Cosmo Oil : 次のリンクは新しいウィンドウを開きますOverview of Business Results for 1st Quarter of FY2016 (PDF/720K)

Overview of Business Results for the First Quarter of Fiscal Year Ending March 2017 [Based on Japanese GAAP] (Consolidated)

August 9, 2016

Name of the Company： Cosmo Energy Holdings Co., Ltd. Shares traded：TSE Company Code： 5021 URL http://ceh.cosmo-oil.co.jp/

Name of Representative： Keizo Morikawa (Title) President

Name of Person to contact： Seiko Takagi (Title) General Manager of Corporate Communication Dept. Phone：[phone] Scheduled date to file quarterly report： August 9, 2016 Dividend payment is to be started on： ―

Availability of the Quarterly Financial Result Supplementary Information： Yes

Execution of the Quarterly Financial Result Presentation Meeting： Yes (for analysts and institutional investors)

Note：Figures less than 1 million are rounded down.

1. Consolidated Financial Results for the First Quarter of Fiscal Year Ending March 2017 (For the period from April 1, 2016 to June 30, 2016)

2. Consolidated operating results (cumulative total) (Figures in % refer to changes from the same quarter a year earlier)

   Net sales		Operating income		Ordinary income		Profit attributable to owners of parent for the First Quarter
   million yen 478,711 －	% ー ー	million yen 12,638 －	% ー ー	million yen 10,348 －	% ー ー	million yen 4,779 －	% ー ー

   First Quarter , FY2016 First Quarter , FY2015

   Note：Comprehensive income First Quarter, FY2016：3,586 million yen (－%) First Quarter, FY2015：－ million yen (－%)

   Net income per share for the First Quarter

   Diluted net income per share for the First Quarter

   yen sen yen sen

   First Quarter , FY2016 56.89 ー

   First Quarter , FY2015 ー ー

   Note : Due to the Company was incorporated through a sole-share transfer on October 1, 2015, there are no results of the same period of the previous fiscal year.

3. Consolidated Financial Position

4. Total assets Net assets Net Worth ratio

   million yen million yen %

   First Quarter , FY2016 1,430,703 206,478 7.5

   FY2015 1,409,615 202,712 7.7

   [Reference] Net worth First Quarter, FY2016：107,050 million yen FY2015：108,046 million yen

5. Dividend Payment Results and Outlook

   Annual dividend per share total

   As of Q1-end As of Q2-end As of Q3-end As of Fiscal Year-end Full Year

   yen sen ー ー	yen sen 0.00	yen sen ー	yen sen 40.00	yen sen 40.00
   0.00	ー	50.00	50.00

   FY2015 FY2016

   FY2016 (outlook)

   Note：Revision made in the forecast dividend as of the end of the current quarter from the previous announcement： No

6. Consolidated Business Outlook for FY2016 (April 1, 2016 to March 31, 2017)

7. (% indicates for FY2016 change from the corresponding period of FY 2015 )

   Profit attributable to

   Net sales Operating income Ordinary income

   owners of parent

   Net income per share

   1H FY2016	million yen 1,209,000	% ー	million yen 38,000	% ー	million yen 34,000	% ー	million yen 20,500	% ー	yen sen 244.00
   FY2016	2,520,000	12.3	77,500	ー	67,500	ー	47,500	ー	565.37

   Note：1.Change made in figures of the consolidated business outlook as of the end of the current quarter from the previous announcement： No

   2.Note : Due to the Company was incorporated through a sole-share transfer on October 1, 2015, there are no results of the parcentage change from the same period of the previous fiscal year.

   Notes to Consolidated Financial Statements

8. Change in significant subsidiaries during the first quarter ： No

   Newly ― (Name of Company) ― Exception ― (Name of Company) ―

9. Adoption of accounting method uniquely adopted to prepare consolidated financial statements for the current quarter： Yes

10. Changes in Accounting Policies, Accounting Estimates and Restatements：

11. Changes in accounting policies due to revisions of accounting standards, etc.： Yes

12. Changes in accounting policies for reasons other than the Item 1： No

13. Changes in accounting estimates： No

14. Restatements： No

15. Total Number of Outstanding Shares (Ordinary shares)

16. Number of outstanding shares as of end of the period (including treasure stock)

17. Number of shares of treasury stock as of the end of the period

18. Average Number of shares outstanding during the period (or the cumulative consolidated accounting period as of the end of the current quarter)

19. First Quarter , FY2016	754,825 shares	FY2015	754,790 shares
    First Quarter , FY2016	84,015,692 shares	First Quarter , FY2015	- shares

    First Quarter , FY2016 84,770,508 shares FY2015 84,770,508 shares

    Note：Information about quarterly review procedure execution：

    This release on the overview of quarterly business results is outside the scope of the quarterly report review procedures under the Financial Instruments and Exchange Act in Japan but as of the day of the disclosure of this release, the quarterly report review procedures under the Financial Instruments and Exchange Act have been completed.

