[Translation]

Quarterly Report(The First Quarter of 145th Business Term)
From April 1, 2013 to June 30, 2013

6-6, Marunouchi 1-chome, Chiyoda-ku, Tokyo

Hitachi, Ltd.

[Cover][Document Filed]

Quarterly Report (“Shihanki Hokokusho”)[Applicable Law]

Article 24-4-7, Paragraph 1 of the Financial Instruments and Exchange Act of Japan[Filed to]

Director, Kanto Local Finance Bureau[Filing Date]

August 9, 2013

[Fiscal Year]

The First Quarter of 145th Business Term (from April 1, 2013 to June 30, 2013)[Company Name]

Kabushiki Kaisha Hitachi Seisakusho[Company Name in English] Hitachi, Ltd.
[Title and Name of

Hiroaki Nakanishi, President

Representative][Address of Head Office]6-6, Marunouchi 1-chome, Chiyoda-ku, Tokyo[Phone No.]

03-3258-1111[Contact Person]

Taro Kaiho, Manager, Legal Division[Contact Address]

6-6, Marunouchi 1-chome, Chiyoda-ku, Tokyo[Phone No.]

03-3258-1111[Contact Person]

Taro Kaiho, Manager, Legal Division[Place Where Available forTokyo Stock Exchange, Inc.

Public Inspection](2-1, Nihombashi Kabutocho, Chuo-ku, Tokyo)
Nagoya Stock Exchange, Inc.
(8-20, Sakae 3-chome, Naka-ku, Nagoya)

This is an English translation of the Quarterly Report filed with the Director of the Kanto Local Finance Bureau via
Electronic Disclosure for Investors’ NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan.
The translation of the Confirmation Letter for the original Quarterly Report are included at the end of this document.
Unless the context indicates otherwise, the term “Company” refers to Hitachi, Ltd. and the term “Hitachi” refers to theCompany and its consolidated subsidiaries.
Unless otherwise stated, in this document, where we present information in millions or hundreds of millions of yen, we
have truncated amounts of less than one million or one hundred million, as the case may be. Accordingly, the total of figures
presented in columns or otherwise may not equal the total of the individual items. We have rounded all percentages to thenearest percent, one-tenth of one percent or one-hundredth of one percent, as the case may be.
References in this document to the “Financial Instruments and Exchange Act” are to the Financial Instruments andExchange Act of Japan and other laws and regulations amending and/or supplementing the Financial Instruments andExchange Act of Japan.

Contents
Part I Information on the Company ............................................................................................................................. 1
I. Overview of the Company ................................................................................................................................... 1
1. Key Financial Data...................................................................................................................................... 1
2. Description of Business .............................................................................................................................. 1
II. Business Overview ............................................................................................................................................. 2
1. Risk Factors................................................................................................................................................. 2
2. Material Agreements, etc. ........................................................................................................................... 2
3. Analyses of Consolidated Financial Condition, Operating Results and Cash Flows ................................. 6
III. Information on the Company .......................................................................................................................... 13
1. Information on the Company’s Stock, etc. ............................................................................................... 13(1) Total number of shares, etc. ................................................................................................................. 13(2) Information on the stock acquisition rights, etc. .................................................................................. 13(3) Information on moving strike convertible bonds, etc. ......................................................................... 13(4) Information on shareholder right plans ................................................................................................ 13(5) Changes in the total number of issued shares and the amount of common stock and other ................ 13(6) Major shareholders ............................................................................................................................... 13(7) Information on voting rights................................................................................................................. 14
2. Changes in Senior Management ............................................................................................................... 15
IV. Financial Information ..................................................................................................................................... 15Part II Information on Guarantors, etc. for the Company .......................................................................................... 15[Consolidated Financial Statements] ...........................................................................................................................F-1[Confirmation Letter] .................................................................................................................................................. A-1

Part I Information on the Company
I. Overview of the Company
1. Key Financial Data
Consolidated financial data, etc.
(Millions of yen, unless otherwise stated)
Three months ended Three months ended
Year ended
June 30, 2012
June 30, 2013
March 31, 2013
Revenues

2,120,715

2,082,938

9,041,071

Income before income taxes

48,86655,399344,537

Net income attributable to Hitachi, Ltd. stockholders

7,011

10,795

175,326(26,986)

136,715420,680

Total Hitachi, Ltd. stockholders’ equity

1,718,289

2,161,939

2,082,560

Total equity

2,710,167

3,279,330

3,179,287

Total assets

9,220,348

10,293,637

9,809,230

Net income attributable to Hitachi, Ltd. stockholders
per share, Basic (yen)

1.51

2.23

37.28

Net income attributable to Hitachi, Ltd. stockholders
per share, Diluted (yen)

1.45

2.23

36.29

Total Hitachi, Ltd. stockholders’ equity ratio (%)

18.6

21.0

21.2

Cash flows from operating activities

43,421

42,948583,508

Cash flows from investing activities(89,179)(148,059)(553,457)

Cash flows from financing activities

31,845

163,382(180,445)

Cash and cash equivalents at end of period

602,408603,285

527,632

Comprehensive income (loss)(Notes)

1. Our consolidated financial statements have been prepared in conformity with accounting
principles generally accepted in the United States.
2. Revenues do not include the consumption tax, etc.

2. Description of Business
The Company’s consolidated financial statements have been prepared in conformity with accounting
principles generally accepted in the United States, and affiliates are disclosed based on the definitions of thoseaccounting principles. The same applies to “II. Business Overview”.
There was no material change in principal businesses of Hitachi during the three months ended June 30,
2013. The Hitachi Group is comprised of the Company and 960 consolidated subsidiaries (including variableinterest entities) and 212 equity-method affiliates. Although the consolidated subsidiaries include variableinterest entities, there is no variable interest entity included into the figures of consolidated subsidiaries as ofJune 30, 2013. Also, consolidated trust accounts are not included into the figures of consolidated subsidiaries.

1Changes of businesses in each segment and major consolidated subsidiaries during the three months ended
June 30, 2013 were as follows. Effective April 1, 2013, the Company changed the name of the “Others” segmentto the “Others (Logistics and Other services)” segment.
Positioning of principal affiliated companies
Manufacturing
Sales and services
Social Infrastructure & Industrial Systems[Consolidated subsidiaries](Dissolved by the merger)
Hitachi Plant Technologies, Ltd.
(Note) Hitachi Plant Technologies, Ltd. merged with the Company as of April 1, 2013.
Segment

II. Business Overview
1. Risk Factors
There was no new risk factor recognized during the three months ended June 30, 2013.
There were no material changes in the risk factors stated in the Annual Securities Report for the 144th
business term pursuant to the Financial Instruments and Exchange Act of Japan.
2. Material Agreements, etc.
(1) Business Integration
The Company and Mitsubishi Heavy Industries, Ltd. (“MHI”) have signed a basic integrationagreement and a joint venture agreement (the “Definitive Agreements”) in relation to the business integration(the “Business Integration”) in fields centered on the thermal power generation systems (the “Integrated
Business”) on June 11, 2013.
In accordance with the Definitive Agreements, the two companies have respectively signed
absorption-type company split agreements (the “Absorption-type Company Split Agreements”) with the newcompany established by MHI (the “Integrated Company”) in order to transfer the Integrated Business by way
of company split (the “Company Split”) on July 31, 2013.
The outline of the Business Integration is as follows.
(i) Purpose of the Business Integration
The global market has continued to expand, driven by the growth engines of China and other emerging
countries, while environmental awareness around the world has increased. These trends have presented amajor opportunity for the Company and MHI to expand thermal power generation systems businesses
where they both excel businesses that solve global energy and environmental issues at the same time. In
order to prevail against competition and respond to this buoyant demand, companies must respond in detail
based on highly advanced technologies, quality and reliability, unfettered by the traditional frameworks ofcompanies. In this regard, they must be able to harness engineering capabilities as well as sales and service
capabilities closely tied to each region. The Company and MHI share the same corporate credo ofcontributing to society through the development of superior, original technologies and products. Over theyears, the two companies have established partnerships harnessing their technical skills and expertise in avariety of fields. Examples include an alliance and subsequent establishment of a joint venture in the steel
production machinery field; collaboration in the overseas railway systems business; and integration of thehydroelectric power generation system business. Another example has been joint support for the
Fukushima Daiichi Nuclear Power Station of Tokyo Electric Power Company.
Based on these extensive partnerships, the two companies reached an agreement on the Business
Integration to address buoyant global demand for thermal power generation systems by harnessing superior
technical skills, quality and reliability, with the aim of prevailing against intensifying global competition.
In the thermal power generation field, the two companies both have expansive product lineups. For
example, in gas turbines, MHI has focused on highly efficient large models in recent years. Meanwhile, theCompany sees its mainstay products as small and medium-sized models. Regionally, MHI has strengths
mainly in Southeast Asia and the Middle East, while the Company has harnessed its strengths in markets
such as Europe and Africa. The two companies will respectively strive to leverage the complementarystrengths of the other company. Moreover, the two companies will further enhance their ability to address
customer needs and provide services by taking advantage of their respective strengths in providing totalsolutions across all aspects of thermal power plants.
Through this agreement, the Company and MHI will cooperate to develop a stable and efficientmanagement base for the new company. The Integrated Company aims to be a global leading company inthe thermal power generation systems field by accelerating global business development along with2

synergies of the integration and by maximizing integrated and complementary strengths in the technology
and product aspects.
(ii) Schedule of the Business Integration
June 11, 2013
Execution of the Definitive Agreements
July 31, 2013
Execution of the Absorption-type Company Split Agreement
January 1, 2014 (Tentative)
Effective date
The Company Split will be a simple absorption-type company split pursuant to Article 784, Paragraph 3of the Companies Act of Japan. Therefore, the Company and MHI do not plan to convene shareholders’meetings to obtain approval for the company split agreement.
(iii) Business Integration Method and Equity Contribution
The Business Integration is executed according to the following scheme. The equity ownership
percentage of the Company and MHI will be 35% and 65% respectively on the effective date of thecompany split.
(a) MHI establishes the Integrated Company.
(b) The Company and MHI will respectively transfer the Integrated Business to the Integrated Company by
way of absorption-type company split and other method. As a result, the Company and MHI own sharesof common stock of the Integrated Company 317 shares and 683 shares, respectively.
(c) MHI will sell 33 shares of common stock of the Integrated Company that it owns to the Company for29.7 billion yen.
(iv) Scope of the Integrated Business- Thermal power generation system businesses (gas turbines, steam turbines, coal gasification
generating equipment, boilers, thermal power control systems, generators, etc.)- Geothermal power system business- Environmental equipment business- Fuel cells business- Electric power sales business (Only electric power sales in relation to demonstration facility for gas
turbine combined cycle power generation plant at Takasago Machinery Works of MHI)
- Other related business
Certain subsidiaries and affiliates engaging in these businesses are included in the Business Integration.
(v) Rights and Obligations Transferred to the Integrated Company
The Integrated Company will succeed assets, liabilities, other rights and obligations and contractual
status from the Company and MHI through the Company Split as provided in the Absorption-type
Company Split Agreements. Stocks and interests of certain subsidiaries and affiliates which each company
owns in relation to the Integrated Business will be included in the Business Integration.
Accounts and amounts of assets and liabilities to be transferred are as follows. The book value are
estimated amounts based on the amounts as of March 31, 2013 and the actual amounts to be transferred
may be different.
-

Assets and liabilities to be transferred from the Company (Unconsolidated basis)
AssetsLiabilities
Accounts
Book value (billion yen)Accounts
Book value (billion yen)
Current assets
121.5 Current liabilities
108.4
Fixed assets
103.9 Noncurrent liabilities
5.1
Total
225.4
Total
113.5

-

Assets and liabilities to be transferred from MHI (Unconsolidated basis)
AssetsLiabilities
Accounts
Book value (billion yen)Accounts
Book value (billion yen)
Current assets
428.0 Current liabilities
320.3
Fixed assets
162.4 Noncurrent liabilities
50.6
Total
590.4
Total
371.0

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(vi) Calculation Basis, etc., Concerning Allotment under the Company Split
The Company and MHI, referencing the results of calculations by the each financial adviser andcomprehensively considering factors including financial condition, condition of assets and business
forecasts of each, discussed the number of shares of common stock of the Integrated Company to beallocated with due care, and concluded that the above number of shares of common stock to be allocated
was appropriate.
(vii) Overview of the Integrated Company
MH Power Systems, Ltd.
Name
(Name will be changed in conjunction with the Business
Integration)
Head office3-1, Minato Mirai 3-chome, Nishi-ku, Yokohama, Kanagawa
The Company will appoint Chairman of the Board (part-time) and
Representative
MHI will appoint President and Director, respectively.
Capital100.0 billion yen
Business
Businesses as stated in (iv) above(2) Absorption-type Company Split
The Company decided to transfer its construction business for power plants, transportation systems andindustrial plants (the “businesses to be transferred”) and integrate them in Hitachi Plant Engineering &Services, Ltd. (“Hitachi Plant Engineering & Services”) through an absorption-type company split (the“Absorption-type Company Split”) on June 28, 2013. The Company and Hitachi Plant Engineering &Services, Ltd. have concluded an absorption-type company split agreement on August 6, 2013.
The outline of the Absorption-type Company Split is as follows.
(i) Purpose of the Absorption-type Company Split
In recent years, investment in social and industrial infrastructure systems has increased on a global
scale. At the same time, infrastructure must now be more advanced to both support economic development
and the creation of a low-carbon society. In emerging countries in particular, rapid population growth,economic expansion and other developments are driving much higher demand for social infrastructure suchas large-scale urban development, energy, transportation and water systems, in addition to industrial
infrastructure, including industrial parks and natural resource development.
The Company is accelerating global development of its Social Innovation Business to solve issues
facing society and customers through innovative solutions combining products, services and highlysophisticated IT. As part of this drive, in April 2013, the Company merged its wholly owned subsidiary
Hitachi Plant Technologies, Ltd., which had globally engaged in various businesses including
manufacturing of large pumps, compressors and other components, EPC (Engineering, Procurement andConstruction) for water treatment systems, air conditioning systems, chemical and pharmaceutical plants,
and construction of power plants, transportation systems and other large plants.
In order to develop these efforts, by integrating the Company’s engineering capabilities including
construction design and construction management for large-scale plants and Hitachi Plant Engineering &Services’ construction abilities, it is anticipated to create a business structure with outstanding technicalabilities and competitiveness. The integration is expected to strengthen the Company’s capabilities forproviding solutions for large-scale infrastructure systems, such as power plants, transportation systems andsmart cities. It is also aimed at winning more orders in Japan and overseas.
(ii) Schedule of the Absorption-type Company Split
August 6, 2013
Execution of absorption-type company split agreement
October 1, 2013 (Tentative)
Effective date
The Absorption-type Company Split is deemed to be a simple absorption-type company split at theCompany, pursuant to Article 784, Paragraph 3 of the Companies Act of Japan, and a short-form
absorption-type company split at Hitachi Plant Engineering & Services, pursuant to Article 796, Paragraph
1 of the Companies Act of Japan. Therefore, the Company and Hitachi Plant Engineering & Services do notplan to convene shareholders’ meetings to obtain approval for the absorption-type company split
agreement.

