total
Engineering Business

Total
Engineering Business¥551.6 billion¥33.4 billion

78.9%

90.9%

S Report on Social Initiatives
Initiatives related to humanrights and labor practices• Promotion of diversity• Support for realization ofwork–life balance• Support for employee careerformation

Number of women in management positions
Ratio of women in managerial positions
Rate of employment of people with disabilities*4

%

1.87

1.97

2.27

1.72

2.58

Number of re-employed employees*5

Persons

109

55

55

13

8

Number of non-Japanese employees*5

Persons

89

86

95

93

90

%

10

14

48

32

69
33 (100)

Rate of employees taking childcare leave (Male)
Number of female employees taking childcare leave (Rate ofreinstatement of female employees taking childcare leave)

Persons (%)

24 (100)

19 (100)

27 (100)

27 (100)

Number of employees taking spousal childbirth leave

Persons

64

80

91

87

61

Number of employees taking sick or injured childcare leave

Persons

185

187

217

167

189

Number of employees taking nursing care leave

Persons

22

11

42

33

38

Number of employees taking temporary retirement for nursing care

Persons

0

0

1

0

3

Number of employees working reduced hours for childcare

Persons

51

47

47

44

68

Number of employees working reduced hours for nursing care

Persons

0

0

0

0

0

%

53

59

60.75

60.95

70.25

Persons

86

45

55

88

102

Total annual training

Hours

–

–

–

57,87750,871

Training per person

Hours

–

–

–

18

17

Persons

2

4

4

1

1

Total project working hours

1,000 hours

90,99356,47840,86149,334

46,401

Number of fatal accidents

Incidents

0

0

1

0

0

Number of accidents accompanied by lost work time

Incidents

8

7

7

8

8

Number of restrictions on work

Incidents

11

18

15

11

13

Number of conditions requiring specialized treatment

Incidents

Rate of utilization of annual leave
Number of employees dispatched for on-site training /on-site instruction

Number of employees dispatched to overseas companies, etc.
Initiatives related to health and safety*6• Fostering of culture of health and safety• HSSE leadership by top management• Enhancement of HSSE management
system for investment projects• Ongoing implementation of traffic safetymeasures• Further development of in-house healthand safety education• Enhancement of Head Officeconstruction HSSE functions

31

46

46

31

32

Rate of frequency of accidents accompanied by lost work time*7

0.018

0.025

0.034

0.032

0.034

Rate of frequency of recordable accidents

0.11

0.25

0.34

0.20

0.23

Times
(People)6 (199)21 (559)

19 (1,856)

27 (846)42 (5,053)

Incidents

28

47

44

49

48

*8

Total Engineering Business
Focused on Total Engineering Business activities including design, procurement, construction, and commissioning offacilities and plants used for petroleum and petroleum refining, petrochemicals, gas, LNG, chemicals, nuclear energy,
metal refining, biochemicals, food, pharmaceuticals, healthcare, logistics, information technology, environmental protection, and pollution control.

Functional Materials Manufacturing Business
Focused on manufacturing and sales of products in the fields of catalysts, nanoparticle technology, hygiene andsafety, electronic materials, high-performance ceramics, and next-generation energy.

Other Businesses
Includes consulting, office support, desalination, and oil and gas production and sales.

Completed Construction by Region

Millions of yen

JapanSoutheast Asia

Middle East

AfricaNorth America

Other

Total

173,106

53,791

148,463

32,009184,986

14,532606,890(Note) B ased on client location and classified by country or region.

G Report on GovernanceInitiatives related to fair business practices•R ealization of increased complianceawareness

Number of times compliance training implemented /Number of employees receiving compliance training*9

Number of reports received by hotlines
Initiatives related to the promotion of
information security• Information management awarenessverification surveys and voluntary
inspections• Drills against targeted threats

Number of serious information security-related incidents

Incidents

0

1*10

0

0

0

Reinforcement of governance system

Number of outside directors

Persons

2

3

4

4

3

*1 Applies to JGC Holdings, JGC, and JGC Japan combined.
*2 Based on CDP reporting. Also includes JGC C&C, Japan Fine Ceramics, and Japan NUS.
*3 Energy consumption (Yokohama Head Office): Reduction target set so that an average annual reduction of 1% over the past five years can be achieved.
*4 From fiscal 2022, scope includes special subsidiary JGC Parallel Technologies Corporation.
*5 Number of re-employed employees and number of non-Japanese employees = (Number of employees in April + Number of employees in March) ÷ 2*6 This data is the total based on the period from January to December.
*7 Rate of frequency of accidents accompanied by lost work time = (Number of accidents accompanied by lost work time) × 200,000 ÷ Total project working hours*8 Rate of frequency of recordable accidents = (Number of fatal accidents + Number of accidents accompanied by lost work time + Number of restrictions on work + Number ofconditions requiring specialized treatment) × 200,000 ÷ Total project working hours*9 From fiscal 2022, includes e-Learning.
*10 Number of serious information security-related incidents: 1 (Emails sent to external parties due to unauthorized access)Corrective measures for the above incident: introduction of measures to prevent unauthorized access through two-factor authentication

85

JGC Report 2023

JGC Report 2023

86

Management Messages

JGC Group's Growth Strategy

Reinforcing Management
Resources for Continuous Growth"Sustainability Management"

Reinforcing Management
Results of Value Creation
Resources for Continuous Growth"Corporate Governance"

Results of Value Creation

Operational Review

Total Engineering Business

Overseas Sector

Farhan Mujib
Representative Director,
President
JGC Corporation¥696 billion
New Contracts Targeted for Fiscal 2023 ¥620 billion

New Contracts in Fiscal 2022 Approx.

Facility Solutions

Energy Solutions
Business Areas

Business Areas ngineering, procurement and construction of plants inEsectors such as liquefied natural gas (LNG), Carbon Captureand Storage (CCS), petroleum refining, petrochemicals,
chemicals, gas processing, etc.

Semiconductor manufacturing facilities (image)
FLNG plant (Africa)

Operational Review

Economic activity resumed around the world during fiscal
2022 as the impact of COVID-19 gradually slowed down.
There was also an increase demand for natural gas including LNG as a transition energy, given both concerns overenergy security caused by conditions in Ukraine and moves
toward low-carbon and decarbonization. With the numberof projects increasing as clients resume their capital investments, we received orders for Zuluf AH Oil Increment Central
Processing Facilities in Saudi Arabia, a near-shore FLNG
plant in Malaysia, and a Vinyl Chloride Monomer (VCM),
Polyvinyl Chloride (PVC) and OSBL expansion project in ngineering, procurement and construction of infrastructureE
facilities in the semiconductor and battery-related industries,
data centers, LNG receiving terminals, transportation
infrastructure, etc.

Thailand.
During fiscal 2023, clients are slated to continue moving
forward with their capital investment plants with a focus on
natural gas and LNG, the importance of which has beenreconfirmed as a transitional energy—a stable energy
source in the shift to a low-carbon and decarbonization. We
will continue to evaluate the risks and concentrate on selecting projects that are definitely forecast to deliver profits. At
the same time, we will also be focusing on increasing future
capacity, including the operation center that we establishedin India.