    Note：Request for appropriate use of the business outlook and other special remarks：

    The consolidated business outlook for the first half of FY2016 and FY2016 is not updated from the previous announcement made on May 12, 2016.

    It is based on information available as of the published date of this release and actual results may differ from the forecast subject to various factors that may arise in the future. As for details, please refer to the "(3) Explanation Concerning Information regarding Consolidated Business Outlook" of the "1.Qualitative information about results for and at the end of the current quarter" on Page 2 of the Supporting data.

    Supplementary information will be uploaded on the Cosmo Energy Holdings Co., Ltd. website on August 9, 2016.

    Contents of Supporting data

20. Qualitative information about results for and at the end of the current quarter

    Page

21. Explanation Concerning Information regarding Consolidated Operating Results ……………………………………… 2

22. Explanation Concerning Information regarding Consolidated Financial Position ……………………………………… 2

23. Explanation Concerning Information regarding Consolidated Business Outlook ………………………………………… 2

24. Information about the summary of business results (Notes to Consolidated Financial Statements)

25. Change in significant subsidiaries during the current accounting period ………………………………………………… 2

26. Adoption of accounting method uniquely adopted to prepare consolidated financial statements

    for the current quarter ………………… 2

27. Changes in Accounting Policies, Accounting Estimates and Restatements ……………………………………………… 2

28. Consolidated Financial Statements

29. (1) Consolidated Balance Sheet ……………………………………………………………………………………………… 3-4

30. Consolidated Statements of Income and Comprehensive Income Consolidated Statements of Income

    Consolidated the first three months of FY2016 statements of income………………………………………………… 5

    Consolidated Statements of Comprehensive Income

    Consolidated the first three months of FY2016 statements of comprehensive income ……………………………… 6

31. Notes to Quarterly Consolidated Financial Statements

(Notes to Going Concern Assumption) …………………………………………………………………………………… 7

(Notes to Remarkable Changes in Shareholders' Equity) …………………………………………………………………… 7

(Segment Information)……………………………………………………………………………………………………… 7

(Significant Subsequent Events)…………………………………………………………………………………………… 7

1. Qualitative information about results for and at the end of the current quarter

   Although the Company was incorporated through a sole-share transfer on October 1, 2015 as a wholly owning parent company of Cosmo Oil Co., Ltd., in substance, the scope of consolidation has not changed. Accordingly, when items are compared against the same period of the previous year, Cosmo Oil Co., Ltd.'s operating results for the three month period of the fiscal year ended March

   31, 2016 (from April 1, 2015 to June 30, 2015) are used.

2. Explanation Concerning Information regarding Consolidated Operating Results

   Consolidated net sales for the first quarter of FY2016 were 478.7 billion (down 116.7 billion from the same period of FY2015), operating income 12.6 billion (down 10.3 billion from the same period of FY2015), ordinary income 10.3 billion (down 11.9 billion from the same period of FY2015) and profit attributable to owners of parent for the period 4.8 billion (down 8.9 billion in the same period of FY2015).

   The operating results for the first quarter of FY2016 by business segment are as follows：

3. In the petroleum business segment, the net sales decreased due to the decline in crude oil prices and sales volume of the petroleum products that were compared with the same period of the previous year. The cost of sales was reduced by the effect

   of inventory valuation caused by increasing crude oil prices while the markets of petroleum products were dull. As a result, the segment reported net sales of 436.7 billion for the first quarter of FY2016 (down 151.4 billion from the same period of FY2015) and segment income of 6.4 billion (down 11.6 billion in the same period of FY2015).

