MITSUBISHI ELECTRIC CORPORATIONPUBLIC RELATIONS DIVISION
7-3, Marunouchi 2-chome, Chiyoda-ku, Tokyo, 100-8310 JapanFOR IMMEDIATE RELEASE

No. 3206

Investor Relations Inquiries

Media Inquiries

Investor Relations Group, Corporate Finance Division
Mitsubishi Electric Corporation
Cad.Irg@rk.MitsubishiElectric.co.jp

Public Relations Division
Mitsubishi Electric Corporation
prd.gnews@nk.MitsubishiElectric.co.jp
www.MitsubishiElectric.com/news/

Mitsubishi Electric Announces Consolidated Financial Results
for the First Quarter of Fiscal 2019TOKYO, July 30, 2018 – Mitsubishi Electric Corporation (TOKYO: 6503) announced today its consolidated
financial results for the first quarter, ended June 30, 2018, of the current fiscal year ending March 31, 2019(fiscal 2019).

Consolidated Financial Results
Net sales:
Operating income:
Income before income taxes:
Net income attributable to
Mitsubishi Electric Corp.
stockholders:

1,050.9 billion yen
61.5 billion yen
68.7 billion yen(2% increase from the same quarter last year)(18% decrease from the same quarter last year)(15% decrease from the same quarter last year)

47.5 billion yen(17% decrease from the same quarter last year)

The global economy in the first quarter, from April through June 2018, of fiscal 2019 saw a slight slowdown
in China, a buoyant expansion in the U.S. and gradual trends of recovery in Japan and Europe. In addition, theyen appreciated against the U.S. dollar and weakened against the euro compared to the same period of theprevious fiscal year.
Under these circumstances, consolidated net sales in the first quarter increased by 2% compared tothe same period of the previous fiscal year to 1,050.9 billion yen with increased sales in the Industrial
Automation Systems, Electronic Devices and Home Appliances segments. Consolidated operating income
decreased by 18% compared to the same period of the previous fiscal year to 61.5 billion yen, due to decreased
profits in all segments.
Income before income taxes decreased by 15% compared to the same period of the previous fiscal
year to 68.7 billion yen.
Net income attributable to Mitsubishi Electric Corporation stockholders decreased by 17%
compared to the same period of the previous fiscal year to 47.5 billion yen.

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Consolidated Financial Results by Business Segment
Energy and Electric Systems
Total sales:
267.3 billion yen (substantially unchanged from the same quarter last year
which recorded 268.5 billion yen)
Operating income:
5.9 billion yen (0.7 billion yen decrease from the same quarter last year which
recorded 6.7 billion yen)
The social infrastructure systems business saw decreases in both orders and sales from the same period of theprevious fiscal year due primarily to decreases in the transportation systems business in Japan and the powersystems business outside Japan.
The building systems business saw increases in both orders and sales compared to the same periodof the previous fiscal year due primarily to buoyancies in the renewal business in Japan and the new installationof elevators and escalators outside Japan.
As a result, total sales for this segment remained substantially unchanged from the same period of
the previous fiscal year. Operating income decreased by 0.7 billion yen from the same period of the previous
fiscal year mainly due to a shift in project portfolios.

Industrial Automation Systems
Total sales:
360.9 billion yen
Operating income:44.8 billion yen(3% increase from the same quarter last year which
recorded 350.8 billion yen)
(5.8 billion yen decrease from the same quarter last year
which recorded 50.7 billion yen)

The factory automation systems business saw decreases in both orders and sales from the same period of theprevious fiscal year due primarily to a temporary slowdown in capital expenditures in the fields of organic
light emitting diodes (OLED) and smartphones outside Japan, despite buoyant demand for exports mainly bymachinery and semiconductor-related equipment manufacturers in Japan.
The automotive equipment business saw increases in both orders and sales from the same period of
the previous fiscal year due primarily to increases in Japan and other markets in Asia, as well as increased
sales in electric-vehicle related equipment in response to market growth worldwide.
As a result, total sales for this segment increased by 3% from the same period of the previous fiscal
year. Operating income decreased by 5.8 billion yen from the same period of the previous fiscal year due
primarily to increases in material prices and upfront investment for growth drivers.
Information and Communication Systems
Total sales:
79.7 billion yen
Operating income (loss):(1.8 billion yen)

(11% decrease from the same quarter last year which
recorded 90.0 billion yen)(substantially unchanged from the same quarter last year
which recorded a loss of 1.7 billion yen)

The telecommunications systems business saw decreases in both orders and sales compared to the same periodof the previous fiscal year due primarily to decreased demand in communications infrastructure equipment.
The information systems and service business saw decreases in both orders and sales compared tothe same period of the previous fiscal year, mainly due to a shift in projects for the system integrations business.
The electronic systems business saw an increase in orders compared to the same period of theprevious fiscal year mainly due to an increase in large-scale projects in the defense systems business, whilesales experienced a decrease compared to the same period of the previous fiscal year due primarily to a shift
in project portfolios in the defense systems business.
As a result, total sales for this segment decreased by 11% compared to the same period of theprevious fiscal year. Operating income remained substantially unchanged from the same period of the previous
fiscal year due primarily to a shift in project portfolios.

2/32Electronic Devices
Total sales:

51.4 billion yen

Operating income:1.4 billion yen(7% increase from the same quarter last year which
recorded 48.1 billion yen)
(1.5 billion yen decrease from the same quarter last year
which recorded 3.0 billion yen)

The electronic devices business saw orders substantially unchanged, while sales rose by 7% from the same
period of the previous fiscal year due to an increase in demand mainly for power modules used in industrial,consumer and automotive applications, despite decreased demand for optical communication devices.
Operating income decreased by 1.5 billion yen compared to the same period of the previous fiscal
year due primarily to a shift in product mix.
Home Appliances
Total sales:

280.3 billion yen

Operating income:20.0 billion yen(4% increase from the same quarter last year which
recorded 269.8 billion yen)
(4.1 billion yen decrease from the same quarter last year
which recorded 24.1 billion yen)

The home appliances business saw an increase in sales of 4% from the same period of the previous fiscal year
due to an increase in sales of air conditioners for Europe, Japan, China and the U.S.A.
Operating income decreased by 4.1 billion yen compared to the same period of the previous fiscal
year due primarily to increases in material prices.
OthersTotal sales:
Operating income:155.6 billion yen
1.1 billion yen(7% increase from the same quarter last year which
recorded 144.9 billion yen)
(0.8 billion yen decrease from the same quarter last year
which recorded 2.0 billion yen)

Sales increased by 7% compared to the same period of the previous fiscal year due primarily to an increase insales at affiliated companies involved in materials procurement.
Operating income decreased by 0.8 billion yen compared to the same period of the previous fiscal
year due primarily to a shift in project portfolios.

Financial Standing
An analysis on the status of assets, liabilities and equity on a consolidated basis
Total assets as of the end of this fiscal quarter decreased from the end of the previous fiscal year by 99.4 billion
yen to 4,206.1 billion yen. The change in balance of total assets is mainly attributable to increases in inventories
by 63.6 billion yen as a result of work-in-process as recorded in commensurate with progress in job orders
under pertinent contracts, while cash and cash equivalents decreased by 6.7 billion yen, and trade receivables
and contract assets decreased by 162.0 billion yen primarily as a result of credit collection.
Total liabilities decreased from the end of the previous fiscal year by 94.3 billion yen to 1,814.0
billion yen. The outstanding balances of debts and corporate bonds decreased by 12.2 billion yen from the endof the previous fiscal year to 299.7 billion yen, resulting in a decline in the ratio of interest bearing debt tototal assets to 7.1%, representing a 0.1 point decrease compared to the end of the previous fiscal year.
Meanwhile, trade payables decreased by 38.5 billion yen, and other current liabilities decreased by 47.3 billion
yen.
Mitsubishi Electric Corporation stockholders’ equity decreased by 8.9 billion yen compared to theend of the previous fiscal year to 2,285.2 billion yen. The stockholders’ equity ratio was recorded at 54.3%,
representing a 1.0 point increase compared to the end of the previous fiscal year. These changes referred toabove primarily result from a decrease in dividend payment of 55.8 billion yen, despite recording a net income
attributable to Mitsubishi Electric Corporation stockholders of 47.5 billion yen.