Operational Review

Orders received in fiscal 2021 progressed at a steady paceduring fiscal 2022, as we also conducted sales activities inearnest with the goal of developing clients and coordinating and secure projects through a solutions-driven approachstarting with conceptual design.
With the expansion of digital industries, we will be aiming
to receive EPC projects in industrial infrastructure sectors
such as the high-demand semiconductor and battery-relatedindustries, data centers. We will continue working with client's decision-making processes to develop clients througha solutions-driven approach starting with conceptual designand coordinate and receive projects. Plans for low-carbon
and decarbonization-related projects are taking shapethroughout Southeast Asia, so we will be coordinating efforts
with companies including JGC Asia Pacific to develop theminto EPC orders.

Current Major EPC Projects

Sustainable Solutions
Business Areas

Engineering, procurement and construction of plants in

Iraq

sectors such as hydrogen/fuel ammonia, SAF, and nuclear
energy, etc.

Refinery Upgrading Project

Operational Review

We established the "Sustainable Solutions" organization in
September 2022 to serve the sustainability sector outsideof Japan toward achieving a low-carbon and decarbonizedsociety. The organization covers sustainability-oriented projects overseas in areas such as hydrogen/fuel ammonia, SAF,
green chemicals, and SMRs while securing and executing
projects for related facilities from FS to FEED, and EPC.

87

JGC Report 2023

CanadaLNG Project

ThailandAmmonia synthesis pilot project facility (Fukushima)

With the global trend toward low-carbon and decarbonization, capital investment plans are anticipated to moveahead during fiscal 2023, particularly in sectors, such ashydrogen/fuel ammonia and SAF. The Company will takepart in FS and FEED, identify the most feasible projects thatcan create a sense of differentiation, and develop them into
EPC orders, all while factoring in partnering and conditions
like countries and regions with a proven track record.

Saudi Arabia
Zuluf AH Oil Increment
Central Processing Project

VCM, PVC, and OSBL
Expansion Project

Malaysia

USA

Floating LNG Project

Ethylene Project

Australia
Hydrogen Projectetc.

JGC Report 2023

88

Management Messages

JGC Group's Growth Strategy

Reinforcing Management
Resources for Continuous Growth"Sustainability Management"

Reinforcing Management
Results of Value Creation
Resources for Continuous Growth"Corporate Governance"

Results of Value Creation

Operational Review

Total Engineering Business

Functional Materials Manufacturing BusinessShoji Yamada

Domestic Sector

Representative Director,
President
JGC Japan Corporation¥128 billion
New Contracts Targeted for Fiscal 2023 ¥180 billion

Catalysts and Fine
Chemicals Sector

Toshiharu Hirai
Representative Director,
President
JGC Catalysis and Chemicals Ltd.

New Contracts in Fiscal 2022 Approx.

Business Areas ngineering, procurement, and construction of plants andE
facilities in sectors such as pharmaceuticals, healthcare, SAF,
hydrogen/fuel ammonia, chemical recycling, petroleum refining,
petrochemicals, chemical, nuclear energy, etc.

Pharmaceutical production plant (Shizuoka)

Japan, such as participating in the technology development
and demonstration project for CO2 separation and capture
with unused LNG cold energy as put forward by companies,
such as Toho Gas Co., Ltd.
There has been ongoing investments in facilities centeredon maintenance of existing refineries, life sciences andhealthcare and chemicals, as well as anticipated growth
in clients capital investments in the low-carbon and decarbonization-related sector, such as hydrogen/fuel ammonia
and SAF, CCS and battery facilities toward achieving Green
Transformation (GX) set forth by the Japanese government,
and the circular economy sector.

In catalysts in fiscal 2022, domestic and overseas demandfor catalysts remained steady, primarily with FCC catalysts
as fuel demand gradually returned. In the Fine Chemicals
sector, despite a worsening business environment in thesemiconductor and electronics market leading to a decreasein demand for silica sols used in hard disk and semiconductor polishing and for silica sols used as anti-reflective material in flat panel displays and tablets, demand for cosmetics
materials remained steady.
Turning to the Functional Materials Manufacturing
Business in fiscal 2023, in catalysts, we will again seek alarger domestic market share for FCC catalysts and continue
developing overseas operations, maintain our partnerships

Fine Ceramics Sector
Business Areas

NiigataMiyagiGround facility for blue hydrogen and ammonia production
pilot project facilityBunum, que pec morterit; hosuludam

and improve profitability for hydrotreating catalysts, work
to secure new chemical catalyst contracts, develop new
chemical catalyst products for the growing carbon recycling
and chemical recycling sectors, and develop materials forenvironmental conservation catalysts for renewable energy
power generation. In fine chemicals, despite concerns overa worsening business environment in our core electronics
and semiconductor markets, we are focusing on launching
new silica sol polishing materials, expanding functional coating material sales and applications, developing cosmetic
microbead alternatives, and expanding optical material sales
and applications.

Representative Director,
President,
Japan Fine Ceramics Co., Ltd evelopment and production of ceramic materials forDsemiconductor, automotive, telecommunications, industrial,
medical, and aerospace applications

Biomass power generation facility

Fukushima

ToyamaGreen ammonia demonstration plant

Vaccine production plantTochigi

Shiga

Bio API manufacturing facility

Pharmaceutical plant

Chiba
Land-based aquaculture plant

Aichi
Biomass power generation facility

Shizuoka
API manufacturing facility

Hyogo
Biomanufacturing-related facility

JGC Report 2023

Oil refining catalysts

Hiroshi Tanaka

Current Major EPC Projects

89 evelopment and production of catalysts used in petroleumD
refining, chemical, and environmental conservation and of finechemical products used as materials in semiconductor,
IT / electronics, optics, cosmetics, and other applications

Operational Review

Operational Review

Fiscal 2022 saw activity in renovation and maintenance forexisting oil refineries as well as ongoing capital investment inlife sciences, healthcare and chemicals facilities. In this kindof environment, in addition to maintenance of existing refineries and chemical plants, the domestic business secured
construction contracts for pharmaceutical manufacturing
facilities and hospitals, a SAF production facility construction
project in Osaka, construction work for a ground facility forblue hydrogen and ammonia production pilot project facility in Niigata Prefecture, and facilities associated with theresumption of nuclear power plants. We also made progresswith low-carbon and decarbonization-related projects in

Business Areas

Operational Review

The semiconductor-related market began to suffer in thesecond half of fiscal 2022 due to slowing demand for
products used in semiconductor manufacturing, as device
manufacturers adjusted production activities and curtailed
new capital investments. Meanwhile, demand for highthermal conductivity silicon nitride substrates for electricvehicle and hybrid vehicle power semiconductors continued
to remain strong, and so the decision was made in June
and July 2022 to acquire land and for capital investment
to increase production of high thermal conductivity silicon

Announcing the location of the new plant

nitride substrates and other materials. To expand businessin the Fine Ceramics sector, operations commenced at JFC
Materials Co. Ltd., on July 1, 2022 following acquisition of
the ceramics business from Showa Denko Materials Co.,Ltd.
Despite ongoing concerns over a worsening businessenvironment in the semiconductor manufacturing equipment
market in fiscal 2023, we will continue working to acquire
new clients and enter new areas, and seek more orders forhigh thermal conductivity silicon nitride substrates.