4. In the petrochemical business segment, due to the effect that Maruzen Petrochemical Co., Ltd. was included in the scope of the consolidated subsidiaries of the Cosmo Energy Group in the end of previous fiscal year, the segment reported net sales of

   67.3 billion for the first quarter of FY2016 (up 58.7 billion from the same period FY2015) and segment income of 1.7

   billion (up 0.3 billion in the same period of FY2015).

5. In the oil exploration and production business segment, due to the decline in the sales price of crude oil, the segment reported net sales of 8.9 billion for the first quarter of FY2016 (down 2.1 billion from the same period of FY2015) and segment income of 1.5 billion (down 1.1 billion from the same period of FY2015).

6. Explanation Concerning Information regarding Consolidated Financial Position

   As for the Company's financial position on a consolidated basis as of the end of the first quarter of FY2016, total assets as of June 30, 2016 amounted to 1,430.7 billion, up 21.1 billion from March 31, 2016, the end of FY2015, mainly reflecting increased fixed assets due to the investment for facilities in the oil exploration and production business.

   Net assets as of June 30, 2016 amounted to 206.5 billion with a net worth ratio of 7.5%.

7. Explanation Concerning Information regarding Consolidated Business Outlook

8. The consolidated business outlook for the first half of FY2016 and FY2016 is not updated from the previous announcement made on May 12, 2016.

9. Information about the summary of business results (Notes to Consolidated Financial Statements)

10. Change in significant subsidiaries during the current accounting period： None

11. Adoption of accounting method uniquely adopted to prepare consolidated financial statements for the current quarter：

    The Company calculates tax expenses for the Company and some of its consolidated subsidiaries by multiplying a reasonably estimated effective tax rate by net income before taxes for the current quarter.

    Income tax adjustments are included in the "income taxes" account stated in the Consolidated Statements of Income.

12. Changes in Accounting Policies, Accounting Estimates and Restatements： Changes in Accounting Policies

13. (Application of practical solution on a change in depreciation method due to Tax Reform 2016)

    As a result of the revision of the Corporation Tax Act, the practical solution on a change in depreciation method due to Tax Reform 2016 (ASBJ Practical Issues Task Force No. 32, June 17, 2016) has been applied to the first quarter of the accounting period under review, and the method of depreciating the buildings and accompanying facilities acquired on or after April 1, 2016, has been changed from the declining balance method to the straight line method.

    The effect of this change on the quarterly consolidated financial statements and segment information for the consolidated cumulative first quarter under review is negligible.

14. Consolidated Financial Statements

16. Consolidated Balance Sheet

    Assets

    Current assets

    FY2015

    (As of March 31, 2016)

    (Unit：million yen) 1Q FY2016

    (As of June 30, 2016)

    Cash and deposits	60,972	87,938
    Notes and accounts receivable-trade	192,572	156,675
    Securities	30,000	12,299
    Merchandise and finished goods	87,825	103,938
    Work in process	391	769
    Raw materials and supplies	94,211	107,562
    Other	50,476	53,297
    Allowance for doubtful accounts	-195	-149
    Total current assets	516,254	522,332

    Noncurrent assets

    Property, plant and equipment

    Machinery, equipment and vehicles, net	149,609	146,640
    Land	320,971	320,685
    Other, net	222,687	247,798
    Total property, plant and equipment	693,267	715,124
    Intangible assets Investments and other assets	47,423	46,573
    Investment securities	112,040	105,931
    Other	40,460	40,621
    Allowance for doubtful accounts	-481	-470
    Total investments and other assets	152,019	146,082
    Total noncurrent assets	892,710	907,781
    Deferred assets Bond issuance cost	651	589
    Total deferred assets	651	589
    Total assets	1,409,615	1,430,703

    Liabilities

    Current liabilities

    Notes and accounts payable-trade	115,803	146,674
    Short-term loans payable	200,619	188,373
    Commercial papers	12,000	47,000
    Accounts payable-other	188,370	161,955
    Income taxes payable	8,094	4,158
    Provision	9,807	10,228
    Other	20,822	19,223
    Total current liabilities	555,519	577,613
    Noncurrent liabilities
    Bonds payable	46,700	46,700
    Long-term loans payable	497,831	500,806
    Net defined benefit liability	9,586	9,315
    Provision	19,707	16,422
    Other	77,558	73,367
    Total noncurrent liabilities	651,384	646,611
    Total liabilities	1,206,903	1,224,224

