(Translation)
Consolidated Financial Results
for the Nine-Month Period Ended December 31, 2021
(Japanese GAAP)
February 8, 2022
Company name:
Stock exchange listings:
Securities code:
URL:
Representative:
Contact:

Kyushu Railway Company
Tokyo and Fukuoka
9142
https://www.jrkyushu.co.jp/
Toshihiko Aoyagi, President and CEO
Keiichi Takano, General Manager, Public Relations Department
Tel.: +81-92-474-2541

Scheduled date for filing of quarterly report:
Planned Date of dividend payment commencement:
Preparation of supplementary explanations for financial results:
Holding of a briefing on quarterly financial results:

February 10, 2022
－
Yes
None

(Amounts less than one million yen, except for per share amounts, are omitted.)

1. Consolidated Financial Results for the Nine-Month Period Ended December 31, 2021
(From April 1, 2021 to December 31, 2021)(1) Consolidated operating results(Percentages show year-on-year changes.)

Operating revenue
Nine months ended
December 31, 2021
December 31, 2020

Millions of yen% Millions of yen
222,712 10.0
2,784
202,405 (36.7)(18,601)(Note) Comprehensive income:Nine months ended
December 31, 2021
December 31, 2020

Operating income%－－

Net income attributable toowners of the parent

Ordinary income
Millions of yen
6,967(16,153)%－－

Millions of yen
9,214(11,662)

Nine months ended December 31, 2021: ¥8,364 million (－%)
Nine months ended December 31, 2020: ¥(13,547) million (－%)

Net income per share— basic

Net income per share— diluted

Yen
58.65
(74.23)Yen－－(2) Consolidated financial position
Total assets
Net assets
Millions of yen
Millions of yen
926,495
386,301
As of December 31, 2021
891,379
395,408
As of March 31, 2021
(Reference) Shareholders’ equity:
As of December 31, 2021: ¥384,507 million
As of March 31, 2021: ¥390,189 million

Equity ratio
%
41.5
43.8

%
－
－

2. DividendsFirstquarter-end
Yen－－

Year ended March 31, 2021
Year ending March 31, 2022
Year ending March 31, 2022
(Forecast)

Annual dividends
SecondThird
quarter-end
quarter-end
Yen
Yen
0.00
－
0.00
－

Fiscalyear-end
Yen
93.00

Total
Yen
93.00

93.00

93.00

(Note) Revisions to the most recently disclosed dividend forecasts: No

3. Consolidated Forecasts for the Fiscal Year Ending March 31, 2022
(April 1, 2021 to March 31, 2022)(Percentages for the full year show year-on-year changes.)

Full year

Net income
Net income per
attributable to owners
shareof the parent
Millions of
%
%
Yen
yen
9,800
62.37
－
－

Operating revenue

Operating income

Ordinary income

Millions ofyen
332,800

Millions of
yen
2,700

Millions of
yen
6,900

%
13.2

%
－

(Note) Revisions to the most recently disclosed financial forecasts: Yes

Notes(1) Changes in significant subsidiaries during the nine months ended December 31, 2021 (changes in specified
subsidiaries affecting the scope of consolidation): No(2) Application of special accounting treatment in preparing the quarterly consolidated financial statements: No(3) Changes in accounting policies, changes in accounting estimates and restatement of revisions
i Changes in accounting policies with revision of accounting standards: Yes
ii Changes in accounting policies other than the above: Yes
iii Changes in accounting estimates: Yes
iv Restatement of revisions: No(Notes)ii is subject to “Changes in Accounting Policies That Are Difficult to Distinguish from Changes in Accounting Estimates.”
For details about i, please refer to “(3) Notes to Quarterly Consolidated Financial Statements, Changes in Accounting Policies” on page
13 of the accompanying materials.
For details about ii and iii, please refer to “(3) Notes to Quarterly Consolidated Financial Statements, Changes in Accounting Policies
That Are Difficult to Distinguish from Changes in Accounting Estimates and Changes in Accounting Estimates” on page 14 of theaccompanying materials.

(4) Number of shares outstanding (common stock)i

Number of shares issued andoutstanding at end of period(including treasury stock)ii Number of shares of treasury
stock at end of period
iii Average number of shares during
the period

As of December
31, 2021

157,301,600
shares

As of March 31,
2021

157,301,600
shares

As of December
31, 2021

183,700
shares157,117,600
shares

As of March 31,
2021

184,600
shares157,116,500
shares

As of December
31, 2021

As of December
31, 2020

Note: The number of shares of treasury stock at the end of the period includes the number of shares of the Company’s stock held by the Board
Benefit Trust (BBT) (Third quarter of FY2022/3, 183,700 shares; FY2021/3, 184,600 shares). In addition, the number of shares of theCompany’s stock held by the Board Benefit Trust (BBT) is included in the treasury stock that is subtracted in the calculation of theaverage number of shares during the period (Third quarter of FY2022/3, 184,000 shares; Third quarter of FY2021/3, 185,100 shares).

* This summary of consolidated financial results is not subject to quarterly reviews by certified public accountants or corporate
auditors.

