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Latest Financial Results and Full Year Forecast

Consolidated Financial Results for the Year Ended March 31, 2019

In the year ended March 31, 2019, the first year of Medium-Term Management Plan 2020—Commitment to Growth, the deceleration of the Chinese economy and trade friction between the United States and China created signs of slowdown in the global economy, which had previously been supported by strong consumption. In this environment, the Company’s revenue for the year ended March 31, 2019, was up year on year due to increased sales in the Metals & Mineral Resources Division, a result of rises in prices and transaction volumes for coal and other resources, and in the Automotive Division, a result of the acquisition of new domestic and overseas automotive dealership and other businesses. Profit for the year (attributable to owners of the Company) rose year on year, thanks to higher gross profit and an increase in share of profit (loss) of investments accounted for using the equity method due to higher profit at an LNG operating company.

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(Billions of Yen)

FY2017
Results
FY2018
Results
Difference
Revenue 1,816.5 1,856.2 +39.7
Gross Profit 232.4 241.0 +8.6
Profit for the Year attributable to owners of the Company 56.8 70.4 +13.6

Changes of Yearly Financial Results (Cumulative)

Gross Profit

Profit attributable to owners of the Company

Segment Performance [Profit for the period attributable to owners of the Company]

Segment Performance [Profit for the Period (Attributable to owners of the Company)]

(Billions of Yen)

FY2017 FY2018 Difference
Automotive 6.5 6.4 (0.1)
Aerospace & Transportation Project 3.3 4.0 +0.7
Machinery & Medical Infrastructure 5.7 2.8 (2.9)
Energy & Social Infrastructure (5.8) 5.8 +11.6
Metals & Mineral Resources 21.9 30.5 +8.6
Chemicals 8.7 9.0 +0.3
Foods & Agriculture Business 4.0 2.3 (1.7)
Retail & Lifestyle Business 5.6 5.7 +0.1
Industrial Infrastructure &
Urban Development
2.1 1.1 (1.0)
Other 4.8 2.8 (2.0)

Factor behind year on year change in earnings

Automotive ¥6.4 billion (down ¥(0.1) billion YoY)
Relatively unchanged year on year
Aerospace & Transportation Project ¥4.0 billion (up ¥0.7 billion YoY)
Increased due to gains on sales of aircraft and earnings contributions accompanying progress in railroad projects
Machinery & Medical Infrastructure ¥2.8 billion (down ¥(2.9) billion YoY)
Decreased due to absence of revenue associated with infrastructure projects recorded in the previous fiscal year
Energy & Social Infrastructure ¥5.8 billion (up ¥11.6 billion YoY)
Increased due to rebound from one-time losses on oil and gas interests recorded in the previous fiscal year as well as to higher prices in LNG operations
Metals & Mineral Resource ¥30.5 billion (up ¥8.6 billion YoY)
Increased due to higher prices and transaction volumes of coal and other resources
Chemicals ¥9.0 billion (up ¥0.3 billion YoY)
Relatively unchanged year on year, despite strong performance in methanol operations, as a result of one-time losses in overseas operations and economic slowdown stemming from trade friction between the United States and China
Foods & Agriculture Business ¥2.3 billion (down ¥(1.7) billion YoY)
Decreased due to higher material costs and lower sales volumes in overseas fertilizer businesses
Retail & Lifestyle Business ¥5.7 billion (up ¥0.1 billion YoY)
Despite earnings contributions from newly consolidated subsidiaries, relatively unchanged year on year because of lower profit at lumber-related subsidiaries
Industrial Infrastructure & Urban Development ¥1.1 billion (down ¥(1.0) billion YoY)
Decreased due to poor sales in domestic real estate operations
Other ¥2.8 billion (down ¥(2.0) billion YoY)

Commodity Prices and Exchange Rates

FY2017 Results
(Annual Avg.)
FY2018 Assumption
(Annual Avg.)
FY2018 Results
(Annual Avg.)
Crude oil (Brent) US$57.9 / bbl US$60.0 / bbl US$70.8 / bbl
Thermal Coal *1 US$93.9 / t US$85.0 / t US$105.8 / t
Exchange rate *2 ¥110.7 / US$ ¥105.0 / US$ ¥111.1 / US$
*1
The results in the above table are cited from the GlobalCOAL NEWC Index and differ from our sales prices.
*2
Impact of exchange rate fluctuations 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. ¥0.25 billion annually, and total equity by approx. ¥2.0 billion annually.

Full Year Forecast of Fiscal Year Ending March 31, 2020

(Billions of Yen)

FY2018
Results
FY2019
Forecast
Difference
Gross Profit 241.0  260.0  +19.0 
Profit for the year attributable to owners of the Company 70.4  72.0  +1.6 

FY2019 Profit for the Year Forecast by Segment

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