Chiyoda Corporation (6366)
Consolidated Financial Results for the three months Ended June 30, 2018

Abridged Translation:
The report is not audited and this translation is an abridged version prepared based on the statutory format in Japan for reference
purpose only. If there is any discrepancy between this translation and the original Japanese version, the Japanese shall prevail.

Consolidated Financial Resultsfor the Three Months Ended June 30, 2018
August 8, 2018
Company name:
Listing:
Stock code:
URL:
Representative:
Inquiries:TEL:

CHIYODA CORPORATIONFirst Section of the Tokyo Stock Exchange
6366http://www.chiyodacorp.com/
Masaji Santo, President & CEO
Masaru Akiyama, GM, Accounting Department+81-45-225-7745

Scheduled date to file Quarterly Report: August 8, 2018
Preparation of Quarterly Supplementary Explanation Material: Yes
Quarterly Financial Results Presentation Held: Yes (for Analysts and Institutional Investors)(Millions of yen with fractional amounts discarded, unless otherwise noted)

1. Consolidated performance for the three months ended June 30, 2018
(Percentages indicate year-on-year changes)(1) Consolidated operating results
Revenue

Operating income

Millions of yen

For the three months
ended June 30, 2018
For the three months
ended June 30, 2017
Note: Comprehensive Income:%

Millions of yen

93,626 (20.6)(3,376)

117,858 (11.8)

584%

Millions of yen－(3,163)(83.4)

Millions of yen－%－(3,702)165(95.5)(4,976) million yen / (－)%
(542) million yen / (－)%

Fully diluted net
income per share

Yen

For the three months
ended June 30, 2018
For the three months
ended June 30, 2017%

996 (88.8)

the three months ended June 30, 2018:
the three months ended June 30, 2017:

Net income per share

Profit attributable toowners of parent

Ordinary income

Yen(14.30)－0.64－(2) Consolidated financial position
Total assets
Millions of yen

Net assets

Equity ratio

Millions of yen%

As of June 30, 2018
393,049
152,358
38.3
As of March 31, 2018
420,337
159,418
37.5
Reference: Equity
As of June 30, 2018: 150,502 million yen
As of March 31, 2018: 157,557 million yen

2. Cash dividends
Cash dividends per share
Record date

First quarter
Yen

Second quarter
Yen

Fiscal year ended
March 31, 2018
Fiscal year ending
March 31, 2019
Fiscal year ending
March 31, 2019 (Forecast)
Note: Revision to the latest forecast announcement 2018: None

Third quarter
Yen

Fiscal year-end
Yen

AnnualYen-

7.50

7.50

-7.50

7.50

Chiyoda Corporation (6366)
Consolidated Financial Results for the three months Ended June 30, 2018

3. Consolidated earnings forecasts for the fiscal year ending March 31, 2019 (from April 1, 2018 toMarch 31, 2019)(Percentages indicate year-on-year changes)

Revenue
Millions of yen

Operating income%Millions of yen%

Fiscal year ending
400,000 (21.7)
11,500 －March 31, 2019
Note: Revision to the latest forecast announcement 2018: None

Profit attributable toowners of parent

Ordinary income
Millions of yen

12,500%Net income
per share

Millions of yen%

Yen

6,500

0.825.10－4. Others(1) Changes in Significant Subsidiaries during the Period (changes in specified subsidiaries accompanying
changes in the scope of consolidation): None
(2) Adoption of Specified Accounting Methods for the Preparation of Quarterly Consolidated FinancialStatements: None
(3) Changes in Accounting Policies and Accounting Estimates / Restatements
a. Changes in accounting policies due to revisions of accounting standards, etc.: Yes
b. Changes in accounting policies other than a. above: Nonec. Changes in accounting estimates: Noned. Restatements: None
(4) Number of issued shares (common stock)a. Total number of issued shares at the end of the period (including treasury stock)
As of June 30, 2018260,324,529 shares
As of March 31, 2018260,324,529 sharesb. Number of treasury stock at the end of the period
As of June 30, 2018
1,356,923 shares
As of March 31, 2018
1,356,873 sharesc. Average number of shares during the periodFor the three months ended June 30, 2018258,967,640 shares
For the three months ended June 30, 2017258,971,855 shares*Presentation of Implementation Status of Quarterly Review Procedure
The review procedure of quarterly financial statements based on the Financial Instruments and Exchange Law has not been
completed at the time of the disclosure of these Consolidated Financial Statements.

