Financial Results for the year ended December 31, 2023 based on International Financial Reporting Standards (IFRS)

INPEX CORPORATION (Securities Code:1605)

March 27, 2024

Cautionary Statement

This presentation includes forward-looking information that reflects the plans and expectations of the Company. Such forward-looking information is based on the current assumptions and judgments of the Company in light of the information currently available to it, and involves known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors may cause the Company's performance, achievements or financial position to be materially different from any future results, performance, achievements or financial position expressed or implied by such forward-looking information. Such risks, uncertainties and other factors include, without limitation:

  • Price volatility and change in demand in crude oil and natural gas

  • Foreign exchange rate volatility

  • Change in costs and other expenses pertaining to exploration, development and production

The Company undertakes no obligation to publicly update or revise the disclosure of information in this presentation (including forward-looking information) after the date of this presentation.

Background for Voluntary Adoption of IFRS

INPEX has adopted International Financial Reporting Standards (IFRS) to:

１．Facilitate international comparability of financial information

Many global companies including major international oil companies (IOCs) have adopted IFRS. INPEX's adoption of IFRS facilitates the comparability of its financial information with that of global companies and helps improve convenience for stakeholders, including investors and analysts.

２．Improve the INPEX Group's business management through standardized accounting procedures

Ichthys local entities, which account for the majority of INPEX's financial performance, and other overseas subsidiaries and affiliates already adopt IFRS. Extending the adoption of IFRS to Japanese entities is expected to help improve the INPEX Group's business management through efficient financial reporting under unified account standards and fair performance evaluation.

Highlights of the Consolidated Financial Results for the year ended December 31, 2023

FY2022 (actual)FY2023 (actual)Change

% Change

Average crude oil price (Brent) ($/bbl)

99.04

82.17

(16.87)

(17.0%)Average exchange rate (¥/$)

131.64 2,316.0

140.66 2,164.5

9.02yen depreciation

6.9% depreciation

Revenue (Billions of yen)

(151.5)

(6.5%)

Operating profit (Billions of yen)

1,503.6

1,114.1

(389.4)

(25.9%)

Profit before tax (Billions of yen)

1,445.3

1,253.3

(191.9)

(13.3%)

Profit attributable to owners of parent (Billions of yen)

498.4

321.7

(176.7)

(35.5%)

Net income per share*1 (Yen)

364.73 1,734.9

248.55 1,319.9

(116.18)

(31.9%)

Net debt*2 (Billions of yen)

(415.0)

(23.9%)

Net debt / equity ratio*2 (%)

45.6

  • *1 Average number of INPEX shares issued and outstanding during the year ended December 31, 2022: 1,366,647,207 shares Average number of INPEX shares issued and outstanding during the year ended December 31, 2023: 1,294,325,142 shares

  • *2 Includes Ichthys downstream Incorporated Joint Venture and differs from financial accounting basis

31.4

(JGAAP) FY2023 (actual)

82.17

140.66

2,165.7

1,121.8

1,261.4

371.5

287.05 1,320.2

(14.2)

-

31.9

Analysis of Profit (FY2022 IFRS vs. FY2023 IFRS)

(Billions of yen)

(176.7)Business activities factors*2 (21.7)

One-off factors*3 (155.0)

・FY2022: +75.6

Transition to group tax sharing system,

Tax effect on loss on valuation of investments in subsidiaries,

Tax effect on change in abandonment expenses estimates, etc. ・FY2023: +6.4

Tax effect on change in abandonment expenses estimates, etc.

498.4

Decrease in tax expense due to lower crude oil sales and income, etc.

・Increase in sales volume: +36.5

(Crude oil: (1.2), Natural gas: +37.7)

・Decrease in unit price: (316.7)

(Crude oil: (268.5), Natural gas: (48.1))

・Exchange rate: +128.4

(Crude oil: +105.6, Natural gas: +22.8)

・FY2022: (36.0) ・FY2023: (5.8)Since the measures to reduce foreign exchange risks in consideration of IFRS had not been taken, foreign exchange gain is recognized in FY2022 for the depreciation of the yen.

321.7

FY2022

Profit attributable to owners of parent*1

Decrease in RevenueDecrease in Cost of salesIncrease in Exploration expenses and

SG&AOther income (expenses)Income tax expenseImpairment lossDivestmentAbandonment expenses

*1 For the convenience of analyzing factors that cause changes in profit attributable to owners of parent, the items in the Consolidated Statements of Profit or Loss are rearranged and aggregated.

*2 With regard to business activities factors, impacts to Income tax expense are listed separately, and impacts to Profit attributable to non-controlling interests are included in Other income (expenses). *3 With regard to one-off factors, impact to tax expense and profit attributable to non-controlling interests are included in each item.

