Latest Financial Results and Full Year Forecast
Consolidated Financial Results for the Year Ended March 31, 2022
In the year ended March 31, 2022, the first year of Medium-Term Management Plan 20223, increasingly strong downward pressure was placed on the global economy by factors including Russia’s military invasion of Ukraine and the economic sanctions placed on Russia in response to this act. At the same time, there was an ongoing need to monitor the potential market impacts of various factors. Such factors included the possibility of resumed increases in COVID-19 cases, soaring resource prices, supply restrictions and inflation resulted from supply chain disruptions, and rapid interest rate increases and yen deprecation triggered by the monetary tightening measures of the central banks of several countries.
The Company’s revenue for the year ended March 31, 2022 was up year on year due to higher revenue in the Metals, Mineral Resources & Recycling Division, a result of higher prices for coal and precious metals; in the Chemicals Division, a result of growth in plastic resin transactions and higher methanol prices; and in the Automotive Division, a result of increased sales volumes in overseas automotive businesses.
Despite the increase in SG&A expenses and other expenses, profit for the year (attributable to owners of the Company) increased year on year following higher gross profit and a rise in share of profit of investments accounted for using the equity method attributable to earnings growth at a steel operating company.
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(BN JPY)
| FY2020 | FY2021 | Difference | ||
|---|---|---|---|---|
| Revenue | 1,602.5 | 2,100.8 | +498.3 |  |
| Gross profit | 188.1 | 271.3 | +83.2 | |
| Profit for the Year attributable to owners of the Company | 27.0 | 82.3 | +55.3 | |
Changes of Yearly Financial Results (Cumulative)
Trends in Financial Data（EXCEL）
Segment Performance (Profit for the year attributable to owners of the Company) (Cumulative)
(BN JPY)
| FY2020 | FY2021 | Difference | |
|---|---|---|---|
| Automotive | 1.1 | 7.1 | +6.0 |
| Aerospace & Transportation Project | 1.8 | 4.7 | +2.9 |
| Infrastructure & Healthcare | 8.2 | 6.6 | (1.6) |
| Metals, Mineral Resources & Recycling | (1.8) | 34.1 | +35.9 |
| Chemicals | 5.8 | 12.6 | +6.8 |
| Consumer Industry & Agriculture Business | 4.6 | 6.4 | +1.8 |
| Retail & Consumer Service | 4.9 | 5.0 | +0.1 |
| Others | 2.4 | 5.8 | +3.4 |
Main factors behind the difference
- ■Automotive ¥7.1 billion (up ¥6.0 bn YoY)
- Increased due to higher sales volumes in overseas automotive operations
- ■Aerospace & Transportation Project ¥4.7 billion (up ¥2.9 bn YoY)
- Increased due to higher transaction volumes in aircraft- and marine vessel-related businesses
- ■Infrastructure & Healthcare ¥6.6 billion (down ¥(1.6) bn YoY)
- Decreased due to impairment loss on telecommunication infrastructure business in Myanmar despite steady profit from healthcare-related businesses and power generation businesses in Japan and overseas
- ■Metals, Mineral Resources & Recycling ¥34.1 billion (up ¥35.9 bn YoY)
- Increased due to higher profits from a rise in coal market conditions and higher profits from steel operating company thanks to recovery of steel demand, despite provision recorded for thermal coal interests based on decarbonization target
- ■Chemicals ¥12.6 billion (up ¥6.8 bn YoY)
- Increased due to recovery of methanol prices and higher transaction volumes of plastic resin
- ■Consumer Industry & Agriculture Business ¥6.4 billion (up ¥1.8 bn YoY)
- Increased due to a rise in market conditions of imported plywood despite higher production cost due to increase in raw material prices in fertilizer businesses
- ■Retail & Consumer Service ¥5.0 billion (up ¥0.1 bn YoY)
- Relatively unchanged year on year due to absence of gains from sale of shopping mall recorded in the previous year despite higher sales volumes of food-related company
- ■Others ¥5.8 billion (up ¥3.4 bn YoY)
- Increased due to sales of assets
Commodity Prices and Exchange Rates
| FY20 Results (annual avg.) |
FY21 initial assumption (annual avg.) |
FY21 results (annual avg.) |
FY21 results (Jan.-Mar. '22 avg.) |
|
|---|---|---|---|---|
| Coking coal *1 |
US$ 117.9 / t | US$ 127.5 / t | US$ 317.5 / t | US＄ 490.7 / t |
| Thermal coal *1 |
US$ 65.6 / t | US$ 80.0 / t | US$ 181.7 / t | US$ 263.4 / t |
| Crude oil (Brent) | US$ 45.8 /bbl | US$ 50.0 /bbl | US$ 80.0 /bbl | US$ 97.9 / bbl |
| Exchange rate *2 |
¥105.9 / US$ | ¥108.0 / US$ | ¥113.04 / US$ | ¥117.8 / 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. ¥0.5 billion annually, profit for the year (attributable to owners of the Company) by approx. ¥0.3 billion annually, and total equity by approx. ¥1.5 billion annually.
Full Year Forecast of Fiscal Year Ending March 31, 2023
(BN JPY)
| FY2021 | FY2022 forecast |
Difference |
|
|---|---|---|---|
| Gross profit | 271.3 | 300.0 | +28.7 |
Profit for the Year (attributable to owners of the Company) |
82.3 | 85.0 | +2.7 |
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 COVID-19 pandemic ends; 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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