*Proper use of earnings forecasts, and other special directions
The forward-looking statements, including earnings forecasts, contained in these materials are based on information
currently available to the Company and on certain assumptions deemed to be reasonable. Actual business and other results
may differ substantially due to a number of factors.

Chiyoda Corporation (6366)
Consolidated Financial Results for the three months Ended June 30, 2018

Table of Contents for the appendices

1.

2.

3.

Qualitative Information Related to Consolidated Performance ................................................... 2(1)

Qualitative Information on Business Performance ............................................................... 2(2)

Financial Information on Business Performance .................................................................. 3(3)

Outlook for the Next Fiscal Year .......................................................................................... 3

Consolidated quarterly financial statements ............................................................................... 4(1)Consolidated balance sheets .............................................................................................. 4(2)Consolidated statement of income and comprehensive income .......................................... 6(3)Notes on Consolidated Quarterly Financial Statements ....................................................... 7

Production, Contracts and Revenue .......................................................................................... 81Chiyoda Corporation (6366)
Consolidated Financial Results for the three months Ended June 30, 2018

1. Qualitative Information Related to Consolidated Performance(1) Qualitative Information on Business Performance
In the first quarter of this fiscal year, the price of oil has stayed within a range of approximately $60-70 perbarrel. In the liquefied natural gas (LNG) business, the Company is starting to see customers consider final
investment decisions for new large-scale projects, reflecting consistent LNG demand, especially fromChina.
Accordingly, Chiyoda has continued to implement large-scale projects in the core LNG business and has
been actively involved in front-end engineering and design work (FEED) for the Qatar expansion
project. Concurrently, the Company has been implementing the structural reforms and growth strategy
detailed in the medium term management plan “Mirai Engineering - A Grand Opportunity for the Future”.
This plan includes expansion into new markets including renewable energy and life sciences, and a moresophisticated business model leveraging big data and AI technology.
On consolidated basis, for the fiscal year ending March 31, 2019, New Orders amounted to 77,285 million
yen (up 103.7% YoY), Backlog to 624,866 million yen (down 4.4% YoY) and Revenues to 93,626 millionyen (down 20.6% YoY).Operating loss came to 3,376 million yen (compared with previous quarter’sconsolidated operating income of 584 million yen), Ordinary loss amounted to 3,163 million yen (comparedwith previous quarter’s consolidated ordinary income of 996 million yen) and Profit attributable to owners ofparent came down to 3,702 million yen (compared with previous quarter’s consolidated profit attribute toowners of parent of 165 million yen). Losses are mainly due to an increase in incremental construction costs
at an ongoing LNG project in the U.S.
The summary of activities in the engineering business; reportable segments below:
Energy
LNG Plant/ Gas Related Work
【Overseas】
LNG Plants: Chiyoda is executing Engineering, Procurement and Construction (EPC) work for projects
in Australia, the US, Russia and Indonesia; Pre-contract work is being conducted on a LNG project inMozambique as the prime EPC contractor; FEED work is underway for an expansion project in Qatar
adding 7.8 million tons per year in 3 trains; In the US, Chiyoda is bidding for new LNG projects;
Other Gas Related Work: In Qatar, the Group is currently executing a EPC contract for a Helium
Extraction Unit Facility; in addition a Group Company in Qatar is engaged in long-term EPCm contracts
as renovation and modification work on LNG and gas processing plants previously built by the Company.
【Japan】
Renovation and modification projects are underway for previously built LNG-receiving terminals, and forseismic upgrades of facilities under the Basic Act for National Resilience.
Offshore and Upstream: A group company has won a conceptual design contract for sub-sea gas field
for gas field exploration in Indonesia. A Joint project between Xodus Group Ltd. (a Chiyoda affiliate) andSubsea 7 SA is underway and Chiyoda will stay focused on floating LNG/gas processing facilities as oneof its priority business areas.
Refinery/Petrochemical/Metal【Overseas】
A group company is executing Engineering, Procurement, Construction and Commissioning (EPCC)
activities for a Residue Fluid Catalytic Cracking (RFCC) project in Malaysia. Also in Malaysia, EPC
activities on a petrochemical tank terminal are ongoing, further a group company based in Southeast
Asia, is engaged in project management for refinery, petrochemical and downstream opportunities
elsewhere in Asia.

