Key Point of President's Regular Press Conference
Key Point of President's Regular Press Conference
Press Conference on the FY2012 Financial Results: President Mizuno’s Message
April 26, 2013
Chubu Electric Power Co.,Inc.
- I will be discussing
- Chubu Electric's financial statements for FY2012.
- Establishment of the “Office for Emergency Measures for Management Efficiency”
Chubu Electric's financial statements for FY2012
[Safety measures at Hamaoka Nuclear Power Station]
- Before I discuss our financial results, I would like to say a few words about our various initiatives concerning the Hamaoka Nuclear Power Station, including our response to new standards as announced this morning.
- Because of our new initiatives, safety measures at Hamaoka Nuclear Power Station that until now were scheduled for completion in December 2013 must now be extended until the end of FY2014.
- Therefore, Chubu Electric Power expects its extremely challenging financial situation to continue.
- However, we believe that nuclear power is a necessary and important energy source for Japan, a nation with scarce energy resources of its own, to be able to ensure energy security, price stability and a stable supply of electric power into the future.
- At the same time, we believe that nuclear power is only possible if we have the trust of the general public, starting with those living near the plant where the power is generated, and safety must always be the highest priority.
- Thus, in light of the accidents at the Fukushima Daiichi Nuclear Power Station, Chubu Electric Power is determined to bring our technical strengths together to achieve a power station with an unprecedented level of safety.
- We will therefore steadily continue taking safety measures, explaining the results of these initiatives to those living near the plant and the rest of the general public, and make every effort to earn back their trust as our highest priority.
[Overview of financial results]
- Next, I’d like to talk about our financial results for FY2012.
- Consolidated net sales in the electricity business reached 2,648.9 billion yen, a gain of 199.7 billion yen year on year, owing to such factors as increased service charges due to an increase in fuel cost adjustments.
- With regard to consolidated ordinary income, in our electricity business, while there was a reduction in nuclear power generation, factors including the reduction of the cut-off error of the fuel cost adjustment system and a decrease in personnel costs and depreciation saw us increase our income by 24.3 billion yen against the same quarter for the previous fiscal year, for a loss of 43.5 million yen.
- Next, turning to our non-consolidated results, net sales were 2,485.6 billion yen, an increase of 190.5 billion yen YoY. We had an operating loss of 28.9 billion yen, an improvement of 21.5 billion yen YoY.We had an ordinary loss of 52.1 billion yen, an improvement of 25.2 billion yen YoY. There was also a net loss of 35.3 billion yen, an improvement of 59.3 billion yen YoY.
- This will represent the second consecutive year that we have recorded operating, ordinary, and net losses in both our consolidated and non-consolidated results.
(Earnings outlook for FY2013)
- Next, let’s look at the earnings outlook for FY2013. Because operations have been suspended in all reactors at Hamaoka Nuclear Power Station and the yen has been weakening, Chubu Electric Power anticipates high fuel costs. Therefore our consolidated earnings outlook forecasts an operating loss of 85 billion yen, ordinary loss of 120 billion yen and net loss of 85 billion yen.
- The non-consolidated earnings outlook forecasts an operating loss of 100 billion yen, ordinary loss of 130 billion yen and net loss of 90 billion yen.
- This will represent the third consecutive year that we have recorded operating, ordinary, and net losses in both our consolidated and non-consolidated results.
- The next topic is dividends.
- We plan on paying a year-end dividend of 25 yen per share, the same as the interim dividend for FY2012.
- As for anticipated dividends in FY2013, Chubu Electric Power faces continuing financial challenges. These are the result of extending the time for completing tsunami countermeasures at Hamaoka Nuclear Power Station in light of needing to respond to new standards and in consideration of the state of the investigation into earthquake countermeasures. Moreover, the situation surrounding nuclear power is uncertain. Thus, we are refraining from indicating any specific amount of FY2013 dividends, which shall officially be “undecided” at this time.
Establishment of the “Office for Emergency Measures for Management Efficiency”
- As I have indicated, we expect our financial statements to show a loss again in FY2013. This would be the third straight year of losses, and we recognize that this is an extremely difficult management situation.
- Chubu Electric Power has already been taking measures for greater management efficiency, but in light of our latest financial results, we plan to pursue even greater efficiency.
- This begins immediately. Today we established the new “Office for Emergency Measures for Management Efficiency.” I will serve as office director and officers of Senior Managing Executive Officer rank and higher will be members. I have ordered the members and our entire organization to make every effort to cut costs. No aspect of our operations will be overlooked.
- In more specific terms, we will consider:
- Reducing costs of transactions, including equipment and materials procurement; and
- Reducing overall costs, for example by trimming down Company assets.
- In closing, we are aware that this is the greatest challenge we have faced since our founding. But let me repeat that the entire organization will work together and is prepared to make sacrifices to speed up efficiency-building and get us through this challenge.
- This concludes my remarks for today.