JGC Report 2023

90

Management Messages

JGC Group's Growth Strategy

Reinforcing Management
Resources for Continuous Growth"Sustainability Management"

Reinforcing Management
Results of Value Creation
Resources for Continuous Growth"Corporate Governance"

Results of Value Creation

Analysis of Performance and Financial Position
Overview of the business environment
Despite a trend toward global economic recovery as theimpact of COVID-19 eases, increasing prices over the longer
term due to factors, such as the prices of resources causedby conditions in Ukraine, as well as countries' central banks
continuing to tighten monetary control in order to curb theseincreases. This is leading to signs of recession throughout
the global economy, and there is growing uncertainty about
the future.
With these circumstances affecting the overseas markets
served by the JGC Group’s Total Engineering Business,
the Energy Solutions sector (including oil refining, petrochemicals and chemicals, gas processing, liquefied naturalgas (LNG)) saw recovery in demand for energy following
the resumption of economic activities around the world.
Moreover, from the standpoint of both energy security andthe shift to a low-carbon society, the importance of relatively
low-impact natural gas (including LNG) is growing, which
has led to steady growth in numerous capital investment
projects in oil- and gas-producing countries. In the Facility
Infrastructure Solutions sector (including power generation,
receiving terminals, pharmaceuticals, medical care, water
treatment, and railways), there was progress in renewable
power generation and investment related to industrial infrastructure mainly throughout Asia in light of the global trend
toward low-carbon and decarbonization. In the Sustainable
Solutions sector (including hydrogen/fuel ammonia, small
modular reactors (SMRs), specialty chemicals, chemical
recycling, and green chemicals), there was steady development mainly with low-carbon and decarbonization-related
projects such as hydrogen/fuel ammonia, following similar
global trends toward low-carbon and decarbonization.
The domestic market for this business saw activity in
refinery renovation and maintenance, and there has beenongoing capital investment in infrastructure focused on life
sciences, healthcare, and chemicals, as well as progresswith low-carbon and decarbonization-related projects suchas hydrogen/fuel ammonia and SAF (sustainable aviationfuel) toward achieving Green Transformation (GX) set forth
by the Japanese government.
In the Functional Materials Manufacturing Business, theCatalysts and Fine Chemicals sector suffered from a worsening business environment for fine chemicals in the semiconductor and electronics market, due to excess supply
and a slowdown in consumer spending following rising
global inflation, despite solid demand for customer products
centered mainly on catalysts in line with the resumption of
economic activities worldwide with the easing of COVID-19.
In the Fine Ceramics sector, there was a greater economic
slowdown in the previously strong semiconductor-related
market, but demand for power semiconductor-related products for electric vehicles and hybrid vehicles continued toremain positive.
The JGC Group continued to monitor the ever-changing
business environment, gathering information and taking
steps against risk as needed, as we sought to prevent the
spread of COVID-19 infection and remain cognizant of thesafety of employees and other stakeholders as we conducted business.

Results of operations

As a result, the equity ratio was 55.7% compared with
55.8% at the end of the previous fiscal year.

In the current consolidated fiscal year, the JGC Group
reported net sales of ¥606,890 million (up 41.7% year onyear), operating income of ¥36,699 million (up 77.4% year
on year), ordinary profit of ¥50,560 million (up 68.4% year onyear), and net profit attributable to owners of the parent of¥30,665 million (net loss attributable to owners of the parentof ¥35,551 million last fiscal year).

AssetsTotal current assets at the end of the current consolidated
fiscal year were ¥539,493 million, an increase of ¥6,149 million compared to the end of the previous fiscal year. Thiswas mainly due to a decrease of ¥38,712 million in accounts
receivable, and an increase of ¥44,792 million in cash anddeposits. Fixed assets totaled ¥173,633 million, an increaseof ¥12,702 million from the end of the previous fiscal year.
This was mainly due to an increase of ¥2,700 million in property, plant and equipment, an increase of ¥1,349 million in
intangible assets, and an increase of ¥8,653 million in investments and other assets.
As a result, total assets amounted to ¥713,127 million,
an increase of ¥18,852 million compared to the end of theprevious fiscal year.

Liabilities
Total current liabilities at the end of the current consolidated
fiscal year were ¥272,206 million, an increase of ¥18,369
million compared to the end of the previous fiscal year. Thiswas mainly due to a decrease of ¥20,000 million in current portion of bonds payable, but an increase of ¥26,747
million in notes and accounts payable and an increase of¥9,794 million in current liabilities and others. Total long-term
liabilities amounted to ¥42,939 million, a decrease of ¥9,836
million compared to the end of the previous fiscal year. Thiswas mainly due to a decrease of ¥10,000 million in bonds
payable.
As a result, total liabilities amounted to ¥315,145 million,
an increase of ¥8,533 million from the end of the previous
fiscal year.

Net assets
Total net assets at the end of the current consolidated fiscal
year were ¥397,981 million, an increase of ¥10,318 million
compared to the end of the previous fiscal year. This was
mainly due to the recording of ¥30,665 million in net profit
attributable to owners of the parent, despite a decrease of¥20,000 million due to the purchase of treasury shares.
Equity and equity ratio(Billions of yen)

(%)
65

500
400
300

394.7

409.2

390.5

417.1
387.1

397.3

59.4
57.6

57.7

55.8

200

55.7

2017

2018

■■ Equity (left scale)91

JGC Report 2023

In fiscal 2022, the JGC Group sought total orders of ¥840
billion in the Energy Solutions Business, Facility Infrastructure
Solutions Business and Sustainable Solutions Business,made up of ¥670 billion in the overseas business and ¥170
billion in the domestic business. With the number of projects
increasing as clients resume their capital investments, we
worked toward securing the number of target orders, while
concentrating on selecting projects that are definitely forecast
to deliver profits, and as a result of these efforts, we achieved
new consolidated contracts of ¥824 billion, close to thenumerical target and our second-highest level ever recorded.
In the Energy Solutions Business in the current consolidated fiscal year, the orders we received included a construction project for a large gas and oil separation plant for Saudi
Aramco, a construction project for a near-shore floating LNG(FLNG) plant for Petroliam Nasional Berhad (PETRONAS)
in Malaysia, and a VCM (vinyl chloride monomer) and PVC(polyvinyl chloride) production capacity expansion project inThailand. Other orders included Front End Engineering Design(FEED) for expansion project of the Cameron LNG plant in
the U.S., an FLNG plant in Nigeria and LNG plant in Papua
New Guinea. Furthermore, JGC Corporation took part in ajoint carbon capture and storage (CSS) study in Malaysia run
by Petronas PETRONAS and Japan Petroleum Exploration
Co., Ltd., and also played an active role toward low-carbon
and decarbonization of fossil fuels, such as taking part ina joint study run by PETRONAS and JX Nippon Oil & Gas
Exploration Corporation for developing the specifics of a
CSS supply chain covering CO2 emitted by various industrial
facilities within Malaysia as well as the separation and capture,transportation, compression and storage of CO2 from Japanand other countries outside of Malaysia. Furthermore, being
the first Japanese company taking part in the "Aiming for Zero
Methane Emissions Initiative," run by an international organization leading the oil and natural gas industry's response to
climate change with the aim of reducing methane emissions
from the oil and natural gas sector.
Orders received in the previous consolidated fiscal year
progressed at a steady pace in the Facility Infrastructure
Solutions sector, as we also conducted sales activities inearnest with the goal of developing clients and coordinating
and securing projects through a solutions-driven approachstarting with conceptual design.
In the Sustainable Solutions Business that was establishedby JGC Corporation in September 2022 as an organization
serving low-carbon and decarbonization projects overseas,
we secured orders for pre-FEED services for the circular
economy, and conducted sales activities in earnest toward