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An analysis on the status of cash flow on a consolidated basis
Cash flows from operating activities for this quarter decreased by 27.5 billion yen compared to the same periodof the previous fiscal year to 97.2 billion yen (cash in), mainly due to an increase in inventories. Cash flows
from investing activities increased by 16.4 billion yen compared to the same period of the previous fiscal year
to 38.7 billion yen (cash out), due primarily to a decrease in proceeds from sale of short-term investments andinvestment securities. As a result, free cash flow was 58.5 billion yen (cash in). Cash flows from financing
activities were 64.0 billion yen (cash out) mainly due to dividend payments.

Forecast for Fiscal 2019
The current consolidated earnings forecast for fiscal 2019, ending March 31, 2019, is unchanged from theannouncement on April 27, 2018 as stated below.
Current consolidated forecast for fiscal 2019
Net sales
4,500.0
Operating income
315.0
Income before income taxes
345.0
Net income attributable to
Mitsubishi Electric Corp.
245.0
stockholders

billion yen
billion yen
billion yen(1% increase from fiscal 2018)(4% decrease from fiscal 2018)(2% decrease from fiscal 2018)billion yen(4% decrease from fiscal 2018)

Note: The results forecast above is based on assumptions deemed reasonable by the Company at the present
time, and actual results may differ significantly from forecasts. Please refer to the cautionary statement
at the end.

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Consolidated Financial Results Summary(In billions of yen except where noted)
FY ’18 Q1 (A)(Apr. 1, 2017 –Jun. 30, 2017)

FY ’19 Q1 (B)(Apr. 1, 2018 –Jun. 30, 2018)

B–A

B/A (%)

1,033.9

1,050.9

17.0

102

Operating income

75.4

61.5

(13.9)

82

Income before income taxes

80.4

68.7

(11.7)

85

56.9

47.5

(9.4)

83

26.55 yen

22.18 yen

(4.37 yen)84

Net sales

Net income attributable to
Mitsubishi Electric Corp.
stockholders
Basic net income per share
attributable to Mitsubishi
Electric Corp. stockholders

Notes:
1) Consolidated financial charts are made in accordance with International Financial Reporting Standards (IFRS).
2) The Company has 208 consolidated subsidiaries.

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Condensed Quarterly Consolidated Financial Statements
Condensed Quarterly Consolidated Statements of Profit or Loss andCondensed Quarterly Consolidated Statements of Comprehensive Income(Condensed Quarterly Consolidated Statements of Profit or Loss)(In millions of yen)

Net sales
Cost of sales
Selling, general andadministrative expenses
Other profit (loss)
Operating income
Financial income
Financial expenses
Share of profit of investments
accounted for using theequity method
Income before income taxes
Income tax expenses
Net income
Net income attributable to:
Mitsubishi Electric Corp.
stockholders
Non-controlling interests

FY ’18 Q1(Apr. 1, 2017 –Jun. 30, 2017)
% of
(A)
total
1,033,936
100.0
716,965
69.3

FY ’19 Q1(Apr. 1, 2018 –Jun. 30, 2018)
% of
(B)
total
1,050,982
100.0
741,04770.5

17,04624,082

B/A
(%)
102
103

B–A

241,610132
75,493
3,587
932

23.4
0.0
7.3
0.4
0.1

250,206
1,860
61,589
4,758
610

23.8
0.2
5.9
0.4
0.1

8,596
1,728
(13,904)
1,171
(322)

104
14-fold
82
133
65

2,298

0.2

2,993

0.3

695

130

80,446

7.8

68,7306.5(11,716)85

21,23659,2102.1
5.7

18,72350,0071.7
4.8(2,513)(9,203)88
84

56,985

5.5

47,5784.5(9,407)

83

2,225

0.2

2,429

0.3

204

109

6/32

(Condensed Quarterly Consolidated Statements of Comprehensive Income)(In millions of yen)

Net income(Other comprehensive income (loss),
net of tax)
Items that will not be reclassified to
net income
Financial assets measured at fair value
through other comprehensive income
Share of other comprehensive income ofinvestments accounted for using theequity method
Subtotal
Items that may be reclassified to net income
Exchange differences on translating
foreign operations
Net changes in the fair value of cash flow
hedgesShare of other comprehensive income ofinvestments accounted for using theequity method
Subtotal
Total other comprehensive income (loss)
Comprehensive income (loss)
Comprehensive income (loss) attributable to:
Mitsubishi Electric Corp. stockholders
Non-controlling interests

FY ’18 Q1 (A)(Apr. 1, 2017 –Jun. 30, 2017)
59,210

FY ’19 Q1 (B)(Apr. 1, 2018 –Jun. 30, 2018)
50,007(9,134)

7,388

16,522287(8,847)

131
7,519

(156)
16,366

12,540(9,152)(21,692)

3

(18)

(21)

(857)
11,686
2,839
62,049(1,844)(11,014)(3,495)46,512(987)(22,700)(6,334)(15,537)

59,5272,522

44,7301,782(14,797)
(740)

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B–A
(9,203)

Condensed Quarterly Consolidated Statements of Financial Position(In millions of yen)
FY ’18 (A)(ended Mar.
31, 2018)(Assets)
Current assets
Cash and cash equivalents
Trade receivables and Contract Assets
Inventories
Other current assets
Non-current assets
Investments accounted for using the equity method
Other financial assets
Net property, plant and equipment
Other non-current assets
Total assets(Liabilities)
Current liabilities
Bonds and borrowings
Trade payables
Other current liabilities
Non-current liabilities
Bonds and borrowings
Net defined benefit liabilities
Other non-current liabilities
Total liabilities(Equity)
Mitsubishi Electric Corp. stockholders’ equity
Common stock
Capital surplus
Retained earnings
Accumulated other comprehensive income (loss)
Treasury stock at costNon-controlling interests
Total equity
Total liabilities and equity
Balance of Debt
Accumulated other comprehensive income (loss):
Exchange differences on translating foreign
operations
Remeasurements of defined benefit pension plans
Financial assets measured at fair value throughother comprehensive income
Net changes in the fair value of cash flow hedges

8/32

FY ’19 Q1 (B)(ended Jun.
30, 2018)

B–A

2,582,735
599,199
1,191,529
646,262
145,745
1,722,845
194,308
363,171724,257
441,1094,305,580

2,495,610
592,4881,029,435
709,929
163,758
1,710,508
182,429
371,726
726,490429,863
4,206,118(87,125)(6,711)(162,094)
63,66718,013(12,337)(11,879)
8,555
2,233
(11,246)(99,462)

1,488,249
122,895
579,566
785,788
420,112
189,055
171,520
59,537
1,908,361

1,420,377
140,904
541,046
738,427
393,672
158,805
175,751
59,116
1,814,049(67,872)
18,009(38,520)(47,361)(26,440)(30,250)
4,231
(421)
(94,312)2,294,174
175,820
199,442
1,811,348
109,492(1,928)103,0452,397,219
4,305,580

2,285,231
175,820
202,639
1,802,907
106,847(2,982)
106,838
2,392,069
4,206,118(8,943)－
3,197(8,441)(2,645)(1,054)
3,793(5,150)(99,462)

311,950

299,709(12,241)

17,549－7,316－(10,233)－

91,952(9)99,561
(30)

7,609
(21)

Condensed Quarterly Consolidated Statements of Changes in Equity(In millions of yen)
Mitsubishi Electric Corp. stockholders’ equity

Balance at April 1, 2017

Commonstock

CapitalsurplusRetainedearnings

Accumulated
othercomprehensive
income (loss)

175,820

198,745

1,593,660

101,166

Treasurystock atcost
(1,228)

Noncontrolling

Totalinterests

Total
equity2,068,163

98,8002,166,963

56,9852,225

59,210

2,542

297

2,839

59,5272,522

62,049Comprehensive income
Net income

56,985

Other comprehensive
income (loss)

