ENEOS : Q&A（118KB）

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■ENEOS Holdings (5020) - Analysts' Meeting Q&A for the second quarter ended Sep. 30, 2020

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1. Date & time: Wednesday, November 11 (16：00－17：00)
2. Attendees: 121
3. Principal questions:
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－This document contains forward-looking statements. A cautionary statement appears in the endnote.－

1. What were the factors behind your upward revision* to the full-year forecast for operating income excluding inventory valuation effects? *Revised from ¥165.0bn to ¥190.0bn

1. The forecast has been revised upwards by ¥25.0 billion due to positive factors including reduced expenses, steady domestic petroleum product margins in the first half, an increase in sales of electronic materials in conjunction with higher demand from the telecommunications sector, and revisions to second half resource price assumptions. These effects outweighed the impacts of COVID-19.

1. You are forecasting a decline in profit in the second half compared to the first half. Can you discuss the factors behind this forecast, especially in relation to the Energy business?

1. In the Energy business, we are forecasting a decline in profit in the second half compared to the first half due to deterioration in domestic petroleum product margins (from approx. ¥12/L in FH to approx. ¥10/L in LH) including correction for time lags, and the slumping of petrochemical product margins, despite the fact that we expect an increase in sales volume for petroleum products during the winter months, especially for kerosene. The concentration of certain expenses to be recorded in the second half is another negative factor.

1. Both the Long-Term Vision (published in May 2019) and the Second Medium-Term Management Plan (published in May 2020) indicate a shift from upstream to midstream and downstream businesses. In light of this, could you please discuss the purpose and strategic positioning of the acquisition of full rights and interests in the Caserones Copper Mine announced in the November 9 news release?

1. The decision to acquire the rights and interests was made in consideration of the advantage of strengthening the supply chain of the entire Metals business, including smelting and recycling, to ensure growth of downstream business and stable supply of advanced materials. We will continue to place emphasis on downstream business, centered on electronic materials.

SQ. Could you please discuss the outlook for operations at the Caserones Copper Mine? SA. Operations had to be downscaled in the first half due to the impact of COVID-19,but

current operational indicators have generally returned to pre-pandemic levels. We will work to achieve our target for annual production while preventing the spread of COVID-19.

Copyright © 2020 ENEOS Holdings, Inc.

This document contains forward-looking statements. Actual results may differ materially from those expressed or implied by forward-looking statements due to various factors, including but not limited to the following:

1. macroeconomic conditions and changes in the competitive environment in the energy, resources, or materials industries;
2. the impact of COVID-19 on economic activity
3. revision of laws and tightening of regulations;
4. risk of lawsuits and other legal risks.

Copyright © 2020 ENEOS Holdings, Inc.