Current consolidated accounting year

56

Total Engineering
Business(Millions of yen)

53

100
0

Total Engineering Business

62
59

58.2

Segment information

2019

2020

2021

2022

FEED and EPC (Engineering, Procurement, Construction)
services for numerous hydrogen-related projects that were
expected to move ahead.
Overseas subsidiaries secured orders, including a largescale solar power generation installation project by the
Vietnam subsidiary, gas processing plant construction project by the Indonesian subsidiary, numerous chemical plant
construction projects by the Singaporean subsidiary, andlarge-scale ethylene production plant construction projectby the U.S. subsidiary.
With the overseas plant market slated to expand overthe medium to long term in line with increasing demand forenergy, we established a new operation center in Chennai
City in India, which began operating in November 2022 inorder to expand the execution capacity of our Group's overseas plant construction projects. Efforts are already being
made to quickly develop a framework comprising 250 engineers, with plans in place to expand up to 1,000 engineers
in the future.
In addition to maintenance of existing refineries and chemical plants, the domestic business secured construction contracts for numerous pharmaceutical manufacturing facilities
and several hospitals, a SAF production facility construction
project in Osaka, and construction work for a ground facility for blue hydrogen and ammonia production pilot project
facility in Niigata Prefecture. We also made significant progress in low-carbon and decarbonization-related projects inJapan, such as participating in the technology development
and demonstration project*1 for CO2 separation and capture
with unused LNG cold energy as put forward by Toho Gas
Co., Ltd, etc.
Our new company "Brownreverse Inc." released the 3D
viewer "INTEGNANCE® VR" for advanced support of maintenance for existing facilities using digital twins, while JGC
Corporation began offering the "CoreSafety®" risk management software to assist with optimizing smart maintenance.
The JGC Group has also focused efforts on diversifying its
business models, including beginning the "Development of
Polymer Synthesis Technology by Microorganisms using CO2
as Direct Raw Material*2" together with Kaneka Corporation,
Bacchus Bio Innovation Co., Ltd. and Shimadzu Corporation,
and as part of this initiative, developing and demonstratingthe "Integrated Biofoundry®" with Bacchus Bio Innovation
Co., Ltd. as a one-stop service for breeding microbes that
produce a variety of useful substances from CO2, scaling up
this technology, and developing production processes.
In addition to the "Perovskite solar cell" next-generation
solar cell developed through the corporate venture capitalfund "JGC MIRAI Innovation Fund" established in the previous consolidated fiscal year, investments were also made into
pharmaceutical and medical-related start-ups, AI-powered
wearable devices, and various start-ups for the production ofplant-derived plastic substitute materials.
As part initiatives toward the "establishment of futureengines of growth" put forward as a key strategy of

(FY)

0

Net sales
Operating profit

Year-on-year
Change (%)

Functional Materials
Manufacturing Business(Millions of yen)

Year-on-year
Change (%)

Other Businesses(Millions of yen)

Year-on-year
Change (%)

551,60745.9

47,773

8.0

7,509

21.4

33,429

95.5

7,169

(1.7)

1,786

72.2

Equity ratio (right scale)

JGC Report 2023

92

Management Messages

JGC Group's Growth Strategy

Reinforcing Management
Resources for Continuous Growth"Sustainability Management"

Reinforcing Management
Results of Value Creation
Resources for Continuous Growth"Corporate Governance"

Results of Value Creation

Analysis of Performance and Financial Position

our current medium-term business plan "Building a
Sustainable Planetary Infrastructure 2025 (BSP 2025),"
we forged an alliance with Toyo Engineering Corporation
for contracting and executing FS (feasibility study), FEEDand EPC projects for fuel ammonia production plants
and ammonia receiving terminals. We also concluded
a license agreement with U.S.-based KBR Inc. for anammonia production process, with the JGC Group, ToyoEngineering Corporation and KBR Inc. coordinating sales
activities toward securing potential contracts in North
America, the Middle East, North Africa and other regions.
We also concluded a license agreement with ToyoEngineering Corporation in March this year for contracting
and executing FEED and EPC projects for SAF production
plants in Japan, and will coordinate joint sales activities andexecution of projects for SAF production plant construction
projects that are expected to increase in Japan going forward, with the view to securing more projects.
We also partnered with Cosmo Oil Co., Ltd. and Revo
International Inc. to establish the merger company SAFFAIRE
SKY ENERGY LLC for a domestic SAF production andsupply project*3 based on used cooking oil, with the aimof commencing operation from between the second half offiscal 2024 to the start of fiscal 2025. For the production andtechnological demonstration project*4 for green ammonia
derived from renewable energy, we concluded a basic cooperation agreement with Namie Town in Fukushima Prefecture
for the site of a demonstration plant anticipated to commence operation in fiscal 2024. Furthermore, we partneredwith Iwatani Corporation and Toyota Tsusho Corporation to
begin a study on developing a low-carbon hydrogen production model using a waste plastic gasification facility in thesuburbs around the Port of Nagoya in Aichi Prefecture, and
we also worked with Teijin Limited and ITOCHU Corporation
to establish the joint venture company RePEaT Co., Ltd. tolicense technology for the chemical recycling of polyester
products, as part of efforts to advance recycling business
operations of polyester products by concluding the firstlicense agreement with Chinese corporations.
*1 Subcontracting initiatives for the NEDO Green Innovation Fund project: Technology
development and demonstration project for CO2 separation and capture*2 Selected as NEDO Green Innovation Fund project: Promotion of Carbon Recycling
Using CO2 from Biomanufacturing Technology as a Direct Raw Material*3 S elected as a NEDO Development of Production Technologies for Biojet Fuels
project: Development of supply chain model through demonstration*4 S elected as a NEDO Green Innovation Fund project: Hydrogen production throughwater electrolysis using power from renewables

Net sales by reportable segment

In catalysts, domestic and overseas demand for catalysts remained steady, primarily with FCC catalysts as fueldemand gradually returned.
In the Fine Chemicals sector, despite a worsening business environment in the semiconductor and electronics
market leading to a decrease in demand for silica sols usedin hard disk and semiconductor polishing and for silica sols
used as anti-reflective material in flat panel displays and tablets, demand for cosmetics materials remained steady.
In the Fine Ceramics sector, the previously strong semiconductor-related market began to suffer from slowing
demand for products used in semiconductor manufacturing, as device manufacturers adjusted production activities
and curtailed new capital investments. Meanwhile, demandfor high thermal conductivity silicon nitride substrates forelectric vehicles and hybrid vehicles continued to remainstrong, and so the decision was made in June and July,
2022 for capital investment and acquisition of land toincrease production of high thermal conductivity silicon
nitride substrates and other materials. To expand businessin the Fine Ceramics sector, operations commenced at JFC
Materials Co., Ltd. on July 1, 2022 following acquisition of
the ceramics business from Showa Denko Materials Co.,
Ltd. As a subsidiary of Japan Fine Ceramics Co., Ltd., ourGroup company in the Functional Materials Manufacturing
Business, JFC Materials Co. Ltd. will help increase production capacity and business performance of the JFC Group.