2Chiyoda Corporation (6366)
Consolidated Financial Results for the three months Ended June 30, 2018

【Japan】
Chiyoda has won contracts to optimize refinery facilities and EPC operations business related to themanufacturing of high- performance materials;
Focus on EPC operations for renovation and upgrades of existing facilities (Basic Act for National
Resilience);
Improvement of energy efficiency in existing petrochemical production and other facilities.
EnvironmentPharmaceutical/Biochemistry/General Chemistry【Japan】
Chiyoda has developed cutting edge, injection production facilities for high-potency pharmacologically
active agents; EPC work in progress for production facilities of middle molecule, Active Pharmaceutical
Ingredients (APIs).
Environment/New Energy/Infrastructure【Overseas】
The Group is completing EPC projects for new international airports in Mongolia and Bohol, Philippines.
Further, Chiyoda plans to introduce the Chiyoda Thoroughbred 121 (CT - 121) Process to flue gas
desulfurization facilities at existing coal-fired plants in India; In Dubai, UAE, a demonstration project of avegetable growing facility using artificial light was recently completed and will be introduced at commercial
facilities elsewhere in the Middle East and Russia.
【Japan】
EPC work on flue gas desulfurization facilities at existing coal-fired plants; demonstration facilities forCO2 separation units; photovoltaic (mega solar) facilities and factories and research facilities complying
with the latest food hygiene standards are currently being executed. Further in the New Energy businessfield a demonstration plant for producing bio-jet and diesel fuels is scheduled to be completed this fiscal
year.
Work is underway on a demonstration project commercializing a hydrogen supply chain, through theAdvanced Hydrogen Energy Chain Association for Technology Development, an organization establishedjointly established with Mitsubishi Corporation, Mitsui & Co., Ltd. and Nippon Yusen (NYK Line).

Digital Technology
The Company has launched projects using AI technologies to improve plant productivity in a tie-up
agreement with GRID Inc. Under these initiatives, Chiyoda has signed a memorandum of understandingwith Abu Dhabi Gas Liquefaction Co. (UAE) to provide state-of-the-art digital technologies for its LNG
Plant.

(2) Financial Information on Business PerformanceThis section is not translated.

(3) Outlook for the Next Fiscal Year
Same as released on May 11, 2018.

3Chiyoda Corporation (6366)
Consolidated Financial Results for the three months Ended June 30, 2018

2. Consolidated quarterly financial statements(1) Consolidated balance sheets(Millions of yen)
As of March 31, 2018

As of June 30, 2018

AssetsCurrent assets
Cash and deposits
Notes receivable, accounts receivable from96,00878,22476,88467,640

7,999

7,999

Costs on uncompleted construction
contracts

15,916

12,093

Accounts receivable - other
Jointly controlled assets of joint venture

41,967
131,374

40,329137,486

Other
Allowance for doubtful accounts

5,563△1,245

6,011△1,245completed construction contracts
Securities

Total current assets

374,470

348,540

Buildings and structures, net
Land

6,010
4,952

5,882
4,952

Other, net

1,108

1,058

Total property, plant and equipment

12,071

11,893

5,718

5,611

Non-current assets
Property, plant and equipment

Intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets

7,681

7,686

11,9088,672△185

11,401
8,093△175

420,337

393,049

28,077

Total non-current assets

45,867

Total assets

427,004
44,509Chiyoda Corporation (6366)
Consolidated Financial Results for the three months Ended June 30, 2018

(Millions of yen)
As of March 31, 2018

As of June 30, 2018

Liabilities
Current liabilities
Notes payable, accounts payable forconstruction contracts
Income taxes payable
Advances received on uncompleted
construction contracts
Provision for warranties for completed

147,654

132,191

894

321

76,29473,554

construction
Provision for loss on construction contracts

419

360

3,288

3,183

Provision for bonuses
Other

3,887
15,408

1,533
11,624

Total current liabilities

247,847

222,768

Non-current liabilities
Long-term loans payable

10,00015,000

Provision
Net defined benefit liability

344
1,176

344
1,183

Other

1,550

1,394

Total non-current liabilities

13,071

17,922260,918

240,691

Capital stock
Capital surplus

43,396
37,112

43,396
37,112Retained earnings
Treasury shares

77,024△1,43471,289△1,434

Total shareholders' equity

156,099

150,364

64

47△1,778

△218

2,159
1,013

△686

1,458

138

1,861

1,856

159,418

152,358

420,337

393,049

Total liabilities
Net assets
Shareholders' equity

Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive
incomeNon-controlling interests
Total net assets
Total liabilities and net assets

5995

Chiyoda Corporation (6366)
Consolidated Financial Results for the three months Ended June 30, 2018(2)

Consolidated statement of income and comprehensive income(Consolidated statement of income)(Millions of yen)Three months ended
June 30, 2017

