Consolidated Financial Highlights for the Second Quarter Ended September 30, 2021
[Based on J-GAAP]
November 12, 2021
Company Name:
Mitsubishi HC Capital Inc.
Stock Exchange Listed on: Tokyo and Nagoya Stock Exchange (First Section)
Company Code:8593
URL: https://www.mitsubishi-hc-capital.com/
Representative:
Takahiro Yanai, Representative Director, President & CEO
For Inquiry:
Satoshi Inoue, Director, Senior Managing Executive Officer TEL: +81-3-6865-3002
Scheduled Date of Submission of Financial Reports:
November 12, 2021
Scheduled Commencement of Dividend Payment:
December 10, 2021
Supplemental Material for Financial Results:
Available
Holding of Quarterly Financial Results Meeting:Yes (for Institutional Investors and Analysts)(Amounts of less than one million yen are rounded down)
1. Consolidated Results for the Second Quarter Ended September 30, 2021 (April 1, 2021 – September 30, 2021)(1) Consolidated Operating Results (Cumulative)(% represents the change from the same period in the previous fiscal year)
Revenues

For the six months ended

Operating income

Net income attributable toowners of the parent

Recurring income(Millions of yen)%

(Millions of yen)%

(Millions of yen)%

(Millions of yen)%

September 30, 2021

833,358

83.3

58,151

80.6

59,08975.7

60,482146.0

September 30, 2020

454,604－

32,199－33,632－

24,586－(Note) 1. Comprehensive income:Six Months Ended September 30, 2021: ¥74,310 million 517.5%
Six Months Ended September 30, 2020: ¥12,034 million-%
2. The Company (the former Mitsubishi UFJ Lease & Finance Company Limited) executed the business integration with Hitachi
Capital Corporation on April 1, 2021.The consolidated operating results for the Six Months ended September 30, 2020 represent
the results of the former Mitsubishi UFJ Lease & Finance Company Limited.
3. Percentages change for the Six Months ended September 30, 2020 are omitted as changes in accounting policies were applied
retrospectively.

Earnings per share

Dilutedearnings per share

For the six months ended

(Yen)

(Yen)

September 30, 2021

42.13

42.03

September 30, 2020

27.59

27.49

(2) Consolidated Financial Position
Total assets

As ofTotal Equity

Equity ratio(Millions of yen)

(Millions of yen)%

September 30, 2021

9,459,998

1,252,420

13.0

March 31, 2021

6,014,896

817,906

13.4(Reference) Shareholders’ equity:

As of September 30, 2021: ¥1,229,647 million
As of March 31, 2021:¥803,796 million(Note) 1. The consolidated financial position for the Year ended March 31, 2021 represent the results of the former Mitsubishi UFJ Lease &Finance Company Limited.
2. Changes in accounting policies were applied retrospectively to figures as of March 31, 2021.

2. Dividends
1st Quarter end

2nd Quarter end

Dividends per share
3rd Quarter end

Year - end

AnnualFor the year ended

(Yen)

(Yen)

(Yen)

(Yen)

(Yen)

March 31, 2021

－

12.75

－

12.75

25.50

March 31, 2022
March 31, 2022
(Forecast)

－

13.00
－

13.00

26.00

(Note) Changes from the latest released dividend forecasts: None

3. Consolidated Earnings Forecasts for the Year Ending March 31, 2022 (April 1, 2021 - March 31, 2022)(Year-on-year change %)Net income attributable toowners of the parent%(Millions of yen)
Full year

95,000Earnings per share
(Yen)

71.7

66.17

(Note) Changes from the latest released performance forecasts: None1

* Notes(1) Significant changes in subsidiaries during the period(Change of specific subsidiaries accompanying the change of scope of consolidation):

Yes

Newly included: 13 companies(Company name)
Capital Insurance Corporation, Mitsubishi HC Business Lease Corporation*, Hitachi Capital (UK) PLC, Mitsubishi
HC Capital America, Inc.*, Mitsubishi HC Capital Canada, Inc.*, Mitsubishi HC Capital Management (China) Limited,
Mitsubishi HC Capital (Hong Kong) Limited, Mitsubishi HC Capital Leasing (Beijing) Co., Ltd., Mitsubishi HC Capital
Factoring (Shanghai) Co., Ltd., Mitsubishi HC Capital Asia Pacific Pte. Ltd., Mitsubishi HC Capital (Thailand) Co.,
Ltd.*, PT HCD Properti Indonesia, Japan Infrastructure Initiative Company Limited*These subsidiaries have been changed the trade names since August 2021 and the trade names above arechanged ones.
(2) Application of accounting treatments specific to the preparation of the quarterly
consolidated financial statements:
Yes(Note) For details, please refer to “2. Quarterly Consolidated Financial Statements and Major Notes, (3) Notes to
the Quarterly Consolidated Financial Statements (Application of accounting treatments specific to the
preparation of the quarterly consolidated financial statements)” on page 15.
(3) Changes in accounting policies, changes in accounting estimates, and restatement of revisions(ⅰ) Changes in accounting policies with revision of accounting standards, etc.
:
Yes(ⅱ) Changes in accounting policies other than (ⅰ) above:Yes(ⅲ) Changes in accounting estimates:No(ⅳ) Restatement of revisions:
No(Note) For details, please refer to “2. Quarterly Consolidated Financial Statements and Major Notes, (3) Notes to
the Quarterly Consolidated Financial Statements (Changes in accounting policies)” on page 15.
(4) Number of outstanding shares (common shares)(ⅰ) Number of outstanding
shares (including treasury
shares)(ⅱ) Number of treasury shares(ⅲ) Weighted average numberof shares outstanding