Tax

Foreign exchange gain (loss)

Revaluation of financial assetsFY2023

Profit attributable to owners of parent*1

Analysis of Profit (FY2023 JGAAP vs. FY2023 IFRS)

(Billions of yen)

(49.8)Business activities factors*2 +6.0

One-off factors*2 (55.8)

Goodwill is not amortized under IFRS

・Increase in impairment loss due to the differences in accounting standards: (25.4)

Prelude, renewable energy PJ, etc.

・Abandonment expenses: +5.3

Australian PJ, etc.

371.5

321.7

Net income attributable to owners of parent*1

JGAAP

Production-related costs and impact of their foreign exchange gain, etc.

Decrease in Exploration expensesAbsence of amortization of goodwill

Tax expense (business activities)

Impairment loss, etc.

Absence of foreign exchange gain

*1 For the convenience of analyzing factors that cause changes in profit attributable to owners of parent, the items in the Consolidated Statements of Profit or Loss are rearranged and aggregated. *2 Impacts to Income tax expense are listed separately, and impacts to Profit attributable to non-controlling interests are included in each item.

*3 With regard to the divestment of U.S. and Angola PJ, the translation differences are recognized as foreign exchange gain in FY2022 under IFRS and in FY2023 under JGAAP.

Tax expense

(one-off)Others

IFRS

Profit attributable to owners of parent*1

Sales by Product

FY2022

FY2023

Change

% Change

Net sales (Billions of yen)

Sales volume (thousand bbl)

1,772.0 138,118

1,607.9 138,024

(164.1)

(94)

(9.3%) (0.1%)Crude Oil

Average unit price of overseas sales ($/bbl)

97.64

82.83

(14.81)

(15.2%)Average exchange rate (¥/$)

131.41

140.68

9.27yen depreciation

7.1% depreciationNatural Gas (excluding LPG)

Net sales (Billions of yen) Sales volume (million cf)

519.8 442,389

527.8 479,814

8.0 37,425

1.5% 8.5%

Average unit price of overseas sales ($/thousand cf)

6.87 81.98

5.62 90.08

(1.25)

(18.2%)

Average unit price of domestic sales (¥/m3)Average exchange rate (¥/$)

132.11

140.20

8.10 8.09yen depreciation

9.9%

6.1% depreciation

* 1m3=41.8605MJ

Consolidated Financial Forecasts for the year ending December 31, 2024

* ROE for the year ended December 31, 2022 (IFRS basis) is 14.6%.

FY2024 Financial Forecasts

Analysis of Profit (FY2023 Actual vs. FY2024 Forecast)

(Billions of yen)

Market factors

Business Activities factors

Other factors

(76.7)

(54.3)

139.3

371.5

321.7

330.0

JGAAP Difference due to

Market factors

Crude Oil Price (Brent)

(US$/bbl)

82.2 → 73.0

Exchange Rate

(Yen/US$)

140.7 → 138.0

FY2023 change in Net Income accounting attributable to standard owners of parent

Business Activities factors

Production Activities

Decrease in production of domestic O&G asset and increase in OPEX of Ichthys

Increase in exploration expense

Increase in exploration activities surrounding Ichthys field and for Bonaparte CCS

Increase in G&A

Increase in R&D cost for Hydrogen & Ammonia

Other factors

Divestments

Partial sell-off of assets in Middle East and Southeast Asia

Taxes

Tax Optimization by optimizing subsidiary organizational structure

IFRS FY2023 Profit attributable to owners of parentImpact from

Crude oil priceImpact from exchange rateProduction activitiesIncrease in exploration expenseIncrease in

G&ADivestmentTaxes

Project impairment loss in FY2023

PreludeOther Project losses in FY2023

OthersIFRS FY2024 Profit attributable to owners of parent

FY2024 Financial Forecasts Cash Flow*

(Billions of Yen)

FY2023 (actual)FY2024 (forecast)Change

Cash Flow from Operations before exploration investment Cash Flow from Investment (inclusive of exploration investment)

Development expenditure

(Oil & Gas Business)

(229.6)

(485.0) (255.4)

Development expenditure (5 Net Zero Business)

(78.9)

(10.0) 68.9

Exploration expenditure

(inclusive of some 5 Net Zero Business)

(44.6)

(71.0) (26.4)

Others

(inclusive of sale of interests, etc)

19.4

13.0 (6.4)

Growth Investment

(333.6)

(553.0) (219.4)

Others

(purchase and disposal of investment securities etc.)

(245.3)

242.0 487.3

Free Cash Flow Financial Cash Flow

489.8

403.0 (86.8)

(563.9)

(410.0) 153.9

Shareholder Returns

(190.1)

(132.0) 58.1

Cash and cash equivalents at end of year

207.1

200.0 (7.1)

* Including cashflow of Ichthys LNG Pty Ltd, Ichthys downstream Incorporated Joint Venture, an equity method affiliate.

(Billions of yen)

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Inpex Corporation published this content on 27 March 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 March 2024 06:06:08 UTC.