Current cash and cash equivalents (hereafter, “net cash”) on
a consolidated basis as of the end of the consolidated fiscal
year stood at ¥332,755 million, a year-on-year increase of¥44,746 million. The cash flow conditions and causes in thecurrent consolidated fiscal year are as follows.
With regard to cash flows from operating activities, inaddition to income before taxes on income of ¥48,811 million, a decrease in accounts receivable was the major contributor to give a total of ¥110,769 million for the current
fiscal year, an increase of ¥19,311 million compared to theprevious fiscal year.
Cash flows from investing activities amounted to ¥11,471
million used in these activities, mainly due to payments forpurchases of property, plant and equipment, compared to(Billions of yen)
120

800

564.0

551.6
426.8

400

388.5

60
20

2017

2018

46.6

2019

44.2

40.7

2020

2021

■■ Total Engineering Business■■ Functional Materials Manufacturing Business

93

5.5

17.2
11.7

12.4
–4.6

–20
45.9

JGC Report 2023

99.3

40

377.9

200

0

92.4

80

0

42.1

110.7

111.8

100

670.0

47.7
2022 (FY)¥7,695 million used in these activities in the previous fiscal
year.
Cash flows used in financing activities amounted ¥61,288
million, mainly due to redemption of corporate bonds, compared to cash flows provided by financing activities of ¥148
million in the previous fiscal year.

Analysis of new contracts
In the current consolidated fiscal year, orders received
totaled ¥878,789 million.
The method used to calculate new contracts was changed
from the current consolidated fiscal year, and includes
new contracts of the Functional Materials Manufacturing
Business. The tables below provide a breakdown of newcontracts by sector and region.

New Contracts by Business Sector 
2022

–40
–60

–55.2

2017

19.3

(Billions of yen)

2023

2023
(Percentageof new
contracts)

Total Engineering Business
Energy Transition

220.3

780.5

–

Oil and gas

92.8

349.7

39.8%

LNG

48.0

147.1

16.7%

Chemical

48.3

212.1

24.1%

Clean energy

28.6

61.8

7.0%

Others

2.5

9.6

1.1%

Healthcare & Life sciences

83.2

38.3

4.4%

Industrial & Urban infrastructure

5.6

4.1

0.5%

Others

0.2

0.9

0.1%

Cash Flows

Cash flows(Billions of yen)

600

Functional Materials Manufacturing Business

Functional Materials Manufacturing
Business

–

47.7

5.4%

Other Businesses

–

7.0

0.8%

New Contracts by Region (Billions of yen)

2022

2023

2023
(Percentageof new
contracts)

Japan

166.4

127.6

15.5%

Asia

67.8

251.0

30.5%

Middle East

62.7

310.1

37.6%

Africa

2.0

10.1

1.2%

North America & Other

10.3

125.0

15.2%

Future outlook
Total Engineering BusinessIn the Energy Solutions Business and Sustainable Solutions
Business, there are concerns about ongoing future uncertainties in the business environment due to long-term inflation and tightening monetary control causing a slowdown in
the global economy. Meanwhile, with energy shortages asmuch of the world decouples from Russia and makes efforts
to diversify suppliers, clients seeking to secure stable energy
supplies over the medium to long term are slated to continue
moving forward with their capital investment plans with afocus on natural gas and LNG, the importance of which has
been reconfirmed as a transitional energy—a stable energy
source in the shift to a low-carbon or decarbonized society.
Furthermore, with the global trend toward low-carbon anddecarbonization, capital investment plans are anticipatedin low-carbon and carbon-free sectors like hydrogen/fuelammonia and SAF, as well as the circular economy sector.
In the Facility Infrastructure Solutions Business as well,
we anticipate steady growth in customer capital investment
plans toward industrial infrastructure and advanced industries, driven by population and economic growth in emerging
economies and elsewhere, with the need for decarbonization as a background factor.
The domestic sector, there has been ongoing capital
investment in industrial infrastructure focused on refinery
maintenance, healthcare & life sciences, and chemicals, aswell as anticipated growth in customer capital investmentsin the low-carbon and decarbonization-related sector suchas hydrogen/fuel ammonia and SAF toward achieving Green
Transformation (GX) set forth by the Japanese government,
and the circular economy sector.

Functional Materials Manufacturing Business
Turning to the Functional Materials Manufacturing Business,in catalysts, we will seek a larger domestic market share for
FCC catalysts and continue developing overseas operations, maintain our partnerships and improve profitability
for hydrotreating catalysts, work to secure new chemical
catalyst contracts, develop new chemical catalyst products
for the growing carbon recycling and chemical recycling sectors, and develop materials for environmental conservation
catalysts for renewable energy power generation. In finechemicals, despite concerns over a worsening businessenvironment in our core electronics and semiconductor
markets, we will focus on launching new silica sol polishingmaterials, expanding functional coating material sales andapplications, developing cosmetic microbead alternatives,and expanding optical material sales and applications.
In fine ceramics, despite ongoing concerns over a worsening business environment in the semiconductor manufacturing equipment market, we will continue working to acquire
new clients and enter new areas, and seek increased orders
for high thermal conductivity silicon nitride substrates.

11.6

–1.0
–13.5

–7.6

2020

2021

–11.4

–59.9

2018

2019

2022 (FY)■■ Cash Flows from Operating Activities■■ Cash Flows from Investing Activities■■ Free Cash FlowJGC Report 2023

94

Management Messages

JGC Group's Growth Strategy

Reinforcing Management
Resources for Continuous Growth"Sustainability Management"

Reinforcing Management
Results of Value Creation
Resources for Continuous Growth"Corporate Governance"

Results of Value Creation

Consolidated Balance Sheets
Years ended March 31, 2023 and 2022

The translation of the Japanese yen amounts into U.S. dollars, using the prevailing exchange
rate at March 31, 2023 of ¥133.53 to U.S.$1, is included solery for the convenience ofreaders outside Japan.
Millions of yen

ASSETS

2022

2023

Millions of U.S. dollars

Millions of yen

LIABILITIES

2023

CURRENT ASSETS

Millions of U.S. dollars

2022

2023

2023

63,25890,005674

CURRENT LIABILITIESCash and deposits

288,159

332,951

2,493

Notes payable, accounts payable for construction contracts and otherNotes receivable, trade receivables, contract assets and other141,222

141,846

1,062

Short-term borrowings

2,167

2,336

17

Costs on construction contracts in progress

23,804

16,981

127

Current portion of bonds payable

30,00010,00075

Merchandise and finished goods

6,659

7,760

58

Current portion of long-term borrowings

8,660

544

4

Work in process

2,970

3,236

24

Income taxes payable

5,244

4,794

36

109,756

113,989

854

6,880

12,509

94

274

299

2
6

Raw materials and supplies

3,596

4,520

34

Contract liabilities

Accounts receivable-others

64,42325,710193

Provision for bonuses

Other

6,069

6,802

51

Provision for bonuses for directors (and other officers)

Allowance for doubtful accounts(3,562)

(315)

(2)

Provision for losses on construction contracts

533,343

539,493

4,040

TOTAL CURRENT ASSETS

384

838

Provision for warranties for completed construction

1,074

958

7

Other

26,13535,929269

TOTAL CURRENT LIABILITIES

253,836

272,206

2,039

Bonds payable

20,00010,00075

Long-term borrowings

11,496

13,891

104

Retirement benefit liability

15,884

12,803

96

210

233

2
11

NON-CURRENT LIABILITIESNON-CURRENT ASSETS

Provision for retirement benefits for directors (and other officers)

PROPERTY, PLANT AND EQUIPMENT
Buildings and structures
Machinery, vehicles, tools, furniture and fixtures

