This document has been translated from a part of the Japanese originalfor reference purposes only. In the event of any discrepancy between
this translated document and the Japanese original, the original shallprevail. JAIC assumes no responsibility for this translation or for direct,
indirect or any other forms of damages arising from the translation.

QualitativeInformationonConsolidated

OperatingResults for the six months Ended September 30, 2021
(1) Outline of consolidated operating results
The consolidated operating results of the JAIC Group for the six months ended
September 30, 2021 (from April 1, 2021 to September 30, 2021) recorded
operating revenue of 1,018 million yen (down 19.0% year-on-year), operating grossprofit of 293 million yen (down 44.9 % year-on-year), operating loss of 413 million
yen (compared to operating loss of 179 million yen for the same period last year),ordinary loss of 529 million yen (compared to ordinary loss of 300 million yen forthe same period last year) and loss attributable to owners of parent of 651 million
yen (compared to loss attributable to owners of parent of 342 million yen for thethe second quarter of the previous fiscal year). The breakdown of operating results
are as follows.
(a) Breakdown of operating revenue and operating cost
(Fund management fees)
Fund management fees etc. consist of management fees and administrative feesfrom investment funds. Total fund management fees etc. was 59 million yen (up0.6% year-on-year), which was almost the same as the amount for the same period
last year. Of the total fees, fund management fees decreased due to a decrease infees from the fund that started the liquidation process. On the other hand, fundadministrative fees increased mainly due to an increase in the number ofadministrative trust funds.
(Investment income)
Most of the proceeds of sale of operational securities were private equity
investments for both the second quarter of the current fiscal year under review andthe same period last year. In the same period last year JAIC mainly sold listed shareswith high profit margins. On the other hand, in the second quarter of the current
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fiscal year under review, JAIC sold unlisted shares of an investee those wereliquidated by prioritizing collection of funds over capital gain. Along with this theproceeds of sale of operational securities decreased to 213 million yen (down15.7 % year-on-year). Realized capital gain, which is calculated by deducting costof securities sold from proceeds of sales of operational investment securities, also
decreased to 44 million yen (down 71.7% year-on-year).
The total amount of investment write-offs and provision for allowance for possible
investment losses increased to 152 million yen (compared to reversal of 57 million
yen for the same period last year). For the same period last year, reversal ofallowance for possible investment losses was recorded with regard to some investee
companies. It was because investment recovery amount from these investee
companies was expected to be greater than anticipated. On the other hand, for thesecond quarter of the current fiscal year under review, investment write-offs andprovision for allowance for possible investment losses were recorded. The businessconditions of some investee companies have deteriorated and the estimated amountof recovery from them has decreased.
As a result, investment loss, which is calculated by deducting investment write-offs
and provision for allowance for possible investment losses from realized capital gains,
amounted to 107 million yen (compared to investment income of 216 million yen
for the same period last year).
(Fund interests income, etc.)
Fund interests income, etc. includes revenue from electricity sales, revenue fromvegetable sales and other revenues from the projects operated by the JAIC Group,interests income from the projects operated by other companies (such as net profits
of the projects sourced from electricity sales and gains from the sale of projects),
interests income from private equity funds operated by other companies, interestand dividend income and other income.
The total amount of fund interests income, etc. for the second quarter of the current
fiscal year under review decreased to 730 million yen (down 21.6% year-on-year).
Out of this, revenue from electricity sales, revenue from vegetable sales and otherrevenues from the projects operated by the JAIC Group accounted for 690 million
yen (down 18.0% year-on-year). The main factor of the decrease was the sale ofsome mega solar projects that were selling electricity in the previous fiscal year.
Interests income from private equity funds operated by other companies also
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decreased to 27 million yen (down 66.3% year-on-year) owning to a decrease incapital gains from investee companies of the funds.
(Fund interests losses, etc.)
Fund interests losses, etc. includes cost of electricity sales, cost of producing
vegetables and other costs of the projects operated by the JAIC Group, interests
losses (such as costs, etc. of projects under construction) of the projects operated
by other companies and interests losses, etc. of the private equity funds operated
by other companies.
The total amount of fund interests losses etc. for the second quarter of the current
fiscal year under review decreased to 398 million yen (down 41.7% year-on-year).
Out of this, cost of electricity sales, cost of producing vegetables and other costs ofthe projects operated by the JAIC Group accounted for 363 million yen (down 22.2%year-on-year). The main factor of the decrease was the sale of some mega solar
projects that are selling electricity in the previous fiscal year. Additionally, losses
decreased to 34 million yen (down 84.0% year-on-year) from the private equity
funds operated by other companies.
As a result, operating revenue decreased by 19.0% year-on-year to 1,018 million
yen, operating cost increased by 0.0% year-on-year to 724 million yen andoperating gross profit decreased by 44.9% year-on-year to 293 million yen.
(b) Selling, general and administrative expenses and operating income
The total amount of selling, general and administrative expenses was 707 million
yen (down 0.8% year-on-year), which was almost the same as the amount for thesame period last year. While labor costs increased, project operating costs
decreased due to the sale of some mega solar projects in the previous fiscal year.
In addition, depreciation expenses also decreased for the second quarter of thecurrent fiscal year under review. Depreciation expenses temporarily increased forthe same period last year due to the relocation of the head office.
As a result, operating loss was 413 million yen (compared to operating loss of 179
million yen for the same period last year).
(c) Non-operating income, non-operating expenses
Non-operating income decreased to 14 million yen (down 70.6% year-on-year) due
mainly to a decrease of gain on an investment partnership.
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Non-operating expenses decreased to 130 million yen (down 22.9% year-on-year)
due mainly to a decrease of interest expenses with the reduction of the balance ofloans payable.
As a result, ordinary loss was 529 million yen (compared to ordinary loss of 300
million yen for the same period last year).
(d) Extraordinary income/loss and Profit/Loss attributable to owners of parent(Extraordinary income/loss)
The main item of extraordinary income/loss for the same period last year was gain
on redemption of investment securities. Total extraordinary income amounted to 13
million yen.
The main item of extraordinary income/loss for the current second quarter underreview was loss on valuation of investment securities. Total extraordinary losses
amounted to 101 million yen.
As a result, loss before income taxes amounted to 630 million yen (compared toloss before income taxes of 290 million yen for the same period last year).
(Profit/loss attributable to owners of parent)
As a result of deducting income taxes and profit attributable to non-controllinginterests from loss before income taxes, loss attributable to owners of parent
amounted to 651 million yen (compared to loss attributable to owners of parent of
342 million yen for the same period last year). JAIC properly estimated tax effectaccounting and did not recognize deferred tax assets for both the second quarter ofthe current fiscal year under review and the same period last year.
(2) Cash flows(Cash flow from operating activities)
Net cash used in operating activities amounted to 1,232 million yen (compared to326 million yen generated from for the same period last year), due mainly to thedecrease in distribution from investment funds.
(Cash flow from investing activities)
Net cash generated from investing activities was 55 million yen (compared to 13
million yen used in for the same period last year) mainly due to proceeds from salesof investment securities.

