Translation

August 9, 2011

Consolidated Financial Results
for the First Quarter of the Fiscal Year Ending March 31, 2012
Company name: CHIYODA CORPORATION
Listing:First Section of the Tokyo Stock Exchange
Stock code:
6366
URL:
http://www.chiyoda-corp.com/
Representative: Takashi Kubota, President & CEO
Inquiries:
Nobuo Sekita, General Manager, Accounting Department
TEL: +81-45-506-9410 (from overseas)
Scheduled date to file Quarterly Report: August 15, 2011
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 First quarter of the fiscal year ending March 31, 2012
(from April 1, 2011 to June 30, 2011)(1) Consolidated operating results (cumulative)
Net sales
Millions of yen(Percentages indicate year-on-year changes.)

Operating income% Millions of yen

Ordinary income% Millions of yen

Net income% Millions of yen%

1Q ended June 30, 2011

55,384

3.6

4,447

52.8

4,772

275.0

1,618

23.8

1Q ended June 30, 2010

53,475 (35.3)

2,909

1.4

1,272

(66.9)

1,308(37.2)

Note: Comprehensive Income: 1Q FY2011: 1,492 million yen (35.5%) ; 1Q FY2010: 1,101 million yen (- %)Net income per share

Fully diluted net
income per share

Yen

Yen

1Q ended June 30, 2011

6.25

-

1Q ended June 30, 2010

5.05

-

(2) Consolidated financial position
Total assets

Net assets

Equity ratio

Millions of yen

Millions of yen%

As of June 30, 2011

334,570

154,391

46.0

As of March 31, 2011

353,392

155,758

43.9

Reference: Equity

As of June 30, 2011: 153,850 million yen

As of March 31, 2011: 155,242 million yen

12.

Cash dividends
Cash dividends per share
Record date

First quarter

Second quarter

Third quarter

Fiscal year-end

Annual

Yen

Yen

Yen

Yen

Yen

-

-

-

11.00

11.00

-

-

10.00

10.00

Fiscal year ended March
31, 2011
Fiscal year ending March
31, 2012
Fiscal year ending March
31, 2012 (Forecast)-

Note: Revision of the forecast in the First quarter of the fiscal year ending March 31, 2012: None3.

Consolidated earnings forecasts for the fiscal year ending March 31, 2012 (from April 1,
2011 to March 31, 2012)(Percentages indicate year-on-year changes.)
Net sales

Operating income

Ordinary income

Net income pershare

Net income

Millions ofyen%Millions ofyen%Millions ofyen%Millions of
yen

%

Yen

2Q ending
September 30, 2011

110,000

(1.7)

6,500

22.0

6,000

98.4

4,000

38.6

15.44

Fiscal year ending
March 31, 2012

250,000

1.2

11,000 (37.3)

12,000 (23.7)

8,000

0.3

30.88

Note: Revision of the forecasts in the First quarter of the fiscal year ending March 31, 2012: None

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 Financial
Statements: None
(3) Changes in Accounting Policies and Accounting Estimates / Restatements
a. Changes in accounting policies due to revisions of accounting standards, etc.: Noneb. Changes in accounting policies other than a. above: Nonec. Changes in accounting estimates: None
d. 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, 2011
260,324,529 shares
As of March 31, 2011
260,324,529 sharesb. Number of treasury stock at the end of the period
As of June 30, 2011
1,225,017 shares
As of March 31, 2011
1,222,540 sharesc. Average number of shares during the period (cumulative from the beginning of the fiscal year)
For the First quarter of the fiscal year ending March 31, 2012
259,100,022 shares
For the First quarter of the fiscal year ended March 31, 2011259,200,391 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.

2

5.