4

(iii) Absorption-type Company Spilt Method and Allotment
This is an absorption-type company split in which the Company is the transferring company and Hitachi
Plant Engineering & Services is the successor company. Hitachi Plant Engineering & Services will allot
one share of common stock to the Company on October 1, 2013.
(iv) Business to Be Transferred
Construction and construction engineering for power plants, transportation systems and industrial plants
as well as design, manufacturing and construction for dust collection systems(v) Rights and Obligations to Be Transferred to the Successor Company
Hitachi Plant Engineering & Services will succeed to assets, claims and obligations, contractual status
and intellectual property of the Company relating only to the businesses to be transferred.
Furthermore, the statuses under contract of labor agreements with employees of the Company engaging
in the businesses to be transferred and the rights and obligations based on these agreements will not betransferred to Hitachi Plant Engineering & Services due to the Absorption-type Company Split. The
employees will remain in the employment of the Company, and the Company will loan them out to Hitachi
Plant Engineering & Services, which will engage the employees in the businesses to be transferred.
Accounts and amounts of assets and liabilities to be transferred are as follows.
(Estimation based on amounts as of October 1, 2013)
Category
Details
Amount (million yen)
Assets
Accounts receivable, inventory, tangible and intangible
36,047
fixed assets, etc.
Liabilities
Accounts payable, advances received, etc.
30,399(vi) Calculation Basis, etc., Concerning Allotment under the Company Split
Because the Company owns all of the issued shares of Hitachi Plant Engineering & Services, theCompany and Hitachi Plant Engineering & Services concluded that it was appropriate to allot one share of
Hitachi Plant Engineering & Services to the Company.
(vii) Overview of the Successor Company
Name
Hitachi Plant Construction, Ltd.
Head office
1-3, Higashi-Ikebukuro 3-Chome, Toshima-ku, Tokyo
Nobuho Goto
Representative
President
Capital3,000 million yen
Construction, construction engineering and construction services
for power plants, transportation systems and industrial plants as
Businesswell as design, manufacturing and construction for dust collection
systems(3) As Licensee
The material contract terminated during the three months ended June 30, 2013 is as follows.
Item underContract
Contract period
LicenseeLicensorCountry
contract
description
License of
From March 31,
Hitachi, Ltd.
General Electric
U.S.A.
Gas turbines
technology
2006 to June 25,(The Company)
Company(Note)
2013(Note) A lump-sum payment had been made, and a certain percentage of sales of the item was paid as royalties.

5(4) As Licensor
The material contract entered into during the three months ended June 30, 2013 is as follows.
Item underContract
Contract period
Licensor
LicenseeCountry
contract
description
From April 26,
2013 to the
License of
Hitachi Metals, Ltd.
Rare earth
Ningbo Yunsheng Co.,
expiration of thepatents
China(Consolidated
magnetsLtd.
patents under(Note)
subsidiary)
contracts(Note) A lump-sum payment has been received, and a certain percentage of sales of the item is received as
royalties.
3. Analyses of Consolidated Financial Condition, Operating Results and Cash Flows(1) Outline of Business Results
Effective from April 1, 2013, the Company adopted earnings before interest and taxes (“EBIT”), which ispresented as income before income taxes less interest income plus interest charges, as the measurement for the
consolidated operating results.
Results of Operations
During the three months ended June 30, 2013, the U.S. economy continued to experience a recovery andSoutheast Asian countries saw moderate economic expansion. On the other hand, the economic recession continued inEurope due to such factors as ongoing fiscal austerity and China and India continued to experience slower economic
growth.
The Japanese economy has improved, due to the depreciation of yen and higher stock market prices resulting
from quantitative easing.
Under these conditions, total revenues in the three months ended June 30, 2013 decreased 2% comparedwith the three months ended June 30, 2012, to ¥2,082.9 billion due mainly to lower revenues in the Power
Systems segment, where sales of preventive maintenance services for nuclear power generation systems declined
sharply, and in the Construction Machinery and the Electronic Systems & Equipment segments. This decrease
was partially offset by higher revenues in the Social Infrastructure & Industrial Systems segment, due mainly tostrong sales of elevators and escalators in China, and in the Information & Telecommunication Systems and theDigital Media & Consumer Products segments.
Cost of sales in the three months ended June 30, 2013 decreased 4% compared with the three months
ended June 30, 2012, to ¥1,537.0 billion, and the ratio of cost of sales to revenues accounted for 74% in the threemonths ended June 30, 2013, compared with 76% in the three months ended June 30, 2012.
Selling, general and administrative expenses in the three months ended June 30, 2013 increased 8%
compared with the three months ended June 30, 2012, to ¥490.3 billion and their ratio to revenues was 24% in
the three months ended June 30, 2013, compared with 21% in the three months ended June 30, 2012. This
increase was due mainly to the effects of foreign currency fluctuations.
Impairment losses for long-lived assets in the three months ended June 30, 2013 was ¥0.2 billion , almost
the same as the three months ended June 30, 2012.
Restructuring charges in the three months ended June 30, 2013 increased ¥2.0 billion, to ¥3.0 billion
compared with the three months ended June 30, 2012.
Interest income in the three months ended June 30, 2013 decreased ¥0.5 billion, to ¥3.1 billion comparedwith the three months ended June 30, 2012.
Dividend income in the three months ended June 30, 2013 increased ¥1.1 billion, to ¥3.7 billion comparedwith the three months ended June 30, 2012.
Other income in the three months ended June 30, 2013 was ¥4.6 billion, a ¥1.5 billion increase comparedwith the three months ended June 30, 2012, due mainly to the posting of exchange gain.
Interest charges in the three month ended June 30, 2013 decreased ¥0.7 billion, to ¥6.3 billion comparedwith the three months ended June 30, 2012.
Other deductions in the three months ended June 30, 2013 were ¥2.0 billion, a ¥10.8 billion decrease
compared with the three months ended June 30, 2012 due mainly to the posting of exchange gain in the threemonths ended June 30, 2013, as compared with exchange loss in the three months ended June 30, 2012.

6

Equity in net loss of affiliated companies in the three months ended June 30, 2013 decreased ¥2.9 billion
compared with the three months ended June 30, 2012, to ¥0.3 billion, due mainly to improvement of profitability
at the Company’s equity-method affiliated company in the semiconductor industry.
As a result of the foregoing, income before income taxes in the three months ended June 30, 2013
increased 13% compared with the three months ended June 30, 2012, to ¥55.3 billion. EBIT in the three months
ended June 30, 2013 increased 12% compared with the three months ended June 30, 2012, to ¥58.5 billion.
Income taxes amounted to ¥32.7 billion in the three months ended June 30, 2013, an increase of ¥4.2
billion compared with the three months ended June 30, 2012.
Net income in the three months ended June 30, 2013 increased 11% compared with the three months
ended June 30, 2012, to ¥22.6 billion.
Net income attributable to noncontrolling interests amounted to ¥11.8 billion in the three months ended
June 30, 2013, a decrease of ¥1.5 billion compared with the three months ended June 30, 2012.
As a result of the foregoing, net income attributable to Hitachi, Ltd. stockholders in the three months
ended June 30, 2013 increased 54% compared with the three months ended June 30, 2012, to ¥10.7 billion.
Operations by Segment
The following is an overview of Hitachi’s results of operations by segment. Revenues for each segment
include intersegment transactions.
Effective April 1, 2013, the Company changed its measurement of segment profitability from operating
income, which is presented as total revenues less total cost of sales and selling, general administrative expenses
in order to be consistent with financial reporting principles and practices generally accepted in Japan, to EBIT.
Accordingly, the amounts previously reported for the three months ended June 30, 2012 have been restated inconformity with the new measure of segment profit or loss.
Effective April 1, 2013, the Company changed the name of “Others” to “Others (Logistics and Other
services).”(Information & Telecommunication Systems)
Revenues increased 5% compared with the three months ended June 30, 2012, to ¥391.0 billion, due
mainly to increased sales in services business and the effects of foreign currency fluctuations. This increase waspartially offset by lower sales in hardware business owing to lower demand in telecommunications and servers.
Segment profit improved ¥1.5 billion, resulting in a profit of ¥0.6 billion, compared with the three months
ended June 30, 2012, due mainly to improved operating income in software and services business, mainly
resulting from higher revenues in services business and improved profitability. This improvement was partially
offset by declined operating income in hardware business owing to lower sales in telecommunications andservers.
(Power Systems)
Revenues decreased 18% compared with the three months ended June 30, 2012, to ¥155.5 billion, due
mainly to a significant decline in revenues from preventive maintenance services for nuclear power generation
systems and a drop-off in new projects and preventive maintenance services for thermal power generation
systems in Japan.
Segment profit worsened ¥6.1 billion, resulting in a loss of ¥4.1 billion, compared with the three months
ended June 30, 2012, due to worsened operating income owing to decreased revenues.
(Social Infrastructure & Industrial Systems)
Revenues increased 8% compared with the three months ended June 30, 2012, to ¥257.5 billion, due
mainly to strong sales of elevators and escalators in China and other overseas markets.
Segment profit improved ¥3.9 billion, resulting in a profit of ¥1.8 billion, compared with the three months
ended June 30, 2012, due mainly to an improvement in operating income, mainly resulting from increased
revenues and foreign exchange gain.
(Electronic Systems & Equipment)
Revenues decreased 8% compared with the three months ended June 30, 2012, to ¥225.6 billion, due
mainly to lower sales of semiconductor manufacturing systems and medical analysis systems, etc. at Hitachi
High-Technologies Corporation.

7

Segment profit decreased 85% compared with the three months ended June 30, 2012, to ¥1.2 billion, due
to decreased operating income at Hitachi High-Technologies Corporation, etc. owing to lower revenues, despite
the posting of foreign exchange gain, etc.
(Construction Machinery)
Revenues decreased 10% compared with the three months ended June 30, 2012, to ¥178.5 billion, due tolower sales of mining machinery in Asia and Oceania, despite higher sales of hydraulic excavators in China.
Segment profit decreased 43% compared with the three months ended June 30, 2012, to ¥6.1 billion, due
mainly to decreased operating income owing to decreased revenues and foreign exchange loss.
(High Functional Materials & Components)
Revenues decreased 1% compared with the three months ended June 30, 2012, to ¥338.1 bullion, due
mainly to the impact of the withdrawal from unprofitable businesses and sluggish hard disk drive-related
demand. This decrease was partially offset by solid sales of automobile products and electronics-relatedmaterials.
Segment profit increased 24% compared with the three months ended June 30, 2012, to ¥25.2 billion, due
to improvement of operating income, mainly reflecting the effect of business structure reforms. This increase
was partially offset by the posting of restructuring costs.
(Automotive Systems)
Revenues increased 1% compared with the three months ended June 30, 2012, to ¥207.8 billion, due
mainly to solid demand in the automotive markets overseas, reflecting recovery in demand in North America andChina.
Segment profit increased 20% compared with the three months ended June 30, 2012, to ¥9.8 billion, due
mainly to increased operating income mainly resulting from higher revenues and cost reductions and effects ofan improvement in foreign exchange loss.
(Digital Media & Consumer Products)
Revenues increased 4% compared with the three months ended June 30, 2012, to ¥227.6 billion, due
mainly to higher sales of air-conditioning equipment and refrigerators, etc. primarily in overseas markets.
Segment profit increased ¥1.7 billion compared with the three months ended June 30, 2012, to ¥1.7 billion,
due mainly to an improvement in operating income mainly resulting from higher revenues and the benefits ofbusiness structure reforms in the digital media business and effects of improved foreign exchange gain andequity in net gain of affiliated companies.
(Others (Logistics and Other services))
Revenues decreased 6% compared with the three months ended June 30, 2012, to ¥263.0 billion, due
mainly to lower sales of batteries for consumer applications and certain other products, despite higher revenues
at Hitachi Transport System, Ltd.
Segment profit increased 13% compared with the three months ended June 30, 2012, to ¥10.2 billion, due
mainly to increased dividend income. This increase was partially offset by decreased operating income owing tolower earnings due to a decline in freight volume for automotive-related customers in Japan and cost increases
for new projects at Hitachi Transport System, Ltd. in addition to lower revenues.
(Financial Services)
Revenues decreased 14% compared with the three months ended June 30, 2012, to ¥81.7 billion, due
mainly to the absence of recording sales related to a large cancellation in the three months ended June 30, 2012,
despite strong results in the overseas business particularly in Asia.
Segment profit increased 22% compared with the three months ended June 30, 2012, to ¥9.4 billion, due toincreased operating income, mainly resulting from the consolidation of NBL Co., Ltd. and higher revenues in theoverseas business at Hitachi Capital Corporation.

