*1: After elimination of inter-segment transactions *2: Reference indices: Give a sense of where certain indicators prioritized by management will be when our financial objectives are achieved *3: Includes amount (approx. 2%) recognized as capital from hybrid corporate bonds (issued October 2020)
*4: Specific Safety Facilities *5: For FY2020, calculations are based on the energy consumption statistics by prefecture (provisional values) reported by the Agency for Natural Resources and Energy. For FY2021 and FY2022, the statistical figures that the various items are based on are not finalized figures.
*6: CO2 emissions (baseline emissions) from Kyushu EP’s domestic retail sales as defined in the Act on Promotion of Global Warming Countermeasures
Financial
ObjectivesPer-spective Indicator
Target
(FY2025)
★ Reference Indices*2
Performance
Progress & Future Issues
FY2020 FY2021 FY2022
Profitability
Consolidated ordinary
income*1
Excluding delayed effects
Over 125円 billion
55円.1 billion 32円.3 billion -86円.6 billion The consolidated ordinary loss of 86円.6 billion was due to not only external factors, such as higher fuel prices and the rapid depreciation of the yen, but also a decline in the
nuclear power plant utilization rate as operation of the Genkai Nuclear Power Plant was suspended for an extended period in order to install SSFs*4. Four nuclear power plants
are expected to begin operation starting in FY2023, which will make it possible to ensure stable income (FY2023 earnings forecast (as of August): 120円 billion)
[46円.1 billion] [101円.3 billion] [-25円.6 billion]Domestic Electricity
Business
75円 billion
30円 billion 2円.6 billion -133円.4 billion
Despite a transitory decline in FY2022, profitability is expected to dramatically improve starting in FY2023, when four nuclear power plants are on line
[21円 billion] [71円.5 billion] [-72円.4 billion]Growth businesses 50円 billion 27円 billion 33円.3 billion 47円.4 billion
Strong progress was made toward the FY2025 ordinary income target of 50円 billion. We will work to identify quality projects, including projects that are already underway, to
further bolster our profits
Total electric power sales 105 billion kWh★ 95 billion kWh 110 billion kWh 110 billion kWh We maintained strong sales in FY2022 through Group-wide efforts to expand sales
ROE Approx. 8%★ 5.0% 1.1% -9.2%
Significant improvement expected from FY2023 onward due to more stable nuclear power operations and increased returns in growth businesses. Promoting ROE-conscious
management as we work to improve our balance sheet
Financial
Soundness
Equity ratio Approx. 20% 14.7%*3 14.0%*3 12.2%*3
In the face of challenges such as fuel price increases and suspension of nuclear power generation, which led to a decline in earnings, along with investments aimed at
maintaining and expanding non-fossil fuel sources (led to an increased interest-bearing debt) have resulted in a period of sluggish performance. However, starting from
the fiscal year 2023, we anticipate securing high profits through the operation of four nuclear power units and accelerating capital expansion. Moreover, through efficient
management of business resources utilizing Return on Invested Capital (ROIC), we will work towards reducing interest-bearing debt, and by doing so, further striving to
achieve our goals.
Growth
Potential
Growth investments 500円 billion★
(FY2021-FY2025 cumulative)
74円 billion 79円 billion 86円 billion
Making decisions that are based on a proper assessment of business profitability and risks with an eye toward achieving our income target while steadily promoting growth
investments going forward through the use of project finance to limit interest-bearing debtRenewable energy
(included above)
250円 billion★ 34円 billion 30円 billion 36円 billionFCF70円 billion★
(Secure five-year cumulative
profitability)
-77円.1 billion -63円 billion -29円.8 billion
Despite a recent negative cash flow due to capital expenditure for nuclear power SSFs*4 at the Genkai Nuclear Power Plant, we will generate cash flows in the medium and
long term through not only high utilization of nuclear power plants and greater return from growth investments starting in FY2023, but also allocation of business resources
that take into consideration capital efficiency
Power outputRenewable energy
Developed
overseas equity output
4,000 MW★
4,000 MW★
2,300 MW
2,430 MW
2,550 MW
2,910 MW
2,610 MW
2,840 MW
[Renewable Energy] As of the end of FY2022, the total amount of renewable energy has become more than 3, 000 MW, including projects that we have already invested in or
will start operation in the future.
[Overseas] We have started new projects, and we will continue to promote group-wide development centered on the renewable energy business.ROICTargetPer-spective Indicator Target
Performance
Future Issues
FY2020 FY2021 FY2022
ProfitabilityROIC(FY2025) Over 2.5%
(FY2030) Over 3.0%
1.5% 1.0% -0.9% For the Domestic Electricity Business, ensuring at least a stable 2%–3% overall while balancing such considerations as efficiency, stable supply of electricity, and efforts to
achieve carbon neutrality, including lowering the carbon intensity of and decarbonizing energy sources. For growth businesses, aiming for a ROIC that ranges from 5%- 9%
overall by selecting and concentrating businesses and investments and using benchmarks of other companies in the same industry
(FY2019–FY2021 average of 1.3%)
Environmental
TargetsPer-spective Indicator
Target
(FY2030)
Performance
Progress & Assessment
FY2020 FY2021 FY2022
Supply
Supply chain
GHG emissions
(Scopes 1, 2, and 3)
Globally: 60% reduction
Domestically: 65% reduction
(compared to FY2013 levels)
31% reduction
32% reduction
35% reduction
37% reduction
26% reduction
28% reduction
Steadily reducing GHG emissions across our supply chain through the active development of renewable energy projects and the continued safe and stable operation of our
nuclear power stations
(Reference)
CO2 emissions from
electricity sales*6—(compared to FY2013 levels)
51% reduction 57% reduction
43% reduction
(provisional value)
Demand
Electrification rate for
Kyushu
Household: 70%
Commercial: 60%
61%*5
48%*5 —*5 —*5 Steadily implementing initiatives to promote electrification, including all-electric homes
1 Overview of the Kyuden Group 2 Value Creation Story 3 Strategy and Performance 4 Creating Value through Business 5 A Foundation for Creating Value 6 Data Section
Table of
Contents 22
KYUDEN GROUP INTEGRATED REPORT 2023
Progress toward Our Financial Objectives and Management Targets (Environmental Targets)
Progress toward
Our Objectives