Chiyoda Corporation (6366)
Consolidated Financial Results for the nine months Ended December 31, 2017

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 Results
for the Nine Months Ended December 31, 2017
February 9, 2018
Company name:
Listing:
Stock code:
URL:
Representative:
Inquiries:TEL:

CHIYODA CORPORATIONFirst Section of the Tokyo Stock Exchange6366
https://www.chiyodacorp.com/en/
Masaji Santo, President & CEO
Shinji Kusunoki, GM, Finance and Accounting Unit
+81-45-225-7745

Scheduled date to file Quarterly Report: February 9, 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 Nine months ended December 31, 2017
(1) Consolidated operating results(Percentages indicate year-on-year changes)

Net salesMillions of yen

For the nine months ended
Dec 31, 2017
For the nine months ended
Dec 31, 2016
Note: Comprehensive Income:Operating income

Profit attributable toowners of parent

Ordinary income%Millions of yen%

Millions of yen%

Millions of yen%

385,934 (11.3)(8,843)－(8,421)

－

5,198

－

435,116

10,411(31.8)(5,595)－(34,000)－(2.0)

the nine months ended December 31, 2017:
the nine months ended December 31, 2016:

Net income per share
For the nine months ended
December 31, 2017
For the nine months ended
December 31, 20165,336 million yen / (－)%
(39,851) million yen / (－)%

Fully diluted net
income per share

YenYen20.07－(131.28)－(2) Consolidated financial position
Total assets

Net assets

Millions of yen

Equity ratio

Millions of yen%

As of December 31, 2017428,779
160,876
37.1
As of March 31, 2017
461,331
157,125
33.7
Reference: Equity
As of December 31, 2017: 158,979 million yen
As of March 31, 2017: 155,339 million yen

2. Cash dividends
Cash dividends per share
Record date

First quarter

Yen

Second quarter

Third quarter

Fiscal year-endAnnualYen

Yen

Yen

Yen

Fiscal year ended March－－
31, 2017
Fiscal year ending March－－
31, 2018
Fiscal year ending March31, 2018 (Forecast)
Note: Revision to the latest forecast announcement 2017: None－

6.00

6.00

6.00

6.00

－

Chiyoda Corporation (6366)
Consolidated Financial Results for the nine months Ended December 31, 2017

3. Consolidated earnings forecasts for the fiscal year ending March 31, 2018 (from April 1, 2017 toMarch 31, 2018)(Percentages indicate year-on-year changes)

Net sales
Millions of yen

Operating income%Millions of yen%

Fiscal year ending
500,000 (17.2)(9,500)－March 31, 2018
Note: Revision to the latest forecast announcement 2017: None

Profit attributable toowners of parent

Ordinary income

Net income
per share

Millions of yen%

Millions of yen%

Yen

(8,000)－5,000－19.31

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.: 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 December 31, 2017
260,324,529 shares
As of March 31, 2017
260,324,529 sharesb. Number of treasury stock at the end of the period
As of December 31, 2017
1,356,764 shares
As of March 31, 2017
1,351,100 sharesc. Average number of shares during the period
For the three months ended December 31, 2017258,969,252 shares
For the three months ended December 31, 2016
258,980,896 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 nine months Ended December 31, 2017

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 ....................................................... 7Production, Contracts and Sales................................................................................................ 81

Chiyoda Corporation (6366)
Consolidated Financial Results for the nine months Ended December 31, 2017