8

Revenues by Market
Revenues in Japan in the three months ended June 30, 2013 were ¥1,087.7 billion, a decrease of 10%
compared with the three months ended June 30, 2012, due mainly to lower revenues in the Power Systems
segment owing to lower sales of preventive maintenance services for nuclear power generation systems, andlower revenues in the High Functional Materials & Components, the Financial Services and the Information &Telecommunication Systems segments.
Overseas revenues were ¥995.2 billion, an increase of 9% compared with the three months ended June 30,
2012, due mainly to higher revenues in the Information & Telecommunication Systems segment mainly
resulting from increased sales in services business and effects of foreign currency fluctuations, in the Social
Infrastructure & Industrial Systems segment resulting from strong sales of elevators and escalators to China andhigher revenues in the High Functional Materials & Components and the Automotive Systems segments, both ofwhich benefited from growth in global automobile demand.
As a result, the ratio of overseas revenues to total revenues was 48% in the three months ended June 30,
2013, compared with 43% in the three months ended June 30, 2012.
(2) Summary of Financial Condition, etc.
Liquidity and Capital Resources
During the three months ended June 30, 2013, there was no major changes in the Company’s policies ofmaintaining liquidity and ensuring funds, efforts for improvement in fund management efficiency, and ideas
regarding funding sources and fundraising. Standard & Poor’s Rating Japan changed the Company’s long-term
rating from BBB+ to A- on August 2, 2013.
Cash Flows(Cash flows from operating activities)
Net income in the three months ended June 30, 2013 increased ¥2.2 billion compared with the threemonths ended June 30, 2012, to ¥22.6 billion. Depreciation in the three months ended June 30, 2013 was ¥80.0
billion, a ¥9.4 billion increase compared with the three months ended June 30, 2012. Increase in inventories inthe three months ended June 30, 2013 was ¥141.1 billion, a ¥8.0 billion increase compared with the three months
ended June 30, 2012. Decrease in payables in the three months ended June 30, 2013 was ¥73.5 billion, a ¥12.8
billion decrease compared with the three months ended June 30, 2012. Decrease in receivables in the threemonths ended June 30, 2013 was ¥280.3 billion, a ¥57.4 billion decrease compared with the three months ended
June 30, 2012. This is because collection of receivables recorded at the end of the fiscal year ended March 31,
2013 proceeded in the three months ended June 30, 2013. Decrease in accrued expenses and retirement andseverance benefits in the three months ended June 30, 2013 was ¥145.1 billion, a ¥26.7 billion increase
compared with the three months ended June 30, 2012. As a result of the foregoing, cash flows from operating
activities recorded net cash inflow of ¥42.9 billion in the three months ended June 30, 2013, a decrease of ¥0.4
billion compared with the three months ended June 30, 2012.
(Cash flows from investing activities)
A net sum of ¥157.5 billion in the three months ended June 30, 2013 was recorded as investments mainly
related to property, plant and equipment, where the collection of investments in leases, the proceeds from
disposal of property, plant and equipment and the proceeds from disposal of tangible assets and software to beleased were subtracted from the amount of the capital expenditures, the purchase of intangible assets and thepurchase of tangible assets and software to be leased. This net sum increased by ¥49.9 billion compared with thethree months ended June 30, 2012, due mainly to the purchase of tangible assets in the Financial Services
segment. As a result of the foregoing, cash flows from investing activities recorded net cash outflow of ¥148.0
billion in the three months ended June 30, 2013, an increase of ¥58.8 billion compared with the three months
ended June 30, 2012.
(Cash flows from financing activities)
Net increase in short-term debt was ¥114.2 billion. This was an increase of ¥21.1 billion compared withthe three months ended June 30, 2012, due mainly to the issuance of commercial paper. A net sum of ¥81.6 billion
in the three months ended June 30, 2013 was recorded as proceeds related to long-term debt, where the payments
on long-term debt were subtracted from the proceeds from long-term debt. This net inflow increased by ¥98.0
billion compared with the three months ended June 30, 2012. As a result of the foregoing, cash flows from9

financing activities recorded net cash inflow of ¥163.3 billion in the three months ended June 30, 2013, an
increase of ¥131.5 billion compared with the three months ended June 30, 2012.
As a result of the foregoing, in the three months ended June 30, 2013, cash and cash equivalents was¥603.2 billion as of June 30, 2013, an increase of ¥75.6 billion from March 31, 2013. Free cash flows, the sum of
cash flows from operating and investing activities, were an outflow of ¥105.1 billion in the three months ended
June 30, 2013, an increase of ¥59.3 billion compared with the three months ended June 30, 2012.
Assets, Liabilities and Equity
Total assets as of June 30, 2013 were ¥10,293.6 billion, an increase of ¥484.4 billion from March 31,
2013. This was due mainly to an increase in accounts receivables owing to seasonal reasons and the impact of
the consolidation of NBL Co., Ltd. for strengthening the financial services business.
Total interest-bearing debt as of June 30, 2013, which is the sum of short-term debt, long-term debt andnon-recourse borrowings of consolidated securitization entities, was ¥2,804.0 billion, a ¥433.9 billion increase
from March 31, 2013. This was due mainly to the impact of the consolidation of NBL Co., Ltd.
Total Hitachi, Ltd. stockholders’ equity as of June 30, 2013 increased by ¥79.3 billion from March 31,
2013, to ¥2,161.9 billion, due mainly to an increase in the accumulated other comprehensive loss owing to thedepreciation of yen and higher stock market prices. The ratio of stockholders’ equity to total assets was 21.0%,
compared with 21.2% as of March 31, 2013.
Noncontrolling interests as of June 30, 2013 increased by ¥20.6 billion from March 31, 2013, to ¥1,117.3
billion.
The ratio of the interest-bearing debt to the total equity (the sum of total Hitachi, Ltd. stockholders’ equity
and noncontrolling interests) increased to 0.86, compared with 0.75 as of March 31, 2013, due mainly to anincrease in the short-term debt.
(3) Challenges Facing Hitachi Group

1) Business and Financial Condition
There was no material change in Hitachi’s business strategy during the three months ended June 30, 2013.
2) Fundamental Policy on the Conduct of Persons Influencing Decision on the Company’s Financial andBusiness Policies
The Group invests a great deal of business resources in fundamental research and in the development ofmarket-leading products and businesses that will bear fruit in the future, and realizing the benefits from thesemanagement policies requires that they be continued for a set period of time. For this purpose, the Company
keeps its shareholders and investors well informed of not just the business results for each period but also of theCompany’s business policies for creating value in the future.
The Company does not deny the significance of the vitalization of business activities and performance thatcan be brought about through a change in management control, but it recognizes the necessity of determining
the impact on company value and the interests of all shareholders of the buying activities and buyout proposals
of parties attempting to acquire a large share of stock of the Company or a Group company by duly examining
the business description, future business plans, past investment activities, and other necessary aspects of such aparty.
There is no party that is currently attempting to acquire a large share of the Company’s stocks nor is therea specific threat, neither does the Company intend to implement specified so-called anti-takeover measures inadvance of the appearance of such a party, but the Company does understand that it is one of the natural duties
bestowed upon it by the shareholders and investors to continuously monitor the state of trading of theCompany’s stock and then to immediately take what the Company deems to be the best action in the event of
the appearance of a party attempting to purchase a large share of the Company’s stock. In particular, together
with outside experts, the Company will evaluate the buyout proposal of the party and hold negotiations with thebuyer, and if the Company deems that said buyout will not maintain the Company’s value and is not in the bestinterest of the shareholders, then the Company will quickly determine the necessity, content, etc., of specificcountermeasures and prepare to implement them. The same response will also be taken in the event a party
attempts to acquire a large percentage of the shares of a Group company.

10(4) Research and Development
There was no material changes in the research and development of the Hitachi Group (the Company andconsolidated subsidiaries) stated in the Annual Securities Report for the 144th business term pursuant to the
Financial Instruments and Exchange Act of Japan. The Hitachi Group’s R&D expenditures in the threemonths ended June 30, 2013 were ¥81.8 billion, 3.9% of revenues. A breakdown of R&D expenditures bysegment is shown below.
(Billions of yen)Three months ended
Segment
June 30, 2013
Information & Telecommunication Systems
19.7
Power Systems
4.6
Social Infrastructure & Industrial Systems
5.6
Electronic Systems & Equipment
9.3
Construction Machinery
4.5
High Functional Materials & Components
10.7
Automotive Systems
14.2
Digital Media & Consumer Products
4.6
Others (Logistics and Other services)
2.0
Financial Services
0.2
Corporate
6.0
Total
81.8
(5) Employees
The number of employees of the Company increased by 4,150 persons during the three months ended June30, 2013, to 37,815 persons. This increase was due mainly to increase in the Social Infrastructure & Industrial
Systems segment resulting from the merger in which the Company merged Hitachi Plant Technologies, Ltd.
There was no material changes in the number of employees of the Hitachi Group (the Company and consolidated
subsidiaries).
(6) Property, Plants and Equipment
The major property, plants and equipment materially changed during the three months ended June 30, 2013
are as follows. This was due mainly to the merger in which the Company merged Hitachi Plant Technologies, Ltd.
The Company(As of June 30, 2013)
Facility(Main location)

Infrastructure
Systems Company(Hitachi, Ibaraki)

Segment

Book value (Millions of yen)
Details ofLand
Machinery [Area in Lease
major facilities
andBuildings
Othersand equipment
assetsequipment thousands
2of m ]

Manufacturing
facilities for
Information & industrial
Telecommuni- machinery andcation Systems, plants,
Power Systems switchboards andand Social
calculation
Infrastructure & control
Industrial
equipment,
Systems
systemdevelopment
facilities

12,40911

11,747

4,832 3,155[789]

Numberof
Total employees

426 32,571

7,093

(7) Forward-Looking Statements
Certain statements found in “3. Analyses of Consolidated Financial Condition, Operating Results and Cash
Flows” and other descriptions in this report may constitute “forward-looking statements” as defined in the U.S.
Private Securities Litigation Reform Act of 1995. Such “forward-looking statements” reflect management’s
current views with respect to certain future events and financial performance and include any statement that does
not directly relate to any historical or current fact. Words such as “anticipate,” “believe,” “expect,” “estimate,”“forecast,” “intend,” “plan,” “project” and similar expressions which indicate future events and trends may
identify “forward-looking statements.” Such statements are based on currently available information and are
subject to various risks and uncertainties that could cause actual results to differ materially from those projectedor implied in the “forward-looking statements” and from historical trends. Certain “forward-looking statements”
are based upon current assumptions of future events which may not prove to be accurate. Undue reliance should
not be placed on “forward-looking statements,” as such statements speak only as of the date of this report.
Factors that could cause actual results to differ materially from those projected or implied in any“forward-looking statement” and from historical trends include, but are not limited to:
•

•
•
•
•
•
•
•
•
•
•
•
•
•
•
•

•
•
•
•
•
•
•
•

economic conditions, including consumer spending and plant and equipment investment in Hitachi’s major
markets, particularly Japan, Asia, the United States and Europe, as well as levels of demand in the majorindustrial sectors Hitachi serves, including, without limitation, the information, electronics, automotive,
construction and financial sectors;
exchange rate fluctuations of the yen against other currencies in which Hitachi makes significant sales or in which
Hitachi’s assets and liabilities are denominated, particularly against the U.S. dollar and the euro;
uncertainty as to Hitachi’s ability to access, or access on favorable terms, liquidity or long-term financing;
uncertainty as to general market price levels for equity securities, declines in which may require Hitachi to write
down equity securities that it holds;
the potential for significant losses on Hitachi’s investments in equity method affiliates;
increased commoditization of information technology products and digital media-related products andintensifying price competition for such products, particularly in the Digital Media & Consumer Products segment;
uncertainty as to Hitachi’s ability to continue to develop and market products that incorporate new technologies
on a timely and cost-effective basis and to achieve market acceptance for such products;
rapid technological innovation;
the possibility of cost fluctuations during the lifetime of, or cancellation of, long-term contracts for which Hitachi
uses the percentage-of-completion method to recognize revenue from sales;
fluctuations in the price of raw materials including, without limitation, petroleum and other materials, such ascopper, steel, aluminum, synthetic resins, rare metals and rare-earth minerals, or shortages of materials, parts andcomponents;
fluctuations in product demand and industry capacity;
uncertainty as to Hitachi’s ability to implement measures to reduce the potential negative impact of fluctuations in
product demand, exchange rates and/or price of raw materials or shortages of materials, parts and components;
uncertainty as to Hitachi’s ability to achieve the anticipated benefits of its strategy to strengthen its Social
Innovation Business;
uncertainty as to the success of restructuring efforts to improve management efficiency by divesting or otherwise
exiting underperforming businesses and to strengthen competitiveness;
uncertainty as to the success of cost reduction measures;
general socioeconomic and political conditions and the regulatory and trade environment of countries where
Hitachi conducts business, particularly Japan, Asia, the United States and Europe, including, without limitation,
direct or indirect restrictions by other nations on imports and differences in commercial and business customs
including, without limitation, contract terms and conditions and labor relations;
uncertainty as to the success of alliances upon which Hitachi depends, some of which Hitachi may not control,with other corporations in the design and development of certain key products;
uncertainty as to Hitachi’s access to, or ability to protect, certain intellectual property rights, particularly thoserelated to electronics and data processing technologies;
uncertainty as to the outcome of litigation, regulatory investigations and other legal proceedings of which theCompany, its subsidiaries or its equity method affiliates have become or may become parties;
the possibility of incurring expenses resulting from any defects in products or services of Hitachi;
the possibility of disruption of Hitachi’s operations by earthquakes, tsunamis or other natural disasters;
uncertainty as to Hitachi’s ability to maintain the integrity of its information systems, as well as Hitachi’s ability
to protect its confidential information or that of its customers;
uncertainty as to the accuracy of key assumptions Hitachi uses to evaluate its significant employee benefit-related
costs; anduncertainty as to Hitachi’s ability to attract and retain skilled personnel.

