Annual Report 2013

Export volumes were impacted by scarce available capacity following the suspension of operations at theChiba Refi nery. Exports of diesel fuel were also held to 45,000 kl. As a result, total sales volume edged down0.5% year on year.Against the backdrop of this operating environment, the Petroleum Business segment posted net sales of?3,116.2 billion, up ?60.6 billion. This was mainly due to the increase in sales prices as a result of the weakyen and the upswing in sales of heavy fuel oil C used for electric power generation. Cosmo Oil incurred anordinary loss in the Petroleum Business segment of ?23.7 billion. This was compared with ordinary income of?8.0 billion in FY2011. Despite a substantial decrease in the cost of fi nding alternative supplies as a result ofthe suspension of operations at the Chiba Refi nery, this deterioration in earnings was largely attributable tothe impact of the decline in sales volume.OUTLOOK FOR FY2013Looking at sales volume in Japan in the year ending March 2014, results from a domestic demand perspectiveare forecast to decline 2.1%. This is mainly due to the downturn in demand from thermal power plants forheavy fuel oil C. Turning to exports, the available capacity is expected to recover on the back of the resumptionof operations at the Chiba Refi nery. The target for middle distillate export volume has been set at 1,540,000 klcompared with the export of 45,000 kl in the previous fi scal year.Cosmo Oil’s Total Sales Volume and Estimates (Announced In May 2013)(Thousand kiloliters)FY2012 FY2011 ChangeFY2013 Estimate(% change from FY2012)Domestic sales 24,361 24,732 -1.5% -2.1%Gasoline 5,999 6,249 -4.0% -0.6%Kerosene 2,246 2,416 -7.0% 0Diesel fuel 4,414 4,615 -4.4% -4.9%Heavy fuel oil A 1,963 2,196 -10.6% -1.1%Naphtha 6,270 6,224 +0.7% 0Jet fuel 476 477 -0.2% +0.1%Heavy fuel oil C 2,993 2,555 +17.1% -7.9%Middle distillate export volume (Diesel fuel and jet fuel) 45 209 -78.5% +3,329.2%Total sales volume 36,891 37,094 -0.5% +4.3%