* Explanation of Appropriate Uses of Performance Forecasts and Other Important Items:
Performance forecasts and other forward-looking statements appearing in this document are based on currently available
information and specific assumptions deemed rational, and are not assurances that the Company will achieve these forecasts.
Actual performance can vary greatly depending on various factors such as fluctuations in interest rates, fluctuations in shareprices, changes in exchange rates, fluctuations in the value of assets, changes in the economic and financial environment,changes in the conditions of competition, occurrences of large-scale and other disasters, and changes in regulations.
Supplementary quarterly materials are attached to this summary of consolidated financial results.

Contents of Accompanying Materials
1. Qualitative Information on Quarterly Consolidated Financial Performance ....................... 2(1) Qualitative Information on Consolidated Operating Results ................................................. 2(2) Qualitative Information on Consolidated Financial Position ................................................. 7(3) Qualitative Information on Consolidated Performance Outlook ............................................ 7
2. Quarterly Consolidated Financial Statements and Major Notes ........................................... 9(1) Consolidated Balance Sheets .................................................................................................. 9(2) Consolidated Statements of Income and Comprehensive Income ......................................... 11
Quarterly Consolidated Income Statements
Consolidated Cumulative Third Quarter .......................................................................... 11
Quarterly Consolidated Comprehensive Income Statements
Consolidated Cumulative Third Quarter ........................................................................ 12(3) Notes to Quarterly Consolidated Financial Statements .......................................................... 13(Notes on Going Concern Assumption) ................................................................................. 13(Notes on Significant Changes in the Value of Shareholders’ Equity) ................................... 13(Changes in Accounting Policies) .......................................................................................... 13(Changes in Accounting Policies That Are Difficult to Distinguish from Changes in
Accounting Estimates and Changes in Accounting Estimates) ............................................ 14(Additional Information) ........................................................................................................ 15(Segment Information) ........................................................................................................... 16(Significant Subsequent Events) ............................................................................................ 17○(Financial results presentation materials)
Financial Results for the Third Quarter of FY22.3 (Cumulative total for the nine-month period from April to December)- 1 -1. Qualitative Information on Quarterly Consolidated Financial Performance
Forward-looking statements in this document are based on assessments as of the end of the third quarter of
FY2022/3.
From the first quarter of FY2022/3, the Company has applied the “Accounting Standard for Revenue
Recognition” (ASBJ Statement No. 29, March 31, 2020), etc.
Details are provided in “2. Quarterly Consolidated Financial Statements and Major Notes, (3) Notes to
Quarterly Consolidated Financial Statements (Changes in Accounting Policies)” and “2. Quarterly
Consolidated Financial Statements and Major Notes, (3) Notes to Quarterly Consolidated Financial
Statements (Segment Information).”(1) Qualitative Information on Consolidated Operating Results
In the nine month period ended December 31, 2021, due to the re-spread of the COVID-19 infection, astate of emergency was declared and extended multiple times. Domestic demand remained sluggish,
centered on the service sector. Due to the expansion of vaccination programs, etc., there are
expectations for progress with the control of COVID-19 and with economic activity. However, a new
COVID-19 variant has emerged, and the timing, extent, etc., of a recovery in economic activity remain
highly uncertain. Challenging conditions are expected to continue for the time being.
Looking at the Group’s results, due to spread of the COVID-19 infection and to the state of emergency
declarations, the railway and other businesses were affected by declining mobility demand andsluggish consumer spending. In these conditions, we worked in accordance with our recognition that
our most important mission is safety in the railway business, which is our mainstay business. We
steadily invested in railway safety, and in April 2021 we opened the Kumamoto Station Building,which is part of our implementation of strategic city-building initiatives in the regions around ourbases. Furthermore, we rolled out a project under the title “Supporting Each Other Until It’s Over,”which expresses our wishes for the resolution of COVID-19 and the invigoration of Kyushu. We also
implemented initiatives to promote “Local Community Invigoration,” such as establishing a
specialized regional fund. In addition, the future course of trends in the management environment isunclear. In preparation for changes in the management environment, we took steps to reduce costs,
centered on the railway business. These steps included temporary leave for employees.
As a result, operating revenue was up 10.0% year on year, to ¥222,712 million; operating income was¥2,784 million (compared with operating loss of ¥18,601 million in the same period of the previous
fiscal year); EBITDA was ¥22,665 million (compared with EBITDA of ¥1,728 million in the same
period of the previous fiscal year); ordinary income was ¥6,967 million (compared with ordinary lossof ¥16,153 million in the same period of the previous fiscal year); and net income attributable to ownersof the parent was ¥9,214 million (compared with net loss attributable to owners of the parent of ¥11,662
million in the same period of the previous fiscal year).
(Note) EBITDA for the consolidated period under review is the numerical value of operating income
plus the cost of depreciation (excluding the cost of depreciation related to lease assets held forthe purpose of subleasing).