The factors listed above are not all-inclusive and are in addition to other factors contained elsewhere in thisreport and in other materials published by Hitachi.

12III. Information on the Company
1. Information on the Company’s Stock, etc.
(1) Total number of shares, etc.
1) Total number of shares

Common stock

Total number of shares authorized to be issued(shares)
10,000,000,000

Total

10,000,000,000

Class2) Issued shares
Class

Number of sharesissued as of the endof fiscal year (shares)(June 30, 2013)

Number of sharesissued as of thefiling date (shares)(August 9, 2013)

Commonstock

4,833,463,387

4,833,463,387

Tokyo, Nagoya

Total

4,833,463,387

4,833,463,387－

Stock exchange on which
the Company is listed

Description
The number ofshares per one unit ofshares is 1,000
shares.
－(2) Information on the stock acquisition rights, etc.
Not applicable.
(3) Information on moving strike convertible bonds, etc.
Not applicable.
(4) Information on shareholder right plans
Not applicable.
(5) Changes in the total number of issued shares and the amount of common stock and other

Date
From April 1, 2013
to June 30, 2013

Change in the Balance of the Change in Balance of Change in Balance of
total number total number of common
capitalcommoncapitalof issuedstockreservestock
reserveissued sharesshares(Millions of (Millions of (Millions of (Millions of(shares)(shares)
yen)
yen)
yen)
yen)
－

4,833,463,387(6) Major shareholders
Not applicable.

13－458,790－

176,757

(7) Information on voting rights
Information on voting rights as of March 31, 2013 is stated in this item because the Company does not
identify the number of voting rights as of June 30, 2013 due to the lack of information on the number of theCompany’s shares held by the entity which the Company holds one quarter or more of all voting rights of such
entity as of June 30, 2013.
1) Issued sharesClassification

Number of shares (shares)

Shares without voting right
Shares with restricted voting
right (treasury stock, etc.)
Shares with restricted voting
right (others)
Shares with full voting right(treasury stock, etc.)
Shares with full voting right(others)
Shares less than one unit

－

－

－

－

－

－

－

－

－

－

－

Common stock

3,070,000

Common stock

4,804,615,000

4,804,615－

Common stock

25,778,387－－

4,833,463,387－－

4,804,615－

Number of issued shares
Total number of voting rights(Note)(As of March 31, 2013)
Number of voting
Description
rights－The “Shares with full voting right (others)” column includes 26,000 shares registered in the name ofJapan Securities Depository Center, Incorporated (account for managing stocks whose shareholders
have not transferred titles) and 26 voting rights for those shares.
2) Treasury stock, etc.

Name ofshareholder

Hitachi, Ltd.
Aoyama Special
Steel Co., Ltd.
ISHIIDENKOSHA
Co., Ltd.
SAITAKOUGYOU CO.,LTD.

Address

6-6, Marunouchi 1-chome,
Chiyoda-ku, Tokyo
9-11, Shinkawa 2-chome,
Chuo-ku, Tokyo
1-11, Oroshishinmachi
3-chome, Higashi-ku,
Niigata-shi, Niigata

Number of
Number ofshares held
shares held
under theunder own name names of(shares)others(shares)(As of March 31, 2013)
Ownership
percentage to
Total shares
the total
held (shares)
number ofissued shares(%)

2,899,000－

2,899,000

0.06

10,000－10,000

0.00

1,000

－

1,000

0.00

88,000－88,000

0.00

5,000

－

5,000

0.00

5-3, Takinogawa 5-chome,
Kita-ku, Tokyo

52,000－52,0000.00

Mizuho Co., Inc.

9-5, Minami-Shinagawa
4-chome, Shinagawa-ku,
Tokyo
3268, Nagaoka,
Ibarakimachi,
Higashiibaraki-gun, Ibaraki
4-1, Koishikawa 5-chome,
Bunkyo-ku, Tokyo

15,000－15,000

0.00

Total

－

3,070,000－

3,070,000

0.06

NIKKO SHOKAI
CO., LTD.
Nitto Jidosha
Kiki K.K.

14

2. Changes in Senior Management
There was no change in senior management from the filing date of the Annual Securities Report for the144th business term pursuant to the Financial Instruments and Exchange Act of Japan to June 30, 2013.
IV. Financial Information
Refer to the consolidated financial statements incorporated in this Quarterly Report.

Part II Information on Guarantors, etc. for the Company
Not applicable.

15

CONSOLIDATED BALANCE SHEETS
Hitachi, Ltd. and Subsidiaries
June 30, 2013 and March 31, 2013

AssetsCurrent assets:
Cash and cash equivalents (note 6)
Short-term investments (note 3)
Trade receivables:
Notes (notes 4, 6, 13 and 20)
Accounts (notes 4, 6 and 20)
Net trade receivables
Investments in leases (notes 6 and 20)
Current portion of financial assets transferred
to consolidated securitization entities (notes 6 and 20)
Inventories (note 5)
Prepaid expenses and other current assets
Total current assets
Investments and advances, including affiliated companies (note 3)
Property, plant and equipment:
Land
Buildings
Machinery and equipment
Construction in progress
Less accumulated depreciation
Net property, plant and equipment
Intangible assets (note 7)
Goodwill
Other intangible assets
Total intangible assets
Financial assets transferred toconsolidated securitization entities (notes 6 and 20)
Other assets (note 20)
Total assets
See accompanying notes to consolidated financial statements.

F-1

June 30,
2013

Millions of yen
March 31,2013

603,285
10,100527,632
10,444

133,706
2,166,227
2,299,933

110,316
2,311,460
2,421,776

310,544

270,899

52,005
1,584,951
555,565
5,416,383

23,365
1,437,399
498,623
5,190,138

850,510

781,984

522,296
1,963,587
5,219,351
117,139
7,822,373
5,483,501
2,338,872

518,313
1,942,634
5,207,010
115,340
7,783,297
5,503,333
2,279,964

299,104
419,483
718,587

290,387
415,009705,396

168,323
800,962
10,293,637

131,379
720,369
9,809,230

Liabilities and Equity
Current liabilities:
Short-term debt
Current portion of long-term debt
Current portion of non-recourse borrowingsof consolidated securitization entities (note 6)
Trade payables:
Notes
Accounts
Accrued expenses (note 13)
Income taxes
Advances received
Other current liabilities
Total current liabilities
Long-term debt
Non-recourse borrowings of consolidated
securitization entities (note 6)
Retirement and severance benefits
Other liabilities
Total liabilities

June 30,
2013

Millions of yen
March 31,2013

937,867
181,155

673,850
260,185

51,80926,39915,644
1,184,109
795,179
28,286
431,045
491,370
4,116,464

15,462
1,219,402
924,591
56,278359,795
428,179
3,964,141

1,501,761

1,306,747

131,486
900,184
364,412
7,014,307

102,898
913,211
342,946
6,629,943

458,790
616,642
1,357,366(269,225)(1,634)2,161,939
1,117,391
3,279,330

458,790622,946
1,370,723(368,334)(1,565)2,082,560
1,096,727
3,179,287

10,293,637

9,809,230

Commitments and contingencies (note 13)
Equity:Common stock (note 9)
Capital surplus
Retained earnings (note 11)
Accumulated other comprehensive loss
Treasury stock, at cost (note 10)
Total Hitachi, Ltd. stockholders’ equity (note 12)
Noncontrolling interests (note 12)
Total equity
Total liabilities and equity
See accompanying notes to consolidated financial statements.

F-2

CONSOLIDATED STATEMENTS OF OPERATIONSAND CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Hitachi, Ltd. and Subsidiaries
Three months ended June 30, 2013 and 2012
Consolidated Statements of Operations

Revenues

Millions of yen
2013
2012
2,082,938
2,120,715

Cost of sales
Selling, general and administrative expenses(1,537,074)(490,379)(1,603,444)(453,697)

Impairment losses for long-lived assets
Restructuring charges (note 14)
Interest income
Dividend income
Other income (note 15)
Interest charges
Other deductions (note 15)
Equity in net loss of affiliated companies
Income before income taxes(248)(3,060)
3,173
3,757
4,666
(6,319)(2,023)(32)
55,399

(252)
(967)
3,680
2,624
3,153
(7,051)(12,889)(3,006)
48,866

Income taxes
Net income(32,766)
22,633(28,486)
20,380Less net income attributable to noncontrolling interests
Net income attributable to Hitachi, Ltd. stockholders

11,838
10,795

13,369
7,011

2.23
2.23

Yen
1.51
1.45

Net income attributable to Hitachi, Ltd. stockholders per share (note 16):
Basic
DilutedConsolidated Statements of Comprehensive Income

Net income

Millions of yen
2013
2012
22,633
20,380

Other comprehensive income (loss) arising during the period
Foreign currency translation adjustments
Pension liability adjustments
Net unrealized holding gain (loss) on available-for-sale securities
Cash flow hedges
Total other comprehensive income (loss) arising during the period
Comprehensive income (loss)
Less comprehensive income (loss) attributable to noncontrolling interests
Comprehensive income (loss) attributable to Hitachi, Ltd. stockholders

59,67613,99934,565
5,842
114,082
136,715
26,824
109,891

See accompanying notes to consolidated financial statements.

F-3(38,669)
15,538(27,257)
3,022(47,366)(26,986)(99)(26,887)

CONSOLIDATED STATEMENTS OF CASH FLOWS
Hitachi, Ltd. and Subsidiaries
Three months ended June 30, 2013 and 2012
Millions of yen
Cash flows from operating activities:
Net income
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation
Amortization
Impairment losses for long-lived assets
Equity in net loss of affiliated companies
Gain on sale of investments in securities and other
Impairment of investments in securities(Gain) loss on disposal of rental assets and other property
Decrease in receivables
Increase in inventories(Increase) decrease in prepaid expenses and other current assets
Decrease in payables
Decrease in accrued expenses and retirement and severance benefits
Decrease in accrued income taxes
Increase in other current liabilities
Net change in lease receivables related to the Company’s and its subsidiaries’ products
Other
Net cash provided by operating activities
Cash flows from investing activities:
Capital expenditures
Purchase of intangible assets
Purchase of tangible assets and software to be leased
Proceeds from disposal of property, plant and equipment
Proceeds from disposal of tangible assets and software to be leased
Collection of investments in leases
Purchase of investments in securities and shares of newly consolidated subsidiaries
Proceeds from sale of investments in securities and shares of consolidated
subsidiaries resulting in deconsolidation
Other
Net cash used in investing activities
Cash flows from financing activities:
Increase in short-term debt, net
Proceeds from long-term debt
Payments on long-term debt
Proceeds from sale of common stock by subsidiaries
Dividends paid to Hitachi, Ltd. stockholders
Dividends paid to noncontrolling interests
Acquisition of common stock for treasury
Proceeds from sales of treasury stock
Purchase of shares of consolidated subsidiaries from noncontrolling interest holders
Other
Net cash provided by financing activities

2013

2012

22,633

20,38080,03028,187
248
32
(863)
1,239
211
280,354(141,198)(39,931)(73,598)(145,192)(14,595)
44,3362,591(1,536)70,551
28,003
252
3,006
(633)
1,959
(1,878)
222,943(133,167)
5,052(60,792)(118,490)(31,238)
46,378
7,895(16,800)

42,94843,421(97,553)(25,935)(117,493)
7,432
6,144
69,854(4,992)(89,578)(20,703)(84,949)
9,835
3,606
74,216(4,252)

2,506
11,978

4,098
18,548(148,059)(89,179)

114,289
256,618(174,982)
1,556(24,203)(8,174)(71)
2(1,617)(36)

93,09396,424(112,847)
1,619(23,215)(9,485)(28)
2(13,664)(54)

163,382

31,845

Effect of exchange rate changes on cash and cash equivalents

17,382(3,256)

Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period

75,653
527,632(17,169)
619,577

Cash and cash equivalents at end of period

603,285

602,408

See accompanying notes to consolidated financial statements.

F-4

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

(1)

Nature of Operations
Hitachi, Ltd. (the Company) is a Japanese corporation, whose principal office is located in Japan. The
Company’s and its subsidiaries’ businesses are global and diverse, and include manufacturing and services
such as information and telecommunication systems, power systems, social infrastructure and industrial
systems, electronic systems and equipment, construction machinery, high functional materials andcomponents, automotive systems, digital media and consumer products and others including logistics andother services, as well as financial services.

(2)

Basis of Presentation and Summary of Significant Accounting Policies(a) Basis of Presentation
The Company and its domestic subsidiaries keep their books of account in accordance with thefinancial accounting standards of Japan, and its foreign subsidiaries in accordance with those of thecountries of their domicile.
The consolidated financial statements presented herein have been prepared to reflect theadjustments which are necessary to conform to accounting principles generally accepted in the
United States of America. Management of the Company has made a number of estimates andassumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets
and liabilities to prepare these financial statements. Actual results could differ from thoseestimates.
(b)

Principles of Consolidation
The consolidated financial statements include the accounts of the Company, its majority-owned
subsidiaries and all variable interest entities (VIEs) for which the Company or any of its
consolidated entities is the primary beneficiary. The definition of a VIE is included in AccountingStandards Codification (ASC) 810, “Consolidation.” This guidance addresses how a businessenterprise should evaluate whether it has a controlling financial interest in an entity through meansother than voting rights and accordingly should consolidate the entity. The consolidated financial
statements include accounts of certain subsidiaries whose closing dates differ from June 30 by 93
days or less to either comply with local statutory requirements or facilitate timely reporting. There
have been no significant transactions, which would materially affect the Company’s financial
position and results of operations, with such subsidiaries during the period from their closing dates
to June 30. Intercompany accounts and significant intercompany transactions have been eliminatedin consolidation.
Investments in corporate joint ventures and affiliated companies, where the Company has theability to exercise significant influence over operational and financial policies generally by holding
20 - 50% ownership, are accounted for under the equity method. Investments where the Company
does not have significant influence are accounted for under the cost method.