74,181
71,13375,001
72,569562

Deferred tax liabilities

1,089

1,438

543

Deferred tax liabilities for land revaluation

1,014

1,014

8

Other

3,080

3,557

27

Land

18,617

18,639140

Leased assets

1,079

2,690

20

Construction in progress
Other
Accumulated depreciation
TOTAL PROPERTY, PLANT AND EQUIPMENT

42,939322

315,145

2,360

Share capital

23,672

23,733178

Capital surplus

25,77025,831

193

342,198

369,066

2,764(6,740)(26,741)(200)

384,901

391,889

2,935

6,311

7,219

54

803

2,928

22

4,795

—

—

NET ASSETS(101,075)(99,595)(746)

69,534

72,234541

INTANGIBLE ASSETSSHAREHOLDERS’ EQUITY

Software

7,228

10,65080

Retained earnings

Other

2,447

374

3

Treasury stock

TOTAL INTANGIBLE ASSETS

9,676

11,02583

TOTAL SHAREHOLDERS’ EQUITY

Investment securities

55,83759,224444

Valuation difference on available-for-sale securities

Long-term loans receivable

8,640

11,07483

Deferred gains or losses on hedges

Retirement benefit asset

1,506

1,277

10

Revaluation reserve for landDeferred tax assets

13,557

15,483116

Foreign currency translation adjustments

Other

16,00225,333190

Remeasurements of defined benefit plans

(424)

677

5

Allowance for doubtful accounts(13,824)(22,018)(165)

TOTAL ACCUMULATED OTHER COMPREHENSIVE INCOME

2,244

5,454

41

TOTAL INVESTMENTS AND OTHER ASSETS

81,72090,373

677

517

637

5

TOTAL NON-CURRENT ASSETS

160,930

173,633

1,300

TOTAL NET ASSETS

387,662

397,9812,980

694,274

713,127

5,341

TOTAL LIABILITIES AND NET ASSETS

694,274

713,127

5,341

INVESTMENTS AND OTHER ASSETSTOTAL ASSETS

95

52,775
306,612TOTAL NON-CURRENT LIABILITIESTOTAL LIABILITIESJGC Report 2023

ACCUMULATED OTHER COMPREHENSIVE INCOME

NON-CONTROLLING INTERESTS

3,786

2,359

18

(10,891)(10,891)

(82)

3,462

6,089

46

JGC Report 2023

96

Management Messages

JGC Group's Growth Strategy

Reinforcing Management
Resources for Continuous Growth"Sustainability Management"

Reinforcing Management
Results of Value Creation
Resources for Continuous Growth"Corporate Governance"

Results of Value Creation

Results of Value Creation

Consolidated Statements of Operations

Consolidated Statements of Comprehensive Income

Years ended March 31, 2023 and 2022

Years ended March 31, 2023 and 2022
Millions of yen

Millions of U.S. dollars

Millions of yen

Millions of U.S. dollars

2022

2023

2023

NET SALES

428,401

606,890

4,545

PROFIT (LOSS)

COST OF SALES

383,029

540,164

4,045

OTHER COMPREHENSIVE INCOMEGROSS PROFIT

45,372

66,725500

Valuation difference on a available-for-sale securities

653

(177)

(1)

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

24,68330,026

225

Deferred gains or losses on hedges

2,855(2,979)(22)

OPERATING PROFIT

20,68836,699275

Foreign currency translation adjustments

3,220

1,387

10

Remeasurements of defined benefit plans

(4)

1,215

9

1,410

3,933

29

NON-OPERATING INCOME
Interest income

1,060

7,364

55

Dividend income

2,103

2,119

16

Share of profit of entities accounted for using equity method

3,014

2,714

20

Foreign exchange gains

2,528

2,833

21

Share of other comprehensive income of entities accounted forusing equity method
TOTAL OTHER COMPREHENSIVE INCOME
COMPREHENSIVE INCOME

2022

2023

(35,496)

30,047

2023

225

8,135

3,378

25

(27,360)

33,425250

COMPREHENSIVE INCOME ATTRIBUTABLE TO

Other

1,124

226

2

TOTAL NON-OPERATING INCOME

9,831

15,259114

COMPREHENSIVE INCOME ATTRIBUTABLE TO OWNERS OF PARENT(27,415)33,875254

9COMPREHENSIVE INCOME ATTRIBUTABLE TO NON-CONTROLLINGINTERESTS

54

(449)

(3)

OTHER EXPENSES
Interest expense

419

1,162

Other

72

235

2

TOTAL OTHER EXPENSES

491

1,397

10

30,02850,560379

Gain on change in equity

—

1,318

10

Gain on sales of investment securities

799

399

3

Gain on liquidation of subsidiaries and associates

179

—

—

Gain on sales of receivables

—

2,079

16

Other

8

5

0

987

3,802

28

Impairment losses

—

2,525

19

Loss on valuation of investment securities

397

992

7

Loss on valuation of investments in capital of subsidiaries and associates

—

1,727

13

57,576

—

—

301

307

2

Total extraordinary losses

58,2755,552

42Profit (loss) before income taxes

ORDINARY PROFITEXTRAORDINARY INCOME

Total extraordinary income
EXTRAORDINARY LOSSES

Loss on Ichthys LNG Project
Other(27,260)

48,811

366

Income taxes - current

7,773

19,302

145

Income taxes - deferred

463

(538)

(4)

8,236

18,763

141(35,496)

30,047

225

54

(618)

(5)

(35,551)

30,665230

Total income taxes
PROFIT (LOSS)PROFIT (LOSS) ATTRIBUTABLE TO NON-CONTROLLING INTERESTSPROFIT (LOSS) ATTRIBUTABLE TO OWNERS OF PARENT

97

JGC Report 2023

JGC Report 2023

98

Management Messages

JGC Group's Growth Strategy

Reinforcing Management
Resources for Continuous Growth"Sustainability Management"

Reinforcing Management
Results of Value Creation
Resources for Continuous Growth"Corporate Governance"

Results of Value Creation

Consolidated Statements of Changes in Net Assets
Years ended March 31, 2023 and 2022
Millions of yen

Shareholders’ equity
Share capital

Capital surplus

Year ended March 31, 2022
Balance at beginning of period

23,61125,709Cumulative effects of changes inaccounting policies
Restated balance

Retainedearnings

380,402

Accumulated other comprehensive income
Treasury shares(6,739)312
23,61125,70961

61

380,714

Total
shareholders’equity422,983

Valuationdifference on
available-for-salesecurities

5,571

Deferred gains
or losses onhedges248

Revaluation
reserve forland

Foreigncurrencytranslation
adjustment(10,891)(358)

Remeasurementsof defined benefit
plans

(432)

Total accumulated
othercomprehensive
income(5,862)

Non-controllinginterests

495

312(6,739)423,295

Total net assets

417,616
312

5,571

248

(10,891)

(358)

(432)

(5,862)495

417,928

Changes during period
Issuance of new shares
Dividends of surplus(3,029)Loss attributable to owners of parent(35,551)(0)

Purchase of treasury shares
64

Change in scope of consolidation

Balance at end of period

122(3,029)(3,029)(35,551)(35,551)

(0)

(0)

64

Net changes in items other thanshareholders’ equity
Total changes during period

122

(28)

(28)

36

—

740

3,537

—

3,849

8

8,135

21

8,157

61

61

(38,515)(0)(38,394)

740

3,537

—

3,820

8

8,107

21

(30,265)

