Integrated Report 2020
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Year ended March 31, 2020 2020 Integrated Report TOYO ENGINEERING CORPORATION Integrated Report 2020 TOYO’s MVV Contents Tool System Diagram Mission, Vision, Values 02 Our Path to Becoming a Global Contractor October 2019 Vol.17 04 TOYO’s Strengths 06 SDGs: Materiality and Our Commitment Global Leading Engineering Engineering for 08 Financial and Non-Financial Highlights Partner Sustainable Growth of 10 President’s Message Integrated Corporate Newsletter Recruitment Mission Report Brochure TOYO TIE I 14 Medium- to long-term strategy Integrity, Creativity, Diversity, the Global Community Vision Moving forward with the Blue and Green double spiral strategy Learning, Team 16 Special Feature 1 Challenge for CHANGE Digest Values 20 Special Feature 2 Ambitious Explorers in TOYO 26 Plant Solution Business Unit Strategy Overview 28 Environment and Infrastructure Business Unit Strategy Engineering for Sustainable Growth of the 30 Reforming Our Human Capital System Specific data 32 Strengthening Project Risk Management Global Community 34 Corporate Governance 37 Risk Management Initiatives R 38 Directors and Audit & Supervisory Board Members R 40 Safety, Quality, Environment I C G R 44 Contributing to the Community, Society, and the Environment Website 46 Ten-Year Financial and Non-Financial Highlights https://www.toyo-eng.com/jp/en/ Our future as an engineering company 48 Financial Section Consolidated Financial Statements As human culture continues to develop, the world we live in is faced with an extensive range of 82 Corporate Information issues at the global level, including energy problems, environmental problems, climate change 83 Stock Information problems, political problems, economic problems, and disparity problems. Ever since TOYO ENGINEERING was founded, our business has been the development of the global economy as well as industrial infrastructure, and we are once again seeing that there is a major turning point coming in terms of the role human society demands of us. Purpose of creating this report To contribute to the sustainability of the world and society, we have declared “Engineering for To achieve a deep understanding of the philosophy and activities of the Toyo Engineering Group (TOYO) among all of our stakeholders, we have published this Integrated Report. It provides both our financial information (such as our management policies and financial results) and non-financial information (such Sustainable Growth of the Global Community” as mission, and the business fields in which we can as TOYO’s business environment and its connections to society). Please see our Securities Report for detailed financial information about TOYO. contribute are limitless. Caution Concerning Forward-Looking Statements This integrated report includes certain “forward-looking statements.” These statements are based on management’s current expectations and are subject Based on our slogan—“Your Success, Our Pride.”—we will continue to evolve for the sake of our to uncertainty and changes in circumstances. Actual results may differ due to changes in economic, business, competitive, technological, regulatory, and other factors. future as an engineering company. TOYO ENGINEERING CORPORATION Integrated Report 2020 01 Our Path to Becoming a Global Contractor Our Path to Becoming a Global Contractor the 1960s the 1970s to the 1980s the 1990s the 2000s the 2010s Expanding Overseas in Enhancing Our Technical Capabilities and Expanding Diversifying Our Establishing a Global Switching from Our Search of Markets Our Business Portfolio Toyo structure Expansion Course Enhanced risk management • Received our first overseas order, an • Learned about various cutting-edge technologies to enhance our technical capabilities. • Diversified our portfolio to include • Promoted the utilization of overseas and CHANGE! India fertilizer plant, two years after • Expanded our business through a string of orders for fertilizer plants and ethylene power plant, pharmaceuticals, and group companies. establishment in 1961. plants both in Japan and overseas. environmental fields due to more in- • Started growing again due in part to • Enhancing our risk management and tense competition. taking on the challenge to our CHANGE! • Cooperated with a licensor to estab- • Listed our stock in 1980. the high price of crude oil. Initiative to cope with the shale revolu- lish a foundation for our technical • Applied information technology to • Unified the Group’s MVV and logo to en- • Expanded our overseas group companies to build a foundation for our global tion, energy transformation, larger and capabilities. the plant enhancement business and hance our solidarity and aim to establish all operation. more complicated