(c)

Income Taxes
The Company computes interim income tax provisions by applying an estimated annual effective
tax rate, which is reasonably determined considering the factors that will affect the tax rate
including non-taxable transactions, tax credits and valuation allowances, to income before income
taxes in accordance with the provisions for interim reporting included in ASC 740, “Income
Taxes.” The effect of a change in judgment about the realization of deferred tax assets in futureyears is recognized in the interim period in which the change occurs.

F-5

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013(d)

Subsequent Events
The Company has evaluated up to August 9, 2013, the date on which its consolidated financial
statements were available to be issued in accordance with the provisions of ASC855, "Subsequent
Events."F-6

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

(3)

Investments in Securities and Affiliated Companies
Short-term investments as of June 30, 2013 and March 31, 2013 are as follows:
Millions of yen
June 30,
March 31,2013
2013
Investments in securities:
Available-for-sale securities
Government debt securities
7,000
6,502
Corporate debt securities
2,888
3,725
Other securities
192
197
Held-to-maturity securities
20
20
10,10010,444
Investments and advances, including affiliated companies as of June 30, 2013 and March 31, 2013 are
as follows:
Millions of yen
June 30,
March 31,2013
2013
Investments in securities:
Available-for-sale securities
Equity securities
334,056
280,491
Government debt securities
1,249
956
Corporate debt securities
14,401
15,066
Other securities
10,583
9,618
Held-to-maturity securities
355
356
Cost-method investments
54,83953,990Investments in affiliated companies
279,005
259,967
Advances and other
156,022
161,540
850,510
781,984

F-7

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

The following tables are summaries of the amortized cost basis, gross unrealized holding gains, grossunrealized holding losses and aggregate fair value of available-for-sale securities by the consolidatedbalance sheet classifications as of June 30, 2013 and March 31, 2013.
Millions of yen
June 30, 2013
Amortized
Gross
Gross
Aggregatecost basis
gains
lossesfair value
Short-term investments:
Government debt securities
7,000
7,000
Corporate debt securities
2,817
75
4
2,888
Other securities
191
1
192
10,00876
4
10,080Investments and advances:
Equity securities
156,048
178,833825
334,056
Government debt securities
1,231
20
2
1,249
Corporate debt securities
12,3002,126
25
14,401Other securities
10,258325
10,583
179,837
181,304852
360,289
189,845
181,380856
370,369

Amortized
cost basis
Short-term investments:
Government debt securities
Corporate debt securities
Other securities
Investments and advances:
Equity securities
Government debt securities
Corporate debt securities
Other securities

Gross
gains

Millions of yen
March 31, 2013
Gross
Aggregate
lossesfair value

6,501
3,387
196
10,084

1
344
1
346

6
6

6,502
3,725
197
10,424

155,625931
12,997
9,285
178,838
188,922

125,775
25
2,093
333
128,226
128,572

909
24
933
939

280,491956
15,066
9,618
306,131316,555

F-8

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

The following tables are summaries of gross unrealized holding losses on available-for-sale securities
and the fair value of the related securities, aggregated by investment category and length of time that
individual securities have been in a continuous unrealized loss position, as of June 30, 2013 and March
31, 2013.
Millions of yen
June 30, 2013
Less than 12 months
12 months or longer
Aggregate
Gross
Aggregate
Grossfair value
lossesfair value
lossesShort-term investments:
Corporate debt securities
496
4
Investments and advances:
Equity securities
Government debt securities
Corporate debt securities

4,401
619
847
5,867
6,363

415
2
13
430
434

Investments and advances:
Equity securities
Corporate debt securities

410
12
422
422

Millions of yen
March 31, 2013
12 months or longer
Aggregate
Grossfair value
lossesLess than 12 months
Aggregate
Grossfair value
lossesShort-term investments:
Corporate debt securities

1,640
988
2,628
2,628

-

-

994

6

4,904
39
4,943
4,943

601
11
612
612

1,219
987
2,206
3,200

308
13
321
327

Equity securities consist primarily of stocks issued by Japanese and the U.S.A. listed companies.
Government debt securities consist primarily of Japan treasury bonds. Corporate debt securities consist
primarily of structured bonds. Other securities consist primarily of investment funds.

F-9

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

The following table represents the purchases, proceeds from the sale, gross realized gains on the sale,and gross realized losses on the sale of available-for-sale securities for the three months ended June 30,
2013 and 2012.
Three months
ended
June 30,
2013
1,619
1,159
365
-

Purchases
Proceeds from the sale
Gross realized gains on the sale
Gross realized losses on the sale

Millions of yen
Three months
ended
June 30,
2012
1,520
726
521
-

The contractual maturities of debt securities and other securities classified as investments and advancesin the consolidated balance sheet as of June 30, 2013 are as follows:
Held-tomaturity
Due within five years
Due after five years through ten years
Due after ten years

Millions of yen
Availablefor-sale
Total

355
355

8,150
1,652
16,431
26,2338,505
1,652
16,431
26,588

Expected redemptions may differ from contractual maturities because some of these securities are
redeemable at the option of the issuers.
The aggregate carrying amounts of cost-method investments which were not evaluated for impairment
as of June 30, 2013 and March 31, 2013 were ¥53,710 million and ¥53,953 million, respectively,
mainly because it was not practicable to estimate the fair value of the investments due to lack of amarket price and difficulty in estimating fair value without incurring excessive cost and the Company
did not identify any events or changes in circumstances that might have had a significant adverse effecton their fair value.
(4)

Allowances for doubtful receivables
Allowances for doubtful receivables as of June 30, 2013 and March 31, 2013 are as follows:

Allowances for doubtful receivables

June 30,2013
32,482F-10

Millions of yen
March 31,2013
31,134HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

(5)

Inventories
Inventories as of June 30, 2013 and March 31, 2013 are summarized as follows:

Finished goods
Work in process
Raw materials(6)

June 30,
2013
628,511
691,554
264,886
1,584,951

Millions of yen
March 31,2013
584,435
601,305
251,659
1,437,399

Securitizations
The Company and certain subsidiaries securitize certain financial assets, such as lease, trade andmortgage loans receivable, and arrange other forms of asset-backed financing for the purpose ofproviding diversified and stable fund raising as part of their ongoing securitization activities.
Historically, they have used third-party Special Purpose Entities (SPEs) to execute securitizationtransactions funded with commercial paper and other borrowings. These securitization transactions are
similar to those used by many financial institutions.
Investors in these entities only have recourse to the assets owned by the entity and not to their generalcredit, unless noted below. The Company and certain subsidiaries do not provide non-contractual
support to SPEs and do not have implicit support arrangements with any SPEs. The majority of theirinvolvement with SPEs related to the securitization activities are assisting in the formation andfinancing of an entity, providing limited credit enhancements, servicing the assets and receiving fees
for services provided.
A portion of these lease, trade and mortgage loans receivable is transferred to SPEs sponsored byfinancial institutions, which operate those SPEs as a part of their businesses. Accordingly, the amountof assets transferred by the Company and its subsidiaries is considerably small compared to the total
assets of the SPEs sponsored by these financial institutions that purchase a large amount of assets fromentities other than the Company and its subsidiaries. In certain transactions, investors have recoursewith a scope that is considerably limited.
The transferred assets have similar risks and characteristics to the Company’s and certain subsidiaries’
receivables recorded on the consolidated balance sheets. Accordingly, the performance, such ascollections or expected credit loss, of these transferred assets has been similar to the receivables
recorded on the consolidated balance sheets for the Company and certain subsidiaries; however, theblended performance of the pools of transferred assets reflects the eligibility screening requirementsthat the Company and certain subsidiaries apply to determine which receivables are selected fortransfer. Therefore, the blended performance may differ from receivables recorded on the consolidatedbalance sheets.
Consolidated SPEs
The Company consolidated SPEs mainly because the Company has both the power to direct theactivities of the SPEs that most significantly impact the SPEs’ economic performance and theobligation to absorb losses or the right to receive benefits that could potentially be significant to theSPEs. The consolidated SPEs are mainly trusts for the securitizations of lease receivables and mortgage
loans receivable.

F-11

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

The tables below summarize the assets and liabilities of the consolidated SPEs as of June 30, 2013 andMarch 31, 2013 by type of transferred financial assets that those SPEs hold:Millions of yen
June 30, 2013
Mortgage
Lease
loans
receivables
receivable
OthersTotal
Cash and cash equivalents
9,369
2,212
1,831
13,412Current portion of financial assets transferred toconsolidated securitization entities
31,385
10,576
10,04452,005
Financial assets transferred to consolidated
securitization entities
40,648
121,379
6,296
168,323
Current portion of non-recourse borrowings ofconsolidated securitization entities：
Loans, mainly from banks
Beneficial interests in trusts

Non-recourse borrowings ofconsolidated securitization entities:
Loans, mainly from banks
Beneficial interests in trusts

19,016
10,957
29,973

12,586
12,586

2,728
6,522
9,250

21,74430,06551,80926,5683,747
30,31596,43696,436

4,100
635
4,735

30,668100,818
131,486

Millions of yen
March 31, 2013

Cash and cash equivalents
Current portion of financial assets transferred toconsolidated securitization entities
Financial assets transferred to consolidated
securitization entities

Lease
receivables
3,617

Mortgageloans
receivable
2,458

Others
961

Total
7,036

5,476

10,944

6,945

23,365

3,411

127,380588

131,379

2,360
4,371
6,731

13,196
13,196

6,472
6,472

2,360
24,03926,399205

102,580

113

102,898

Current portion of non-recourse borrowings ofconsolidated securitization entities：
Loans, mainly from banks
Beneficial interests in trusts

Non-recourse borrowings ofconsolidated securitization entities:
Beneficial interests in trusts

F-12

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

The assets and liabilities of the consolidated SPEs on the table above exclude intercompany balancesthat are eliminated in consolidation. Substantially, all of the assets of the consolidated SPEs can only
be used to settle obligations of those SPEs.
Transfers to unconsolidated entities
The following information is related to financial assets transferred to unconsolidated entities andaccounted for as sales. Those financial assets are transferred mainly to SPEs sponsored by financial
institutions.
Securitizations of lease receivables:
Hitachi Capital Corporation and certain other subsidiaries sold lease receivables to unconsolidated
SPEs and other entities. During the three months ended June 30, 2013 and 2012, proceeds from thetransfer of lease receivables were ¥5,840 million and ¥32,418 million, respectively, and net gains andnet losses recognized on those transfers were a net loss of ¥2 million and a net gain of ¥1,654 million,
respectively. The subsidiaries retained servicing responsibilities, but did not record a servicing asset or
liability because the cost to service the receivables approximated the servicing income.
The amounts of initial fair value of the subordinated interests for the three months ended June 30, 2013
and 2012 were ¥390 million and ¥5,163 million, respectively. The subordinated interests relating tosecuritizations of lease receivables are initially classified as Level 3 assets within the fair value
hierarchy. The initial fair value of the subordinated interests is determined based on economic
assumptions including weighted-average life, expected credit risks, and discount rates.

F-13

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

Quantitative information about delinquencies, net credit losses, and components of lease receivables
subject to transfer and other assets managed together as of and for the three months ended June 30,
2013 and as of and for the year ended March 31, 2013 is as follows:
Millions of yen
June 30, 2013
Principal
amount of
Total
receivables
principal 90 days or
amount of more past Net credit
receivablesdue
loss
Total assets managed or transferred:
Lease receivables
Assets transferred
Assets held in portfolio

1,122,126(249,615)
872,511313

72

Millions of yen
March 31, 2013
Principal
amount of
Total
receivables
principal 90 days or
amount of more past Net credit
receivablesdue
loss
Total assets managed or transferred:
Lease receivables
Assets transferred
Assets held in portfolio

953,372(264,864)
688,508

195

433

As of June 30, 2013 and March 31, 2013, the amounts of the maximum exposures to losses were¥88,227 million and ¥88,490 million, respectively. They mainly consist of the subordinated interests
and the obligations to purchase assets with a scope that is considerably limited relating to thesesecuritizations of lease receivables. As of June 30, 2013 and March 31, 2013, the amounts of thesubordinated interests measured at fair value relating to these securitizations of lease receivables were¥52,936 million and ¥53,081 million, respectively.
Securitizations of trade receivables:
The Company and certain subsidiaries sold trade receivables mainly to unconsolidated SPEs and otherentities. During the three months ended June 30, 2013 and 2012, proceeds from the transfer of tradereceivables were ¥145,444 million and ¥133,296 million, respectively, and net losses recognized on
those transfers were ¥97 million and ¥383 million, respectively. The Company and certain subsidiaries
retained servicing responsibilities, but did not record a servicing asset or liability because the cost toservice the receivables approximated the servicing income.

F-14

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

The amount of initial fair value of the subordinated interests for the three months ended June 30, 2013
and 2012, were ¥110 million and ¥6,085 million, respectively. The subordinated interests relating tosecuritizations of trade receivables are initially classified as Level 3 assets within the fair value
hierarchy. The initial fair value of the subordinated interests is determined based on economic
assumptions including weighted-average life, expected credit risks, discount rates, and prepayment
rates.
Quantitative information about delinquencies, net credit loss, and components of trade receivables
subject to transfer and other assets managed together as of and for the three months ended June 30,
2013 and as of and for the year ended March 31, 2013 is as follows:
Millions of yen
June 30, 2013
Principal
amount of
Total
receivables
principal 90 days or
amount of more past Net credit
receivablesdue
loss
Total assets managed or transferred:
Trade receivables
Assets transferred
Assets held in portfolio

1,028,111(268,367)
759,744

2,322

368

Millions of yen
March 31, 2013
Principal
amount of
Total
receivables
principal 90 days or
amount of more past Net credit
receivablesdue
loss
Total assets managed or transferred:
Trade receivables
Assets transferred
Assets held in portfolio

1,042,802(290,172)
752,630

1,957

2,095

As of June 30, 2013 and March 31, 2013, the amounts of the maximum exposures to losses were¥59,084 million and ¥62,586 million, respectively. They mainly consist of the subordinated interestsand obligations to purchase assets with a scope that is considerably limited relating to thesesecuritizations of trade receivables. As of June 30, 2013 and March 31, 2013, the amounts of thesubordinated interests relating to these securitizations of trade receivables were ¥27,679 million and¥33,325 million, respectively.