2,542

Comprehensive income－－

Transfer to retained earnings
Dividends paid

56,985

2,542

6,948

(6,948)－－(38,642)(38,642)

Purchase of treasury stock

(697)

－
(1,499)(40,141)

(697)

(697)

－

－

Reissuance of treasury stock
Transactions with noncontrolling interests, etc.
Balance at June 30, 2017

175,820

198,745

1,618,951

96,760(1,925)－79

79

2,088,351

99,902

2,188,253

Mitsubishi Electric Corp. stockholders’ equity

Balance at April 1, 2018

CommonCapitalRetainedstock

surplusearnings

175,820

199,442

1,811,348

Accumulated
othercomprehensive
income (loss)

Treasury

109,492(1,928)stock atNoncontrolling

Totalinterests

cost

Total
equity2,294,174

103,0452,397,219

47,5782,429

50,007(2,848)(647)(3,495)44,7301,782

46,512Comprehensive income
Net income

47,578Other comprehensive
income (loss)
Comprehensive income(2,848)－－Transfer to retained earnings
Dividends paid

47,578(2,848)

(203)

203

－

－

(55,816)(55,816)

Purchase of treasury stock(1,054)

Reissuance of treasury stock－(2,585)(58,401)(1,054)(1,054)－－

Transactions with noncontrolling interests, etc.
Balance at June 30, 2018

3,197
175,820

202,639

1,802,907

9/32

106,847(2,982)

3,197

4,596

7,793

2,285,231

106,838

2,392,069

Condensed Quarterly Consolidated Statements of Cash Flows(In millions of yen)I

II

Cash flows from operating activities
1 Net income
2 Adjustments to reconcile net income to net cash
provided by operating activities(1) Depreciation and amortization(2) Decrease in trade receivables and contract assets(3) Decrease (increase) in inventories(4) Increase (decrease) in trade payables(5) Other, net
Cash flows from operating activities
Cash flows from investing activities
1 Purchase of property, plant and equipment
2 Proceeds from sale of property, plant and equipment
3 Purchase of short-term investments and investment
securities
4 Proceeds from sale of short-term investments andinvestment securities
5 Other, net
Cash flows from investing activities

I + II

III

IV
V
VI
VII

Free cash flow

Cash flows from financing activities
1 Proceeds from long-term debt and repayment of longterm debt
2 Increase (decrease) in bank loans, net
3 Dividends paid
4 Purchase of treasury stock
5 Other, net
Cash flows from financing activities
Effect of exchange rate changes on cash and cash
equivalents
Net increase (decrease) in cash and cash
equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

10/32

FY ’18 Q1(Apr. 1, 2017 –Jun. 30, 2017)(A)

FY ’19 Q1(Apr. 1, 2018 –Jun. 30, 2018)
(B)

B–A

59,21050,007(9,203)37,295
157,910(49,263)(30,910)(49,485)
124,757

38,093
164,962(62,155)(39,220)(54,451)
97,236798
7,052(12,892)(8,310)(4,966)(27,521)(42,711)393(36,350)
1,102

6,361
709

(3,201)(4,129)(928)

25,716(2,469)(22,272)

1,944(1,288)(38,721)(23,772)
1,181(16,449)

102,485

58,515(43,970)(2,254)(11,380)(38,642)(697)(2,085)(55,058)(12,336)(1,814)(55,816)(1,054)7,001(64,019)(10,082)
9,566(17,174)
(357)
9,086
(8,961)

3,004(1,207)(4,211)50,431
662,469
712,900(6,711)
599,199
592,488(57,142)(63,270)(120,412)

Consolidated Segment Information
1. Sales and Operating Income by Business Segment(In millions of yen)
FY ’18 Q1(Apr. 1, 2017 –Jun. 30, 2017)
OperatingSales
income(A)(loss) (B)FY ’19 Q1(Apr. 1, 2018 –Jun. 30, 2018)
OperatingSales
income(C)(loss) (D)

C–A

Energy and Electric Systems

268,544

6,712

267,397

5,978(1,147)

(734)

100

Industrial Automation Systems
Information andCommunication Systems

350,81750,746360,999

44,873

10,182(5,873)103

90,046(1,783)79,782(1,840)(10,264)(57)

89

Electronic Devices

48,122

3,056

51,462

1,486

3,340

(1,570)107

Home Appliances

269,892

24,188280,334

20,056

10,442(4,132)

104

Others144,904

2,013

155,657

1,160

10,753(853)

107

Subtotal

1,172,325

84,932

1,195,631

71,71323,306(13,219)102

Eliminations and other(138,389)(9,439)(144,649)(10,124)(6,260)(685)－

Consolidated Total

1,033,936

75,493

1,050,982

61,58917,046(13,904)

102

Business Segment

D–B

C/A
(%)

*Notes: Inter-segment sales are included in the above chart.

2. Sales by Location of Customers(In millions of yen)

Location of Customers

Japan
North America

FY ’18 Q1(Apr. 1, 2017 –Jun. 30, 2017)% of total
Sales (A)net sales

FY ’19 Q1(Apr. 1, 2018 –Jun. 30, 2018)% of total
Sales (B)net sales

B–A

B/A (%)

527,472
106,48151.0
10.3

541,434
103,098

51.5
9.8

13,962(3,383)

103
97

Asia (excluding Japan)
China

274,426
140,390

26.6
13.6

270,275
140,183

25.7
13.3(4,151)
(207)

98
100

EuropeOthers112,064
13,49310.8
1.3

121,637
14,538

11.6
1.4

9,573
1,045

109
108

Total overseas sales
Consolidated total

506,464
1,033,936

49.0
100.0

509,548
1,050,982

48.5
100.0

3,084
17,046

101
102

11/32

Notes to the Condensed Consolidated Financial Statements(Notes regarding the going concern assumption)
Not applicable(Notes if there is any significant change in Mitsubishi Electric Corp. stockholders’ equity)
Not applicable(Summary of key accounting policies)(a) Disclosure of compliance with IFRS and matters regarding first-time adoption
The Mitsubishi Electric Group has applied IFRS from the first quarter in the current fiscal year. The
date of transition to IFRS is April 1, 2017. “Disclosures of transition to IFRS” section describes how
the transition to IFRS affected the Mitsubishi Electric Group's reported financial position, financial
performance and cash flows at the date of transition to IFRS and in comparative fiscal years.
(b) Financial instruments
The Mitsubishi Electric Group classifies non-derivative financial assets as financial assets measured
at amortized cost or financial assets measured at fair value through profit or loss for the year or othercomprehensive income. This classification is determined on initial recognition.
Financial assets measured at amortized cost are measured at amortized cost using the effective
interest method and considering loss allowance for expected credit losses after initial recognition.
Financial assets that are not measured at amortized cost are measured at fair value. Changes after
initial recognition in fair value of financial assets measured at fair value through other comprehensive
income are recognized in other comprehensive income. When these financial assets are derecognized,
cumulative gains or losses previously recognized in other comprehensive income are reclassified toretained earnings.
Changes in fair value after initial recognition of financial assets measured at fair value throughprofit or loss for the year are recognized in profit or loss.
(c) Inventories
Inventories are measured at the lower of cost or net realizable value. In determining the cost, workin-progress for build-to-ordered products are recorded under the specific identification method, maketo-stock products are recorded at the average production costs and raw material and finished productinventories are generally recorded using the average-cost method.
(d) Property, plant and equipment
Property, plant and equipment is measured at cost on initial recognition and depreciated primarily
using the declining-balance method over the estimated useful life of each asset. Some assets are
depreciated using the straight-line method.
It is determined for property, plant and equipment whether there is an indication of impairment of
the asset or cash-generating unit. If there is an indication of impairment, the asset or cash-generating
unit is tested for impairment by estimating its recoverable amounts and comparing its carrying amountwith the recoverable amount.
(e) Goodwill and intangible assets
Goodwill is stated at cost less accumulated impairment losses. Goodwill is not amortized but is tested
for impairment at least annually.
Intangible assets acquired in a business combination are measured at fair value on initialrecognition. Other intangible assets are measured at cost on initial recognition. Intangible assets withfinite useful lives are depreciated on a straight-line basis over the estimated useful life of each asset.
It is determined for intangible assets with finite useful lives whether there is an indication of