1. Qualitative Information Related to Consolidated Performance(1) Qualitative Information on Business Performance
Despite geopolitical tensions in the Middle East and Korean Peninsula, macroeconomics in Asia, Europeand the USA remained relatively stable during the nine months of the current fiscal year. The price of crude
oil has remained in a range of approximately $50 to $60 per barrel and, although large scale LiquefiedNatural Gas (LNG) project final investment decisions remain outstanding, bidding and investment activities
have gradually increased.
Through its LNG core business, Chiyoda continued to implement large-scale projects worldwide. In addition,
the Company is also implementing structural reforms and the growth strategy detailed in its Medium-Term
Management Plan “Mirai Engineering – A Grand Opportunity for the Future” announced in August 2017.
This includes expansion into new markets, such as renewable energy and life sciences and new areas forfuture business models such as leveraging big data and AI technology.
Consequently, on a consolidated basis, New Orders for the fiscal year ending March 2018 amounted to
209,079 million yen (down 26.8% year on year). The Backlog amounted to 695,028 million yen (down 20.7%year on year). Revenues from completed construction contracts amounted to 385,934 million yen (down11.3% year on year) and Operating Loss is 8,843 million yen (compared with the previous year’s
consolidated profit operating income of 10,411 million yen). Ordinary loss amounted to 8,421 million yen(compared with the previous year’s consolidated profit ordinary loss of 5,595 million yen). Profit attributableto owners of parent amounted to 5,198 million yen (compared with the previous year’s consolidated loss
attributable to owners of parent of 34.0 billion yen).
Operating Income and ordinary income is a loss due to the company anticipating an increase in costs on
LNG projects currently underway in the United States. On the other hand, profit attributable to owners ofparent was 5,198 million yen due to a recovery in subsidiary losses and Federal corporation tax refunds tothe U.S. subsidiary.

A summary of reportable engineering business activities is shown below.

LNG Plants and Other Gas Related Work
Overseas, Chiyoda is conducting pre-contract work on an LNG project in Mozambique as the selectedEngineering, Procurement and Construction (EPC) Contractor and continues EPC operations on LNG
projects in Australia, Russia, Indonesia and the USA. In Qatar, under an agreement with Qatar Petroleum
announced in June 2017, Chiyoda conducted debottlenecking studies to increase the capacity of LNG plants,
contributing to the development of the basic plan for LNG production capacity increase. Also Chiyoda is
bidding for new LNG plant projects in Canada and USA. In Qatar, the Group has been engaged under longterm Engineering, Procurement, Construction and management (EPCm) contracts on a helium production
facility and the renovation and modification of LNG and gas processing plants previously constructed by theCompany.
In Japan, EPC activities have commenced for the renovation and modification of existing LNG receiving
terminals similarly built by Chiyoda.

Refinery/Petrochemicals/Metal
Overseas, Front-End Engineering and Design (FEED) work for petrochemical project in the USA isprogressing well, as are Engineering, Procurement, Construction and Commissioning (EPCC) activities ona Residue Fluid Catalytic Cracking (RFCC) project in Malaysia and EPC operations on a petrochemical tankterminal in Southeast Asia. In addition, Chiyoda has long term project management contracts for refinery,
chemical production and other downstream projects in Asia and in May 2017 completed a titanium sponge
plant in Saudi Arabia.
In Japan, Chiyoda continues to facilitate inter-refinery cooperation in the mutual accommodation of fuelthrough its EPC operations and optimize the configuration of refineries and other facilities. The Group
continues to renovate and upgrade existing facilities in accordance with the Basic Act for National Resilienceand carry out routine maintenance to improve energy efficiency in existing petrochemical production, andother, facilities.

2Chiyoda Corporation (6366)
Consolidated Financial Results for the nine months Ended December 31, 2017

Pharmaceutical/Biochemistry/General Chemistry/Environment/Infrastructure
Overseas, in transport infrastructure, the Group is completing EPC projects for new international airports inMongolia and Bohol in The Philippines. In the environment field, the Group aims to introduce the Chiyoda
Thoroughbred 121 (CT-121) Process into flue gas desulfurization facilities on an existing coal fired power
plant project in India under long term agreement. The demonstration vegetable facility project that uses
artificial light in Dubai, UAE was completed in December 2017, and Chiyoda will continue to focus its
introduction of the commercial facilities in the Middle East and Russia.
In Japan, Chiyoda is conducting EPC work on photovoltaic (mega solar) facilities, CO2 separation units andflue gas desulfurization facilities on existing coal-fired power plants.
EPC operations in the food, pharmaceutical and biochemistry industries include: factories complying withthe latest food hygiene standards, research facilities capable of handling high-potency pharmacologically
active agents, including cutting-edge injection production facilities, and pharmaceutical/biomedicine
manufacturing facilities. The Group will also complete Japan’s first demonstration plant for bio-jet and diesel
fuel production, for Euglena Co. Ltd, by October 2018.

