Japan Petroleum Exploration (1662) Q1 2024 earnings summary

Executive summary

• Q1 FY3/24 net sales rose 5% YoY to ¥61.3bn and operating profit rose 32% to ¥12.9bn; ordinary profit fell 19% to ¥18.2bn and net profit fell 17% to ¥13.0bn.

• Operating profit gains from higher Japan gas prices and U.S. tight-oil sales were offset at the ordinary-profit level by lower affiliate earnings and foreign-exchange gains.

Financial highlights

• Gross profit increased 23% YoY to ¥20.5bn; exploration expenses were ¥255m versus ¥97m a year earlier.

• Net profit attributable to owners was ¥13.0bn, down ¥2.6bn YoY, as operating-profit improvement was offset by reduced non-operating income.

Outlook and guidance

• FY3/24 forecast revised to net sales of ¥306.1bn (+2% vs. May), operating profit of ¥38.9bn (-6%), ordinary profit of ¥44.8bn (-2%) and net profit of ¥34.0bn, unchanged.

• Revised assumptions: WTI $75.60/bbl, CIF crude $77.45/bbl and ¥131.16/$; Seagull production delay is expected to reduce overseas E&P volumes and profit.

• Annual dividend forecast remains ¥200/share, split into ¥100 interim and ¥100 year-end, under a 30% payout-ratio policy.