As of September 30, 2021

1,466,912,244 shares As of March 31, 2021
31,232,500

As of September 30, 2021
For the Six Months ended
September 30, 2021

shares As of March 31, 2021

For the Six Months ended
1,435,598,327 shares
September 30, 2020

895,834,160

shares4,368,016

shares891,125,958

shares(Note) As a result of the business integration with Hitachi Capital Corporation on April 1, 2021 (merger ratio:1:5.1),
the number of outstanding shares increased by 571,078,084 shares to 1,466,912,244 shares.
* This “Consolidated Financial Highlights” is outside the scope of an audit by certified public accountants or an audit firm.
* Explanation regarding the appropriate use of the forecasts, etc.
(Remarks on forward-looking statements)
The forward-looking statements in this report, including earnings forecasts, have been prepared using information
available to the Company on the date of release and certain assumptions deemed reasonable by the Company, and are
not intended to assure that the Company will achieve such results. Actual earnings may differ significantly from theforecasts for various reasons.
* This “Consolidated Financial Highlights” is made in Japanese and translated into English. The Japanese text is the original
and the English text for reference purposes. If there is any conflict or inconsistency between these two texts, the Japanese
text shall prevail.

2

Contents
1．Qualitative Information concerning Financial Results for the Second Quarter Ended September 30, 2021

4(1) Summary of Operating Results

4(2) Summary of Consolidated Financial Position

7(3) Explanation on Future Forecast Information including Consolidated Earnings Forecasts

7

2．Quarterly Consolidated Financial Statements and Major Notes

8(1) Quarterly Consolidated Balance Sheets

8(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income

10

Quarterly Consolidated Statements of Income
For the Six Months ended September 30, 2021 and 2020

10

Quarterly Consolidated Statements of Comprehensive Income
For the Six Months ended September 30, 2021 and 2020
(3) Notes to the Quarterly Consolidated Financial Statements

11
12(Segment information)

12(Notes concerning going concern assumption)

15(Notes concerning significant changes in shareholders’ equity)

15(Application of accounting treatments specific to the preparation of the quarterly consolidated financial 15
statements)(Changes in accounting policies)

15(Additional information)

173

1. Qualitative Information concerning Financial Results for the Second Quarter Ended September 30, 2021
(1) Summary of Operating Results
On April 1, 2021, the Company (the former Mitsubishi UFJ Lease & Finance Company Limited, “MUL”) executed thebusiness integration with Hitachi Capital Corporation (“HC”) and changed the trade name to Mitsubishi HC Capital Inc.
Accordingly, the figures for the Six Months ended September 30, 2020 in 1) Summary of operating results and topics
are the sum of consolidated results of MUL and those of HC (IFRS basis) converted into J-GAAP basis in a simplified
manner, which are presented as reference value.
Figures for the Six Months ended September 30, 2020 and as of March 31, 2021 in 2) Operating results by reporting
segments are the sum of consolidated results of MUL and those of HC (IFRS basis) converted into J-GAAP basis in a
simplified manner, which are reclassified to conform to the new segmentation and presented as reference value.
1) Summary of operating results and topics
Summarized results for the Six Months ended September 30, 2021 were as follows.
Net income attributable to owners of the parent increased by ¥23.5 billion, or 63.9% year on year (reference
value) to ¥60.4 billion mainly thanks to performance improvement primarily in Europe and the U.S. in Account
Solution segment, continuous replacement of the portfolio and steady promotion in asset turnover business despitea reactionary fall in sales gains and absence of compensation received in association with the redevelopment project,both recorded in Real Estate segment in the Six Months ended September 30, 2020.
In the business integration with HC, the excess of the fair value of net assets of HC as of the date of the businessintegration over the acquisition cost amounting to ¥0.4 billion is recognized as gain on bargain purchase.
One of the major topics, in Logistics segment in June 2021, is that the Company decided to acquire all shares of
CAI International, Inc., a leading U.S. marine container leasing company, and make the company its wholly-owned
subsidiary. This acquisition will enable the Company to enhance the global competitiveness in the marine container
leasing business with stable demand and high profitability as the sustainable growth market and also develop thebusiness as a driver to support the medium- to long-term growth by capitalizing on the growth potential.
We are also strengthening our efforts toward realization of prosperous and sustainable society such as
decarbonization and established the Tokorozawa Kitaiwaoka Solar Power Plant in July 2021 under the solar sharing
model which allows to cope with both providing electricity to Tokorozawa City, Saitama Prefecture, and cultivating
blueberries. Our overseas efforts include the acquisition of shares of Trung Nam Wind Power Joint Stock Company,a Vietnamese wind power generation business developer and operator, in May 2021 to enter the wind power market
in Vietnam and the investment in a solar power generation business in California, the U.S., in September 2021. In
October 2021, we also made investment in Universal Hydrogen Co., a U.S. hydrogen-powered aircraft-relatedcompany, with an aim to contribute to reducing environmental impacts of the aviation sector and building hydrogenvalue chains.
(Billions of yen)
Six Months Ended
September 30, 2020
(Reference value)