Qualitative Information related to Consolidated Performance(1) Qualitative Information on Business Performance
The business environment facing the Chiyoda Group during the consolidated first quarter was characterized
by uncertainty in Japan over the impact of the Great East Japan Earthquake in March of this year. However
demand in the world economy for energy and resources, especially liquefied natural gas (LNG), bottomed out
and there were definite signs of major investments. On the other hand, the yen remained high and Chiyoda
continued to face fierce competition in its existing business fields.
Under these conditions, the Chiyoda Group directed its efforts into winning contracts where we could takeadvantage of our technical superiority and advanced our global operations using our overseas bases inSoutheast Asia, which resulted in two new contracts in the region. One of those projects involves providing
support to a Japanese customer aiming to install new facilities in Indonesia, while the other is the fruit of ourcollaboration with Toyo-Thai Corporation PCL, a company of which we became shareholder last year. We arealso performing steadily in existing projects.
We continue to carry out backlog projects in Japan and, moreover, we are helping customers in various fields(petroleum, gas, chemicals, pharmaceuticals and more) to restore facilities damaged by the Earthquake.
The result of these efforts during the consolidated first quarter was 26,007 million yen in consolidated newcontracts (32.6% increase compared to the same period of the previous fiscal year), 467,268 million yen inconsolidated contract backlog (3.1% decrease year on year) and 55,384 million yen (3.6% increase year onyear) in consolidated revenues. Smooth execution of projects resulted in increase of incomes; operating
income 4,447 million yen (52.8% increase year on year), ordinary income 4,772 million yen (275.0% increase
year on year) and net income 1,618 million yen (23.8% increase year on year).
The general situation in our key business segment, engineering, can be summarized as follows:a. LNG plants/other gas/electric power
Outside Japan, we continued to execute engineering, procurement and construction (EPC) work on an LNG
plant in Papua New Guinea and a gas processing plant in Qatar, as well as undertaking the basic design ofan LNG plant in Australia whilst, at the same time, aggressively marketing to secure new basic design
contracts.
We entered into a partnership with Saipem S.p.A to develop onshore LNG and upstream projects and havebegun marketing initiatives in this regard.
Our Qatari subsidiary has a long term service contract under which it executes the maintenance andmodification work to LNG and gas processing plants built by the Chiyoda Group, and performs engineering,procurement and construction management (EPCm) work for helium extraction facilities. It is also
marketing itself to provide such services for other similar plants in Qatar.
In Japan, we continue to make steady progress on existing projects, including the construction of three LNG
receiving terminals in Niigata and Fukuoka prefectures. We are also marketing to obtain new contracts forseveral LNG receiving terminals.
b. Petroleum/petrochemicals/gas chemicals
Outside Japan, the Group is working together on various investment plans, including oil refineries in the
Middle East and Southeast Asia. We continue to execute EPC work for a heavy oil cracking facility in
Saudi Arabia and EPCm works for oil refineries in Singapore and Malaysia. We are also actively marketing
our services to win further contracts for oil refineries in Southeast Asia and the Middle East.
In Japan, we completed the partial replacement of an atmospheric distillation tower by applying a uniqueconstruction method newly-developed by the Chiyoda Group and are steadily progressing with otherprojects, such as construction of a benzene extraction unit awarded in the previous fiscal year.
c. General chemicals/industrial machinery/environment/otherIn new fields for Chiyoda, we are efficiently constructing a plant in Malaysia that will produce
polycrystalline silicon (used in solar cells), a nickel refining plant in the Philippines and, in Japan, a lithium
ion battery production plant and the expansion of a nonferrous metals plant. In Saudi Arabia, in addition to
executing a study on the recycling and reuse of industrial wastewater for a large industrial area, we are
studying the feasibility of conducting future business in the Kingdom. Moreover, because of the high yen
and uncertainty about future supplies and cost of electric power in Japan, we are seeing a growing numberof Japanese companies wishing to divert some of their domestic production capacity to other countries.

3

As investment plans related to lithium ion batteries are also increasing, we are actively marketing in thesefields. In the field of solar energy, we are developing and marketing a new generation technology (molten
salt parabolic trough solar energy) and have sealed a cooperation agreement with an Italian company, thefront-runner in the production of solar receiver tubes, to jointly explore business opportunities forconcentrated solar power plant projects
In the pharmaceuticals sector, we are executing EPC works for high-bioactive drug production facilities,
such as bioactive medicines (antibodies and vaccines) and anticancer drugs.
(Note) See Page 9 for more information about segment New Orders, Revenues, and Contract Backlog.

4

6.

Consolidated quarterly financial statements(1) Consolidated balance sheets
As of March 31, 2011
AssetsCurrent assets
Cash and deposits
Notes receivable, accounts receivable from completed
construction contracts
Short-term investment securities
Costs on uncompleted construction contracts
Jointly controlled assets of joint venture
other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings and structures, net
Land
Other, net
Total property, plant and equipment
Intangible assets
Investments and other assets
Investment securities
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets

5(Millions of yen)
As of June 30, 2011

33,85528,02356,03349,062

96,841
12,64888,66228,158(3)
316,196

100,341
14,93282,12323,238(2)297,719

5,215
11,9381,867
19,021
4,733

4,976
11,938
1,922
18,837
4,709

8,505
5,022
(87)
13,44137,196353,392

8,230
5,159
(87)
13,30336,850334,570

As of March 31, 2011
Liabilities
Current liabilities
Notes payable, accounts payable for construction contracts
Income taxes payable
Advances received on uncompleted construction contracts
Provision for warranties for completed construction
Provision for loss on construction contracts
Provision for bonuses
Other
Total current liabilities
Noncurrent liabilities
Long-term loans payable
Provision
Other
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Total accumulated other comprehensive income
Minority interests
Total net assets
Total liabilities and net assets