12/32

impairment of the asset or cash-generating unit. If there is an indication of impairment, the asset or
cash-generating unit is tested for impairment by estimating its recoverable amounts and comparing
its carrying amount with the recoverable amount.
(f) Income taxes
Deferred tax assets and liabilities are recognized for temporary differences between the accounting
carrying amounts of assets and liabilities and their tax bases, the carry forward of unused tax losses
and unused tax credits at the end of a reporting period. In principle, deferred tax liabilities arerecognized for all taxable temporary differences. Deferred tax assets are recognized for all deductible
temporary differences to the extent that it is probable that future taxable profit will be available against
which the deductible temporary difference can be utilized.
Deferred tax assets and liabilities are measured at the tax rates and in accordance with tax laws thatare expected to apply to the period when the asset is realized or the liability is settled, based on tax
rates and tax laws that have been enacted or substantively enacted by the end of the reporting period.
(g) Post-employment benefits and pension
Net defined benefit liability or asset is determined at the present value of the defined benefit obligation
less the fair value of the plan assets. The amount of change in fair value arising from remeasurementof the present value of defined benefit obligations and the fair value of plan assets is fully recognizedin other comprehensive income in the periods in which it arises and immediately transferred toretained earnings. Past service costs arising from plan amendments are recognized in profit or loss forthe period in which they arise. Contributions to a defined benefit plan are recognized as expenses forthe period in which the employees render the related service.

13/32

Disclosures of Transition to IFRSThe Mitsubishi Electric Group has applied IFRS beginning with the consolidated financial statements forthe first quarter of the current fiscal year. The most recent consolidated financial statements prepared inaccordance with US GAAP are for the one-year period ended on March 31, 2018. The date of transition to
IFRS was April 1, 2017.
(1) Exemptions and exceptions in IFRS 1IFRS 1 requires entities adopting IFRS for the first time to retrospectively apply IFRS in principle;
however, with regard to certain items, it allows exemption from, or prohibits, retrospective applicationof IFRS.
The Company and its consolidated subsidiaries use the following exemptions on retrospective
application permitted by IFRS 1:- Business combinations
The Company and its consolidated subsidiaries elected not to apply IFRS 3 Business Combinations
retrospectively to past business combinations that occurred on or before December 22, 2015.
Consequently, the amount of goodwill that arose from business combinations occurred on or before
December 22, 2015 is recorded at the carrying value in accordance with US GAAP. This goodwill wastested for impairment at the transition date irrespective of whether there was any indication of
impairment.
- Exchange differences on translating foreign operations
The Company and its consolidated subsidiaries elected to deem the cumulative translation differences
for foreign operations at the transition date to be zero. Consequently, the cumulative translationdifferences for foreign operations at the transition date were transferred from accumulated othercomprehensive income (loss) to retained earnings.
- Designation of financial instruments recognized before the date of transition to IFRSThe Company and its consolidated subsidiaries elected to determine the classification of financial
instruments on the basis of the facts and circumstances that exist at the date of transition to IFRS.
(2) Reconciliations
Reconciliations for which disclosures are required on first time adoption of IFRS are as follows:
Items that do not affect retained earnings and comprehensive income are presented in“Reclassification,” and items that affect retained earnings and comprehensive income are presented in“Recognition and measurement differences.”

14/32

Reconciliation of Equity as at the Date of Transition to IFRS (April 1, 2017)(Consolidated Statements of Financial Position)
Presentation under US GAAP

Recognition
Reand
US GAAP classification measurement
differences

IFRS(Assets)
Current assets
2,500,685
Cash and cash equivalents
662,469
1,037,201
Trade receivables
643,040
Inventories
Prepaid expenses andother current assets
157,975－
Long-term trade receivables
2,815
Investments
618,935(12,199)(3,062)(2,815)(618,935)(15,056)
130,720
60,950 1,729,473
－
－
－
－

－
－

181,724
362,869

5,634
27,710732,611317,224
4,172,270－
74,095－(33,133)
699,478
60,739452,058
65,760 4,238,030

Net property, plant andequipment
Other assets
Total assets

3,062－
15,261－

15/32(In millions of yen)

Presentation under IFRS

(Assets)
Current assets
Cash and cash equivalents
Trade receivables andcontract assets
559,902
Inventories

4,810 2,508,557－
662,469
103,004 1,155,466(83,138)

187,358
390,579

Other current assets
Non-current assets

Investments accounted forusing the equity method
Other financial assets
Net property, plant andequipment
Other non-current assets
Total assets

(In millions of yen)

Presentation under US GAAP US GAAP
(Liabilities)
Current liabilities
Bank loans and current
portion of long-term debt
Trade payables
Other current liabilities
Long-term debt
Retirement and severance
benefits
Other fixed liabilities
Total liabilities(Equity)
Mitsubishi Electric Corp.
shareholders’ equity
Common stock
Capital surplus
Retained earnings
Accumulated othercomprehensive income(loss)
Treasury stock at cost
Noncontrolling interests
Total equity
Total liabilities and equity
Balance of Debt

Recognition
Reandclassification measurement
differences

1,525,761

7,456

33,082

124,368
780,202621,191－
227,756－(145,119)
152,575(7,456)－21,987－
11,095
6,423－

194,990
83,0552,031,562－(7,456)－

8,044(1,621)
39,5052,039,627
175,820
212,530
1,654,557－－－－

28,536－(13,785)(60,897)(2,052)(1,228)101,0812,140,708
4,172,270

－
－
－
－
－

103,218－(2,281)
26,25565,760352,124－

21,987

Accumulated othercomprehensive income (loss):
Foreign currency translation
adjustments

18,535－(18,535)

Pension liability adjustments (156,993)－

156,993

136,352－(35,223)

54

－

(17)

Unrealized gains on
securities
Unrealized gains (losses) on
derivative instruments

16/32

IFRS

Presentation under IFRS(Liabilities)
1,566,299 Current liabilities
Bonds and borrowings
146,355
Trade payables
635,083
784,861
Other current liabilities
504,768 Non-current liabilities
Bonds and borrowings
227,756
Net defined benefit
203,034
liabilities
73,978Other non-current liabilities
2,071,067 Total liabilities(Equity)
Mitsubishi Electric Corp.
2,068,163 stockholders’ equity
Common stock
175,820
Capital surplus
198,745
Retained earnings
1,593,660
Accumulated othercomprehensive income
101,166(loss)
Treasury stock at cost
(1,228)98,800 Non-controlling interests
2,166,963 Total equity
4,238,030 Total liabilities and equity
374,111 Balance of Debt
Accumulated othercomprehensive income (loss):
Exchange differences ontranslating foreign－
operations
Remeasurements of defined－
benefit pension plans
Financial assets measured atfair value through other
101,129
comprehensive income
Net changes in the fair value37
of cash flow hedges

Reconciliation of Equity as at the End of the First Quarter of the Previous Fiscal Year
(June 30, 2017)(Condensed Quarterly Consolidated Statements of Financial Position)(In millions of yen)
Presentation under US GAAP
(Assets)
Current assets
Cash and cash equivalents
Trade receivables
Inventories
Prepaid expenses andother current assets
Long-term trade receivables
Investments

Net property, plant andequipment
Other assets
Total assets

Recognition
Reand
US GAAP classification measurement
differences

2,494,270
712,900
869,117723,340

3,167－(2,102)－

15,682
118,436－ (108,524)

188,913－2,644
578,353(12,515)(3,167)(2,644)(578,353)－－

167,341
326,496745,257
296,849
4,117,373－
83,993
－

17/32

IFRS

Presentation under IFRS

(Assets)
2,495,335 Current assets
712,900
Cash and cash equivalents
Trade receivables and1,003,235
contract assets
614,816
Inventories(12,014)164,384
Other current assets
67,398 1,687,334 Non-current assets－－－－
Investments accounted for
5,332
172,673
using the equity method
27,872354,368
Other financial assets
Net property, plant and(32,777)
712,480
equipment
66,971
447,813
Other non-current assets
65,296 4,182,669 Total assets