Six Months Ended
September 30, 2021

Change (%)

Revenues

827.0

833.3

0.8

Gross profit

144.5

161.1

11.5

Operating income

46.7

58.1

24.3

Recurring income

50.3

59.0

17.3

Net income attributableto owners of the parent

36.9

60.4

63.9

2) Operating results by reporting segments
Operating results by reporting segments were as follows.
Following the business integration with HC, the Company reorganized its reporting segments to ten segments asfollows.

4

(For details of new reporting segments, please refer to “2. Quarterly Consolidated Financial Statements andMajor Notes, (3) Notes to the Quarterly Consolidated Financial Statements (Segment information)” on page 12.
(Customer Business)
Segment profit increased by ¥17.8 billion, or 182.1% year on year (reference value), to ¥27.6 billion mainly thanks
to performance improvement of a U.S. vendor finance company ENGS Holdings Inc. and an increase in gains onsales of strategic shareholdings.
(Account Solution)
Segment profit increased by ¥4.9 billion, or 57.7% year on year (reference value), to ¥13.4 billion mainly thanks
to business growth primarily in Europe and the U.S. despite an increase in selling, general and administrative
expenses associated with expanded sales activities.
(Vendor Solution)
Segment profit decreased by ¥0.4 billion, or 20.5% year on year (reference value), to ¥1.7 billion due to adecrease in operating assets attributable to a decline in new transactions volume in the year ended March 31, 2021.
(LIFE)
Segment profit increased by ¥0.6 billion, or 40.1% year on year (reference value), to ¥2.1 billion thanks to asteady growth of real estate-related business as well as a decrease in selling, general and administrative expenses.
(Real Estate)
Segment profit decreased by ¥7.4 billion, or 51.1% year on year (reference value), to ¥7.1 billion due to areactionary fall in sales gains and absence of compensation received in association with the redevelopment project,both recorded in the Six Months ended September 30, 2020.
(Environment & Renewable Energy)
Segment profit decreased by ¥0.3 billion, or 9.6% year on year (reference value), to ¥3.2 billion due to areactionary fall in sales gains related to the solar power generation business recorded in the Six Months ended
September 30, 2020 despite an increase in electricity sales revenues.
(Aviation)
Segment profit increased by ¥0.9 billion, or 29.4% year on year (reference value), to ¥4.2 billion mainly thanks
to stable lease revenues from major customers, an increase in gain on sale of assets and posting of gain on valuationof certain receivables from bankrupt debtors despite posting of additional credit costs for certain existing customers,
expenses in relation to modification of terms for certain existing lease contracts, and foreign exchange losses related
to borrowings denominated in foreign currencies in certain businesses.
(Logistics)
Segment profit increased by ¥1.7 billion, or 528.9% year on year (reference value), to ¥2.0 billion mainly thanks
to increases in operating assets, an operating rate of the marine container leasing business and earnings of equitymethod investees in the auto leasing business.
(Mobility)
Segment profit increased by ¥0.5 billion, or 96.2% year on year (reference value), to ¥1.0 billion mainly thanks
to an increase in sales gains against a backdrop of steady used car markets in Japan and overseas.
(Others)
Segment profit decreased by ¥0.8 billion year on year (reference value) to a segment loss of ¥0.9 billion mainly
due to posting of valuation loss in association with a decline in fair value of certain investees in the infrastructurebusiness.

