[Company analysis] Osaka Gas Co., Ltd. (大阪ガス)

「Osaka Gas Co., Ltd. (大阪ガス)」is a Japanese major gas supplier for Osaka and its neighboring area.  It is one of the largest Japanese city gas companies(「Tokyo Gas Co., Ltd. (東京ガス)」,「Osaka Gas Co., Ltd.(大阪ガス)」,「Toho Gas Co., Ltd.(東邦ガス)」and「Saibugas Co., Ltd.(西部ガス)」). They supply gas to 7.22 million households in the area of ​​approximately 3,220 ㎢. As for the city gas sales, it has the second largest market share in the country with a market share of 25%, and the total length of gas pipelines is 61,900km. In 2018, they changed the official name to "Daigas" in consideration of expanding overseas. The number of consolidated employees is approximately 20,224. 

 

1. Company Profile

2. Summary and Features

3. Major Business

4. Financial Information

 

 

 

1. Company Profile

 

※Unit is JPY million, as of 2019

Company name	Osaka Gas Co., Ltd.
Company name (Japanese)	大阪ガス
Date of establishment	April 10, 1897
Headquarters location	〒541-0046 大阪府大阪市中央区平野町四丁目1番2号
Capital	132,166
Consolidated sales	1,371,863
Consolidated operating profit	67,977
Consolidated total assets	2,029,722
Consolidated capital	1,035,044
Capital adequacy ratio	51.0%
Consolidated number of employees	20,224

 

 

 

2. Summary and Features

 
「Osaka Gas」is the company with the second largest sales volume in the Japanese gas industry after「Tokyo Gas」. Together with「Tokyo Gas」, both companies have an overwhelming presence, accounting for about 70% of the industry's total sales. It has a very stable business structure owing to the high profile in the Kansai region and possesses an exclusive pipeline.

 

In addition to business development using their own pipeline, they also wholesale natural gas to their patners such as「Okayama Gas(岡山ガス)」,「Shikoku Gas(四国ガス)」,「Otsu City Enterprise Bureau(小津市企業局)」and「Shizuoka Gas(静岡ガス)」. Besides,「Osaka Gas」supplies natural gas for power generation to「The Kansai Electric Power(関西電力)」and「Okinawa Electric Power(沖縄電力)」.

 

In fact, the gas infrastructure industry has strong tendency to the stability. However,「Osaka Gas」is showing aggressive business development. In particular, 「Osaka Gas」entered into the power generation business, in response to the trend of energy liberalisation. Now, they secured facilities with a power generation capacity of approximately 1.81 million kW in Japan domestic level and approximately 1.2 million kW in overseas.

 

Moreover,「Osaka Gas」is expanding not only in Japan but also in Southeast Asia(Thailand, Singapore, Indonesia), and they aim to generate 30% of total profit from overseas business in 2030. This company operates thermal power plants in Michigan, Connecticut, and Pennsylvania in the United States. Besides,「Osaka Gas」also participated in LNG terminals and shale gas development by investment.

 

In addition, this company is actively dealing with the development and practical application of various new technologies as a differentiation strategy for improving corporate competitiveness. For example, they achieved a good reputation for developing a "low-radiation method" that reduces the heat on the equipment surface and reduces radiant heat.

 

 

 

3. Major Business

 

■ Domestic gas business in Japan
They carry out city gas production / supply, sales, gas equipment sales, gas piping, LNG / LPG, and industrial gas sales.

■ Japan domestic power business
They sell the electricity generated by our own power generation facility.

■ Overseas energy business
「Osaka Gas」is developing and investing in natural gas and oil, and are also promoting energy supply and LNG transport tanker rental business.

■ Life & Business Solution
They also handle real estate development, leasing, information processing services, fine materials and carbon products.

 

 

 

4. Financial information

 

※Unit is JPY million

		2016	2017	2018
Consolidated sales		1,183,846	1,296,238	1,371,863
Consolidated operating profit		97,250	78,118	67,977
Consolidated total assets		1,886,577	1,905,215	2,029,722
Consolidated net assets		991,870	1,028,799	1,035,044
Breakdown of sales	Japan domestic gas business	897,294	959,511	999,476
	Japan domestic energy・power business	106,366	156,497	183,067
	Oversea energy business	18,672	14,313	22,113
	Life & business solution	161,513	165,915	167,206