F-15

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013(7)

Goodwill and Other Intangible Assets
Goodwill and other intangible assets included in other assets as of June 30, 2013 and March 31, 2013
are as follows:
Millions of yen
March 31, 2013

June 30, 2013

Goodwill
Amortized intangible assets:
Software
Software for internal use
Patents
Other

Indefinite-lived
intangible assets

(8)

Gross
carrying
amountAccumulated
amortization

Net carrying
amountGrosscarrying
amountAccumulated
amortization

Net carrying
amount299,104-

299,104

290,387-

290,387

793,713568,199
80,720238,643
1,681,275

655,045
430,961
75,440114,153
1,275,599

138,668
137,238
5,280
124,490405,676784,570
568,637
80,401
232,941
1,666,549

646,331434,299
75,190110,1171,265,937

138,239
134,338
5,211
122,824400,612

13,807-

13,807

14,397-

14,397Retirement and Severance Benefits
Net periodic benefit cost for the contributory funded benefit pension plans and the unfunded lump-sum
payment plans for the three months ended June 30, 2013 and 2012 consists of the following
components:

Three months ended
June 30, 2013
22,343
6,627(8,877)(4,014)22,226(20)(42)
38,243Service cost
Interest cost
Expected return on plan assets for the period
Amortization of prior service benefit
Amortization of actuarial loss
Transfer to defined contribution pension plan
Employees’ contributions(9)

Millions of yen
Three months ended
June 30, 2012
17,902
11,211(9,043)(5,647)
24,259(104)(17)
38,561

Common Stock
Issued shares of common stock as of June 30, 2013 and March 31, 2013 are as follows:
June 30,
2013
4,833,463,387

Issued shares of common stock

F-16

Issued shares
March 31,2013
4,833,463,387

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013(10) Treasury Stock
Shares of treasury stock as of June 30, 2013 and March 31, 2013 are as follows:
June 30,
2013
3,003,266

Shares of treasury stock

SharesMarch 31,2013
2,899,151(11) Dividends

Decision
The Board of
Directors on
May 10, 2013

Class of
SharesCashdividends(Millionsof yen)Appropriationfrom

Commonstock

24,152Retainedearnings

Cashdividends
per share(Yen)

Recorddate

Effective
Date

5.0

March
31, 2013

May
28, 2013(12) Equity
The changes in the equity for the three months ended June 30, 2013 and 2012 are summarized as follows:
Millions of yen
Three months ended June 30, 2013

Balance at beginning of period
Dividends to Hitachi, Ltd. stockholders
Dividends to noncontrolling interests
Equity transactions and otherComprehensive income
Net income
Other comprehensive income, net ofincome taxes and reclassification adjustments:
Foreign currency translation adjustments
Pension liability adjustments
Net unrealized holding gain on
available-for-sale securities
Cash flow hedges
Comprehensive income
Balance at end of period

Total Hitachi, Ltd.
stockholders’equity2,082,560(24,152)(6,360)Noncontrollinginterests
1,096,727(10,841)
4,681

Total equity
3,179,287(24,152)(10,841)(1,679)10,795

11,83822,63346,548
13,771

13,128228

59,67613,99933,677
5,100
109,891
2,161,939

888
742
26,824
1,117,391

34,565
5,842
136,715
3,279,330

F-17

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

Millions of yen
Three months ended June 30, 2012

Balance at beginning of period
Dividends to Hitachi, Ltd. stockholders
Dividends to noncontrolling interests
Equity transactions and otherComprehensive loss
Net income
Other comprehensive income (loss), net ofincome taxes and reclassification adjustments:
Foreign currency translation adjustments
Pension liability adjustments
Net unrealized holding loss onavailable-for-sale securities
Cash flow hedges
Comprehensive loss
Balance at end of period

Total Hitachi, Ltd.
stockholders’equity1,771,782(23,175)(3,431)

Noncontrollinginterests
1,002,213(9,011)(1,225)

Total equity
2,773,995(23,175)(9,011)(4,656)

7,011

13,36920,380(25,256)
14,792(13,413)746(38,669)
15,538(25,126)
1,692(26,887)
1,718,289(2,131)1,330(99)991,878(27,257)
3,022(26,986)
2,710,167

The changes in accumulated other comprehensive loss, net of income taxes, for the three months ended
June 30, 2013 are as follows:

Balance at beginningof period
Equity transactions andother
Other comprehensive
income, net ofreclassification
adjustment
Other comprehensive
income arising during
the period
Reclassification
adjustments forrealized net loss
included in net income
Other comprehensive
income, net ofreclassification
adjustment
Balance at end of period

Millions of yen
Three months ended June 30, 2013
Net unrealized
holding gain on
available-for-sale
Cash flow
securities
hedges
Total

Foreigncurrencytranslation
adjustments

Pensionliability
adjustments(91,314)(308,724)

61,482(29,778)(368,334)

(3)

17

(3)

2

13

46,549(170)

33,882

4,891

85,152(1)

13,941(205)

209

13,94446,548

13,771

33,677

5,100

99,096(44,769)(294,936)

95,156(24,676)(269,225)

F-18

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

The following table represents the reclassification adjustments for realized net loss included in net
income by each classification of other comprehensive income arising during the period ended June 30,
2013 with location in consolidated statements of operations.
Millions of yen
Three months ended June 30, 2013
Reclassification adjustments
for realized net loss included
in net income
Location
Foreign currency translation
adjustments:(1)
Other income
Before-tax amount(1)
Income before income taxes
Tax benefit (expense)
Income taxes
Net income attributable to
Net-of-tax amount(1)
Hitachi, Ltd. stockholders
Pension liability adjustment:
Prior service benefit
Actuarial loss
Before-tax amountTax benefit (expense)(3,533)
20,218
16,685(2,744)Net-of-tax amount

13,941(a)(a)
Income before income taxes
Income taxes
Net income attributable to
Hitachi, Ltd. stockholders

Net unrealized holding gain on
available-for-sale securities:
Before-tax amountTax benefit (expense)

(310)
(310)
105

Net-of-tax amount(205)

Cash flow hedges:
Forward exchange contracts
Cross currency swap
agreements
Interest rate swaps
Before-tax amountTax benefit (expense)
Net-of-tax amount
Reclassification adjustments forrealized net loss included in net
incomeOther deductions
Income before income taxes
Income taxes
Net income attributable to
Hitachi, Ltd. Stockholders

77

Other income

56
68
201
8
209

Other income
Interest charges
Income before income taxes
Income taxes
Net income attributable to
Hitachi, Ltd. stockholders

13,944

Net income attributable to
Hitachi, Ltd. stockholders(a) These accumulated other comprehensive income (loss) components are included in the computationof net periodic benefit cost (see note 8).

F-19

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013(13) Commitments and Contingencies
The Company and its subsidiaries are contingently liable for loan guarantees to its affiliates and others in
the amount of approximately ¥74,394 million as of June 30, 2013.
Hitachi Capital Corporation (HCC) and subsidiaries in financial services segment provide guarantees tofinancial institutions for extending loans to customers of the subsidiaries. As of June 30, 2013, theundiscounted maximum potential future payments under such guarantees amounted to ¥303,557 million.
For providing these guarantees, the subsidiaries obtain collateral appropriate for the amount of theguarantees, and therefore, the Company considers the risk to be low. The Company accrued ¥10,869
million as an obligation to stand ready to perform over the term of the guarantees in the event the customer
cannot make scheduled payments.
The Company and HCC provide loan commitments to affiliates and others.
The outstanding balance of loan commitments as of June 30, 2013 is as follows:
Millions of yen
40,632356
40,276

Total commitment available
Less amount utilized
Balance available

The amount of total commitment available in the table above includes lines of credits which require an
additional credit approval prior to funding, and it may not be fully utilized.
The Company and certain subsidiaries have line of credit arrangements with banks in order to secure afinancing source for business operations. The unused lines of credit as of June 30, 2013 amounted to¥517,057 million, primarily related to unused lines of credit belonging to the Company. The Company
maintains commitment line agreements with a number of banks and pays commitment fees as consideration.
These commitment agreements generally provide a one-year term, and are subject to renewal at the end of
the term. The unused availability under these agreements as of June 30, 2013 amounted to ¥200,000 million.
The Company also maintains another commitment line agreement, whose three years and two months term
ends in July 2016, with financing companies. The unused availability under this agreement as of June 30,
2013 amounted to ¥200,000 million.
It is a common practice in Japan for companies, in the ordinary course of business, to receive promissory
notes in the settlement of trade accounts receivable and to subsequently discount such notes to banks or totransfer them by endorsement to suppliers in the settlement of accounts payable. As of June 30, 2013 andMarch 31, 2013, the Company and subsidiaries were contingently liable for trade notes discounted andendorsed in the following amounts:
Millions of yen
June 30,
March 31,2013
2013
Notes discounted
1,112
2,149
Notes endorsed
2,368
2,707
3,480
4,856

F-20

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

The Company and its subsidiaries provide warranties for certain of their products. The accrued productwarranty costs are based primarily on historical experience of actual warranty claims. The changes in
accrued product warranty costs for the three months ended June 30, 2013 and 2012 are summarized asfollows:

Balance at beginning of period
Expense recognized upon issuance of
warranties
Usage
Acquisitions and divestitures
Other, including effect of foreign currencytranslation
Balance at end of period

Three months ended
June 30, 2013
40,114

Millions of yen
Three months ended
June 30, 2012
41,356

3,615(3,041)‐

1,961(2,932)81

54
40,742(678)
39,788In December 2006, the Company and a subsidiary in Europe received requests for information from theEuropean Commission in respect of alleged antitrust violations relating to liquid crystal displays.
In November 2007, a subsidiary in the U.S.A. received a grand jury subpoena in connection with theinvestigation conducted by the Antitrust Division of the U.S. Department of Justice in respect of alleged
antitrust violations relating to cathode ray tubes. In addition, in November 2007, two subsidiaries in Asiaand in Europe received requests for information from the European Commission. Furthermore, inNovember 2007, a subsidiary in Canada received requests for information from the Canadian Competition
Bureau.
In June 2009, a subsidiary in Japan received a grand jury subpoena in connection with the investigation
conducted by the Antitrust Division of the U.S. Department of Justice and received requests for informationfrom the European Commission, and a subsidiary in Korea was investigated in Singapore by theCompetition Commission of Singapore, all in respect of alleged antitrust violations relating to optical disk
drives. In September 2011, the Korean subsidiary received a notice of discontinuation of the investigationfrom the Competition Commission of Singapore. In October 2011, the Japanese subsidiary agreed to pay afine in relation to the investigation from the Antitrust Division of the U.S. Department of Justice and in
November 2011, it paid that fine. In July 2012, the Japanese subsidiary received a statement of objections
from the European Commission in respect of alleged antitrust violations.
In July 2011, a subsidiary and an affiliated company in Japan received a statement of objections from theEuropean Commission in respect of alleged antitrust violations relating to high-voltage power cables. These
companies accrued the reasonably estimated amount for the loss.
In July 2011, a subsidiary in the U.S.A. was investigated by and received a grand jury subpoena from the
Antitrust Division of the U.S. Department of Justice, the Company and a subsidiary in Europe received
requests for information from the European Commission, and a subsidiary in Canada received requests for
information from the Canadian Competition Bureau, all in respect of alleged antitrust violations relating toautomotive equipment.
The Company and its subsidiaries and affiliated companies (including a former subsidiary) have cooperated
F-21

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

with the competent authorities. Depending upon the outcome of these matters, fines or surcharge payments,
the amount of which is uncertain, may be imposed on them. Also, in connection with pending and settled
antitrust violations, civil disputes, including class action lawsuits, involving the Company and some ofthese companies (including a former subsidiary) have arisen in a number of countries, including in the
U.S.A. and Canada. A reasonably estimated amount was accrued for the potential losses in relation tocertain of these civil disputes.
In August 2012, a subsidiary in Europe received a complaint filed by a customer in Europe seeking
compensation for consequential losses of EUR 1,058 million (¥136,061 million), additional costs andinterest allegedly incurred by the delay in the construction process of a power plant against, jointly andseverally, the Company, the subsidiary in Europe, a consortium including the Company and the subsidiaryin Europe, and two other companies. Although the Company, the subsidiary in Europe and the consortium
will vigorously defend themselves against this lawsuit, there can be no assurance that they will not be held
liable for any amounts claimed.
Depending upon the outcome of the above legal proceedings, there may be an adverse effect on the
consolidated financial position or results of operations. Currently the Company is unable to estimate theadverse effect, if any, of many of these proceedings. Accordingly, except as otherwise stated, no accrual for
potential loss has been made. The actual amount of fines, surcharge payments or any other payments
resulting from these legal proceedings may be different from the accrued amounts.
In addition to the above, the Company and its subsidiaries are subject to several legal proceedings andclaims which have arisen in the ordinary course of business and have not been finally adjudicated. These
actions when ultimately concluded and determined will not, in the opinion of management, have a material
adverse effect on the consolidated financial position or results of operations of the Company andsubsidiaries.