Presentation under US GAAP US GAAP
(Liabilities)
Current liabilities
Bank loans and current
portion of long-term debt
Trade payables
Other current liabilities
Long-term debt
Retirement and severance
benefits
Other fixed liabilities
Total liabilities(Equity)
Mitsubishi Electric Corp.
shareholders’ equity
Common stock
Capital surplus
Retained earnings
Accumulated othercomprehensive income(loss)
Treasury stock at cost
Noncontrolling interests
Total equity
Total liabilities and equity
Balance of Debt

Recognition
Reandclassification measurement
differences

IFRS

Presentation under IFRS(Liabilities)
Current liabilities

1,472,476

7,632

23,356

1,503,464

134,310
723,525
614,641－
217,516－(118,564)
126,196(7,632)－

10,819－12,537
19,137－

187,719
74,212
1,951,923－(7,632)－

19,989(852)
42,493

2,063,279
175,820
212,530
1,683,659－－－－

25,072－(13,785)(64,708)(6,805)(1,925)102,171
2,165,450
4,117,373

－
－
－
－
－

103,565－(2,269)22,80365,296

Bonds and borrowings
Trade payables
Other current liabilities
Non-current liabilities
Bonds and borrowings
Net defined benefit
207,708
liabilities
65,728Other non-current liabilities
1,994,416 Total liabilities(Equity)
Mitsubishi Electric Corp.
2,088,351
stockholders’ equity
175,820
Common stock
198,745
Capital surplus
1,618,951
Retained earnings
Accumulated othercomprehensive income
96,760(loss)(1,925)
Treasury stock at cost
99,902 Non-controlling interests
2,188,253 Total equity
4,182,669 Total liabilities and equity

351,826－

10,819

Accumulated othercomprehensive income (loss):
Foreign currency translation
adjustments

23,023－(11,618)

Pension liability adjustments(144,517)－

144,517

114,685－(29,380)4－

46

Unrealized gains on
securities
Unrealized gains (losses) on
derivative instruments(In millions of yen)

18/32

145,129604,961
753,374
490,952
217,516

362,645 Balance of Debt

Accumulated othercomprehensive income (loss):
Exchange differences ontranslating foreign
11,405operations
Remeasurements of defined－
benefit pension plans
Financial assets measured atfair value through other
85,305comprehensive income
Net changes in the fair value
50
of cash flow hedges

Reconciliation of Equity as at the End of the Previous Fiscal Year (March 31, 2018)(Consolidated Statements of Financial Position)(In millions of yen)
Presentation under US GAAP
(Assets)
Current assets
Cash and cash equivalents

Recognition
Reand
US GAAP classification measurement
differences

IFRS

2,606,493
599,199

2,582,735 Current assets
Cash and cash equivalents
599,199

Presentation under IFRS
(Assets)(1,434)－(22,324)－

Trade receivables andcontract assets
Inventories

Trade receivables
Inventories
Prepaid expenses andother current assets

1,087,593
741,782

14,225－89,711(95,520)

1,191,529
646,262

177,919

Long-term trade receivables
Investments

1,965
614,295(15,659)
1,434(1,965)(614,295)(16,515)
63,345－－

Other current assets
145,745
1,722,845 Non-current assets－－－

Net property, plant andequipment
Other assets
Total assets－－

187,828
335,474

6,480
27,697

194,308
363,171

740,448
301,358
4,264,559－
94,392－(16,191)
45,35941,021

724,257
441,1094,305,580

19/32

Investments accounted forusing the equity method
Other financial assets
Net property, plant andequipment
Other non-current assets
Total assets

Presentation under US GAAP US GAAP
(Liabilities)
Current liabilities
Bank loans and current
portion of long-term debt
Trade payables
Other current liabilities

Balance of Debt

Presentation under IFRS(Liabilities)
Current liabilities

8,586

8,296

1,488,249

122,430
719,404
629,533
189,055－(139,838)
148,424(8,586)
－

465
－
7,831
(349)
－

171,017
68,9751,900,414－(8,586)
－

503
(852)
7,947

2,259,355
175,820
213,250
1,857,741－－－－

34,819－(13,808)(46,393)

14,472(1,928)104,7902,364,145
4,264,559

－
－
－
－
－

95,020－(1,745)33,07441,021

Bonds and borrowings
Trade payables
Other current liabilities
Non-current liabilities
Bonds and borrowings
Net defined benefit
liabilities
171,520
Other non-current liabilities
59,537
1,908,361 Total liabilities(Equity)
Mitsubishi Electric Corp.
stockholders’ equity
2,294,174
Common stock
175,820
Capital surplus
199,442
Retained earnings
1,811,348
Accumulated othercomprehensive income(loss)
109,492
Treasury stock at cost
(1,928)103,045 Non-controlling interests
2,397,219 Total equity
4,305,580 Total liabilities and equity

311,485－

465

Accumulated othercomprehensive income (loss):
Foreign currency translation
adjustments

34,149－(16,600)

Pension liability adjustments(141,075)－

141,075

121,413－(29,461)

(15)

－

6

Unrealized gains on
securities
Unrealized gains (losses) on
derivative instruments

IFRS

1,471,367－
Long-term debt
Retirement and severance
benefits
Other fixed liabilities
Total liabilities(Equity)
Mitsubishi Electric Corp.
shareholders’ equity
Common stock
Capital surplus
Retained earnings
Accumulated othercomprehensive income(loss)
Treasury stock at cost
Noncontrolling interests
Total equity
Total liabilities and equity

Recognition
Reandclassification measurement
differences

20/32

122,895
579,566
785,788
420,112
189,055

311,950 Balance of Debt

Accumulated othercomprehensive income (loss):
Exchange differences ontranslating foreign
operations
17,549Remeasurements of defined－
benefit pension plans
Financial assets measured atfair value through othercomprehensive income
91,952
Net changes in the fair valueof cash flow hedges(9)Notes to reconciliation of equity
The principal effects of transition to IFRS in the reconciliation of equity above are as follows:(1) Reclassification
The main elements of reclassification are as follows:(a) In accordance with the presentation provisions under IFRS, other financial assets are presented separately.
(b) Part of trade receivables, prepaid expenses and other current assets and other assets, etc. arereclassified based on the definition and recognition criteria of IFRS.
(c) Part of trade payables, other current liabilities and other fixed liabilities are reclassified based on thedefinition and recognition criteria of IFRS.
(2) Recognition and measurement differences
The main elements of recognition and measurement differences are as follows:(a) Employee benefits
Under US GAAP, actuarial gains and losses and past service costs are deferred in accumulated othercomprehensive income, subsequently amortized for a specified future period and recognized in profit orloss. Current service costs, interest costs and expected return on plan assets are recognized in profit orloss for the fiscal year.
Under IFRS, on the other hand, changes resulting from remeasurement of defined-benefit
corporate pension plans, defined benefit obligation on lump-sum payment plans and plan assets
required by IFRS are recognized in other comprehensive income, and reclassified from accumulated
other comprehensive income directly to retained earnings, not through profit or loss. Past service
costs arising from plan amendments are fully recognized immediately in profit or loss. Current
service costs are recognized in profit or loss. Interest costs are recognized in profit or loss at theamount determined by multiplying the net amount of the defined benefit obligation and plan assets
by the discount rate used to determine the present value of the obligation.
(b) Equity instruments
Under US GAAP, non-marketable equity instruments are recognized at their cost. If fair value of equity
instruments has decreased and the decrease is considered not to be temporary, impairment loss isrecognized for the amount of the cost of the equity instruments in excess of fair value. Gains or losseson the sale of these equity instruments are recognized in profit or loss.
Under IFRS, on the other hand, all equity instruments are recognized at fair value irrespective ofwhether there is an active market. Since it is permitted to recognize changes in fair value in othercomprehensive income, the Company and its consolidated subsidiaries have elected to recognizechanges in fair value of equity instruments in other comprehensive income. Accordingly, loss on
impairment and gains or losses on the sale of equity instruments recognized in profit or loss under
US GAAP are recognized in other comprehensive income as well.
(c) Income taxes
Under US GAAP, tax expenses incurred by sellers are deferred using the deferral method for differences
arising from unrealized profits and losses from intercompany transactions.
Under IFRS, on the other hand, a difference between the carrying amount and the sale price of an asset
sold is recognized as a future deductible temporary difference based on the asset-and-liability approach.
A deferred tax asset is recognized for the future deductible temporary difference using purchaser’s
effective tax rate while taking its recoverability into consideration.
Under US GAAP, deferred tax liabilities for temporary differences associated with investments inequity investees are recognized using tax rates applicable on the premise that the temporary difference
will be reversed at the time of sale of the equity investees even if a company intends to continue to holdthe investments. In principle, deferred tax liabilities are recognized for the undistributed earnings ofsubsidiaries, etc.
Under IFRS, deferred tax liabilities are in principle recognized for all the taxable temporary differencesusing tax rates applied when the taxable temporary differences reverse, such as when receiving dividends
or selling the investments. Deferred tax liabilities are recognized for the taxable temporary differences
associated with investments in subsidiaries etc. which are probable to reverse in the foreseeable future.

