Latest Financial Results and Full Year Forecast
Consolidated Financial Results for the First Half Ended September 30, 2022
In the six-month period ended September 30, 2022, increasingly strong downward pressure was placed on the global economy by factors including Russia’s military invasion of Ukraine, the economic sanctions placed on Russia in response to this act, high inflation, and the opaque outlook for the Chinese economy.
Despite the dissipation of the impacts of the COVID-19 pandemic, there is a need to carefully monitor factors with the potential to trigger future economic recession, such as high inflation and possible reductions to demand due to the monetary tightening measures of central banks around the world.
Revenue in the six-month period ended September 30, 2022, was up year on year following increases in revenue in the Metals, Mineral Resources & Recycling Division, a result of higher prices for coal; in the Chemicals Division, a result of growth in plastic resin transactions and higher methanol prices; and in the Consumer Industry & Agriculture Business Division, a result of higher lumber and fertilizer prices. Profit for the period (attributable to owners of the Company) was up year on year, despite a rise in SG&A expenses associated with the acquisition of new consolidated subsidiaries, following higher gross profit.
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(BN JPY)
| FY2021 H1 | FY2022 H1 | Difference | ||
|---|---|---|---|---|
| Revenue | 1,000.7 | 1,273.3 | +272.6 |  |
| Gross profit | 117.7 | 182.2 | +64.5 | |
| Profit for the period attributable to owners of the Company | 39.4 | 78.9 | +39.5 | |
Changes of Yearly Financial Results (Cumulative)
Trends in Financial Data（EXCEL）
Segment Performance (Profit for the Period attributable to owners of the Company) (Cumulative)
(BN JPY)
| FY21 H1 | FY22 H1 | Difference | |
|---|---|---|---|
| Automotive | 3.4 | 4.5 | +1.1 |
| Aerospace & Transportation Project | 1.4 | 2.0 | +0.6 |
| Infrastructure & Healthcare | 1.2 | 9.0 | +7.8 |
| Metals, Mineral Resources & Recycling | 16.2 | 41.8 | +25.6 |
| Chemicals | 6.8 | 11.3 | +4.5 |
| Consumer Industry & Agriculture Business | 4.7 | 5.9 | +1.2 |
| Retail & Consumer Service | 1.9 | 1.4 | (0.5) |
| Others | 3.8 | 3.0 | (0.8) |
Main factors behind the difference
- ■Automotive ¥4.5 billion (up ¥1.1 bn YoY)
- Increased due to yen depreciation in overseas automobile businesses
- ■Aerospace & Transportation Project ¥2.0 billion (up ¥0.6 bn YoY)
- Increased due to earnings from aircraft-related businesses
- ■Infrastructure & Healthcare ¥9.0 billion (up ¥7.8 bn YoY)
- Increased due to gain on partial sale of equity in overseas telecommunications tower operating business as well as earnings contributions projected from domestic and overseas power generation and LNG businesses
- ■Metals, Mineral Resources & Recycling ¥41.8 billion (up ¥25.6 bn YoY)
- Increased due to higher selling prices in coal businesses
- ■Chemicals ¥11.3 billion (up ¥4.5 bn YoY)
- Increased due to higher prices of various chemical products and improved profitability
- ■Consumer Industry & Agriculture Business ¥5.9 billion (up ¥1.2 bn YoY)
- Increased due to improved profitability in fertilizer businesses and higher selling prices in lumber-related businesses
- ■Retail & Consumer Service ¥1.4 billion (down ¥(0.5) bn YoY)
- Decreased due to reduced profitability for imported food products as a result of yen depreciation
- ■Others ¥3.0 billion (down ¥(0.8) bn YoY)
Commodity Prices and Exchange Rates
| FY21 Results (Apr.-Sep. avg.) |
FY22 Assumption ⇒FY22 H2 Assumption (Nov 1. 2022) |
FY22 Results (Apr.-Sep.avg.) |
Latest Data (As of Oct. 26, 2022) |
|
|---|---|---|---|---|
| Coking coal *1 |
US$ 199.5 / t | US$ 280.0 / t [1H:US$ 340.0 / t] [2H:US$ 220.0 / t] |
US$ 345.3 / t | US＄ 306.8 / t |
| Thermal coal *1 |
US$ 138.3 / t | US$ 160.0 / t ⇒US$ 330.0/t (H2) |
US$ 401.3 / t | US$ 379.3 / t |
| Crude oil (Brent) | US$ 71.2 /bbl | ⇒US$ 90.0 / t | US$ 104.8 / bbl | US$ 95.7 / bbl |
| Exchange rate *2 |
¥110.1 / US$ | ¥115.0 / US$ ⇒¥140.0 / US$ (H2) |
¥135.3 / US$ | ¥148.2 / US$ |
- *1 :
- Coal prices are based on standard market prices and therefore differ from the Company’s selling prices.
- *2 :
- Impact of fluctuations in the exchange rate on earnings: \1/US$ change alters gross profit by approx. ¥0.75 billion annually, profit for the year (attributable to owners of the Company) by approx. ¥0.3 bn annually,
and total equity by approx. ¥1.5 bn annually.
Full Year Forecast of Fiscal Year Ending March 31, 2023
(BN JPY)
| FY2021 Results |
FY2022 Revised Forecast (Nov. 1, 2022) |
Difference |
|
|---|---|---|---|
| Gross profit | 271.3 | 340.0 | +68.7 |
Profit for the Year (attributable to owners of the Company) |
82.3 | 110.0 | +27.7 |
FY2022 Profit for the Year Forecast by Segment
Caution regarding Forward-looking Statements
This document contains forward-looking statements based on information available to the Company at the time of disclosure and certain assumptions that management believes to be reasonable. Actual results may differ materially based on various factors including the timing at which the changes in economic conditions in key markets, both in and outside of Japan, and exchange rate movements. The Company will provide timely disclosure of any material changes, events, or other relevant issues.
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