F-22

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013(14) Restructuring Charges
Certain losses incurred in the reorganization of the Company’s operations are considered restructuring
charges. Components and related amounts of the restructuring charges, before the related tax effects, forthe three months ended June 30, 2013 and 2012 are as follows:

Special termination benefits
Loss on fixed assets

Three months ended
June 30, 2013
3,060
3,060

Millions of yen
Three months ended
June 30, 2012
966
1
967

The Company and certain subsidiaries provided special termination benefits to those employees
voluntarily leaving the companies. The accrued special termination benefits were recognized at the timevoluntary termination was offered and benefits were accepted by the employees. An analysis of theaccrued special termination benefits for the three months ended June 30, 2013 and 2012 is as follows:

Balance at beginning of the period
New charges
Cash payments
Foreign currency exchange rate changes
Balance at end of the period

Three months ended
June 30, 201315,2933,060(14,964)
27
3,416

Millions of yen
Three months ended
June 30, 2012
7,487
966
(7,004)(29)
1,420

The restructuring charges for the three months ended June 30, 2013 mainly consist of special
termination benefits for the early-terminated employees of subsidiaries for the purpose of reorganizing
businesses which has encountered the deterioration of the business environment in the High Functional
Materials & Components segment.
(15) Other Income and Other Deductions
The following items are included in other income or other deductions for the three months ended June30, 2013 and 2012.

Net loss on securities
Net gain (loss) on sale and disposal ofrental assets and other property
Exchange gain (loss)

Three months ended
June 30, 2013
(1,330)Millions of yen
Three months ended
June 30, 2012
(976)

(530)
2,895

2,693
(11,743)

F-23

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013(16) Net Income Per Share Information
The reconciliations of the numbers and the amounts used in the basic and diluted net income attributable
to Hitachi, Ltd. stockholders per share computations for the three months ended June 30, 2013 and 2012
are as follows:
Number of shares
Three months ended
Three months ended
June 30, 2013
June 30, 2012
Weighted average number of shares on which basic net
income per share is calculated
4,830,450,781
4,635,033,270
Effect of dilutive securities:
Unsecured convertible bonds (8th series)
195,783,686
Number of shares on which diluted net income per shareis calculated
4,830,450,781
4,830,816,956

Net income attributable to Hitachi, Ltd. stockholders
Effect of dilutive securities:
Unsecured convertible bonds (8th series)
Other
Net income attributable to Hitachi, Ltd. stockholders
on which diluted net income per share is calculated

Three months ended
June 30, 2013
10,795

Millions of yen
Three months ended
June 30, 2012
7,011

(16)

11
(11)

10,779

7,011

Yen
Net income attributable to Hitachi, Ltd. stockholders
per share:
Basic
Diluted

F-24

2.23
2.23

1.51
1.45

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013(17) Concentrations of Credit Risk
The Company and its subsidiaries generally do not have significant concentrations of credit risk to any
counterparties nor any regions because they are diversified and spread globally.
(18) Derivative Instruments and Hedging Activities
Overall risk profile
The major manufacturing bases of the Company and its subsidiaries are located in Japan and Asia. The
selling bases are located globally, and the Company and its subsidiaries generated approximately 50%of their sales from overseas for the three months ended June 30, 2013. These overseas sales are mainly
denominated in the U.S. dollar or Euro. As a result, the Company and its subsidiaries are exposed tomarket risks from changes in foreign currency exchange rates.
The Company’s financing subsidiaries mainly in the U.K. issue variable rate medium-term notes
mainly through the Euro markets to finance their overseas long-term operating capital. As a result, theCompany and its subsidiaries are exposed to market risks from changes in foreign currency exchange
rates and interest rates.
The Company and its subsidiaries are also exposed to credit-related losses in the event of
non-performance by counterparties to derivative financial instruments, but it is not expected that any
counterparties will fail to meet their obligations because most of the counterparties are internationallyrecognized financial institutions that are rated A or higher and contracts are diversified into a numberof major financial institutions.
The Company and its subsidiaries have an insignificant amount of derivative instruments containing
credit-risk-related contingent features, such as provisions that require the Company’s debt to maintainan investment grade credit rating from each of the major credit rating agencies.
Risk management policy
The Company and its subsidiaries assess foreign currency exchange rate risk and interest rate risk bycontinually monitoring changes in these exposures and by evaluating hedging opportunities. It is theCompany’s principal policy not to enter into derivative financial instruments for speculation purposes.
Foreign currency exchange rate risk management
The Company and its subsidiaries have assets and liabilities which are exposed to foreign currency
exchange rate risk and, as a result, they enter into forward exchange contracts and cross currency swap
agreements for the purpose of hedging these risk exposures.
In order to fix the future net cash flows principally from trade receivables and payables recognized,
which are denominated in foreign currencies, the Company and its subsidiaries on a monthly basis
measure the volume and due date of future net cash flows by currency. In accordance with theCompany’s policy, a certain portion of measured net cash flows is covered using comprehensive
forward exchange contracts, which principally mature within one year. If necessary, the Company andits subsidiaries establish the risk control policy and the risk management approach specific to eachtransaction by reviewing the business characteristics, the structure of the income and expenditure, andconditions of the contract. The Company and its subsidiaries hedge the risk exposure arising from
specific transactions based on the risk control policy and the risk management approach.
The Company and its subsidiaries enter into cross currency swap agreements with the same maturities as
underlying debt to fix cash flows from long-term debt denominated in foreign currencies. The hedging
F-25

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

relationship between the derivative financial instrument and its hedged item is highly effective inachieving offsetting changes in foreign currency exchange rates.
Interest rate risk management
The Company’s and its subsidiaries’ exposure to interest rate risk is related principally to long-term
debt obligations. Management believes it is prudent to minimize the variability caused by interest raterisk.
To meet this objective, the Company and its subsidiaries principally enter into interest rate swaps tomanage fluctuations in cash flows. The interest rate swaps entered into are receive-variable, pay-fixedinterest rate swaps. Under the interest rate swaps, the Company and certain subsidiaries receive
variable interest rate payments on long-term debt associated with medium-term notes and make fixedinterest rate payments, thereby creating fixed interest rate long-term debt.
Certain financing subsidiaries mainly finance a portion of their operations using long-term debt with afixed interest rate and lend funds at variable interest rates. Therefore, such subsidiaries are exposed tointerest rate risk. Management believes it is prudent to minimize the variability caused by interest raterisk. To meet this objective, certain financing subsidiaries principally enter into interest rate swaps
converting the fixed rate to a variable rate to manage fluctuations in fair value resulting from interest
rate risk. Under the interest rate swaps, certain financing subsidiaries receive fixed interest rate
payments associated with long-term debt, including medium-term notes, and make variable interest rate
payments, thereby creating variable-rate long-term debt.
The hedging relationship between the interest rate swaps and its hedged item is highly effective inachieving offsetting changes in cash flows and fair value resulting from interest rate risk.
Fair value hedge
Changes in the fair value of both recognized assets and liabilities, and derivative financial instruments
designated as fair value hedges of these assets and liabilities are recognized in other income(deductions). Derivative financial instruments designated as fair value hedges include forward
exchange contracts associated with operating transactions, cross currency swap agreements and interest
rate swaps associated with financing transactions.
Cash flow hedge
Foreign currency exposure:
Changes in the fair value of forward exchange contracts designated and qualifying as cash flow hedgesof forecasted transactions are reported in accumulated other comprehensive income (AOCI). Theseamounts are reclassified into earnings in the same period as the hedged items affect earnings.
Interest rate exposure:
Changes in fair values of interest rate swaps designated as hedging instruments for the variability of cash
flows associated with long-term debt obligations are reported in AOCI. These amounts subsequently arereclassified into interest charges as a yield adjustment in the same period in which the hedged debt
obligations affect earnings.

F-26

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013(19) Fair Value
ASC 820, “Fair Value Measurement” establishes a fair value hierarchy that prioritizes the use ofobservable inputs in markets over the use of unobservable inputs when measuring fair value as follows:
Level 1
Quoted prices for identical assets or liabilities in active markets.
Level 2
Quoted prices for similar assets or liabilities in active markets; quoted prices associated withtransactions that are not distressed for identical or similar assets or liabilities in markets that are notactive; or valuations whose significant inputs are derived from or corroborated by observable market
data.
Level 3
Valuations using inputs that are not observable.
Investments in debt and equity securities
Investment securities of which quoted market prices are available to determine their fair value areincluded in Level 1. Level 1 securities include available-for-sale securities such as listed stocks on
exchange markets, debt securities such as Japan treasury bonds and U.S.A. treasury bonds andexchange traded funds.
In the absence of an active market for investment securities, quoted prices for similar investment
securities, quoted prices associated with transactions that are not distressed for identical or similar
investment securities or other relevant information including market interest rate curves, referenced
credit spreads or default rates, are used to determine fair value. These investments are included in
Level 2. Level 2 securities include short-term investments and available-for-sale securities such as
listed stocks traded over-the-counter, investment funds and debt securities traded over-the-counter.
In infrequent circumstances, the significant inputs of fair value for investment securities areunobservable and such investment are included in Level 3. The Company uses price information
provided by financial institutions to evaluate these investments while corroborating the information
mainly with prices estimated using an income approach based on its own valuation models or a market
approach such as comparison with prices of similar securities. Level 3 securities include
available-for-sale securities such as subordinated debentures and structured bonds with little market
activity.
Derivatives
Closing prices are used for derivatives included in Level 1, which are traded on active markets. The
majority of derivatives are traded on over-the-counter markets, which the Company does not deem torepresent active markets. Derivative assets and liabilities for which fair value is based on quoted prices
associated with transactions that are not distressed, in markets that are not active, or based on models
using interest rate curves and forward and spot prices for currencies and commodities are included in
Level 2. Derivatives included in Level 2 primarily consist of interest rate swaps, cross-currency swaps
and foreign currency and commodity forward and option contracts. In infrequent circumstances, thesignificant inputs of fair value are unobservable and the Company mainly uses an income or market
approach to corroborate relevant information provided by financial institutions. These derivatives areincluded in Level 3.

F-27

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

Subordinated interests resulting from securitization
When fair value is determined using observable inputs, including prices of recent transactions inmarkets that are not distressed, subordinated interests are included in Level 2. When significant inputs
are not observable, fair value is determined based on economic assumptions used in measuring the fairvalue of the subordinated interests, including weighted-average life, expected credit risks, and discountrates, and the subordinated interests are included in Level 3.
The Company uses its own valuation models to evaluate these investments categorized within Level 3
and periodically reviews the appropriateness of consistent application of the models as well as updatingof the inputs in consideration of recent changes in economic conditions. The Company also analyses
that the sensitivity in the valuation of these investments does not have material adverse effects on the
consolidated financial statements.

F-28

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

The following tables present the assets and liabilities that are measured at fair value on a recurring
basis and the fair value hierarchy classification as of June 30, 2013 and March 31, 2013. The carrying
values on the consolidated balance sheets are recorded by the fair value of these assets and liabilities:

Assets:Investments in securities
Equity securities
Government debt securities
Corporate debt securities
Other
Derivatives
Subordinated interests resulting
from securitization
Liabilities:
Derivatives

Assets:Investments in securities
Equity securities
Government debt securities
Corporate debt securities
Other
Derivatives
Subordinated interests resulting
from securitization
Liabilities:
Derivatives

Total

Millions of yen
June 30, 2013
Fair value hierarchy classification
Level 1
Level 2
Level 3334,056
8,249
17,28910,775
14,311

333,251
7,929
10,176
-

805
320
5,274
599
14,311

12,015-79,818464,498

351,356

21,30979,81891,833(65,571)-(65,571)-

Total

Millions of yen
March 31, 2013
Fair value hierarchy classification
Level 1
Level 2
Level 3

280,491
7,458
18,791
9,815
12,017279,727
7,132
9,246
-

764
326
5,154
569
12,017

13,637-

84,688413,260

296,105

18,83084,68898,325(60,953)-(60,953)-

F-29

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

The following tables present the changes in Level 3 instruments measured on a recurring basis for thethree months ended June 30, 2013 and 2012:

Balance at beginning of period
Purchases
Settlements
Total gains or losses (realized/unrealized)
Included in earnings (a)Included in other comprehensive income (loss)
Balance at end of period
The amount of total gains or losses for the period
included in earnings attributable to the change inunrealized gains or losses relating to assets still held atJune 30, 2013

Millions of yen
Three months ended June 30, 2013
Subordinatedinterests
Corporate
resultingdebt
fromsecurities
securitization
Total
13,637
84,68898,325500
500(1,400)(7,223)(8,623)(1)(221)
12,01550
1,803
79,81849
1,582
91,833---(a) Level 3 gains or losses included in earnings for the three months ended June 30, 2013 are reported
in other income (deductions) for corporate debt securities and are reported in revenue forsubordinated interests resulting from securitization.

Balance at beginning of period
Purchases
Settlements
Total gains or losses (realized/unrealized)
Included in earnings (a)Included in other comprehensive loss
Balance at end of period
The amount of total gains or losses for the period
included in earnings attributable to the change inunrealized gains or losses relating to assets still held atJune 30, 2012

Millions of yen
Three months ended June 30, 2012
Subordinatedinterests
Corporate
resultingdebt
fromsecurities
securitization
Total
24,264
66,31390,577
10,52910,529(1,390)(5,998)(7,388)(132)
22,74294(2,802)
68,13694(2,934)90,878---(a) Level 3 gains or losses included in earnings for the three months ended June 30, 2012 are reported
in revenue.