plants, and the rise of industrial system fields. group companies as profit centers. emerging-country contractors by. Fertilizer India: Fertilizer Indonesia: Fertilizer Trinidad and Tobago: Methanol China: Ammonia Venezuela: Fertilizer Nigeria: Fertilizer Petro- chemicals Japan: Ethylene Iran: Aromatics Thailand: Ethylene Korea: Hydrogen Saudi Arabia: EOEG Indonesia: Polyethylene Oil & Gas Japan: Naphtha Reforming Germany: Residue Upgrading Turkey: EOR Qatar: GTL Brazil: FPSO Infra- More than structure Brunei: Gas-fired Power Plant Indonesia: Coal-fired Power Plant Thailand: Gas-fired Power Plant Japan: Photovoltaic Power Plant 10 70 Pharma- Own Product ceuticals Technologies Lines Japan: Pharmaceuticals Japan: Drug Substances Japan: Drug Substances Environ- ment • EOEG: Ethylene Oxide/Ethylene Glycol • EOR: Enhanced Oil Recovery Japan: Water Treatment Facility Japan: PCB Detox Treatment ® • FPSO: Floating Production Storage and Offloading • GTL: Gas to Liquids • PCB Detox Treatment: Polychlorinated Biphenyl Japan: 2010 Established 1986 1961 1972 1976 1987 1998 2004 Toyo-Canada Group Toyo-Malaysia Toyo-Japan Toyo-Europe Toyo-India Toyo-Korea, TPS Toyo-Brazil Toyo-China 2011 Toyo-USA Companies IKPT 1972 1973 2008 2015 2018 Social Restoration of diplo- Shift to a float- 1980-1988 1991 2000 Fourth Global financial Crude oil price matic relations between ing exchange Iran-Iraq War Dissolution of the Soviet Union IT bubble Industrial Trends crisis crash Japan and China rate system Revolution TOYO ENGINEERING CORPORATION TOYO ENGINEERING CORPORATION 02 Integrated Report 2020 Integrated Report 2020 03 TOYO’s Strengths TOYO’s Strengths Group Capabilities Diverse Portfolio Engineering and High-tech Capabilities TOYO has ten EPC* group companies around the world as well as one procurement company, and we do business As a result of expanding our portfolio in line with on a global basis. The abilities of our group companies—which handle engineering rooted in the community—are the needs of society and the times, TOYO is now Based on a solid relationship with the ammonia li- improving every year, and these group companies currently account for over 50% of TOYO’s consolidated net sales. engaged in a wide variety of businesses. censor KBR, TOYO has exploited its strength as a In particular, Toyo-India and the rest of our Asian EPC group companies handle specialty products, and each of urea license holder to achieve a track record of over them has the ability to execute projects at the scale of several billions of yen on their own. In addition, in the case 100 fertilizer plants. In addition, through technical of large, complex projects, we use Toyo-Japan as the central hub and decide formation flexibly by taking advan- cooperation with Lummus—which boasts the in- tage of the characteristics of our group companies. dustry’s leading share of the ethylene market—we *Engineering, Procurement, Construction have constructed more than 40 plants. FY2019 Net Sales Results Global License Shares Other Petrochemicals FY2019 6.7 billion yen 77.2 billion yen Company B E Other than Japan % Net Sales Japan % Pharmaceuticals, 34% 70 30 4 projects Environment, and P 219 Industrial Facilities Urea 2 projects billion yen license 5.8 billion yen Company A Chemicals and 50% TSPI fertilizers São Paulo, Brazil 67.7 billion yen Toyo-Europe • Number of employees: around 380 TOYO Toyo-India 2 projects Milan, Italy • Most recent major own projects: 3% Mumbai, India FPSO topside project (Brazil) 16% • European product • Number of employees: around 1,900 3% procurement company • Most recent major collaborative projects: KBR fertilizer (India, Nigeria), ethylene (Malaysia, Russia) Toyo-USA 35% • Most recent major own projects: Houston, USA 36% LNG regasification facilities (India) Toyo-Canada 31% 219 Ammonia billion yen Toyo-China Calgary, Canada license Shanghai, China Other • Number of employees: 53% around 290 Toyo-Korea 7% • Most recent major own projects: Seoul, Korea 21% TOYO foreign-affiliated company • Number of employees: around 350 Company E (KBR technology) chemical project • Most recent major collaborative projects: 9% 11% polyethylene (Indonesia, Russia) • Most recent major own projects: Power Plant, Lummus Oil & Gas Company D 1,3-Butadiene, 1-Butene (Thailand) Transportation Systems, etc. Toyo-Japan 32% 16.5 billion yen 16% IKPT Chiba, Japan 45.1 billion yen Jakarta, Indonesia Toyo-Malaysia Ethylene Kuala Lumpur, Malaysia • Number of employees: around 900 TPS 6 projects license • Most recent major collaborative • Number of employees: around 210 Chiba, Japan projects: ethylene (Malaysia), • Most recent major collaborative • Number of employees: around 250 5 projects G polyethylene, acrylic acid production projects: ethylene (Malaysia) • Most recent major collaborative