5Segment profits or loss by reporting segments(Billions of yen)

Reporting segments

Six Months Ended
September 30, 2020
(Reference value)

Six Months Ended
September 30, 2021

Change (%)

Customer Business

9.8

27.6

182.1

Account Solution

8.5

13.4

57.7

Vendor Solution

2.2

1.7

(20.5)

LIFE

1.5

2.1

40.1

Real Estate

14.5

7.1

(51.1)

Environment &Renewable Energy

3.6

3.2

(9.6)

Aviation

3.2

4.2

29.4

Logistics

0.3

2.0

528.9

Mobility

0.5

1.0

96.2

Others

0.0

(0.9)

-

Adjustments

(7.4)

(1.3)

-

Total

36.9

60.4

63.9

(Note) 1. Adjustments of segment profit (loss) consist mostly of adjustments of company-wide expenses
included in selling, general and administrative expenses not allocated to any reporting segments.
2. Segment profit (loss) is consistent with net income attributable to owners of the parent on thequarterly consolidated statements of income.
Segment assets by reporting segments(Billions of yen)
As of March 31,2021

Reporting segments(Reference value)

As of September 30, 2021

Change (%)

Customer Business

2,129.5

2,050.9(3.7)

Account Solution

2,109.2

2,135.5

1.2

Vendor Solution

434.4

436.8

0.6

LIFE

321.8

327.8

1.9

Real Estate

955.6

944.6

(1.2)

Environment &Renewable Energy

322.4

320.7

(0.5)

Aviation

1,203.8

1,305.8

8.5

Logistics

545.5

583.3

6.9

Mobility

161.1

165.0

2.4

Others

355.7

342.6

(3.7)

Adjustments

65.4

10.4

(84.0)

Total

8,604.8

8,623.9

0.2(Note) 1. Segment assets include operating assets, equity-method investments, goodwill and investment
securities.
2. Adjustments of segment assets consist mostly of goodwill recognized when Diamond Lease
Company Limited and UFJ Central Leasing Co., Ltd. merged and became Mitsubishi UFJ Lease &Finance Company Limited in 2007 and other segment assets such as investment securities related
to Corporate, which are not attributable to any reporting segments, and offsets in transactions
between segments.

6(2) Summary of Consolidated Financial Position
Total assets as of September 30, 2021 increased by ¥3,445.1 billion to ¥9,459.9 billion because of the businessintegration with HC on April 1, 2021. Total equity as of September 30, 2021 increased by ¥434.5 billion to ¥1,252.4
billion and interest-bearing debt (excluding lease obligations) increased by ¥2,782.2 billion to ¥7,417.1 billion.
(3) Explanation on Future Forecast Information including Consolidated Earnings Forecasts
The progress made toward the consolidated earnings forecasts (net income attributable to owners of the parentof ¥95.0 billion) during the Six Months ended September 30, 2021 was almost in line with the plan at 63.7%, withthe major contributing factor being gains on sales of strategic shareholdings, which was already taken into accountin the consolidated earnings forecasts announced on May 17, 2021. The consolidated earnings forecasts for theyear ending March 31, 2022 remains the same as there is still uncertainty in the macro environment.

7

2. Quarterly Consolidated Financial Statements and Major Notes(1) Quarterly Consolidated Balance Sheets(Millions of yen)
For the Six Months ended
September 30, 2021
(As of September 30, 2021)

For the Year ended
March 31,2021(As of March 31, 2021)
AssetsCurrent assets
Cash and deposits
Installment receivables
Lease receivables and investments in leases
Operating loans receivables
Other operating loans receivable
Lease and other receivables
Securities
Merchandise
Other current assets
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Leased assets
Leased assets
Advances on purchases of leased assets
Total leased assets
Other operating assets
Own-used assets
Total property, plant and equipment
Intangible assets
Leased assets
Other intangible assets
Goodwill
Other
Total other intangible assets
Total intangible assets
Investments and other assets
Investment securities
Distressed receivables
OthersAllowance for doubtful accounts
Total investments and other assets
Total non-current assets
Deferred assets
Bond issuance costs
Total deferred assets
Total assets

8294,241
191,043
1,628,749
809,345
58,39331,1985,469
27,468120,042(5,794)
3,160,157

405,912259,4133,087,635
1,533,632
155,246
67,8054,040
35,668157,055(19,390)
5,687,020

2,051,082
59,7502,110,833
152,138
6,248
2,269,220

2,728,387
37,612
2,766,000
234,729
14,852
3,015,581

4

53,941

57,277
93,479150,757
150,762

57,764
131,844
189,609
243,550

357,791
39,26956,742(22,501)
431,301
2,851,284

364,460
96,037
113,326(64,414)509,4093,768,541

3,454
3,454
6,014,896

4,435
4,435
9,459,998

(Millions of yen)
For the Six Months ended
September 30, 2021
(As of September 30, 2021)