- 2 -The Group's business performance by segment is as follows.
(Millions of Yen)
Operating revenue
FY2022/3,
consolidated
cumulative
third quarter(nine months
ended
December 31,
2021)

Operating income / loss
FY2022/3,
consolidated
cumulative
third quarter(nine months
ended
December 31,
2021)

YoY

EBITDA (Note 2)
FY2022/3,
consolidated
cumulative
third quarter(nine months
ended
December 31,
2021)

YoY

YoY

Transportation

81,498

11,20015.9%(11,393)

13,451－(5,000)11,568－Construction

62,627

4,329

7.4%

2,689

43

1.6%

3,428

20

0.6%

Real Estate andHotels

62,762

13,68927.9%10,729

5,305

97.8%

21,111

6,583

45.3%

Real estate
lease

43,294

6,894

18.9%

11,667

2,861

32.5%

20,406

4,277

26.5%

Real estate sale

12,748

5,446

74.6%

1,296

1,196

－

1,305

1,196

－

Hotel

6,719

1,348

25.1%

(2,234)

1,246

－

(600)

1,108

－

Retail andRestaurant

32,462(8,731) (21.2%)

(794)

1,183

－

135

1,071

－

Other

41,759(2,551)(5.8%)

2,079

1,192

134.5%

3,778

1,509

66.5%

Total

281,110

17,936

6.8%

3,310

21,175－23,452

20,753 768.8%

Adjustment(Note 1)

(58,398)

2,370

－

(526)

210

－

(787)

183

－

Amount on the
consolidated

222,712

20,306

10.0%

2,784

21,386－

22,66520,936－

financial statements(Notes) 1. Adjustments reflect the elimination of intersegment transactions.
2. Consolidated EBITDA = operating income + depreciation (after elimination of intersegment transactions,excluding depreciation of leased assets held for subleasing purposes), segment EBITDA = segment operating
income + segment depreciation (after elimination of intersegment transactions, excluding depreciation of leased
assets held for subleasing purposes)

a. Transportation GroupIn the railway business, the Company worked to secure safety and implemented measures to preventthe spread of COVID-19. On that basis, we worked to secure revenues. In addition, we advanced cost
reductions in order to improve profitability in the railway business, which has a high percentage of
fixed costs.
In terms of safety initiatives, we implemented safety creation activities in order to steadily create
safety for the entire JR Kyushu Group. The slogan of the activities was “Save lives!! Understand therules and put them into practice.” In addition, we steadily implemented safety investment, such as new
production of rolling stock and replacement of aging facilities.
In regard to services, with consideration for prevention of the COVID-19 infection, we worked tounderstand the needs of each customer and to meet their expectations with prompt action. In addition,
we worked to provide services that are aligned with new lifestyles, are safe, and can be used with- 3 -peace of mind, such as a hygiene promotion that was implemented in collaboration with Lion
Corporation, and the announcement of verification testing of limited-express tickets using QR code
payment, which was implemented in cooperation with PayPay Corporation.
In marketing, for the opening of the Nishi-Kyushu Shinkansen in fall 2022, we conducted a tourism
campaign communicating the appeal of Saga and Nagasaki. Together with HKT48, and incooperation with other Kyushu railway companies, we also implemented the “Minna no Kyushu
Project.” Furthermore, we implemented a promotion to expand the use of the Internet train reservation
services, with the catchphrase “For the ticket, use the Internet!” In line with the decrease in usage
accompanying the spread of the COVID-19 infection, for certain discount tickets, we ended sales orrevised prices. In addition, we started a new Shinkansen cargo transport business with the aim of
securing new earnings opportunities.
In transportation, while implementing infection prevention measures at stations and on trains, we
worked to maintain the transportation network, which is social infrastructure. Due to the impacts ofheavy rain that occurred in northern Kyushu in July 2017, we are implementing substitute forms oftransportation between Soeda Station and Yoake Station on the Hitahikosan Line. We have obtained
the approval of related local governments regarding restoration through the introduction of a bus rapidtransit (BRT) system, and we are advancing preparations for the restoration. Furthermore, due to the
influence of the heavy rains in July 2020, which occurred in July 2020, railway facilities on the
Hisatsu Line were damaged, and we are implementing substitute forms of transportation on certain
sections.
In our passenger ship business, as a protection measure to prevent the spread of the COVID-19
infection, the Japanese government requested the halting of passenger transportation operations, andoperations have been suspended on all scheduled routes since March 2020. Also, as an initiative to be
implemented during the suspension of service on scheduled routes, from March 2021 we wereconducting domestic sightseeing operation of the “QUEEN BEETLE” new-style hydrofoil ferry.
However, measures equivalent to priority measures were implemented, such as measures to preventthe spread of the infection in Fukuoka Prefecture, and there were state of emergency declarations. As aresult, domestic sightseeing operations were suspended from May 6 to July 11, 2021 and from August
2 to September 30, 2021.
In our bus business, we reduced service in line with usage conditions, while working to create anenvironment in which customers can use bus services with peace of mind through measures to preventthe spread of infection.
In the field of new mobility services (MaaS), with the objective of restoring a lively atmosphere to thecenter of Fukuoka City, which has been affected by the influence of the COVID-19 infection, we
launched sales of digital tickets on a MaaS app in conjunction with Nishi-Nippon Railroad Co., Ltd.,and 18 commercial facilities in the Tenjin and Hakata areas. Also, on September 30, 2021, together
with DAIICHI KOUTSU SANGYO Co., Ltd., and Nishi-Nippon Railroad Co., Ltd., we concluded amemorandum regarding the establishment of mobility services utilizing digital technologies. Initiatives
targeting the realization of a seamless, highly convenient transportation network have been started,
centered on Kitakyushu City, where the three companies have strong foundations. We have been
advancing MaaS initiatives in the Miyazaki region since FY2021/3. Targeting the establishment ofsustainable regional transportation services in the Miyazaki region, in September 10, 2021 weconcluded a memorandum regarding collaboration in regional transportation services with Miyazaki
kotsu Co., Ltd, and we started a new regional transportation service utilizing bus and railway services- 4 -at Nippo Main Line’s Takanabe Station. In addition, we are working to advance MaaS initiatives inareas around Kyushu, and we are aiming to introduce these programs in Saga Prefecture and in the
Yufuin region in Oita Prefecture within this fiscal year. Furthermore, we also advanced initiatives
through collaboration with other transportation companies outside of Kyushu. For example, we agreed
to provide information related to stations and train locations within the JR Kyushu service area
through a MaaS app provided by West Japan Railway Company, and we started the provision of thisservice.
As a result, the Transportation Group recorded operating revenue of ¥81,498 million, up 15.9% year on
year; an operating loss of ¥11,393 million (compared with operating loss of ¥24,844 million in the same
period of the previous fiscal year); and negative EBITDA of ¥5,000 million (compared with negative
EBITDA of ¥16,569 million in the same period of the previous fiscal year).

