TOA OIL COMPANY,LIMITED (E01073) Stock Price

Toa Petroleum is a specialized subsidiary of Idemitsu Kosan that operates oil refining and power generation businesses under contract. The company manufactures petroleum products such as gasoline and diesel by processing crude oil and feedstock oils on a contract basis, and also operates thermal power plants to supply electricity. It operates a business model focused on contract manufacturing, processing and producing materials and fuels provided by Idemitsu Kosan.

The company's revenue is primarily composed of contract fees from Idemitsu Kosan. In the petroleum division, it receives refining processing fees based on contract refining agreements with Idemitsu Kosan. In the electricity division, since April 2021, it has conducted power generation operations under a contract power generation agreement with Idemitsu Kosan. Previously, it also handled electricity sales to Tokyo Electric Power Energy Partner, but contract power generation for Idemitsu Kosan is now its primary focus.

The company operates through two business segments: petroleum and electricity. In petroleum operations, it works with subsidiary Toa Technex to operate and maintain refining facilities, and similarly handles power generation facility operations jointly in the electricity business. Through related company Ogishima Oil Storage Base, it also provides oil storage functions, serving as a critical infrastructure company supporting Idemitsu Kosan's business operations.

Toa Oil aims to become "the company with top-tier efficiency, refining costs, and equipment reliability in the Greater Tokyo Area" as a specialized oil refining and power generation company. Through a business model centered on contract refining and contract power generation, the company is securing a stable revenue base while advancing business strategies that address global decarbonization trends and the structural decline in domestic oil demand. The company has set four priority management targets—safety, equipment reliability, efficiency, and employee satisfaction—and is implementing concrete improvement initiatives across each area.

The core of the company's differentiation strategy is the utilization of high-value heavy oil cracking units and maximizing the locational advantages of the Keihin district. To counter rising maintenance costs for aging equipment, the company is enhancing preventive maintenance through active adoption of IT technology and improving reliability through planned and efficient equipment management. The company also aims to expand revenues through increased added value via daily operational improvements, including energy conservation, loss reduction, and increased production through securing crude oil and feedstock. The company is also advancing business process automation through cutting-edge technology adoption and improving operational efficiency through appropriate workforce allocation.

Regarding technology innovation, the company is addressing technology transfer challenges during a major generational transition by actively recruiting experienced personnel and establishing forward-looking workforce planning. Through expanded educational and training opportunities, the company is maintaining and enhancing plant operation and equipment management technologies developed over many years. By implementing IT-enabled predictive maintenance systems, the company is advancing equipment reliability improvement and building efficient maintenance frameworks. Through these technological innovations, the company aims to fulfill its social mission of ensuring stable energy supply to the Greater Tokyo Area.