For the Year ended
March 31,2021(As of March 31, 2021)
Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term borrowings
Current portion of bonds payable
Current portion of long-term borrowings
Commercial papers
Current maturities of loans from thesecuritizations of the minimum future rentals
on lease contracts
Income taxes payable
Deferred profit on installment sales
Provision for bonuses
Provision for bonuses for directors (and otherofficers)
Other current liabilities
Total current liabilities
Non-current liabilities
Bonds payable
Long-term borrowings
Loans from the securitizations of the minimum
future rentals on lease contracts, less current
maturities
Provision for retirement benefits for directors(and other officers)
Retirement benefit liability
Reserve for contract of insurance
Other non-current liabilities
Total non-current liabilities
Total liabilities
EquityShareholders' equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive
incomeShare acquisition rights
Non-controlling interests
Total equity
Total liabilities and equity

9

88,062
236,730
244,025
372,344434,171

135,797
413,325
413,543674,006
655,788

61,995257,969

10,805
10,095
5,384

17,224
11,978
9,276

505

1,239

126,660
1,590,780

210,0402,800,190

980,1812,261,273

1,735,276
2,990,439

44,234

276,823

112

122

3,060
317,345
3,606,209
5,196,990

8,076
10,592
386,057
5,407,388
8,207,578

33,196167,280
568,335(1,528)767,283

33,196548,623
617,791(19,478)
1,180,132

30,67815,169(15,519)
22,278(925)(9,459)43,841(35)

36,51249,515

1,552
12,557
817,906
6,014,896

1,942
20,8301,252,420
9,459,998

(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income(Quarterly Consolidated Statements of Income)(For the Six Months ended September 30, 2021 and 2020)(Millions of yen)
For the Six Months ended
September 30, 2020
(April 1, 2020 - September 30, 2020)
Revenues
Cost of revenues
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Share of profit of entities accounted for using
equity method
Other
Total non-operating income
Non-operating expenses
Interest expenses
Loss on valuation of derivatives
Foreign exchange losses
Other
Total non-operating expenses
Recurring income
Extraordinary income
Gain on sale of investment securities
Compensation income
Gain on bargain purchaseTotal extraordinary income
Extraordinary losses
Loss on step acquisitions
Total extraordinary losses
Income before income taxes
Income taxes
Net income
Net income attributable to non-controlling interests
Net income attributable to owners of the parent

10

For the Six Months ended
September 30, 2021
(April 1, 2021 - September 30, 2021)

454,604
373,753
80,85048,65032,199833,358
672,183
161,175
103,024
58,151

210
1,779

492
931

1,798

3,081

1,149
4,937

2,084
6,589

1,842
948
713
3,504
33,632

2,382
2,264
1,004
5,650
59,089

1,430
3,488
4,918

26,842431
27,27438,551
13,331
25,219633
24,586229
229
86,13525,17760,958476
60,482

(Quarterly Consolidated Statements of Comprehensive Income)(For the Six Months ended September 30, 2021 and 2020)(Millions of yen)
For the Six Months ended
September 30, 2020
(April 1, 2020 - September 30, 2020)

For the Six Months ended
September 30, 2021
(April 1, 2021 - September 30, 2021)

25,21960,958

8,951(15,512)(12,777)(9,055)169

5,507
21,667
868

(473)

821

(13,185)
12,034

13,351
74,31011,60873,484425

825

Net income
Other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of
the parent
Comprehensive income attributable to noncontrolling interests11(3) Notes to the Quarterly Consolidated Financial Statements(Segment information)
1. Changes in reporting segments, etc.
On April 1, 2021, the Company (the former Mitsubishi UFJ Lease & Finance Company Limited, “MUL”) executed
the business integration with Hitachi Capital Corporation (“HC”) and changed the trade name to Mitsubishi HC Capital
Inc.
Following the business integration, the Company reorganized part of the reporting segments of MUL and HC andchanged them to the following ten segments effective April 1, 2021; “Customer Business,” “Account Solution,”“Vender Solution,” “LIFE,” “Real Estate,” “Environment & Renewable Energy,” “Aviation,” “Logistics,” “Mobility,” and“Others.”
Segments of “Healthcare,” “Infrastructure & Investment,” and other businesses are aggregated into “Others” inaccordance with the aggregation criteria set forth in the “Accounting Standard for Disclosures about Segments of anenterprise and Related Information.”
Details of new reporting segments after the change are as follows.
Reporting segments

Main services and business description

Customer Business

Finance solutions for corporations

Account Solution

Financial services for companies, government agencies, and vendors

Vendor Solution

Sales finance provided through collaboration with vendors

LIFE
Real Estate
Environment &Renewable Energy

Development, operation, and leasing of logistics and commercial facilities,
community development, food and agriculture and living essentials industry,
non-life insurance
Real estate securitization finance, real estate revitalization investment business,real estate asset management business, real estate leasing business
Power generation by renewable energy, environment related equipment leasing andfinance

Aviation

Aircraft leasing business, aircraft engine leasing business

Logistics

Marine container leasing business, railway freight car leasing business,
auto leasing business

Mobility

Auto leasing business and supplementary services

OthersServicing, trust, settlement services, medical equipment leasing and finance,social infrastructure investment business, etc.