b. Construction GroupIn the construction business, we leveraged specialized skills in the railway business in order tocontribute to safe, stable railway operations through railway-related civil engineering, railroad track,and construction work as well as through maintenance operations and rolling stock equipment work. In
railway construction, in a continuation from the previous fiscal year, we endeavored to steadily
advance work related to the Nishi-Kyushu Shinkansen and the Hokuriku Shinkansen.
Furthermore, we worked to obtain orders from government and municipal offices and from private
enterprises for the construction of elevated tracks and for work related to the Shinkansen,
condominiums, and other projects. We also endeavored to reduce costs.
As a result, the Construction Group posted operating revenue of ¥62,627 million, up 7.4% year on year;
operating income of ¥2,689 million, up 1.6%; and EBITDA of ¥3,428 million, up 0.6%.
c. Real Estate and Hotels GroupIn the real estate business, we opened Amu Plaza Kumamoto in April 2021. On the other hand, a stateof emergency was declared, and in accordance with requests from the local government, at our stationbuildings we implemented shorter operating hours and certain tenants suspended operations at stores.
In the real estate sale business, while instituting infection prevention measures at model rooms, werecorded sales from “MJR Sakaisuji Honmachi Tower,” “MJR Hirao Ekimae,” “MJR Miyazakieki
Minami Park Side” and other condominium buildings, and we sought to promote sales of “MJR the
Garden Shimoori,” “MJR the Garden Kashii,” “MJR Kumamoto The Tower,” etc.
In the hotel business, we opened THE BLOSSOM KUMAMOTO in April 2021. In addition, we took
steps to capture limited demand, such as sales of a plan for teleworking. Occupancy rates had declined
due to the spread of the COVID-19 infection, but from October 2021 there were signs of improvement
as a result of a recovery in mobility following the lifting of the state of emergency.
As a result, the Real Estate and Hotels Group posted operating revenue of ¥62,762 million, up 27.9%
year on year; operating income of ¥10,729 million, up 97.8%; and EBITDA of ¥21,111 million, up
45.3%.

- 5 -d. Retail and Restaurant GroupIn our retail business, we renovated convenience stores, and we opened “hands be Amu Plaza
Kumamoto” at Amu Plaza Kumamoto, which opened in April 2021. In addition, we implemented
online openings of “Yobuko Manbou” and “FAMILK!!” on Ekicho Osusume No e-MALL, a JR
Kyushu Group e-commerce site that opened in August 2021. Furthermore, in September 2021 we
opened the “Famima Toranomon Hills,” our first convenience store in the Kanto region.
In the restaurant business, we took steps to expand new store openings. For example, we opened a new
Cinnabon specialty cinnamon roll shop in Amu Plaza Kumamoto, which opened in April 2021.
Furthermore, we took steps to create new demand. For example, in August 2021 we opened the firstUmaya freestanding restaurant in a suburban location. In addition, we continued the initiative of using
platform stores at Hakata Station as pop-up shops, and we also worked to further improve
management efficiency, including closing unprofitable stores. Moreover, in October 2021, Nurubon
Inc., which was established in August as a subsidiary of the Company, acquired and began to operate
Yakuniku Nurubon, which is a yakiniku chain, and other restaurants from Amiya Co., Ltd. and Royal
Foods Co., Ltd.
Nonetheless, stores in stations and existing restaurants were affected by the decline in mobility
demand and sluggish consumption demand due to the influence of the spread of COVID-19. In
addition, in May 2020, the Company transferred to TSURUHA Holdings, Inc. a portion of its holdingsof the shares of JR Kyushu Drug Eleven Inc. JR Kyushu Drug Eleven was removed from the scope of
consolidation from the end of the first quarter of FY2021/3, which also had an effect on the Retail andRestaurant Group.
As a result, the Retail and Restaurant Group recorded operating revenue of ¥32,462 million, down 21.2%
year on year; operating loss of ¥794 million (compared with operating loss of ¥1,978 million in the same
period of the previous fiscal year); and EBITDA of ¥135 million (compared with negative EBITDA of¥935 million in the same period of the previous fiscal year).
e. Other Groups
For the construction machinery sales and rental business, we worked to secure earnings throughaggressive sales activities.
As a result, Other Groups posted operating revenue of ¥41,759 million, down 5.8% year on year;
operating income of ¥2,079 million, up 134.5%; and EBITDA of ¥3,778 million, up 66.5%.
(Note) EBITDA for the consolidated period under review is the numerical value of operating income
plus the cost of depreciation (excluding the cost of depreciation related to lease assets held forthe purpose of subleasing).