6(Millions of yen)
As of June 30, 2011

97,417
5,986
62,571
1,190
1,057
3,944
9,720
181,887

89,931459
58,784
1,164
1,361
1,744
10,614
164,060

10,2082,940
2,598
15,746
197,633

10,212
3,441
2,463
16,117
180,178

43,396
37,112
77,832(1,295)
157,046

43,396
37,11276,601(1,297)
155,812(229)
345(1,919)(1,804)516
155,758
353,392(515)
212(1,658)(1,962)
540
154,391
334,570

(2) Consolidated statement of income and comprehensive income(Consolidated statement of income)First quarter ended June 30,
2010(From April 1, 2010
to June 30, 2010)
Net sales of completed construction contracts
Cost of sales of completed construction contracts
Gross profit on completed construction contracts
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividends income
Equity in earnings of affiliates

53,47547,366
6,109
3,199
2,909

55,38447,515
7,868
3,421
4,447

156
51
9

222
84
－
24

－
33
150
402

Foreign exchange gains
Real estate rent
Other
Total non-operating income
Non-operating expenses
Interest expenses
Equity in losses of affiliates(Millions of yen)First quarter ended June 30,
2011(From April 1, 2011
to June 30, 2011)

62
－
1,933

30
58
420
50
1

Rent expenses on real estates
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Surrender value of insurance

25
17
2,039
1,272

－
16
26
95
4,772

109

－

Total extraordinary income

109

－

146

－

146

－
4,772
347
2,768
3,115
1,656
37
1,618

Foreign exchange losses

Extraordinary loss
Loss on adjustment for changes of accounting standard for
asset retirement obligations
Total extraordinary losses
Income before income taxes and minority interests
Income taxes-current
Income taxes-deferred
Total income taxes
Income before minority interests
Minority interests in income (loss)
Net income

1,235
101
(153)
(51)
1,287
(20)
1,308

7

(Consolidated statement of comprehensive income)First quarter ended June 30,
2010(From April 1, 2010
to June 30, 2010)
Income before minority interests
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Share of other comprehensive income of associates
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of the parent
Comprehensive income attributable to minority interests

8(Millions of yen)First quarter ended June 30,
2011(From April 1, 2011
to June 30, 2011)

1,287

1,656

(211)
(56)
126
(44)

(286)
(132)
268
(12)

(186)
1,101

(163)
1,492

1,112
(11)

1,460
31

7.

Production, Contracts and Sales(Millions of yen)
1Q FY2011
Apr. 1, 2011 —Jun. 30, 2011
RevenuesAmt%

New contracts
Amt%

Backlog of contracts
Amt%

Business Segment
Engineering
LNG plants
Gas and power utilities
Gas chemicals
Petroleum and petrochemicals
General chemicals
Industrial machinery
Environment and otherTotal Engineering

5,975
5,396
35
7,031
4,566
602
533
24,141

23.0
20.7
0.1
27.0
17.6
2.3
2.1
92.8

25,238
6,305
8,321
7,377
5,487
1,286
54,016

45.6
11.4
15.0
13.3
9.9
2.3
97.5

204,492
125,93135
37,97568,3303,256
25,093465,114

43.8
26.9
0.0
8.1
14.6
0.7
5.4
99.5

Other

1,866

7.2

1,367

2.5

2,154

0.5

Domestic
Overseas
Total

16,7499,258
26,007

64.4
35.6
100.0

21,03934,34455,384

38.0
62.0
100.0

150,069
317,198467,268

32.1
67.9
100.0

(Millions of yen)
1Q FY2010
Apr. 1, 2010 —Jun. 30, 2010
New contracts
Amt

Revenue%Amt

Backlog of contracts
%

Amt

%

Business Segment
Engineering
LNG plants
Gas and power utilities
Gas chemicals
Petroleum and petrochemicals
General chemicals
Industrial machinery
Environment and otherTotal Engineering

3,763
1,123
55
6,706
3,410
1,386
1,614
18,060

19.2
5.7
0.3
34.2
17.4
7.1
8.2
92.1

18,997
12,48628
11,130
3,161
5,930
393
52,127

35.5
23.4
0.1
20.8
5.9
11.1
0.7
97.5

263,061
111,336611
50,173
16,21817,307
22,846
481,554

54.6
23.1
0.1
10.4
3.4
3.6
4.7
99.9

Other

1,557

7.9

1,348

2.5

704

0.1

Domestic
Overseas
Total

13,8695,748
19,618

70.7
29.3
100.0

26,52826,94653,475

49.6
50.4
100.0

156,154
326,104
482,259

32.4
67.6
100.0

Note: The backlog of contracts for the three months ended June 30, 2011 includes a decrease due to changes in construction
contracts acquired in prior fiscal years, an increase due to adjustments in new contract amounts, and an increase due toforeign exchange translation adjustments.

9