Japan Petroleum Exploration (1662) Q3 2023 earnings summary

Executive summary

• 9M FY3/23 net sales rose 31% YoY to ¥225.1bn; operating profit reached ¥38.7bn and parent-attributable profit was ¥43.3bn, versus a ¥85.1bn loss a year earlier.

• FY3/23 forecasts were revised upward on stronger oil, gas and electricity sales, improved LNG procurement margins and higher prices; annual dividend forecast increased to ¥330/share.

Financial highlights

• 9M net sales ¥225.1bn, up 31% YoY; gross profit ¥63.9bn, up 85%; operating profit ¥38.7bn, up 233%; ordinary profit ¥57.9bn, up 136%.

• Parent-attributable profit was ¥43.3bn, compared with a ¥85.1bn loss in 1–3Q FY3/22; prior-year results included extraordinary losses related to Canadian project exits.

• Revised FY3/23 forecast: net sales ¥326.7bn, gross profit ¥95.8bn, operating profit ¥61.3bn, ordinary profit ¥79.0bn and parent-attributable profit ¥60.0bn.

Outlook and guidance

• Versus the Nov. 10 forecast, FY3/23 net sales rose ¥22.1bn (+7%), operating profit ¥16.0bn (+35%), ordinary profit ¥12.0bn (+18%) and parent-attributable profit ¥7.0bn (+13%).

• Revised assumptions: WTI $94.42/bbl, CIF crude $96.24/bbl and ¥132.13/$; forecast changes reflect higher sales prices and improved LNG procurement margins, partly offset by higher Japex Garraf operating costs.

• Domestic Katakai additional-development drilling was underway; first-well production was scheduled for 2H 2023. UK North Sea Seagull production was scheduled to start in mid-2023.