- 6 -(2) Qualitative Information on Consolidated Financial Position
Total assets as of December 31, 2021, were up 3.9% compared with the previous fiscal year-end, to¥926,495 million. Current assets increased 0.9%, to ¥202,758 million, due to an increase in cash andtime deposits and other factors. Non-current assets increased 4.8%, to ¥723,736 million, due principallyto the acquisition of property, plant and equipment, etc.
Meanwhile, total liabilities increased 8.9% compared with the previous fiscal year-end, to ¥540,193
million. Current liabilities increased 10.0%, to ¥159,117 million, due to the issuance of commercial
papers and other factors. Non-current liabilities were up 8.5%, to ¥381,076 million, as a result of theissuance of bonds and other factors.
Furthermore, total equity decreased 2.3% compared with the previous fiscal year-end, to ¥386,301
million, due primarily to a decrease in retained earnings resulting from the payment of dividends, etc.
(3) Qualitative Information on Consolidated Performance Outlook
Looking at the consolidated performance forecasts for FY2022/3, there is ongoing uncertainty due tothe spread of the new COVID-19 variant. However, with consideration for recent results trends, for the
expected sale of Company properties accompanying the start of operations of JR Kyushu Private REIT
Inc., and for other factors, we have implemented upward revisions to the forecasts for operating revenue,
operating income, ordinary income, and net income attributable to owners of the parent that wereannounced on November 2, 2021.

Full-year performance forecasts for FY2022/3
Operating revenue¥332,800 million (up 13.2% YoY)
Operating income¥2,700 million (operating loss of ¥22,873 million in previous fiscal year)
Ordinary income¥6,900 million (ordinary loss of ¥19,323 million in previous fiscal year)
Net income attributable to owners of the parent¥9,800 million (net loss attributableto owners of parent of ¥18,984 million in previous fiscal year)
EBITDA¥29,900 million (increase of 544.5 % YoY)
* In regard to the method of depreciation for railway business fixed assets, previously the Company
primarily used the declining-balance method. However, from FY2022/3, the Company has changed tomainly using the straight-line method. In addition, in regard to rolling stock, the Company haschanged to useful life in line with usage condition. As a result, in comparison with before the change,
depreciation in the railway business is expected to decline by approximately ¥3,100 million.

- 7 -Also, forecasts by segment for operating revenue, operating income, and EBITDA are as follows.
(Millions of Yen)
Operating revenue
FY 2022/3(April 1, 2021 –March 31, 2022)

Operating income / loss
FY 2022/3(April 1, 2021 –YoY

EBITDAFY 2022/3(April 1, 2021 –YoY

March 31, 2022)

YoY

March 31, 2022)

Transportation

110,000 14,705

15.4%(22,300)

15,329－(13,400)

Construction

95,100 (1,423) (1.5%)

6,300

(690)

(9.9%)

7,200(841) (10.5%)

Real Estate andHotels110,800 30,672

38.3%

18,200

8,286

83.6%

32,100

9,874

44.4%

58,200

8,438

17.0%

15,000

2,927

24.3%

26,700

4,690

21.3%

Real estate sale

43,500 19,939

84.6%

6,100

3,459 131.0%

6,100

3,447 129.9%

Hotel

9,100

33.7%

(2,900)

1,899

－

(700)

1,737

－

44,400 (7,088) (13.8%)

(900)

1,675

－

300

1,480

－

59,300 (4,341) (6.8%)

2,400

648

37.0%

4,900

1,192

32.2%

419,600 32,524

8.4%

3,700

25,248－31,10024,813 394.7%

6,361

－

(1,000)325－(1,200)332,800 38,885

13.2%

2,700

25,573－29,900Real estate
lease

Retail andRestaurant
Other
Total
Adjustment(86,800)

2,293

13,107447－－

Amount on the
consolidated
financial

25,260 544.5%

statements

Moreover, the performance outlook was prepared based on information available as of the release dateof these materials, and there are cases where actual performance differs from outlook figures due tovarious factors that arise going forward.