21/32

(d) Exchange differences on translating foreign operations
Cumulative exchange differences on translating foreign operations are all deemed to be zero at the dateof transition to IFRS. Consequently, exchange differences on translating foreign operations included inaccumulated other comprehensive income as at the transition date were fully reclassified to retained
earnings.
(e) Exclusion of equity investees
Under US GAAP, when an investee no longer qualifies as an equity investee, the difference between thesale price and the carrying amount of the interest sold is recognized in profit or loss. If an investor retains
a residual interest, gains or losses recognized in prior periods remain included in the carrying amount of
the residual interest.
Under IFRS, on the other hand, when an investee no longer qualifies as an equity investee, the residualinterest is measured at fair value if an investor retains a residual interest. The sale price and the difference
between the fair value and the carrying amount of the residual interest at the point when an investee nolonger qualifies as an equity investee is recognized in profit or loss.
(f) Government grants
Under US GAAP, government grants related to acquisition of assets are not reflected in the carrying
amounts of assets because there are no accounting standards for such government grants.
Under IFRS, on the other hand, government grants related to assets are recognized as reducing thecarrying amount of the asset by the government grants received.
(g) Impairment of non-financial assets
Under US GAAP, if there is an indication that a fixed asset may be impaired, the carrying amount and theundiscounted estimated future cash flows of the asset is compared. If the carrying amount exceeds theestimated future cash flows, any excess of the carrying amount over the fair value is recognized as an
impairment loss.
Under IFRS, on the other hand, if there is an indication that a fixed asset may be impaired, any excessof the carrying amount over the recoverable amount of the fixed asset (the higher of value in use or fairvalue less costs of disposal) is recognized as an impairment loss of the fixed asset.
(h) Business combinations
Under US GAAP, in business combinations, the acquirer measures the acquiree as a whole (including
non-controlling interests) at fair value and goodwill is recognized including the portion of goodwill
attributable to the non-controlling interests.
Under IFRS, on the other hand, in business combinations it is permitted to elect to apply either method:
the acquirer measures the acquiree as a whole (including non-controlling interests) at fair value andgoodwill is recognized including the portion of goodwill attributable to the non-controlling interests; or
non-controlling interest is measured as a proportional interest in the fair value of the acquiree's net
identifiable assets and goodwill is recognized only for the acquirer’s share. The Company elected themethod of measuring non-controlling interest as a proportional interest in the fair value of the acquiree's
net identifiable assets and recognizing goodwill only for the acquirer’s share. Capital surplus isrecognized when non-controlling interests are additionally acquired after the date when control was
obtained.

22/32

Reconciliation of Profit or Loss and Comprehensive Income for the First Quarter of thePrevious Fiscal Year (from April 1, 2017 to June 30, 2017)(Condensed Quarterly Consolidated Statements of Profit or Loss)(In millions of yen)
Presentation under US GAAPNet sales
Cost of sales
Selling, general andadministrative expenses
Operating income
Other income
Interest and Dividends
Equity in earnings ofaffiliated companies
Other
Other expenses
Interest
Other

Income before income taxes
Income taxes
Net income
Net income attributable tothe noncontrolling interests
Net income attributable to
Mitsubishi Electric Corp.

Recognition
Reand
US GAAP classification measurement
differences

1,005,599
681,232－(39)

28,33735,772

250,121－
74,24628,493
3,587

461
143
(279)
－
19,926(8,972)
(11)
1,526
－
(19,926)

2,405
22,501
3,491
677
2,814

(2,405)(22,501)－192(2,814)

－
－
－
63
－

IFRS

Presentation under IFRS

1,033,936 Net sales
Cost of sales
716,965

Selling, general andadministrative expenses
241,610
Other profit (loss)
132
75,493 Operating income－
Financial income
3,587
－
－
－
932
－

－
99,24829,24170,007

2,405
(232)
(232)
－

(107)
(18,570)(7,773)(10,797)

2,298
80,446
21,23659,210

2,263

－

(38)

2,225

67,744－(10,759)

56,98523/32

Financial expenses
Share of profit ofinvestments accounted forusing the equity method
Income before income taxes
Income tax expenses
Net income
Net income attributable to:Non-controlling interests
Mitsubishi Electric Corp.
stockholders

(Condensed Quarterly Consolidated Statements of Comprehensive Income)
Presentation under US GAAPNet income
Other comprehensive income(loss), net of tax

Unrealized gains (losses)
on securities
Pension liability
adjustments

Foreign currencytranslation adjustments
Unrealized gains (losses)
on derivative instruments

Total
Comprehensive income (loss)
Comprehensive income (loss)
attributable tothe noncontrolling interests
Comprehensive income (loss)
attributable to
Mitsubishi Electric Corp.

Recognition
Reand
US GAAP classification measurement
differences

70,007－(10,797)

IFRS(In millions of yen)

Presentation under IFRS

59,210 Net income(Other comprehensive income(loss), net of tax)
Items that will not bereclassified to net income
Financial assets measured atfair value through othercomprehensive income
Remeasurements of defined
benefit pension plans
Share of othercomprehensive income ofinvestments accounted forusing the equity method
Subtotal
Items that may bereclassified to net income
Exchange differences ontranslating foreign
operations
Net changes in the fairvalue of cash flow hedges
Share of othercomprehensive income ofinvestments accounted forusing the equity method
Subtotal
Total other comprehensive
income (loss)
Comprehensive income (loss)
Comprehensive income (loss)
attributable to:(21,638)(287)

12,791(9,134)

12,477(179)(12,298)

－

－
－

466
－

(179)
314

287
(8,847)

4,720

855

6,965

12,540

(63)

3

63

3

－
－

(858)
－

1
7,029

(857)
11,686(4,504)65,503－－

7,343(3,454)

2,839
62,049

2,512

－

10

2,522

Non-controlling interests

62,991－(3,464)59,527

Mitsubishi Electric Corp.
stockholders

24/32

Reconciliation of Profit or Loss and Comprehensive Income for the Previous Fiscal Year(from April 1, 2017 to March 31, 2018)(Consolidated Statements of Profit or Loss)(In millions of yen)
Presentation under US GAAP

Recognition
Reand
US GAAP classification measurement
differences

IFRS

Presentation under IFRSNet sales
Cost of sales
Selling, general andadministrative expenses
Loss on impairment oflong-lived assets

4,431,198
3,030,902－－

13,22653,0244,444,424 Net sales
3,083,926 Cost of sales

1,061,778

729(34,623)

1,027,884

19,881

Operating income
Other income
Interest and Dividends
Equity in earnings ofaffiliated companies
Other
Other expenses
Interest
Other

318,637
60,414
8,611(19,881)(20,990)(1,838)－23,637－
15,82010,645－(23,637)

22,261
29,542
14,473
2,727
11,746(22,261)(29,542)－
4,726(11,746)

－
－
－
(657)
－

－

－
Income before income taxes
Income taxes
Net income
Net income attributable tothe noncontrolling interests
Net income attributable to
Mitsubishi Electric Corp.