New Business Fields
In the offshore and upstream fields, following approval of the ECS reorganization plan in June 2017, Chiyoda
has been in discussions with Subsea 7 S. A., ECS’s new parent, regarding future collaboration. Xodus
Group Ltd., Chiyoda’s subsidiary in the U.K., is continuing to advise on acquiring rights and provide planning,
design, consulting and other services to companies developing natural resources on the safe
decommissioning of obsolete facilities and on the construction of crude oil, gas production and other facilities.
In the new energy field, “Advanced Hydrogen Energy Chain Association for Technology Development”,
established jointly with Mitsubishi Corporation, Mitsui & Co. Ltd. and Nippon Yusen (NYK Line), has started
actual work on a demonstration project aimed at commercializing a hydrogen supply chain.
In the digital innovation business field, in a tie-up agreement with GRID Inc., a leading venture company inthe field of AI technologies in Japan, the Company commenced projects using AI technologies to improve
plant productivity.

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

(3) Outlook for the Next Fiscal Year
Please refer to the company’s release ‘Notice of Revisions to the Forecast of Consolidated Results”
published on November 7, 2017.
In addition, expected foreign exchange of JPY 110/USD remains unchanged.

3Chiyoda Corporation (6366)
Consolidated Financial Results for the nine months Ended December 31, 2017

2. Consolidated quarterly financial statements(1) Consolidated balance sheets
As of March 31, 2017

As of December 31, 2017

AssetsCurrent assets
Cash and deposits
Notes receivable, accounts receivable fromcompleted construction contracts
Securities
Costs on uncompleted construction
contracts
Jointly controlled assets of joint venture
OtherAllowance for doubtful accounts
Total current assets

135,373

99,32059,865

77,184

7,999

7,999

24,22020,397

164,283141,482

35,044△1,54137,672△1,450425,244382,607

Buildings and structures, net
Land

6,627
5,266

6,184
4,952

Other, net

1,265

1,092

Total property, plant and equipment

13,158

12,228Intangible assets

8,098

7,409

Investments and other assets
Investment securities

7,707

7,914

7,458
△336

18,959△339

36,086

46,172

461,331428,779

Non-current assets
Property, plant and equipment

Other
Allowance for doubtful accounts
Total investments and other assets

14,830Total non-current assets
Total assets

426,534

Chiyoda Corporation (6366)
Consolidated Financial Results for the nine months Ended December 31, 2017

(Millions of yen)
As of March 31, 2017

As of December 31, 2017

Liabilities
Current liabilities
Notes payable, accounts payable for

160,096

construction contracts
Short-term loans payable

152,681203

256

Current portion of long-term loans payable
Income taxes payable

10,004668

10,003345

Advances received on uncompleted
construction contracts

85,187

79,588Provision for warranties for completed
construction

319

322

Provision for loss on construction contracts
Provision for bonuses

3,315
3,156

4,993
1,994

Provision for loss on business ofsubsidiaries and associates

22,919－Other15,311

14,478

Total current liabilities

301,182

264,663

Long-term loans payable
Provision

4338

1359

Net defined benefit liability
Other

1,522
1,158

1,652
1,226

Total non-current liabilities

3,023

3,239

304,206

267,90243,39643,396

37,112
72,132△1,431

37,11275,777△1,434Non-current liabilities

Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity151,210

154,851

Valuation difference on available-for-salesecurities

379

97

Deferred gains or losses on hedges
Foreign currency translation adjustment

499
2,656

1,112
2,200

Remeasurements of defined benefit plans

592

717

Total accumulated other comprehensive
income

4,128

4,127

Accumulated other comprehensive income

Non-controlling interests
Total net assets
Total liabilities and net assets

5

1,785

1,897

157,125

160,876

461,331428,779Chiyoda Corporation (6366)
Consolidated Financial Results for the nine months Ended December 31, 2017(2)

Consolidated statement of income and comprehensive income(Consolidated statement of income)(Millions of yen)
Nine months ended
December 31, 2016

Nine months ended
December 31, 2017

Net sales of completed construction contracts
Cost of sales of completed construction contracts

435,116
408,680

Gross profit on completed construction contracts

26,436

6,262

Selling, general and administrative expenses

16,024

15,105

Operating profit (loss)