- 8 -2. Quarterly Consolidated Financial Statements and Major Notes(1) Consolidated Balance Sheets(Millions of Yen)
FY 2021/3(As of March 31, 2021)
ASSETS
Current assets
Cash and time deposits
Notes and accounts receivable–trade
Notes and accounts receivable–trade, and contract
assetsFares receivable
Securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and fixtures (net)
Machinery, rolling stock and vehicles (net)Land
Lease assets (net)
Construction in progress
Other (net)Net property, plant and equipment
Intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Net defined benefit assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets- 9 -FY 2022/3, Third Quarter(As of December 31, 2021)

22,92750,85748,097－－43,476

1,059
42,096
13,583
20,4298,352
41,646(47)
200,906

1,739
33,027
21,84926,204
9,849
18,555(42)
202,758

284,255
38,047
153,553
19,66428,4988,002
532,0213,940

300,273
41,369148,216
19,75544,9157,496
562,026
4,144

45,16255,252873
54,062(840)
154,510
690,472
891,379

42,74058,0601,221
56,367(824)
157,565
723,736
926,495

(Millions of Yen)
FY 2021/3(As of March 31, 2021)
LIABILITIES AND EQUITYCurrent liabilities
Notes and accounts payable–trade
Short-term loans
Commercial papers
Current portion of long-term debt
PayablesAccrued income taxes
Fare deposits received with regard to railway
connecting services
Railway fares received in advanceAccrued bonuses
Other
Total current liabilities
Non-current liabilities
Corporate bonds
Long-term debt
Allowance for safety and environmental measures
Allowance for disaster-damage losses
Net defined benefit liabilities
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities
EQUITY
Shareholders’ equity
Common stock
Capital surplus
Retained earnings (Deficit)
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Unrealized gain on available-for-sale securities
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total equity
TOTAL LIABILITIES AND EQUITY- 10 -FY 2022/3, Third Quarter(As of December 31, 2021)

31,942
6,885
－
4,674
47,952
2,749

16,801
6,523
30,00010,83638,038
507

3,060

2,939

4,737
5,814
36,864
144,681

5,025
3,516
44,927
159,11780,000159,383
1,412
3,773
50,507
1,462
54,750351,290495,971

120,000
150,575
1,436
3,437
49,3991,455
54,771
381,076
540,193

16,000224,021150,017(594)
389,445

16,000225,038
143,905(591)
384,352

7,079
(186)
(6,148)743
5,218
395,408
891,379

5,655
(174)
(5,325)
155
1,793
386,301
926,495

(2) Consolidated Statements of Income and Comprehensive Income
Quarterly Consolidated Income Statements
Consolidated Cumulative Third Quarter(Millions of Yen)
FY 2021/3, Third Quarter(Nine months ended December
31, 2020)
OPERATING REVENUEOPERATING EXPENSE
Transportation, other services and cost of sales
Selling, general and administrative expense
Total operating expense
OPERATING INCOME (LOSS)NON-OPERATING INCOME
Interest income
Dividend income
Gain on assets held in trust
Subsidies for employment adjustment
Other
Total non-operating income
NON-OPERATING EXPENSEInterest expense
Other
Total non-operating expense
ORDINARY INCOME (LOSS)EXTRAORDINARY GAINS
Construction grants received
Gain on sales of shares of subsidiaries and associates
Other
Total extraordinary gains
EXTRAORDINARY LOSSES
Losses from provision for cost reduction of fixed assets
Provision for loss on disaster
Disaster-damage losses
Other
Total extraordinary losses
INCOME (LOSS) BEFORE INCOME TAXESINCOME TAXES -Current
INCOME TAXES -Deferred
Total income taxes
NET INCOME (LOSS)
NET LOSS ATTRIBUTABLE TONON-CONTROLLING INTERESTSNET INCOME (LOSS) ATTRIBUTABLE TOOWNERS OF THE PARENT- 11 -FY 2022/3, Third Quarter(Nine months ended December
31, 2021)

202,405

222,712

152,553
68,453221,006(18,601)

151,514
68,412219,927
2,784

59
608
1,379
1,498
552
4,099

70
573
1,693
1,647
2,039
6,025

1,306
344
1,651
(16,153)

1,119
722
1,842
6,967

997
9,144
620
10,762

637
－
475
1,113

954
5,194
585
1,521
8,254
(13,646)765(2,668)(1,902)(11,743)

627
806
146
500
2,079
6,001
761
(3,726)(2,965)
8,967

(81)

(247)

(11,662)9,214

Quarterly Consolidated Comprehensive Income Statements
Consolidated Cumulative Third Quarter(Millions of Yen)
FY 2021/3, Third Quarter(Nine months ended December
31, 2020)
NET INCOME (LOSS)OTHER COMPREHENSIVE INCOME
Unrealized gain on available-for-sale securities
Gain (loss) on deferred hedges
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total other comprehensive income
COMPREHENSIVE INCOME
TOTAL COMPREHENSIVE INCOME
ATTRIBUTABLE TO:
Owners of the parent
Non-controlling interests- 12 -FY 2022/3, Third Quarter(Nine months ended December
31, 2021)(11,743)

8,967(2,458)
(15)
(72)
742
(1,803)(13,547)(1,425)
－
17
805
(603)
8,364

(13,436)
(111)

8,624
(260)

