ENEOS (5020) Status update summary

FY2024 forecast revisions

• Operating profit forecast reduced by ¥395.0 billion to ¥25.0 billion due to inventory valuation losses, goodwill impairment, and profit reclassification related to JX Advanced Metals (JXAM).

• Operating profit including discontinued operations and excluding inventory valuation is now expected at ¥440.0 billion, up ¥20.0 billion from the previous forecast.

• Goodwill impairment of ¥160.0 billion will be recorded in the Petroleum Products Business due to rising interest rates and revised future plans.

• Sale of 57.6% of JXAM shares and deconsolidation of the Metals Business will improve financial position and net D/E ratio.

• Free cash flow forecast raised to ¥530.0 billion, mainly from the JXAM share sale.

Key business drivers and impacts

• Declining oil prices and negative time lag impacted inventory valuation and operating profit.

• Improved margins in petroleum products and early operation of Goi Thermal Power Plant contributed positively.

• Cancellation of an onshore wind power project negatively affected renewable energy segment.

• Butadiene market price increase supported high performance materials segment.

• JXAM operating profit and gain on share sale now classified as discontinued operations.

Financial position and outlook

• Net D/E ratio expected to improve to 0.40 by March 2025, reflecting asset sales and deconsolidation.

• Total equity forecast to decrease to ¥3,320.0 billion by March 2025.

• Capital investment revised to ¥490.0 billion, with asset sales and other income at ¥420.0 billion.

• Profit attributable to owners of the parent revised to ¥215.0 billion, down ¥5.0 billion from previous forecast.

• Fourth Medium-Term Management Plan to be released in May 2025, reflecting JXAM listing.