The segment information for the Six Months ended September 30, 2020 and the Year ended March 31, 2021
was prepared and reported under the classification of reporting segments of MUL.
As described in “2. Quarterly Consolidated Financial Statements and Major Notes, (3) Notes to the Quarterly
Consolidated Financial Statements (Changes in accounting policies),” the Company changed its accounting
policies effective April 1, 2021, and the new accounting policies have been retrospectively applied to the figures inthe segment information for the Six Months ended September 30, 2020 and the Year ended March 31, 2021.

12

2. Information on profit or loss by reporting segments
For the Six Months Ended September 30, 2020 (April 1, 2020 to September 30, 2020)(Millions of yen)Amountrecorded in
Adjustments quarterly
consolidated
Infrastructure (Note) 1
statements
of income& Investment(Note) 2

Reporting segments
Customer Environment
Healthcare Real EstateBusiness& Energy

9,813

Segment profit(Note)

1.
2.

2,427

327

14,577Aviation

Logistics

3,259

326

92

(6,238)24,586

Adjustments of segment profit consist mostly of adjustments of company-wide expenses included in selling, generaland administrative expenses not allocated to any reporting segments.
Segment profit is consistent with net income attributable to owners of the parent on the quarterly consolidated
statements of income.

For the Six Months Ended September 30, 2021 (April 1, 2021 to September 30, 2021)(Millions of yen)

Reporting segments
CustomerBusiness
Segment profit (loss)

Account
Solution

27,68913,467

VendorSolution

1,774

Reporting segments
Logistics
Segment profit (loss)(Note)

1.
2.

2,054

Mobility

1,055

Others

(938)

LIFE

2,146

Real Estate

Environment &Renewable
Energy

7,129

3,265

Aviation

4,217(Millions of yen)Amountrecorded inquarterly
Adjustments
consolidated(Note) 1
statements ofincome(Note) 2(1,380)60,482Adjustments of segment profit (loss) consist mostly of adjustments of company-wide expenses included in selling,
general and administrative expenses not allocated to any reporting segments, and profit adjustments of ¥1,397 million
recorded by purchase method associated with the merger with Hitachi Capital Corporation.
Segment profit (loss) is consistent with net income attributable to owners of the parent on the quarterly consolidated
statements of income.

13

3. Information on assets by reporting segments(Significant increase in assets because of a merger, etc.)
For the Six Months ended September 30, 2021, segment assets increased significantly because of the businessintegration through a merger with HC on April 1, 2021.
For the Year Ended March 31, 2021 (As of March 31, 2021)(Millions of yen)

Reporting segments
CustomerBusiness
Segment assets(Note)1

2,129,561

Environment& Energy

Healthcare

Real Estate

198,592

157,373955,654

Aviation

1,203,858

Logistics

Infrastructure &Investment

545,525

111,688(Millions of yen)

Adjustments(Note)2

Segment assets(Note)1(Note)

34,426

Total

5,336,681

Amount adjusted
to total
Amountassets inrecorded inconsolidated
consolidatedbalance sheets balance sheets(Note)3

678,215

6,014,896

1.

Segment assets include operating assets, equity-method investments, goodwill and investment securities.

2.

Adjustments of segment assets consist mostly of goodwill recognized when Diamond Lease Company Limited and
UFJ Central Leasing Co., Ltd. merged and became Mitsubishi UFJ Lease & Finance Company Limited in 2007 andother segment assets such as investment securities related to Corporate, which are not attributable to any reporting
segments.

3.

“Amount adjusted to total assets in consolidated balance sheets” represents the difference between total
consolidated assets and total segment assets including Corporate, which consists of assets other than segment
assets such as cash and deposits and own-used assets.

For the Six Months Ended September 30, 2021 (As of September 30, 2021)(Millions of yen)

Reporting segments

Segment assets(Note)1

CustomerBusiness

Account
Solution

2,050,970

2,135,593

VendorSolution

LIFE

436,853

327,894

Real Estate

Environment &Renewable
Energy944,645

320,751

Aviation

1,305,868(Millions of yen)

Reporting segments
Adjustments
Logistics
Segment assets(Note)1(Note)

583,309

Mobility

165,001(Note)2

Others342,638

10,451

Total

8,623,977

Amount adjusted
Amountto total
recorded in
assets inquarterly
consolidated
consolidatedbalance sheets balance sheets(Note)3

836,020

9,459,998

1.

Segment assets include operating assets, equity-method investments, goodwill and investment securities.