(3) Notes to Quarterly Consolidated Financial Statements(Notes on Going Concern Assumption)
None(Notes on Significant Changes in the Value of Shareholders’ Equity)
None(Changes in Accounting Policies)(Application of Accounting Standard for Revenue Recognition, etc.)
The Company has applied the “Accounting Standard for Revenue Recognition” (ASBJ Statement No.
29, March 31, 2020; hereinafter, “Accounting Standard for Revenue Recognition”), etc., from the
beginning of the first quarter of the current consolidated fiscal year. The Company has decided torecognize as revenue the amount expected to be received in exchange for promised goods or services
at the point when control of the goods or services is transferred to the customer. The major resulting
changes are as follows.
(1) Revenue recognition related to contract work
Previously, in regard to construction contracts, the percentage of completion method was applied towork for which it was possible to accurately confirm the degree of progress, and the completedcontract method was applied to other work. From the current consolidated fiscal year, this has beenchanged to the method of recognizing revenue over a certain period of time as performance obligations
are fulfilled. In regard to work for which it is not possible to rationally estimate the percentage ofprogress related to the fulfillment of performance obligations, the cost-recovery method is applied.
(2) Revenue recognition related to agent transactions
For certain transactions, previously the Company recognized as revenue the total amount ofconsideration received from the customer. From the current consolidated fiscal year, for transactions
in which the role of the Group corresponds to that of an agent in the provision of goods or services tothe customer, the net amount, calculated by subtracting the amount paid to the supplier from theamount received from the customer, is recognized as revenue.
(3) Revenue recognition related to seniors business
Previously, in regard to certain lump-sum move-in fees at private retirement homes, revenue wasrecognized at the point when it was confirmed that repayment would not be required. From the current
consolidated fiscal year, the Company has decided to estimate a rational period of time related to thefulfillment of performance obligations and to recognize revenue over a certain period of time inaccordance with the percentage of progress.
The application of the Accounting Standard for Revenue Recognition, etc., is in accordance with thetransitional treatment stipulated in the proviso to paragraph 84 of the Accounting Standard for
Revenue Recognition. The cumulative effect of retrospectively applying the new accounting policy
prior to the beginning of the first quarter of the current consolidated fiscal year has been added to or
deducted from retained earnings at the beginning of the first quarter of the current consolidated fiscal
year, and the new accounting policy has been applied from this starting balance.

- 13 -

In the third quarter of the current consolidated fiscal year, this had the result of increasing operating
revenue by ¥2,403 million, increasing operating expenses by ¥2,341 million, and increasing each ofoperating income, ordinary income, and income before income taxes by ¥61 million. In addition, thestarting balance of retained earnings for the period was decreased by ¥698 million.
As a result of the application of the Accounting Standard for Revenue Recognition, etc., “notes andaccounts receivable–trade,” which were presented under “current assets” in the consolidated balance
sheet for the previous consolidated fiscal year, are included in ”notes and accounts receivable–trade,and contract assets”, from the first quarter of the current consolidated fiscal year. In accordance withthe transitional treatment stipulated in paragraph 89-2 of the Accounting Standard for Revenue
Recognition, prior fiscal years have not been reclassified using the new presentation method.
(Application of Accounting Standard for Fair Value Measurement, etc.)
The Company has applied the “Accounting Standard for Fair Value Measurement” (ASBJ Statement
No. 30, July 4, 2019; hereinafter, “fair value measurement accounting standard”), etc., from the
beginning of the first quarter of the current consolidated fiscal year. In accordance with the transitional
treatment stipulated in article 19 of the fair value measurement accounting standard and article 44–2
of the “Accounting Standard for Financial Instruments” (ASBJ Statement No. 10, July 4, 2019), theCompany has decided to prospectively apply the new accounting policies specified by the fair value
measurement accounting standard. The application of the fair value measurement accounting standard
had no effect on the quarterly consolidated financial statements.
(Changes in Accounting Policies That Are Difficult to Distinguish from Changes in Accounting
Estimates and Changes in Accounting Estimates)(Changes in method of depreciation and useful life for property, plant and equipment)
In regard to the method of depreciation for property, plant and equipment, previously the Company
primarily used the declining-balance method. However, from the first quarter, the Company haschanged to mainly using the straight-line method.
In the Company’s railway business, the current rolling stock is becoming obsolete. The Medium-TermBusiness Plan includes the policy of developing and expanding the introduction of energy-saving
rolling stock with the objective of efficient energy usage. In accordance with this policy, as
replacements for conventional-line rolling stock, the Company is advancing the new production of
821 series AC suburban-type rolling stock, YC1 series storage battery-equipped diesel-electric rollingstock, etc. In addition, future plans call for a substantial amount of investment in new rolling stock,such as the new production of Shinkansen rolling stock at the time of the opening of the Nishi-Kyushu
Shinkansen route.
With consideration for these changes in the management environment and future investment plans in
the railway business, the Company reconsidered the pattern of consumption of the future economic
benefit for all property, plant and equipment, including that in the railway business. As a result, theCompany determined that from the first quarter the economic situation would be more appropriatelyreflected if the Company changed to mainly using the straight-line method for property, plant andequipment.
In addition, the useful life of the Company’s property, plant and equipment was in line with the same
- 14 -

