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To Our Stakeholders

Photo:Masayuki Sato

Representative Director,
Chairman and Chief Executive Officer(CEO)
Masayuki Sato(Left)

Representative Director,
President and Chief Operating Officer(COO)
Tadashi Ishizuka(Right)

We would like to convey our heartfelt appreciation for the deep understanding of our business activities and the steadfast support shown by all our stakeholders.

Fiscal 2016 is likely to be seen as an historical turning point as a result of a series of major political events worldwide, including the UK's decision to leave the EU and the new administration in the US. Meanwhile, crude oil prices, which are closely linked to our core engineering business, eventually steadied at around $50/bbl after a period of weakness from autumn 2014, partly helped by an OPEC agreement in November 2016 to cut production. In oil-producing countries, companies that had reined in capital investment started investing again, and conditions in the plant market gradually began to recover. Against this backdrop, the JGC Group secured orders worth more than \500 billion in fiscal 2016, up from \320 billion in fiscal 2015.

However, we are disappointed to report that the Company recorded a net loss for the first time in 19 years, reflecting significant losses related to the implementation of a petrochemical project in the US, an oil refinery project in the Middle East and several other projects. We would like to take this opportunity to offer our most sincere apologies to our stakeholders.

Under our leadership, the aim of the new senior management team is to deliver solid results by building an operating structure that generates steady profits from our core EPC business and by making bold moves into the infrastructure and offshore engineering fields.

To give stakeholders a better understanding of the diverse value that the JGC Group provides, we have added more content to this 2017 edition of the JGC Report, which covers our business activities, future management strategies and specific business initiatives, as well as a broad range of information about our activities in the environment, social and governance (ESG) spheres. In doing so, we hope to give stakeholders an insight into the JGC Group's powerful ability to create and provide value, in both an economic and social context.

We look forward to your continued support as we strive to meet the expectations of shareholders, clients, business partners, local communities and all our other stakeholders.

Representative Director, Chairman and Chief Executive Officer(CEO)
Masayuki Sato

Representative Director, President and Chief Operating Officer(COO)
Tadashi Ishizuka