23,672

25,770342,198(6,740)384,901

6,311

3,786

(10,891)

3,462

(424)

2,244

517

387,662
Millions of yen

Shareholders’ equity
Share capital

Capital surplus

Year ended March 31, 2023
Balance at beginning of period

23,672

25,77060

60Retainedearnings

342,198

Accumulated other comprehensive income
Treasury shares(6,740)Total
shareholders’equity384,901

Valuationdifference on
available-for-salesecurities

6,311

Deferred gains
or losses onhedges3,786

Revaluation
reserve forland

Foreigncurrencytranslation
adjustment(10,891)

3,462

Remeasurementsof defined benefit
plans

(424)

Total accumulated
othercomprehensive
income2,244

Non-controllinginterests

517

Total net assets

387,662

Changes during period
120

120

Dividends of surplus

Issuance of new shares(3,788)(3,788)(3,788)

Profit attributable to owners of parent

30,66530,66530,665(20,000)(20,000)(8)(8)

Purchase of treasury shares(20,000)

Change in scope of consolidation(8)

Net changes in items other thanshareholders’ equity
Total changes during period
Balance at end of period—

907(1,426)

—

2,627

1,101

3,210

120

3,330

60

60

26,868(20,000)

6,988

907

(1,426)

—

2,627

1,101

3,210

120

10,31823,73325,831

369,066(26,741)

391,889

7,219

2,359

(10,891)

6,089

677

5,454

637

397,981Millions of U.S. dollars

Shareholders’ equity
Share capital

Capital surplus

Year ended March 31, 2023
Balance at beginning of period

177

193

0

0

Retainedearnings

2,563

Accumulated other comprehensive income
Treasury shares

(50)

Total
shareholders’equity2,883

Valuationdifference on
available-for-salesecurities

47

Deferred gains
or losses onhedges28

Revaluation
reserve for
land

(82)

Foreigncurrencytranslation
adjustment

26

Remeasurementsof defined benefit
plans

(3)

Total accumulated
othercomprehensive
income17

Non-controllinginterests

4

Total net assets

2,903

Changes during period
Issuance of new shares

1

1

Dividends of surplus

(28)

(28)

(28)

Profit attributable to owners of parent

230

230

230

(150)

(150)

(0)

(0)

Purchase of treasury shares(150)

Change in scope of consolidation(0)

Net changes in items other thanshareholders’ equity
Total changes during period
Balance at end of period99

JGC Report 2023

—

7

(11)

—

20

8

24

1

25

0

0

201

(150)

52

7

(11)

—

20

8

24

1

77

178

193

2,764

(200)

2,935

54

18

(82)

46

5

41

5

2,980

JGC Report 2023 100

Management Messages

JGC Group's Growth Strategy

Results of Value Creation

Results of Value Creation

Consolidated Statements of Cash Flows

Group Companies

Years ended March 31, 2023 and 2022

(As of March 31, 2023)

Reinforcing Management
Resources for Continuous Growth"Sustainability Management"

Reinforcing Management
Results of Value Creation
Resources for Continuous Growth"Corporate Governance"● Consolidated subsidiaries● Affiliated companies accounted for by the equity method

Millions of yen
2022

2023

Millions of U.S. dollars
2023

Industry

CASH FLOWS FROM OPERATING ACTIVITIES(27,260)

48,811366

Depreciation
Impairment losses

7,202
—

7,839
2,525

59
19

Increase (decrease) in allowance for doubtful accounts

3,712

4,489

(3,164)419(4,419)(3,014)
3,326

Profit (loss) before income taxes

Interest and dividend income
Interest expense
Foreign exchange losses (gains)Share of loss (profit) of entities accounted for using equity method
Decrease (increase) in notes receivable, trade receivables,
contract assets and other
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable - trade
Loss (gain) on sale of investment securities
Increase (decrease) in retirement benefit liabilities
Increase (decrease) in provision for loss on construction contracts
Loss (gain) on valuation of investment securities
Loss on valuation of investments in capital of subsidiaries and associates
Loss (gain) on change in equity
Increase (decrease) in contract liabilities
Decrease (increase) in accounts receivable - other
Increase (decrease) in accounts payable - other
Gain on sale of receivables
Other, net
SubtotalInterest and dividends received
Interest paid
Proceeds from sale of receivables
Income taxes paid
Cash flows from operating activities
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Purchase of investment securities
Proceeds from sale of investment securities
Purchase of intangible assets
Proceeds from sale of intangible assets
Proceeds from capital reduction of investments
Other, net
CASH FLOWS FROM INVESTING ACTIVITIES:CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long-term borrowings
Repayments of long-term borrowings
Redemption of bonds
Dividends paid
Dividends paid to non-controlling interests
Net increase (decrease) in short-term borrowings
Purchase of treasury stock
Other, net
CASH FLOWS FROM 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 PERIODINCREASE IN CASH AND CASH EQUIVALENTS FROM INCLUSION
OF SUBSIDARIES IN CONSOLIDATIONCASH AND CASH EQUIVALENTS AT END OF PERIOD

101 JGC Report 2023

● Affiliated companies not accounted for by the equity method

Total Engineering Business(3,742)
19,072(799)
353(3,251)
397
—
—
8,739
33,328(13,437)—(895)
16,567
5,341
(419)
—
(2,177)
19,311(5,467)9(2,435)
2,835(4,339)—1,064
637(7,695)Name● JGC CORPORATIONCountry

CapitalPercentage ofvoting rights
owned*

Japan¥1.0 billion

100%● JGC JAPAN CORPORATION

Japan¥1.0 billion

100%

Singapore

S$2,100,000

100%

34

● JGC ASIA PACIFIC PTE. LTD.
● JGC PHILIPPINES, INC.

The Philippines

PHP1,300,000,000(9,484)
1,162(11,761)(2,714)

(71)
9
(88)
(20)

● PT. JGC INDONESIA

Indonesia

IDR1,357,050,000● JGC Gulf International Co. Ltd.

Saudi Arabia

SAR262,500,000● JGC OCEANIA PTY LTD

Australia

A$913,800,000

100%
49%
(14%)
100%
(5%)
100%

898

7

● JGC America, Inc.

U.S.A.

US$41,051,000● JGC Gulf Engineering Co. Ltd.

Saudi Arabia

SAR500,000● JGC Construction International Pte. Ltd.

Singapore

US$1,043,000● JGC ASIA PACIFIC (M) SDN. BHD.

Malaysia

MYR750,000● JGC INDIA EPC PRIVATE LIMITEDIndia

INR280,000,000● JGC Vietnam Co., Ltd.

Vietnam

VND519,831,000,000● Japan NuScale Innovation, LLC

U.S.A.

US$173,008,000

29%
(29%)

Inspection / Maintenance● JGC PLANTECH AOMORI Co., Ltd.

Japan

¥50 million

100%(100%)

Process Licensing● Nikki-Universal Co., Ltd.