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(Cash flow from financing activities)
Net cash used in financing activities with repayments of long-term borrowings was
697 million yen (compared to 697 million yen for the same period last year).
Cash and cash equivalents as of September 30, 2021 decreased by 1,855 million
yen from March 31, 2021 to 1,445 million yen, after adding effect of exchange ratechange on cash and cash equivalents of 19 million yen.
(3) Financial position(Assets)
Total assets as of September 30, 2021 decreased to 23,743 million yen (comparedto 25,165 million yen as of March 31, 2021).
Cash and deposits decreased to 5,035 million yen (compared to cash and depositsof 6,486 million yen as of March 31, 2021) due to repayment of loans payable,payment of expenses and interests, and investment executions.
Meanwhile, the amount of the cash and deposits included deposits attributable tothe investment funds operated by the JAIC Group. Those deposits must bemanaged in accordance with each fundʼs partnership agreement. The JAIC Group
clearly separates and manages those deposits from cash and deposits belonging
to the JAIC Group. Cash and deposits belonging to the JAIC Group were cash andcash equivalents of 1,445 million yen as of September 30, 2021 (compared to3,301 million yen as of March 31, 2021) in the consolidated statements of cashflows.
In addition, private equity investments conducted by the JAIC Group are highly
affected by factors such as stock market fluctuations due to the nature of theirbusiness. It is difficult to make a reasonable forecast of business results in thecurrent volatile environment. As a result, the amount of funds recovered fromprivate equity investments could decline significantly. Under these circumstances,
the JAIC Group must maintain a certain balance of cash and deposits at all times toensure not only the payment of expenses and interests and the repayment of loans
payable but also the investment for future growth.
Property, plant and equipment mainly consists of renewable energy power plantfacilities of projects operated by the JAIC Group. The amount as of September 30,
2021 increased to 8,184 million yen (compared to 7,852 million yen as of March 31,
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2021) because the power generation equipment under planning was recorded in
the construction in progress.
Operational investment securities consist of private equity investment assets, theassets of the projects operated by other companies and the assets of some projects
operated by the JAIC Group. These projects operated by the JAIC Group and in theearly stages of development are recorded as operational investment securities
because those are not included in the scope of consolidation due to their low
financial importance.
Operational investment securities as of September 30, 2021 decreased to 9,070
million yen (compared to 9,379 million yen as of March 31, 2021). The main reason
for the decrease was that some of the projects operated by the JAIC Group wereconsolidated and they were recorded in other items such as property, plant andequipment. Those projects were consolidated due to the progress of development
and the increase in financial importance.
Allowance for possible investment losses as of September 30, 2021 increased to1,439 million yen (compared to 1,349 million yen as of March 31, 2021), because
provisions were posted for the second quarter of the current fiscal year under review.
As a result, the investment loss provision ratio (ratio of allowance for possible
investment losses to operational investment securities) as of September 30, 2021
was 15.9 % (up 1.5 points from March 31, 2021).
(Liabilities)
Total liabilities decreased to 15,366 million yen as of September 30, 2021
(compared to 16,059 million yen as of March 31, 2021).
In liabilities, total of loans payable and bonds as of September 30, 2021 decreased
to 14,155 million yen (compared to 14,990 million yen as of March 31, 2021). Loanspayable of JAIC itself decreased to 6,253 million yen (compared to 6,950 millionyen as of March 31, 2021). Project finance and bonds for the projects operated by
the JAIC Group as of September 30, 2021 decreased to 7,902 million yen (comparedto 8,039 million yen as of March 31, 2021).
Loans payable of JAIC itself decreased reflecting the repayments of 697 million yen
for the second quarter of the current fiscal year under review. After securing
investment funds for future growth, JAIC will continue to repay its loans payable.
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The balance of loans payable by project finance and bonds for the projects operated
by the JAIC Group decreased by 137 million yen reflecting the repayments for thesecond quarter of the current fiscal year under review. Project finance and bond forthe projects operated by the JAIC Group will not affect the financial soundness of
the JAIC Group, since its source of payments is limited to the assets and revenuesof the projects. Therefore, the JAIC Group will continue to expand fund raisingthrough project finance and bond. The JAIC Group will promote leveraged
investment in a wide range of projects including renewable energy projects
operated by the JAIC Group. This enhance profitability of the JAIC Group withoutcompromising on financial soundness.
(Net assets)
In net assets, total shareholdersʼ equity as of September 30, 2021 decreased to6,650 million yen (compared to 7,328 million yen as of March 31, 2021) due to aquarterly net loss attributable to owners of the parent and a decrease in unrealized
gains on securities. As a result, the equity ratio as of September 30, 2021 fell by
1.1 points to 28.0% (compared to 29.1% as of March 31, 2021). Total net assets
as of September 30, 2021 also decreased to 8,377 million yen (compared to 9,106
million yen as of March 31, 2021).
(4) Business Position(a) Investment and loan activities
For the second quarter of the current fiscal year under review, new investments
and loans increased by 238.6% year-on-year to 2,214 million yen in 15
companies/projects. As of September 30, 2021, the balance of investments andloans increased to 14,741 million yen in 124 companies/projects (compared to12,855 million yen in 121 companies/projects as of March 31, 2021).
As for private equity investment, when JAICʼs own capital is invested, JAIC makes
strategic investment in partner companies for project oriented investment. JAIC
invests its own capital in a selective manner based on business themes in line withits management philosophy in principle. When the capital of a fund is invested, JAIC
makes financial investment pursuant to the fundʼs investment policy.
For the second quarter of the current fiscal year under review, new investments
increased by 707.8% year-on-year to 1,282 million yen in 5 companies.
The amount increased due to the execution of strategic investments and the7/8

