Tohoku Electric Power Incorporated : Financial Results for the Second Quarter of Fiscal Year ending March 31, 2023 (FY2022)

TOHOKU ELECTRIC POWER CO., INC.

October 28, 2022

Financial Results for the Second Quarter of Fiscal Year ending March 31, 2023 (FY2022)

Tohoku Electric Power CO., Inc. released its financial results for the second quarter of FY2022 (April 1, 2022 through March 31, 2023) today.

【Consolidated Financial Results】

Although retail electricity sales volume decreased due to intensifying competition, total electricity sales volume increased to 39.3 TWh, a year-on-year increase of 0.4%, owing to an increase in volume of wholesale electricity sales inside our franchise area.

Consolidated operating revenue increased to ¥1,339.7 billion, a year on year increase of ¥466.5 billion or 53.4%, mainly due to an increase in fuel cost adjustment charge.

Consolidated ordinary loss was ¥131.9 billion, a year-on-year decrease of ¥171.8 billion due to a significant increase in electricity procurement costs resulting from rising fuel prices and JEPX prices.

Net loss attributable to owners of the parent was ¥136.3 billion, a year-on-year decrease of ¥170.5 billion.

Consolidated cash income* for this period was ¥110.3 billion.

*We set consolidated cash income as a financial target in the Tohoku Electric Power Group's medium- to long- term vision "Working alongside next". (Target for 320 billion yen in FY 2024)

Consolidated cash income = Operating income + Depreciation + Amortization of nuclear fuel + Share of profit of entities accounted for using equity method (Operating income doesn't include time lag between fuel cost and fuel cost adjustment charges.)

1

Key points of financial results and forecasts

Financial Results for the second quarter of FY2022

• Operating revenue : mainly due to an increase in fuel cost adjustment charges
• Ordinary loss : mainly due to an increase in electricity procurement costs resulting from rising fuel prices and JEPX prices, and rapidly weakening yen

Financial and Dividend Forecasts for FY2022

Summary of Financial Results

2

 Operating revenue

¥1,339.7 billion (a year on year increase of ¥466.5 billion)

• Operating revenue increased mainly due to an increase in fuel cost adjustment charges resulting from rise in fuel prices.

 Ordinary loss

- ¥131.9 billion (a year on year decrease of ¥171.8 billion)

• Ordinary income/loss decreased mainly due to an increase in electricity procurement costs resulting from rising fuel prices and JEPX prices, and rapidly weakening yen.

 Net Loss Attributable to	- ¥136.3 billion (a year on year decrease of ¥170.5 billion)
Owners of Parent
【Summary of Consolidated Financial Statements】

(billions of yen)

	FY2021/2Q			FY2022/2Q			Change			Change
	(A)			(B)			(B) - (A)			(B) / (A)
Operating Revenue	873.1			1,339.7			466.5			153.4	%
Ordinary Income(Loss)*1	39.9			(131.9)			(171.8)			-
[	76.9	]	[	9.0	]	[	(67.8)	]	[	11.8	%]
Net Income(Loss) Attributable to	34.2			(136.3)			(170.5)			-
Owners of Parent
Consolidated Cash Income*2	175.7			110.3			(65.3)			62.8	%

*1 Lower figures exclude time lag between fuel cost and fuel cost adjustment charges.

*2 Consolidated Cash Income = Operating income + Depreciation + Amortization of nuclear fuel + Share of profit of entities accounted for using equity method (Operating income doesn't include time lag between fuel cost and fuel cost adjustment charges.)

Changing Factors in Consolidated Ordinary Income	3
from the Corresponding Period Last Year
Decrease of 171.8 Billion Yen (39.9 → -131.9)

• Increase in fuel cost adjustment charges 23.7

• Increase in fuel cost	Increase in
adjustment charges 164.4	revenue from
	retail electricity
	sales
• Impact of the earthquake	174.5
off the coast of Fukushima
Prefecture -7.6

39.9

73.6

Increase in	Increase in
revenue from	costs of
wholesale	electricity
electricity sales	procurement
	-394.3

(billions of yen)

• Increase in fuel cost -218.0
• Increase in power purchased from JEPX -176.3
• • Impact of the earthquake off the coast of Fukushima Prefecture -51.2

Effect of changing factors related to electricity supply-demand-146.2

• Network business etc.

FY2021/2Q

Ordinary income excluding time lag between fuel cost and fuel cost adjustment charges 76.9

• Time lag between fuel cost and fuel cost	Others
adjustment charges	-104.0	-25.6
• Rise in JEPX prices	-70.0
• Exceeding the upper limit of the fuel cost
adjustment system	-11.6 etc

Impact excluding Time lag between fuel cost and fuel cost adjustment

charges︓decrease of about 67.8 billion yen

-131.9

FY2022/2Q

Ordinary income excluding time lag between fuel cost and fuel cost adjustment charges 9.0

Electricity Sales and Major Factors

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 Retail electricity sales	31.4 TWh (a year on year decrease 0.1 TWh)
	Retail electricity sales volume decreased due to the impact of intensifing competition.

 Wholesale electricity sales	7.8 TWh (a year on year increase 0.2 TWh)
		Wholesale electricity sales volume increased due to an increase in volume of
		wholesale electricity sales inside our franchise area.
										(GWh)
Electricity Sales*1		FY2021/2Q		FY2022/2Q		Change		Change
		(A)		(B)		(B) - (A)		(B) / (A)
Lighting (Residential)		8,887		8,716		(171)		98.1	%
Power		22,621		22,716		95		100.4	%
Retail Electricity Sales*2		31,509		31,432		(77)		99.8	%
Wholesale Electricity Sales*3		7,616		7,841		225		103.0	%
Total of Electricity Sales		39,124		39,274		150		100.4	%
*1 Individual figures of Tohoku Electric Power Co., Inc., excluding network business.
*2 Retail Electricity Sales includes electric power for business use.
*3 Wholesale Electricity Sales includes the volume of specified power interchange.
Major Factors			FY2021/2Q		FY2022/2Q		Change
			(A)			(B)		(B) - (A)
Crude Oil CIF Price ($/bbl.)			70.3		111.9	41.6
Exchange Rate (¥/$)			110		134	24
Hydro Power Flow Rate (%)			95.2		101.8	6.6
Nuclear Power Utilization Rate (%)		-		-			-