Chiyoda Global Headquarters
Minato Mirai Grand Central Tower
4-6-2, Minatomirai, Nishi-ku,
Yokohama 220-8765, Japanwww.chiyodacorp.com/enThe presentation was held in Japanese.

May 15, 2020

This document is a translation/summary

IR, PR & CSR Department

for reference only.

Chiyoda Corporation

Summary of a Q&A session following the Presentation of theFull-Year Financial Results for the FY ending 31 March 2020
The following summarizes a Q&A session following the presentation of Chiyoda Corporation (“Chiyoda”)
year-end financial results for Fiscal Year ending March 31, 2020, held by telephone conference in Tokyo,
Japan and released on May 8, 2020.
Question
1Answer

Crude oil price trends:

The crude oil price forecast is conservatively

How do you see trends in crude oil prices

factored in our future business plan.

over the medium to long term?

While there is a possibility that the crude oil supplydemand balance and the structure of society willchange due to COVID-19, crude oil demand indeveloping countries remains solid. We recognizethat various factors are intricately intertwined in
crude oil price trends.

2Changes in the business environment:We are currently assessing the impact of falling

Is there any change in the relationship with

crude oil prices and the impact of COVID-19, but

customers, orders and the competitive

have made no significant changes to the expectedenvironment due to falling crude oil prices

ordering plan as of today.

and the spread of COVID-19?

Customer’s investment plans in LNG projects arebeing reviewed and the competitive environment isbecoming severe.
We continue to communicate and work closely withour customers and maintain our long-standing andtrusting relationships.

3

Update of US LNG projects:

We have progressed US LNG projects in the fiscal

What is the future impact on US LNG

year ending March 31, 2020 with thorough riskprojects, the major cause of the deficit inmanagement processes and strengthened humanthe last fiscal year?

resources. On the Cameron LNG project, the first1

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

Question

Answerand second train have already commenced
commercial operation and the third train is
expected to be completed in the near future. Profit
has improved due to the realization of incentives
associated with revised contract conditions.

4Profit:A theoretical scenario: If the spot income from

What is the contribution of one-time profit

incentives etc. (positive factors) and the estimatedon the financial results for the year ending

impact of COVID-19 and other potential risks

March 31, 2020?

(negative factors) would be excluded from thecalculation, a gross profit margin of 7.4% would
have been secured as planned. (Remark: Achieved
GPM 11.1%)

5

Status of ongoing projects:There are currently no cases where project

What is the impact of COVID-19 onexecution has been suspended due to COVID-19.

ongoing projects?

On EPC projects, Engineering design (E) can be
performed by telework. Procurement (P) is affectedby the disruption of the global supply chain andthere

aredelays

intheproduction

andtransportation of materials in some projects. There
have been labor mobilization challenges affecting
construction (C) on some projects.
We are discussing these issues with our clients
within a Force Majeure framework.
The execution of our projects has also beencertified as priority important infrastructure in eachcountry. Even though there have been restrictions
on the movement of people due to COVID-19, wehave thus far been able to secure labor andproceed with construction.
6Order forecasts:

As for large-scale LNG projects, we are currently

What is your outlook for new orders?

working on the North Field Expansion project inQatar. FID has been delayed due to COVID-19, but2

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

Question

Answer
we firmly believe the project will materialize. We will
also secure domestic projects in the global
environment business field as a base load forprofits.

Throughtheseendeavors,

wewillaccumulate orders accordingly this fiscal year.
7Digital Transformation:

EFEXIS – a combination of the words ‘Efficiency &What is Chiyoda’s advantage in marketing

Expertize’, is the brand name to market ourthe EFEXIS brand?

innovative digital products. Chiyoda’s advantage isthe plant construction and management expertiseas an integrated engineering company andimproving plant efficiency by combining thisexpertise with our customers operational andmaintenance knowledge.

8Hydrogen business:

The hydrogenation plant in Brunei and theRegarding SPERA hydrogen, what is thedehydrogenation plant in Kawasaki demonstrating

status of the transport demonstration plant

the large-scale international hydrogen supply chain

from Brunei to Kawasaki, Japan?

have been completed. SPERA hydrogen has beentransported by container to the dehydrogenation
plant in Kawasaki where it is returned to gas andwill be supplied to an adjacent power plant in May
this year.

9New business opportunities:The international division of production and labor is

It is expected that domestic and overseas

under

supply chains will be rebuilt which may

pharmaceuticals,

lead to future business opportunities.

overseas

review.
toGeneralisindustry,

starting

domestic

toincluding

switchproduction

andfrom
theGovernment is supporting this in the private sector.
The need for remote engineering is also increasing
as non-contact work expands as a result of COVID19. We expect these trends to continue andbecome business opportunities for engineering
companies, for which Chiyoda is well positioned to
be a front runner.

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

Question
10Answer

Forecast:

Although

COVID-19

willaffect

What is the reason for the undisclosed

schedules

andfinancial forecast for this fiscal year? The

progressing and as of today no further deterioration

order backlog is JPY 800 billion and evenin profitability is expected. The decline in crude oil

if new orders are delayed, the impact toand gas prices has led to new order uncertainty

business results should be limited. Is theand it is impossible to predict the future with

non-disclosure due to the potential risk ofreasonable accuracy. The financial forecast for thisfurther delays on ongoing projects?

fiscal year is therefore yet to be determined.

costs, ongoing

construction
projects

areAlthough we expect the impact of new orders on
this fiscal year's financial results to be relatively
limited, we have refrained from disclosing theforecast until it becomes possible for us toaccurately assess the impact of COVID-19.
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Reduction of capital:

When financial institutions extend a loan, theThe cumulative loss of retained earnings

creditworthinesswill be erased by a Capital Reduction but

assessed on its Net Assets. As Capital Reduction

what will be the impact on cash flow andis the merely the transfer of account titles in Net

securing borrowing?

Assets on the Balance Sheet, the amount of Netofacompany

isprimarily

Assets remains unchanged and future financing for
Chiyoda will be unaffected. We have secured acredit line of JPY 90 billion from Mitsubishi
Corporation and no new funding is planned.
12Tokyo Stock Exchange Second Section

We received support from our business partners

Relocation:

following relocation to the Second Section of theWhat has been the impact of last year’sTokyo Stock Exchange last year and have been

relocation to the Second Section of the

progressing our revitalization to facilitate an earlyTokyo Stock Exchange and what do you

return to the First Section.

envisage in the future?
-EndPlease address inquiries to: IR, PR & CSR Department: Tel. +81-45-225-7734

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

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 beconstrued in any way as being guaranteed by the Company. Investors are recommended not to depend
solely on these projections for making investment decisions.

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