－(5,170) Other profit (loss)
327,444 Operating income－
8,611 Financial income
－
－
－
6,796
－

364,578
82,239282,339

22,261
(723)
(723)
－

1,686
(10,649)
5,291(15,940)

23,947353,206
86,807
266,399

10,459－185

10,644

271,880－(16,125)

255,755

25/32

Selling, general andadministrative expenses

Financial expenses
Share of profit ofinvestments accounted forusing the equity method
Income before income taxes
Income tax expenses
Net income
Net income attributable to:Non-controlling interests
Mitsubishi Electric Corp.
stockholders

(Consolidated Statements of Comprehensive Income)
Presentation under US GAAPNet income
Other comprehensive income(loss), net of tax

Unrealized gains (losses)
on securities
Pension liability
adjustments

Foreign currencytranslation adjustments
Unrealized gains (losses)
on derivative instruments

Total
Comprehensive income (loss)
Comprehensive income (loss)
attributable tothe noncontrolling interests
Comprehensive income (loss)
attributable to
Mitsubishi Electric Corp.

(In millions of yen)

Recognition
Reand
US GAAP classification measurement
differences

282,339－(15,940)

IFRS

Presentation under IFRS

266,399 Net income(Other comprehensive income(loss), net of tax)
Items that will not bereclassified to net income
Financial assets measured atfair value through othercomprehensive income
Remeasurements of defined
benefit pension plans
Share of othercomprehensive income ofinvestments accounted forusing the equity method
Subtotal
Items that may bereclassified to net income
Exchange differences ontranslating foreign
operations
Net changes in the fairvalue of cash flow hedges
Share of othercomprehensive income ofinvestments accounted forusing the equity method
Subtotal
Total Other comprehensive
income (loss)
Comprehensive income (loss)
Comprehensive income (loss)
attributable to:(14,875)

392

14,431(52)

15,857

(596)

6,062

21,323

－
－

204
－

(34)
20,459170
21,441

17,023(1,908)

1,877

16,992

(88)

(6)

23

(71)

－
－

1,914
－

(45)
1,855

1,869
18,79017,917300,256－－

22,314
6,374

40,231
306,630

11,852－

68

11,920Non-controlling interests

288,404－

6,306

294,710

Mitsubishi Electric Corp.
stockholders

26/32

Notes to Reconciliation of Profit or Loss and Comprehensive Income
The principal effects of transition to IFRS in the reconciliation of profit or loss and comprehensive income
above are as follows:(1) Reclassification
The main elements of reclassification are as follows:(a) In accordance with the presentation provisions under IFRS, financial income and financial expenses arepresented separately.
(b) In accordance with the presentation provisions under IFRS, part of other income and other expenses, etc.
is included and presented in operating profit.
(c) Unrealized gains (losses) on securities, pension liability adjustments, foreign currency translation
adjustments and unrealized gains (losses) on derivative instruments in other comprehensive income thatare attributable to equity investees are reclassified in accordance with the presentation provisions under
IFRS.
(2) Recognition and measurement differences
The main elements of recognition and measurement differences are as follows:(a) Reconciliation of sales and cost of sales
Under US GAAP, if amounts of construction contracts cannot be reliably estimated, all construction
costs and construction revenue are recognized when the construction is complete.
Under IFRS, on the other hand, revenue from a performance obligation satisfied over time isrecognized using the cost recovery method if the outcome cannot be reliably estimated. Revenues
using the cost recovery method are only recognized for costs incurred to the extent that it is probablethat the cost will be recovered and costs are recognized as expenses in the period in which they are
incurred.
(b) Equity instruments
Non-marketable equity instruments are recognized at their cost under US GAAP. If fair value ofequity instruments has decreased and the decrease is considered not to be temporary, impairment
loss is recognized for the amount of the cost of the equity instruments in excess of fair value. Gainsor losses on the sale of these equity instruments are recognized in profit or loss.
Under IFRS, on the other hand, equity instruments are recognized at fair value irrespective ofwhether there is an active market. Because it is permitted to recognize changes in fair value in othercomprehensive income, the Company and its consolidated subsidiaries have elected to recognizechanges in fair value of equity instruments in other comprehensive income. Accordingly, loss on
impairment and gains or losses on the sale of equity instruments recognized in profit or loss under
US GAAP are recognized in other comprehensive income as well.

Notes to Reconciliation of Cash Flows
There are no significant differences in the statement of cash flows resulting from transition from US GAAP to
IFRS.
Cautionary Statement
The Mitsubishi Electric Group (hereafter “the Group”) is involved in development, manufacture and sales ina wide range of fields including Energy and Electric Systems, Industrial Automation Systems, Information
and Communication Systems, Electronic Devices and Home Appliances, and these operations extend globally,
not only inside Japan, but also in North America, Europe, Asia and other regions. While the statements herein
are based on certain assumptions and premises that the Group trusts and considers to be reasonable under thecircumstances on the date of announcement, actual financial standings and operating results are subject tochange due to any of the factors as contemplated hereunder and/or any additional factor unforeseeable as ofthe date of this announcement. Such factors materially affecting the expectations expressed herein shall include
but are not limited to the following:(1) Important trends
The Group’s operations may be affected by trends in the global economy, social conditions, laws, tax
codes and regulations.

27/32

(2) Foreign currency exchange rates
Fluctuations in foreign currency markets may affect the Group’s sales of exported products and purchasesof imported materials that are denominated in U.S. dollars or euros, as well as its Asian production bases’
sales of exported products and purchases of imported materials that are denominated in foreign currencies.
(3) Stock markets
A fall in stock market prices may cause a decline in value of the Group’s marketable securities and pension
assets.
(4) Supply/demand balance for products and procurement conditions for materials and components
A decline in prices and shipments due to changes in the supply/demand balance, as well as an increase inmaterial prices due to a worsening of material and component procurement conditions, may adversely
affect the Group’s performance.
(5) Fund raising
An increase in interest rates, the yen interest rate in particular, would increase the Group’s interest
expenses.
(6) Significant patent matters
Important patent filings, licensing, copyrights and patent-related disputes may adversely affect related
businesses.
(7) Environmental legislation or relevant issues
The Group may incur losses or expenses owing to changes in environmental legislation or the occurrenceof environmental issues. Such changes in legislation or the occurrence of environmental issues may also
impact manufacturing and all corporate activities of the Group.
(8) Flaws or defects in products or services
The Group may incur losses or expenses resulting out of flaws or defects in products or services, and thelowered reputation of the quality of all its products and services may affect the entire Group.
(9) Litigation and other legal proceedings
The Group’s operations may be affected by lawsuits or other legal proceedings against Mitsubishi Electric,
its subsidiaries and/or equity-method affiliated companies.
(10) Disruptive changes
Disruptive changes in technology, development of products using new technology, timing of production
and market introduction may adversely affect the Group’s performance.
(11) Business restructuring
The Group may record losses due to restructuring measures.
(12) Information security
The performance of the Group may be affected by computer virus infections, unauthorized access andother unpredictable incidents that lead to the loss or leakage of personal information held by the Group or
confidential information regarding the Group’s business such as its technology, sales and other operations.
(13) Natural disasters
The Group’s operations, particularly manufacturing activities, may be affected by the occurrence ofearthquakes, typhoons, tsunami, fires and other large-scale disasters.
(14) Other significant factors
The Group’s operations may be affected by the outbreak of social or political upheaval due to terrorism,
war, pandemic by new strains of influenza and other diseases, or other factors.
###
About Mitsubishi Electric Corporation
With nearly 100 years of experience in providing reliable, high-quality products, Mitsubishi Electric
Corporation (TOKYO: 6503) is a recognized world leader in the manufacture, marketing and sales of electricaland electronic equipment used in information processing and communications, space development and satellite
communications, consumer electronics, industrial technology, energy, transportation and building equipment.
Embracing the spirit of its corporate statement, Changes for the Better, and its environmental statement, Eco
Changes, Mitsubishi Electric endeavors to be a global, leading green company, enriching society withtechnology. The company recorded consolidated group sales of 4,444.4 billion yen (in accordance with IFRS;
US$ 41.9 billion*) in the fiscal year ended March 31, 2018. For more information visit:
www.MitsubishiElectric.com*At an exchange rate of 106 yen to the US dollar, the rate given by the Tokyo Foreign Exchange Market on
March 31, 201828/32