Japan

¥1.0 billion

50%

5,310
26,594(398)(3,324)
429
992
1,727
(1,318)3,753
36,5797,177(2,079)6,820
124,029
9,985
(932)
2,079
(24,392)
110,769(6,565)150(2,629)939(5,573)
1,796
733
(322)
(11,471)

40
199
(3)
(25)
3
7
13
(10)
28
274
54
(16)
51
929
75
(7)
16
(183)
830
(49)
1
(20)
7
(42)
13
5
(2)
(86)

1,617
(370)

2,324
(9,197)17(69)—(3,031)
(33)
1,819
(0)
(148)
(148)

(30,000)(3,789)(44)56(20,000)(637)(61,288)

(225)
(28)
(0)
0
(150)
(5)
(459)

7,968

6,592

49

19,436268,281

44,602
288,009

334
2,157

291

144

1

288,009332,755

2,492

EPC

100%
75%
(75%)
100%
(100%)
100%(100%)
100%(100%)
100%(62%)

Functional Material Manufacturing Business
Name

Country

CapitalPercentage ofvoting rights
owned*● JGC Catalysts and Chemicals Ltd.

Japan

¥1.8 billion

100%● Japan Fine Ceramics Co., Ltd.

Japan

¥0.3 billion

100%● Nikki-Universal Co., Ltd.

Japan

¥1.0 billion

50%

Other Businesses
Industry

Name

Country

CapitalPercentage ofvoting rights
owned*

Equipment Procurement● JGC Trading & Services Co., Ltd.

Japan

¥40 million

Consulting● Japan NUS CO., LTD.

Japan

¥50 million

88%

Office Support Services● NIKKI BUSINESS SERVICES CO., LTD.

Japan

¥1,455 million

100%

Water Treatment● Swing CorporationJapan¥5.5 billion

33%

Japan

¥0.1 billion● Swing Engineering CorporationJapan¥0.3 billion[100%][100%]● JGC (GULF COAST), LLC

U.S.A.

US$51,050,000● JGC Exploration Eagle Ford LLC

U.S.A.

US$46,700,000● JGC EXPLORATION CANADA LTD.

Canada

C$160,885,000

100%(100%)
100%(100%)100%

Oman

OMR7,500,000

75%● A. R. C. H WLL●A SH SHARQIYAH OPERATION AND
MAINTENANCE COMPANY LLC

Bahrain

US$758,000

30%

Saudi Arabia

SAR1,000,00029%● Japan Sankofa Offshore Production Pte. Ltd.

Singapore

US$29,824,000

26%● Swing AM Corporation

Oil and Gas Production Sales

Water Desalination

FPSO(Floating Production, Storage andOffloading system)● Al Asilah Desalination Company S. A. O. C.

24%* Figures in parentheses ( ) in percentage of voting rights owned ratio are indirect ownership ratios, and figures in parentheses [ ] are ownership ratios held by persons closely related toor in agreement with the company, and are outside figures.

JGC Report 2023 102

Management Messages

JGC Group's Growth Strategy

Results of Value Creation

Results of Value Creation

Stock Information

Outline of JGC(As of March 31, 2023)(As of March 31, 2023)

Major Shareholders

Authorized Shares
600,000,000
Issued and Outstanding Shares
259,409,926
Number of Shareholders
36,924
Administrator of the Shareholders’Register
Mitsubishi UFJ Trust and Banking
Corp.1-4-5, Marunouchi, Chiyoda-ku,
Tokyo 100-8212, Japan

Reinforcing Management
Resources for Continuous Growth"Sustainability Management"

Reinforcing Management
Results of Value Creation
Resources for Continuous Growth"Corporate Governance"

Company NameJGC HOLDINGS CORPORATION

Numberof shares(thousands)

Percentage
of total(%)

The Master Trust Bank of Japan, Ltd. (Trust Account)

46,21019.20

Custody Bank of Japan, Ltd. (Trust Account)

36,52915.18

JGC Trading & Services Co., Ltd.

12,112

5.03

JGC-S SCHOLARSHIP FOUNDATION

8,433

3.50

SSBTC CLIENT OMNIBUS ACCOUNT

7,014

2.91

Capital stock

Sumitomo Mitsui Banking Corporation

5,500

2.28

¥23,733,170,000

BNYM AS AGT/CLTS NON TREATY JASDEC

3,724

1.54

Employees

Mizuho Bank, Ltd.

2,899

1.20

313 (Consolidated: 7,876)

JP MORGAN CHASE BANK 385781

2,866

1.19

JPMorgan Securities Japan Co., Ltd.

2,675

1.11

Head Office2-3-1, Minato Mirai, Nishi-ku, Yokohama-shi, Kanagawa 220-6001, Japan
Established
October 25, 1928

Independent Auditor
KPMG AZSA LLC(Notes) 1. N umber of shares is rounded down to the nearest thousand. Percentage of total is rounded down to thesecond decimal place.
2. T he Company holds 18,820 thousand shares (7.26%, 3rd) of treasury stock, but this is excluded from theabove table.
3. Percentage of total is calculated excluding treasury stock.

Distribution of Shareholders

Information Provided(%)
Financial
institutions

Treasury stock■ Financial institutions

Foreigninvestors

Financial
instruments
firms

Individuals
and others

39.02■ Financial instruments firms

3.85■ Other domestic corporations

11.59■ Individuals and others

10.93■ Foreign investors

27.35■ Treasury stock

7.26

About Us

https://www.jgc.com/en/about/

Narrow

Other domestic
corporations

Stock Price
JGC Holdings Stock Price (Yen)

Nikkei Average (Yen)
50,000

5,000
4,000

30,00050,000

2,000
4,000

20,00040,0001,000

JGC Holdings Stock Price0100,000

2019
1

2

2020
3

4

5

6

7

8

9 10 11 12 1

2019
1

2

2

2021
3

4

5

6

7

8

2020
3

4

5

6

7

8

9 10 11 12 1

2

9 10 11 12 1

2

2022
3

4

5

6

7

8

9 10 11 12 1

2021
3

4

5

6

7

8

9 10 11 12 1

3

4

5

6

7

8

9 10 11 12 1

3

4

5

6

7

8

9 10 11 12 1

2

2

4

5

6

7

8

9 10 11 12 1

2022
3

4

5

6

7

8

9 10 11 12 1

3

4

5

6

7

8

9 10 11 12 1

3

4

5

6

7

8

9 10 11 12 1

3

4

5

6

7

8

9 10 11 12 1

3

4

5

6

7

8

9

10,000

2

0
3

4

5

6

7

8

9

80,000 (Thousands of shares)
Volume60,000100,000
40,00080,00020,00060,000040,0002019

20,000

1

0

2

2020
3

4

5

6

7

8

9 10 11 12 1

3

4

5

6

7

8

9 10 11 12 1

2019
1

2

2

2021

2020

103 JGC Report 2023

2

2

2022

2021
2

2

CriticalContent

Investor Relations

https://www.jgc.com/en/ir/• IR Calendar• Financial Information• Securities Reports/Quarterly Reports• Management Strategy• Fact Sheet, etc.

2023
3

4

5

6

7

8

9 10 11 12 1

3

4

5

6

7

8

9 10 11 12 1

2022
2

Detailed(Comprehensive)0
20,0002

2023

2• Realizing a Sustainable Society• Environmental Initiatives• Social Initiatives• Governance, etc.

10,00030,0002023
3

https://www.jgc.com/en/esg-hsse/

Broad

3,000
5,000

0
2,000

Sustainability

JGC
Website40,000

Nikkei Average

1,000
3,000

JGC Report(Integrated Report)

Target (Primarily aimed at investors)

Figures have been rounded down to the second decimal places.

• Message from Top Management• JGC’s Purpose and Values• Group Companies• History• JGC Group at a Glance, etc.

2

3

4

5

6

7

8

9

2023
2

3

4

5

6

7

8

9

JGC Report 2023 104