execution of investments from the fund supporting the business succession needs.
On the other hand, no large scale divestment was executed for the second quarterof the current fiscal year under review As a result, the balance of investments andloans increased to 7,754 million yen in 87 companies (compared to 6,767 million
yen in 88 companies as of March 31, 2021).
Looking at project oriented investment for the second quarter of the current fiscal
year under review, new investments and loans increased by 88.2% year-on-year to932 million yen in 10 projects. The investment amounts in smart-agriculture projectand renewable energy projects increased.
No project was sold for the second quarter of the current fiscal year under review.
As a result, the balance of investments and loans as of September 30, 2021
increased to 6,986 million yen in 37 projects (compared to 6,088 million yen in 33
projects as of March 31, 2021).
As of September 30, 2021, JAIC invested in 16 mega solar projects (18 powerplants) with the capacity of 70.5ＭＷ which are either currently selling electricity or
are under construction or planning. Out of these mega solar projects, the portion
that attributable to JAIC is 26.7ＭＷ in capacity. JAIC also invested in one woody
biomass project with the capacity of 2.0ＭＷ, two biogas projects with the capacityof 1.1ＭＷ, one biogas plant operator and one wind power project with the capacityof 25.2ＭＷ at most.
(b) Management of investment funds
As of September 30, 2021, the number of investment funds, for which the JAIC
Group is responsible for management, operation or provision of investment
information, totaled 10, and the balance of total commitment amounts undermanagement decreased to 15,884 million yen (compared to 11 investment fundswith 16,450 million yen as of March 31, 2021).
In the second quarter of the current fiscal year under review, 1 fund (totalcommitment amount of 1,001 million yen) was established. The total commitment
amount in investment funds decreased, however, due to 1 fund (total commitment
amount of 500 million yen) which had been under liquidation procedure and 1 fund(total commitment amount of 1,178 million yen) which maturity had been extended.
(End)

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