10,411△8,843Non-operating income
1,156
820

Interest income
Dividend income

385,934
379,672

1,706
338

Share of profit of entities accounted for using
equity method－697Other

205

184

2,182

2,927

157

159

14,649－

3,297

2,062

84284

Total non-operating income
Non-operating expenses
Interest expenses
Share of loss of entities accounted for using
equity method
Foreign exchange losses
Other

18,1882,506△5,595△8,421－

12,127

Other

1,965－

203
589

Total extraordinary income

1,965

12,920

Provision for loss on business of subsidiaries
and associates

23,764－

Loss on sales of shares of subsidiaries andassociates

1,146－

Loss on valuation of investment securities

393－

Total non-operating expensesOrdinary loss
Extraordinary income
Reversal of provision for loss on business ofsubsidiaries and associates
Gain on sales of investment securities

Extraordinary losses

Total extraordinary losses
Profit (loss) before income taxes

25,304－△28,934

4,499

10,725△5,544

Income taxes - current
Income taxes - deferred

5,181

Total income taxes△34,115

Profit (loss)
Profit (loss) attributable to non-controlling interests△115△34,000

Profit (loss) attributable to owners of parent

6△5,402
4,581
△821

5,320
1225,198

Chiyoda Corporation (6366)
Consolidated Financial Results for the nine months Ended December 31, 2017

(Millions of yen)
Nine months ended
December 31, 2016
Profit (loss)
Other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment△34,115

5,320△2,086

△282

115

125

3,321
△4,500Remeasurements of defined benefit plans, netof tax
Share of other comprehensive income ofentities accounted for using equity method
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to ownersof parent
Comprehensive income attributable to non-403△39,851

5,336△39,727

5,197

△124

controlling interests

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

7614
△844

△2,586△5,736

Total other comprehensive income(3)

Nine months ended
December 31, 201716139

Chiyoda Corporation (6366)
Consolidated Financial Results for the nine months Ended December 31, 2017

3. Production, Contracts and Sales(Millions of yen)
Apr. 1, 2017－Dec. 31, 2017

Apr. 1, 2016 － Dec 31, 2016

Engineering
LNG PlantNew
contracts(ratio)Net sales(ratio)Backlog ofcontracts(ratio)Newcontracts(ratio)Net sales(ratio)Backlog ofcontracts(ratio)283,195

432,502

933,956

206,598

383,452

695,028(99.1%)(99.4%)(100.0%)(98.8%)(99.4%)(100.0%)166,787

306,896644,672

75,562281,988389,713(58.3%)(70.5%)(69.0%)(36.1%)(73.1%)(56.1%)

6,498

9,725

14,046

1,841

8,701

5,143

(2.3%)(2.2%)(1.5%)(0.9%)(2.3%)(0.7%)

32,26573,343

157,51433,34741,367

149,645(11.3%)(16.9%)(16.9%)(15.9%)(10.7%)(21.5%)

30,761

21,73138,362

30,46022,98942,783(10.8%)(5.0%)(4.1%)(14.6%)(6.0%)(6.2%)

Environment/New Energy/

37,92917,12571,18254,521

21,421

96,626

Infrastructure(13.3%)(3.9%)(7.6%)(26.1%)(5.5%)(13.9%)

Gas Development/
Processing/Receiving
Refinery/Petrochemical/
Metal
Pharmaceutical/Biochemistry/
ChemicalOthersOther Business

Total

Domestic
Overseas

8,952

3,679

8,177

10,865

6,984

11,116(3.1%)(0.9%)(0.9%)(5.2%)(1.8%)(1.6%)

2,614

2,614

2,481

2,481

(0.9%)(0.6%)－(－)(1.2%)(0.6%)－(－)

285,809435,116

933,956

209,079

385,934

695,028(100.0%)(100.0%)(100.0%)(100.0%)(100.0%)(100.0%)105,22173,311

126,252

113,205

76,984

158,132(36.8%)(16.8%)(13.5%)(54.1%)(19.9%)(22.8%)

180,587

361,804

807,703

95,874308,949

536,895(63.2%)(83.2%)(86.5%)(45.9%)(80.1%)(77.2%)

Note 1:The backlog of contracts for the nine months ended December 31, 2017 includes a decrease due to changes inconstruction contracts acquired in prior fiscal years, and an increase due to foreign exchange translation
adjustments.

Note 2:The total amount of the above table does not include consumption tax.

8