【Supplementary Materials】

July 30, 2018

Mitsubishi Electric Corporation

Fiscal 2019 First-quarter Consolidated Results
1. Financial Results
2. Net Sales and Operating Income by Segment
3. Overseas Net Sales by Segment
4. Orders by Segment
5. Foreign Exchange Rates for Recording Net Sales andImpact of Exchange Rate Fluctuations on Net Sales<Reference>
Difference between US GAAP and IFRS

29/32

FY ’18: Apr. 1, 2017 – Mar. 31, 2018
FY ’19: Apr. 1, 2018 – Mar. 31, 2019
1. Financial Results(Consolidated)(Billions of yen, year-on-year % change)

FY '18FY '19Net sales
Operating income

Q1(Actual)1,033.9
75.4

Full Year(Actual)4,444.4
327.4

Q1(Actual)1,050.9
(+2)
61.5
(-18)

Full Year(Forecast)
4,500.0
(+1)
315.0
(-4)

Income before income taxes

80.4

353.2

68.7

(-15)

345.0

(-2)

Net income attributable to
Mitsubishi Electric Corp.
stockholders

56.9

255.7

47.5

(-17)

245.0

(-4)

*Figures in parentheses in the right column indicate change from the previous corresponding period.

2. Net Sales and Operating Income by Segment(Billions of yen, year-on-year % change)

FY '18Energy and Electric
Systems

Net Sales
Operating Income

Net Sales
Industrial
Automation Systems Operating Income
Net Sales
Information andCommunication Systems Operating Income
Electronic Devices
Home Appliances

Net Sales
Operating Income

Net Sales
Operating Income

Net Sales

OthersOperating Income

Subtotal
Eliminations and other

Consolidated total

Net Sales
Operating Income

Net Sales
Operating Income

Net Sales
Operating Income

Q1(Actual)
268.5
6.7
350.8
50.7
90.0
-1.7
48.1
3.0
269.8
24.1
144.9
2.0
1,172.3
84.9-138.3-9.4
1,033.9
75.4

FY '19Full Year(Actual)1,253.0
65.4
1,444.9
187.3
438.1
11.3
202.2
14.1
1,049.3
55.4
659.0
24.0
5,046.8
357.8-602.4-30.3
4,444.4
327.4

3. Overseas Net Sales by Segment

Industrial Automation Systems
Information and Communication Systems

Electronic Devices
Home Appliances
OthersConsolidated total
Ratio of overseas net sales to total sales

(0)
(-11)
(+3)
(-12)
(-11)
(－)
(+7)
(-51)
(+4)
(-17)
(+7)
(-42)
(+2)
(-16)

(+2)
(-18)

(Billions of yen, year-on-year % change)

FY '18Energy and Electric Systems

Q1(Actual)
267.3
5.9
360.9
44.8
79.7
-1.8
51.4
1.4
280.3
20.0
155.6
1.1
1,195.6
71.7-144.6-10.1
1,050.9
61.5

Q1(Actual)
96.9
221.0
1.6
27.6
154.7
4.3
506.4
49.0%

FY '19Full Year(Actual)
422.1
865.8
13.1
115.8
568.7
19.7
2,005.4
45.1%

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Q1
(Actual)
95.7
(-1)
216.9
(-2)
2.0 (+24)
28.8
(+4)
(+4)
161.4
4.4
(+3)
509.5
(+1)
48.5%

Full Year(Forecast)
1,290.0
(+3)
68.0
(+4)
(0)
1,450.0
184.0
(-2)
430.0
(-2)
10.0
(-12)
220.0
(+9)
(-8)
13.0
1,060.0
(+1)
48.0
(-14)
670.0
(+2)
24.0
(0)
(+1)
5,120.0347.0(-3)-620.0-32.0
4,500.0
(+1)
315.0
(-4)

4. Orders by Segment(Consolidated)(Billions of yen, year-on-year % change)

FY '19Energy and Electric Systems
Industrial Automation Systems
Information and Communication Systems

Electronic Devices

Q1(Actual)
275.9
356.6
71.5
50.1

(-7)
(+1)
(-4)

(0)
*Home Appliances and Others segments have few products made on order, thus not included in the chart above.

5. Foreign Exchange Rates for Recording Net Sales and Impact of Exchange Rate Fluctuations on Net Sales
FY '18Average exchange
rate

Impact ofexchange rate
fluctuations
on net sales

FY '19Q1(Actual)

Full Year(Actual)Q1(Actual)

Full Year *(Forecast)

CNY

¥111
¥124
¥16.3

¥111
¥130
¥16.8

¥110
¥129
¥17.0

¥100
¥125
¥16.5

Consolidated
total

About ¥11.0 billion
increase

About ¥75.0 billion
increase

About ¥3.0 billion
increase

US$

About ¥3.0 billion increase

About ¥9.0 billion increase

About ¥2.0 billion decreaseEuro

About ¥2.0 billion increase

About ¥26.0 billion increase

About ¥4.0 billion increase

CNY

About ¥1.0 billion decrease

About ¥11.0 billion increase

About ¥3.0 billion increase

US$
Euro

*The forecast for fiscal 2019 is unchanged from the announcement on April 27, 2018.

31/32

<Reference>
Difference between US GAAP and IFRS
1) Financial Results(Consolidated)(Billions of yen)

FY '18Net sales
Operating income

US GAAP
1,005.5
74.2

Q1(Actual)Difference
IFRS
1,033.9
28.3
75.4
1.2

US GAAP
4,431.1
318.6

Full Year(Actual)IFRS
4,444.4
327.4

Difference
13.2
8.8

Income before income taxes

99.2

80.4

-18.8

364.5

353.2

-11.3

Net income attributable to
Mitsubishi Electric Corp.
stockholders

67.7

56.9

-10.7

271.8

255.7

-16.1

* "Net income attributable to Mitsubishi Electric Corp. stockholders'' is described as "Net income attributable to Mitsubishi Electric Corp.'' under US GAAP.

2) Net Sales and Operating Income by Segment(Billions of yen)

FY '18Energy and Electric
Systems

Net Sales
Operating Income

Net Sales
Industrial
Automation Systems Operating Income
Net Sales
Information andCommunication Systems Operating Income
Electronic Devices
Home Appliances

Net Sales
Operating Income

Net Sales
Operating Income

Net Sales

OthersOperating Income

Subtotal
Eliminations and other

Consolidated total

Net Sales
Operating Income

Net Sales
Operating Income

Net Sales
Operating Income

US GAAP
250.0
6.7
350.8
49.8
80.1

Q1
(Actual)Difference
IFRS
268.5
18.4
6.7
-0.0
350.8
－
50.7
0.9
90.0
9.8

US GAAP1,241.9
51.7
1,444.9
190.8
436.0

Full Year(Actual)
IFRS
1,253.0
65.4
1,444.9
187.3
438.1

Difference
11.1
13.7
－
-3.4
2.1

-2.2

-1.7

0.4

11.9

11.3

-0.6

48.1
3.0
269.8
24.1
170.6
2.1
1,169.7
83.6-164.1-9.4
1,005.5
74.2

48.1
3.0
269.8
24.1
144.9
2.0
1,172.3
84.9-138.3-9.4
1,033.9
75.4

－
0.0
－
0.0
-25.7
-0.0
2.6
1.2
25.7
－
28.3
1.2

202.2
14.5
1,049.3
56.0
764.3
23.9
5,138.9349.0-707.7-30.3
4,431.1
318.6

202.2
14.1
1,049.3
55.4
659.0
24.0
5,046.8
357.8-602.4-30.3
4,444.4
327.4

－
-0.3
－
-0.5
-105.2
0.1
-92.0
8.8
105.2
－
13.2
8.8

32/32