    Net assets

    FY2015

    (As of March 31, 2016)

    (Unit：million yen) 1Q FY2016

    (As of June 30, 2016)

    Shareholders' equity Capital stock	40,000	40,000
    Capital surplus	84,509	84,510
    Retained earnings	259	1,579
    Treasury shares	-1,223	-1,223
    Total shareholders' equity	123,545	124,866
    Accumulated other comprehensive income
    Valuation difference on available-for-sale securities	3,042	1,404
    Deferred gains or losses on hedges	-1,601	-721
    Revaluation reserve for land	-20,660	-20,617
    Foreign currency translation adjustment	8,507	6,406
    Remeasurements of defined benefit plans	-4,786	-4,288
    Total accumulated other comprehensive income	-15,499	-17,815
    Non-controlling interests	94,665	99,427
    Total net assets	202,712	206,478
    Total liabilities and net assets	1,409,615	1,430,703

17. Consolidated Statements of Income and Comprehensive Income (Consolidated Statements of Income)

    (Consolidated the first three months of FY2016 statements of income)

    (Unit：million yen) 1Q FY2016

    (From April 1, 2016

    to June 30, 2016)

    Net sales 478,711

    Cost of sales 435,400

    Gross profit 43,310

    Selling, general and administrative expenses 30,672

    Operating income 12,638

    Non-operating income

    Interest income 42

    Dividends income 356

    Foreign exchange gains 1,669

    Other 895

    Total non-operating income 2,963

    Non-operating expenses

    Interest expenses 3,074

    Share of loss of entities accounted for using equity method 1,313

    Other 864

    Total non-operating expenses 5,253

    Ordinary income 10,348

    Extraordinary income

    Gain on sales of noncurrent assets 128

    Gain on bargain purchase 493

    Other 21

    Total extraordinary income 644

    Extraordinary loss

    Loss on disposal of noncurrent assets	788
    Impairment loss	371
    Loss on valuation of investment securities	274
    Business structure improvement expenses	147
    Other	70
    Total extraordinary losses	1,652
    Income before income taxes	9,340
    Income taxes	3,342
    Profit	5,997
    Profit attributable to non-controlling interests	1,218
    Profit attributable to owners of parent	4,779

    (Consolidated Statements of Comprehensive Income)

    (Consolidated the first three months of FY2016 statements of comprehensive income)

    (Unit：million yen) 1Q FY2016

    (From April 1, 2016

    to June 30, 2016)

    Profit 5,997

    Other comprehensive income

    Valuation difference on available-for-sale securities	-1,721
    Deferred gains or losses on hedges	933
    Revaluation reserve for land	-29
    Foreign currency translation adjustment	-1,278
    Remeasurements of defined benefit plans	498
    Share of other comprehensive income of entities accounted for using equity method	-813
    Total other comprehensive income	-2,410
    Comprehensive income	3,586
    (Breakdown)
    Comprehensive income attributable to owners of parent	2,389
    Comprehensive income attributable to non-controlling interests	1,197

18. Notes to Quarterly Consolidated Financial Statements (Notes to Going Concern Assumption)

None

(Notes to Remarkable Changes in Shareholders' Equity)

None

(Segment Information)

1Q FY2016 (From April 1, 2016 to June 30, 2016)

Information about net sales and income or loss amounts by segment reported

Oil exploration

Other

Adjustments

(Unit：million yen) Consolidated

Net sales

Outside customers Inter-segment

Total

Segment Income (Loss)

Petroleum Petrochemical

411,036 25,707	59,393 7,874	3,252 5,597	5,029 7,063	― -46,243	478,711 ―
436,744	67,267	8,850	12,092	-46,243	478,711
6,352	1,675	1,537	-352	1,135	10,348

and production

Note：1

Note：2

Note：3

Note 1 "Other" is segment of non-classified, including construction works, insurance agency, leasing, travel agency and wind power generation, etc.

2 Segment Income (Loss) in "Adjustments" 1,135 million yen includes 1,108 million yen for the net amount of the entire Company's income and expenses not allocated to the reporting segments or the "Other" category, 34 million yen for internal eliminations, 114 million yen for inventory adjustments, and -121 million yen for adjustment of fixed assets. 3 Segment Income (Loss) is adjusted to ordinary income of consolidated quarterly statements of income.

(Significant Subsequent Events) None