F-30

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013(20) Financing Receivables and Allowance for Doubtful Receivables
The Company classifies financing receivables aggregated and categorized as finance leases, installment
loans, mortgage loans, and other financing receivables, based on the nature of risks and characteristics
as described below.
Financing receivables from equipment leases, installment arrangements, mortgage loans, and otherreceivables with a contractual maturity of one year or more are subject to disclosure as reported in thisnote. Trade receivables from sale of products or services that have contractual maturities of one year orless are excluded from this note. Finance lease receivables are recorded based on the total minimum
payments to be received and unguaranteed residual values less executory costs and unearned income.
Installment loans, mortgage loans and other financing receivables are reported on the amortized costbasis.
Finance leases are receivables from lease arrangements, including products manufactured by theCompany and certain of its subsidiaries, such as information technology equipment, manufacturingmachinery and equipment and construction machinery, typically secured by underlying assets. The
primary locations of finance leases are Japan, U.S.A., U.K. and China. The lease term ranges mainly
from three to six years. The non-specific allowance for doubtful receivables is collectively determinedon the basis of past collection experience, consideration of current economic conditions and changes inour customer collection trends as well as other factors that may affect the customers’ ability to pay.
Installment loans represent receivables from arrangements with customers and dealers to provide
financing primarily for products manufactured by the Company and certain of its subsidiaries, such as
manufacturing machinery. Installment loans are typically secured by underlying assets. The primarylocations of installment loans are Japan, U.S.A., U.K. and China. The loan term is generally less than
three years. The non-specific allowance is collectively determined on the basis of past collection
experience, consideration of current economic conditions and changes in our customer collection trends
as well as other factors that may affect the customers’ ability to pay.
Mortgage loans are financing receivables from residential loan arrangements for individuals. Mortgage
loans are usually arranged with collateral. The location of mortgage loans is Japan; more than fifty
percent of mortgage loans are arranged for employees of the Company and its domestic subsidiaries.
The term of mortgage loans is usually less than 30 years. The non-specific allowance is collectively
determined on the basis of past collection experience, consideration of current economic conditions andchanges in our customer collection trends as well as other factors that may affect the customers’ ability
to pay.
Other financing receivables are the financing service receivables provided by the subsidiaries in thefinancial services segment such as factoring, loan servicing, and other forms of commercial financing.
The contractual maturities associated with those services generally range over one to three years. The
non-specific allowance is collectively determined on the basis of past collection experience,
consideration of current economic conditions and changes in our customer collection trends as well asother factors that may affect the customers’ ability to pay.
In addition, common to all financing receivables, the Company and its subsidiaries individually evaluate
collectability of financing receivables either by discounted cash flow analyses when they determine
principal and interest of a financing receivable cannot be collected or by estimating the fair value of
related collateral when applicable and further estimating the allowance for doubtful receivables. The
Company and its subsidiaries have proprietary credit quality indicators appropriate to the unique
F-31

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

characteristics of their operations and the nature of their financing receivable portfolios. Based on such
indicators as the duration of overdue payments, the unpaid amounts, the existence of extended payment
terms, evaluation by third-party credit agencies, and the degree of debtors’ excessive debt, the Company
and its subsidiaries classify and monitor their financial receivables into two categories: the individually
evaluated receivables, and the collectively evaluated receivables.
Interest income for long-term financing receivables is recognized on the accrual basis.
As of June 30, 2013 and March 31, 2013, financing receivables include past due receivables in theamount of ¥36,314 million and ¥28,055 million, respectively. Of these amounts, financing receivables
past due 90 days or more and still accruing interest amounted to ¥9,715 million and ¥7,802 million,
respectively.
The following tables present the allowance for doubtful receivables and recorded investment infinancing receivables as of June 30, 2013 and 2012, and changes in the allowance for the three months
ended June 30, 2013 and 2012.
Millions of yen
June 30, 2013
FinanceleasesAllowance for doubtfulreceivables
Balance, March 31, 2013
Provision
RecoveryWrite off
Acquisitions anddivestitures
Balance, June 30, 2013
Applicable to amounts;
Individually evaluatedfor impairment
Applicable to amounts;
Collectively evaluatedfor impairment
Financing receivables
Balance, June 30, 2013
Applicable to amounts;
Individually evaluatedfor impairment
Applicable to amounts;
Collectively evaluatedfor impairment

Installment
loans

Mortgage
loans

Other
financingreceivables

Total

9,946
1,889
(1,103)
(83)

2,209
948
(504)
(640)

153
2
(6)
-

5,082
1,767
(612)
(296)

17,3904,606(2,225)(1,019)1,820
12,469

73
2,086

149

165
6,106

2,058
20,810

7,419

703

46

3,507

11,675

5,050

1,383

103

2,599

9,135

884,980

240,229

166,021289,056

1,580,286

20,393

824

94

8,062

29,373

864,587

239,405

165,927

280,994

1,550,913

F-32

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

Millions of yen
June 30, 2012
FinanceleasesAllowance for doubtfulreceivables
Balance, March 31, 2012
Provision
RecoveryWrite off
Balance, June 30, 2012
Applicable to amounts;
Individually evaluatedfor impairment
Applicable to amounts;
Collectively evaluatedfor impairment
Financing receivables
Balance, June 30, 2012
Applicable to amounts;
Individually evaluatedfor impairment
Applicable to amounts;
Collectively evaluatedfor impairment

Installment
loans

Mortgage
loans

Other
financingreceivables

Total

7,680
1,359
(495)
(91)
8,453

1,912
450
(205)
(200)
1,957

210
36
(34)
(1)
211

6,509
619
(433)
(276)
6,419

16,311
2,464(1,167)(568)
17,040

3,514

770

85

4,298

8,667

4,939

1,187

126

2,121

8,373

710,400

149,548

185,454

224,807

1,270,209

9,828

1,098

172

8,477

19,575700,572

148,450

185,282

216,330

1,250,634

In addition, as of June 30, 2013 and March 31, 2013, the amounts of impaired loans relating toreceivables which arose from sales of products or services are ¥32,680 million and ¥44,558 million,
respectively.
(21) Subsequent Events
On June 11, 2013, the Company executed the definitive agreements on the business integration covering
the thermal power generation systems business with Mitsubishi Heavy Industries, Ltd. (MHI).
On July 31, 2013, in accordance with the definitive agreements, MHI and the Company executed theabsorption-type company split agreements with the integrated company established by MHI in order totransfer their business centered on the thermal power generation systems.
The Company expects to apply the provisions of deconsolidation and initial measurements of an equity
method investee to the company split. In accordance with this accounting treatment, the assets andliabilities subject to the company split will be transferred to the integrated company and shares of theintegrated company allotted due to the company split are expected to be recorded under investments inaffiliated companies evaluated at fair value on January 1, 2014, the effective date of the company split.

F-33

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013(22) Segment Information
The operating segments of the Company are the components for which separate financial information isavailable and for which segment profit or loss amounts are evaluated regularly by the chief operating
decision maker in deciding how to allocate resources and in assessing performance. The Company hasaggregated certain operating segments into reportable segments for reporting purpose, since suchaggregation helps financial statement users better understand the Company’s performance.
The reportable segments correspond to categories of activities classified primarily by markets, products
and services.
The Company discloses its business in ten reportable segments: Information & Telecommunication
Systems, Power Systems, Social Infrastructure & Industrial Systems, Electronic Systems & Equipment,
Construction Machinery, High Functional Materials & Components, Automotive Systems, DigitalMedia & Consumer Products, Others (Logistics and Other services) and Financial Services.
The primary products and services included in each segment are as follows:
Information & Telecommunication Systems:
Systems integration, Outsourcing services, Software, Disk array subsystems, Servers, Mainframes,
Telecommunication equipment and ATMs
Power Systems:
Thermal, Nuclear and Renewable energy power generation system and Transmission & distribution
systems
Social Infrastructure & Industrial Systems:
Industrial machinery and plants, Elevators, Escalators and Railway systems
Electronic Systems & Equipment:
Semiconductor and LCDs manufacturing equipment, Test and measurement equipment, Medical
electronics equipment, Power tools and Electronic parts manufacturing system
Construction Machinery:Hydraulic excavators, Wheel loaders and Mining machinery
High Functional Materials & Components:
Wires and cables, Copper products, Semiconductor and display related materials, Circuit boards andmaterials, Specialty steels, Magnetic materials and components and High grade casting components andmaterials
Automotive Systems:
Engine management systems, Electric powertrain systems, Drive control systems and Car information
systems
Digital Media & Consumer Products:
Air-conditioning equipment, Room air conditioner, Refrigerators, Washing machines, Optical disk
drives, LCD projectors and Flat-panel TVs

F-34

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

Others (Logistics and Other services):
Logistics, Information storage media, Batteries, Property management and others
Financial Services:
Leasing and Loan guarantees
Effective April 1, 2013, the Company changed the name of Others to Others (Logistics and Other
services).
Effective April 1, 2013, the Company changed its measurement of segment profitability from operating
income to earnings before interest and taxes (EBIT). Accordingly, the amounts previously reported forthe three months ended June 30, 2012 have been restated in conformity with the new measure ofsegment profit or loss.
The following tables show segment information for the three months ended June 30, 2013 and 2012.
Revenues from Outside Customers

Information & Telecommunication Systems
Power Systems
Social Infrastructure & Industrial Systems
Electronic Systems & Equipment
Construction Machinery
High Functional Materials & Components
Automotive Systems
Digital Media & Consumer Products
Others (Logistics and Other services)
Financial Services
Subtotal
Corporate items
Total

F-35

Three months
ended June 30,
2013

Millions of yen
Three months
ended June 30,2012348,264
138,454
225,160
198,035
178,123
321,692
207,273
209,457
180,543
75,8492,082,850
88
2,082,938

331,165
170,050
200,677
217,294
197,962
325,774
204,334
199,631
190,232
83,4602,120,579
136
2,120,715

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

Revenues from Intersegment Transactions

Information & Telecommunication Systems
Power Systems
Social Infrastructure & Industrial Systems
Electronic Systems & Equipment
Construction Machinery
High Functional Materials & Components
Automotive Systems
Digital Media & Consumer Products
Others (Logistics and Other services)
Financial Services
Subtotal
Corporate items and Eliminations
Total

Three months
ended June 30,
2013

Millions of yen
Three months
ended June 30,
201242,82917,09632,412
27,643468
16,443592
18,14382,505
5,864
243,995(243,995)-

40,471
20,52437,39627,965
1,080
17,385668
18,921
88,333
11,170263,913(263,913)-

Three months
ended June 30,
2013

Millions of yen
Three months
ended June 30,
2012

391,093
155,550
257,572
225,678
178,591
338,135
207,865
227,600
263,048
81,7132,326,845(243,907)
2,082,938

371,636
190,574
238,073245,259
199,042
343,159
205,002
218,552
278,565
94,6302,384,492(263,777)
2,120,715

Total Revenues

Information & Telecommunication Systems
Power Systems
Social Infrastructure & Industrial Systems
Electronic Systems & Equipment
Construction Machinery
High Functional Materials & Components
Automotive Systems
Digital Media & Consumer Products
Others (Logistics and Other services)
Financial Services
Subtotal
Corporate items and Eliminations
Total

F-36

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

Segment Profit (Loss)
Three months
ended June 30,
2013

Millions of yen
Three months
ended June 30,
2012

Information & Telecommunication Systems
Power Systems
Social Infrastructure & Industrial Systems
Electronic Systems & Equipment
Construction Machinery
High Functional Materials & Components
Automotive Systems
Digital Media & Consumer Products
Others (Logistics and Other services)
Financial Services
Subtotal
Corporate items and Eliminations
Total Segment profit609(4,172)
1,888
1,252
6,137
25,257
9,883
1,778
10,286
9,493
62,411(3,866)58,545(972)
1,949(2,056)
8,358
10,74020,396
8,238
42
9,087
7,767
63,549(11,312)52,237

Interest income
Interest charges
Income before income taxes

3,173(6,319)55,3993,680(7,051)
48,866

Intersegment transactions are recorded at the same prices used in transactions with third parties.
Corporate items include unallocated corporate expenses, such as leading edge R&D expenditures, andothers.

F-37

HITACHI, LTD. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
June 30, 2013

Operating Income

Information & Telecommunication Systems
Power Systems
Social Infrastructure & Industrial Systems
Electronic Systems & Equipment
Construction Machinery
High Functional Materials & Components
Automotive Systems
Digital Media & Consumer Products
Others (Logistics and Other services)
Financial Services
Subtotal
Corporate items and Eliminations
Total

Three months
ended June 30,
2013

Millions of yen
Three months
ended June 30,
201272(5,877)(444)
329
11,772
26,047
9,714
607
7,091
8,281
57,592(2,107)55,485(1,408)2,485(2,034)
9,538
14,10820,011
9,327
17
8,948
7,250
68,242(4,668)63,574

Operating income is presented as total revenues less total cost of sales and selling, generaladministrative expenses in order to be consistent with financial reporting principles and practices
generally accepted in Japan.

F-38

[Cover][Document Filed]

Confirmation Letter[Applicable Law]

Article 24-4-8, Paragraph 1 of the Financial Instruments and Exchange Act ofJapan[Filed to]

Director, Kanto Local Finance Bureau[Filing Date]

August 9, 2013

[Company Name]

Kabushiki Kaisha Hitachi Seisakusho[Company Name in English] Hitachi, Ltd.
[Title and Name of

Hiroaki Nakanishi, President

Representative][Name and title of CFO]

Toyoaki Nakamura, Executive Vice President and Executive Officer[Address of Head Office]6-6, Marunouchi 1-chome, Chiyoda-ku, Tokyo[Place Where Available forTokyo Stock Exchange, Inc.

Public Inspection](2-1, Nihombashi Kabutocho, Chuo-ku, Tokyo)
Nagoya Stock Exchange, Inc.
(8-20, Sakae 3-chome, Naka-ku, Nagoya)A-1

1. Matters Related to Adequacy of Statements Contained in the Annual Securities Report
Mr. Hiroaki Nakanishi, President, and Mr. Toyoaki Nakamura, Executive Vice President andExecutive Officer, confirmed that statements contained in the Quarterly Report for the first quarter of
145th fiscal year (from April 1, 2013 to June 30, 2013) were adequate under the Financial Instruments andExchange Act.
2. Special Notes
None.

A-2