2.

Adjustments of segment assets consist mostly of goodwill recognized when Diamond Lease Company Limited and
UFJ Central Leasing Co., Ltd. merged and became Mitsubishi UFJ Lease & Finance Company Limited in 2007 andother segment assets such as investment securities related to Corporate, which are not attributable to any reporting
segments, and offsets in transactions between segments.

3.

“Amount adjusted to total assets in consolidated balance sheets” represents the difference between total
consolidated assets and total segment assets including Corporate, which consists of assets other than segment
assets such as cash and deposits and own-used assets.

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(Notes concerning going concern assumption)
Not applicable(Notes concerning significant changes in shareholders’ equity)
In association with the merger with Hitachi Capital Corporation, the Company delivered its common shares andacquired its shares held by Hitachi Capital Corporation; and as a result, capital surplus and treasury shares as of
September 30, 2021 increased by ¥381,480 million and ¥18,022 million from March 31, 2021 to ¥548,623 million and¥(19,478) million, respectively.
(Application of accounting treatments specific to the preparation of the quarterly consolidated financial statements)
Tax expenses of the Company and its certain consolidated subsidiaries were calculated through multiplying income
before income taxes for the Six Months ended September 30, 2021 by the reasonably estimated effective tax rate (after
tax effect accounting) applicable to income before income taxes for the year ending March 31, 2022.
(Changes in accounting policies)(Application of accounting standard for revenue recognition)
On April 1, 2021, the Company applied the “Accounting Standard for Revenue Recognition” (ASBJ Statement No.29,
March 31, 2020, “Accounting Standard for Revenue Recognition”), etc., and recognizes revenue at an amount that it
expects to receive in exchange for the promised goods or services when the control of the goods or services istransferred to a customer.
In applying the Accounting Standard for Revenue Recognition, etc., the Company followed the transitional treatment
stipulated by a provisory clause of Paragraph 84 of the Accounting Standard for Revenue Recognition.
As a result, both revenues and cost of revenues for the Six Months ended September 30, 2021 decreased by ¥4,755
million, but the impact on income before income taxes was insignificant. The impact on retained earnings as of April 1,
2021 was also insignificant.
Pursuant to the transitional treatment stipulated by Paragraph 89-2 of the Accounting Standard for Revenue
Recognition, the Company did not reclassify figures for the year ended March 31, 2021 to conform to the newpresentation method.
(Application of accounting standard for fair value measurement, etc.)
On April 1, 2021, the Company applied the “Accounting Standard for Fair Value Measurement” (ASBJ Statement
No.30, July 4, 2019, “Accounting Standard for Fair Value Measurement”), etc., and the new accounting policies
stipulated in the Accounting Standard for Fair Value Measurement, etc. are applied prospectively pursuant to thetransitional treatment stipulated by Paragraph 19 of the Accounting Standard for Fair Value Measurement andParagraph 44-2 of the “Accounting Standard for Financial Instruments” (ASBJ Statement No. 10, July 4, 2019). The
application has no impact on the quarterly consolidated financial statements.
(Changes in accounting policies following the merger with Hitachi Capital Corporation)
The Company merged with Hitachi Capital Corporation effective on April 1, 2021.
As a result, the Company and its certain consolidated subsidiaries changed the accounting policies regarding
the following items from April 1, 2021.
All changes in accounting policies were applied retrospectively to the quarterly consolidated financial statements
for the Six Months ended September 30, 2020 and the consolidated financial statements for the year ended March
31, 2021.
〈Accounting treatment for recognizing revenue from extended lease agreement in lease transactions〉
Previously, the Company recognized lease payments from an extended lease agreement (usually for oneyear) as revenues on the date the lease agreement is extended but changed the method to recognize revenues
on a monthly basis over the extended lease term.
We previously recognized lease payments from an extended lease agreement as earnings in a lump sumon the lease commencement date as asset balance related to extended lease agreements is increasing becauseof the merger and also extended lease agreements generally require lump sum payment of lease payments forthe entire lease term on the lease commencement date and are not required to refund unearned portion in the15event the agreement is terminated. However, we decided to change the method because an extended leaseagreement is a lease transaction and we believe recognizing revenues over the lease term better reflects
earnings from lease transactions in the consolidated financial statements.
As a result of this change, in the consolidated balance sheets as of March 31, 2021, other current liabilities
increased by ¥8,392 million, lease and other receivables and retained earnings decreased by ¥1,884 millionand ¥6,926 million, respectively, compared to their respective balances before the retrospective application.
Also because the cumulative effects were adjusted to the balance of total equity as of April 1, 2020, retained
earnings as of April 1, 2020 decreased by ¥6,833 million.
The impact of this change on earnings and per share information for the Six Months ended September 30,
2020 is insignificant.
〈Accounting treatment for lease transactions treated as finance transactions〉
Previously, lease agreements treated as financial transactions in substance based on their nature wererecognized as operating loans receivables in the consolidated balance sheets, with interest income recognized
as revenues in the consolidated statements of income. However, to reflect the nature of the agreements, wechanged the method to recognize them as lease receivables and investments in leases in the consolidatedbalance sheets, and to recognize lease revenues and cost of lease as revenues and cost of revenues,
respectively, in the consolidated statements of income.
Previously, we accounted for and presented those agreements in a similar manner as loans receivables asfinancial transactions in substance with leased property treated as collateral based on the intent of thecontracting parties and nature of the leased property. However, we decided to change the method because of
an increase in the number of agreements whereby leased property are returned to the Company after the
expiration of the lease term, showing more of a characteristic of finance lease, and also because of an increasein the asset balance of similar transactions following the merger.
As a result of this change, in the consolidated balance sheets as of March 31, 2021, lease receivables andinvestments in leases and retained earnings increased by ¥214,643 million and ¥1,732 million, respectively, andoperating loans receivables decreased by ¥212,146 million. In the consolidated statements of income for the
Six Months ended September 30, 2020, both revenues and cost of revenues increased by ¥26,393 million,
compared to their respective figures before the retrospective application. Also because the cumulative effects
were adjusted to the balance of total equity as of April 1, 2020, retained earnings as of April 1, 2020 increasedby ¥1,732 million.
The impact of this change on earnings and per share information for the Six Months ended September 30,
2020 is insignificant.
〈Accounting treatment for deferred assets (bond issuance costs)〉
Previously, bond issuance costs related to bonds issued by the Company and its domestic subsidiaries were
expensed as incurred, but the method was changed to amortize the costs over the period until the redemptionof the relevant bonds using the interest method.
We decided to change the method to better reflect the Group’s funding activities in the consolidated financial
statements because bond issuance costs are funding costs as with bond interest and also because theinternational accounting standards require such costs to be amortized using the interest method and therefore
the Company’s overseas subsidiaries amortize their bond issuance costs using the interest method.
As a result of this change, in the consolidated balance sheets as of March 31, 2021, bond issuance costs
and retained earnings increased by ¥3,454 million and ¥2,070 million, respectively, compared to their respectivebalances before the retrospective application. Also because the cumulative effects were adjusted to the balanceof total equity as of April 1, 2020, retained earnings as of April 1, 2020 increased by ¥1,993 million.
The impact of this change on earnings and per share information for the Six Months ended September 30,
2020 is insignificant.