Three months ended
June 30, 2018

Net sales of completed construction contracts

117,858

93,626

Cost of sales of completed construction contracts

112,40292,766Gross profit on completed construction contracts

5,455

860

Selling, general and administrative expenses

4,871

4,237

Operating profit (loss)

584△3,376

Non-operating income
Interest income

546

631

7980

4324

Dividend income
Share of profit of entities accounted for using
equity method
Other5339722

775

5056

Foreign exchange losses
Other150
10848817

Total non-operating expenses

310562

Ordinary profit (loss)
Profit (loss) before income taxes

996△3,163996△3,1632,238△1,443864△322

Total income taxes

795

542

Profit (loss)
Profit (loss) attributable to non-controlling interests

200
35△3,706△4Profit (loss) attributable to owners of parent

165△3,702

Total non-operating income
Non-operating expenses
Interest expenses

Income taxes - currentIncome taxes - deferred6

Chiyoda Corporation (6366)
Consolidated Financial Results for the three months Ended June 30, 2018

(Millions of yen)Three months ended
June 30, 2017
Profit (loss)
Other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net

Three months ended
June 30, 2018200

△3,706△86△16207△1,317

1,559△2,684413△11038of tax
Share of other comprehensive income ofentities accounted for using equity methodTotal other comprehensive income△743△1,269△553△5,022△542

Comprehensive income
Comprehensive income attributable toComprehensive income attributable to ownersof parent
Comprehensive income attributable to non-10

controlling interests△17△4,97646(3) Notes on Consolidated Quarterly Financial Statements(Notes on Assumptions for a Going Concern)
None(Notes on Significant Changes in the Amount of Shareholders’ Equity, if Applicable)
None(Changes in accounting policies)
The Company has applied IFRS 9, “Financial Instruments” and 15, “Revenue from Contracts withCustomers”, from the first quarter of the fiscal year ending March 31, 2019. The effects this change will
have on business performance are minor.

7

Chiyoda Corporation (6366)
Consolidated Financial Results for the three months Ended June 30, 2018

3. Production, Contracts and Revenue
Apr. 1, 2017－Jun. 30, 2017

Engineering
LNG PlantNew
contracts(ratio)Revenue(ratio)Backlog ofcontracts(ratio)(Millions of yen)
Apr. 1, 2018－Jun. 30, 2018
New
contracts(ratio)Revenue(ratio)Backlog ofcontracts(ratio)37,144

117,056

783,283

76,482

92,823624,866(97.9%)(99.3%)(100.0%)(99.0%)(99.1%)(100.0%)17,92090,164518,266

9,964

73,027

276,976(47.2%)(76.5%)(66.2%(12.9%)(78.0%)(44.3%)

Gas Development/
Processing/Receiving

828

3,121

9,212

2,115

186

6,302

(2.2%)(2.7%)(1.2%(2.7%)(0.2%)(1.0%)

Refinery/Petrochemical/
Metal

11,1559,289

156,861

25,836

7,681

173,022(29.4%)(7.9%)(20.0%(33.4%)(8.2%)(27.7%)

Pharmaceutical/Biochemistry/
Chemical

1,689

4,974

32,026

2,221

6,055

32,273(4.5%)(4.2%)(4.1%(2.9%)(6.5%)(5.2%)

Environment/New Energy/

4,393

7,354

60,41834,665

4,627

126,626(11.6%)(6.2%)(7.7%(44.9%)(4.9%)(20.3%)

Infrastructure
OthersOther Business

Total

Domestic
Overseas

1,156

2,141

6,498

1,679

1,243

9,665

(3.0%)(1.8%)(0.8%(2.2%)(1.3%)(1.5%)

801

801－

802

802

－

(2.1%)(0.7%)(－)(1.0%)(0.9%)(－)

37,946

117,858

783,283

77,28593,626

624,866(100.0%)(100.0%)(100.0%(100.0%)(100.0%)(100.0%)17,226

20,203

118,960

64,987

15,740212,375(45.4%)(17.1%)(15.2%(84.1%)(16.8%)(34.0%)

20,71997,654

664,322

12,29777,886412,491(54.6%)(82.9%)(84.8%(15.9%)(83.2%)(66.0%)
Note1: The backlog of contracts for the three months ended June 30, 2018 includes a decrease due to changes inconstruction contracts acquired in prior fiscal years, and an increase due to foreign exchange translation
adjustments.
Note2: The total amount of the above table does not include consumption tax.

8