Japan Petroleum Exploration (1662) Q4 2024 earnings summary

Executive summary

• FY3/24 net sales fell 3% YoY to ¥325.9bn; operating profit declined 11% to ¥55.2bn and profit attributable to owners of parent fell 20% to ¥53.7bn.

• Overseas E&P growth, led by U.S. tight oil and the Iraq Garraf project, partly offset lower domestic E&P and Infrastructure & Utility (I/U) earnings.

Financial highlights

• FY3/24 gross profit was ¥87.3bn, down 9% YoY; ordinary profit was ¥68.8bn, down 17%.

• Net income declined ¥13.7bn YoY, with lower operating profit and reduced equity-method profit among the drivers.

• E&P sales rose 58% YoY to ¥88.8bn, while I/U sales fell 19% to ¥172.1bn.

Outlook and guidance

• FY3/25 forecast: net sales ¥379.4bn (+16% YoY), operating profit ¥52.4bn (-5%), ordinary profit ¥55.5bn (-19%) and parent net income ¥42.8bn (-20%).

• Forecast oil assumptions: WTI $80/bbl, crude oil CIF $85/bbl and ¥140/$; FY3/24 actuals were $77.69/bbl, $86.28/bbl and ¥143.28/$.

• FY3/25 E&P sales are forecast to rise 59% to ¥141.2bn, mainly on higher U.S. tight oil, Garraf and Seagull volumes.

• FY3/25 annual dividend forecast is ¥150/share on a post-split basis: ¥125 interim and ¥25 year-end; the year-end equivalent before the 5-for-1 split is ¥125.