16(Additional information)(Accounting estimate related to the spread of COVID-19 infections)
As of September 30, 2021, we made estimates taking into account the impact of COVID-19 on the economic
conditions and the future.
(Conclusion of a definitive agreement to acquire CAI International, Inc.)At the Board of Directors meeting held on June 18, 2021, we resolved to acquire all shares of CAI International,
Inc. (“CAI”) through a merger of Cattleya Acquisition Corp. (“Acquiring Subsidiary”), our wholly-owned subsidiary
in Delaware, the U.S. established for the acquisition, and CAI (reverse triangular merger), and a definitive
agreement was concluded among the Company, the Acquiring Subsidiary and CAI.
1. Outline of the business combination(1) Name and business description and size of the acquiree
Name of the acquiree: CAI International, Inc.
Business description: Marine container leasing business(2) Reason for acquiring the subsidiary
The Company decided to proceed with the acquisition with an aim to enhance “global assets,” one of our
focal business domains, as a growth driver for our medium- to long-term management strategy. CAI which will
become our subsidiary after the merger ranked sixth in the global market share of the marine container leasing
industry (TEU* basis) and is strong in the global platform of marketing/operation sites and container depots
around the world. Combined with our marine container leasing company Beacon Intermodal leasing, LLC, theGroup will join the world’s second rank group in term of the number of containers owned, so we will makeeffective use of platforms of both companies and combine the experience and insights to further increase
earnings and accelerate growth. This acquisition will increase our global competitiveness in the marine
container leasing business and also provide opportunities for the business to further grow as a driver to support
our medium- to long-term growth.
* TEU: a measure of volume in units of twenty-foot long containers(3) Scheduled date of business combination
Third quarter of the fiscal year ending March 31, 2022
(4) Legal form of the business combination
Acquisition of shares for cash consideration through a “reverse triangular merger”(5) Company name after the business combination
There is no plan to change the company name after the business combination.
(6) Voting rights to be acquired
100%(7) Background for deciding the acquiree
To obtain the majority of voting rights of CAI through this merger agreement
2. Acquisition costs of the acquiree and the breakdown
Acquisition costs (including estimated purchase price for shares and advisory fees) are estimated to beapproximately US$1,108 million.

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