standards as the method stipulated in the Corporation Tax Act. However, with the change in themethod of depreciation, the useful life has been revised to the estimated economic useful life from thefirst quarter. This revision was decided with comprehensive consideration for the physical useful lifeof property, plant and equipment as well as the usage record, etc.
Due to these changes, in comparison with the previous method, for the first nine months of the fiscal
year, operating income, ordinary income, and income before income taxes each improved by ¥2,518
million.
The influence on segment information is described in “Segment Information.”(Additional information)(Occurrence of damage due to rainstorms and heavy rains in the period from August 7, 2021, to August23, 2021)
Due to the influence of the heavy rains that occurred throughout Kyushu in August 2021, damage
occurred on multiple lines, including the Sasebo Line and the Kyudai Main Line. This damage included
deformation of tracks over bridges and flooding of tracks. Among the recovery expenses, etc., resulting
from this damage, extraordinary losses were recorded in the quarterly consolidated income statements
for the consolidated cumulative third quarter. Recovery expenses, etc., for the consolidated cumulative
third quarter were recorded as “disaster-damage losses” and a reasonable estimate of the amount ofrecovery expenses, etc., anticipated in the consolidated fourth quarter and thereafter was recorded as“provision for loss on disaster.”- 15 -

(Segment Information)
Ⅰ FY 2021/3, Third Quarter (Nine-Month Period Ended December 31, 2020)
1. Information Related to Operating Revenue and Income (Loss) by Segment(Millions of Yen)
Adjustment(Note 2)

Quarterly
Consolidated
Statements ofIncome(Note 3)

Reportable Segment
Transportation Construction

Real Estateand Hotels

Retail andRestaurant

Others(Note 1)

Total

Operating Revenue
Outside Customers

65,34925,07046,48841,074

24,422

202,405－

202,405

Inside Group

4,948

33,2272,585

119

19,88860,769(60,769)－

Total

70,29758,29849,073

41,19444,311

263,174(60,769)

202,405

Segment income (loss)(24,844)

2,646

5,424

(1,978)886(17,864)(736)(18,601)(Notes) 1. “Others” represents categories of business that are not included in reportable segments and includes theconstruction machinery sales and rental business, etc.
2. The ¥736 million deduction from segment income (loss) reflects the elimination of intersegment transactions.
3. Segment income (loss) has been adjusted for the operating loss figure on the quarterly consolidated income
statements.

2. Information related to assets for each reportable segment(Significant decrease in assets due to decline in the number of subsidiaries)
Due to the exclusion from the scope of consolidation of JR Kyushu Drug Eleven Inc. (currently:
DRUG ELEVEN CO., LTD.), in comparison with the previous fiscal year, assets in the Retail andRestaurant segment were down ¥16,167 million.
Ⅱ FY 2022/3, Third Quarter (Nine-Month Period Ended December 31, 2021)
1. Information Related to Operating Revenue and Income (Loss) by Segment(Millions of Yen)
Adjustment(Note 2)

Quarterly
Consolidated
Statements ofIncome(Note 3)

Reportable Segment
Real EstateTransportation Constructionand Hotels

Retail andRestaurant

Others(Note 1)

Total

Operating Revenue
Outside Customers

76,33029,58459,90132,31524,579222,712－

222,712Inside Group

5,168

33,0432,860

146

17,18058,398(58,398)－

Total

81,49862,62762,762

32,462

41,759281,110(58,398)

222,712Segment income (loss)(11,393)

2,689

10,729

(794)

2,079

3,310

(526)

2,784

(Notes) 1. “Others” represents categories of business that are not included in reportable segments and includes theconstruction machinery sales and rental business, etc.
2. The ¥526 million deduction from segment income (loss) reflects the elimination of intersegment transactions.
3. Segment income (loss) has been adjusted for the operating income figure on the quarterly consolidated income
statements.

2. Information regarding changes to reportable segments, etc.
(Application of Accounting Standard for Revenue Recognition, etc.)
As described in “Changes in Accounting Policies” the Company has applied the Accounting Standard
for Revenue Recognition, etc., from the beginning of the first quarter of the current consolidated fiscal
year and changed the method of accounting for revenue recognition. As a result, the Company has- 16 -

similarly changed the method of calculating segment income or loss.
As a result of this change, in comparison with the previous method, operating revenue decreased by¥145 million in Transportation, increased by ¥7,409 million in Construction, decreased by ¥54 million
in Real Estate and Hotels, decreased by ¥1,100 million in Retail and Restaurant, and decreased by¥954 million in Other. Segment income increased by ¥61 million in Real Estate and Hotels.
(Changes in method of depreciation and useful life for property, plant and equipment)
As described in “Changes in Accounting Policies That Are Difficult to Distinguish from Changes in
Accounting Estimates and Changes in Accounting Estimates,” previously the Company primarily usedthe declining-balance method of depreciation for property, plant and equipment. However, from thefirst quarter, the Company has changed to mainly using the straight-line method. In addition, with thechange in the method of depreciation, the useful life has been revised to the estimated economic usefullife from the first quarter. Due to these changes, in comparison with the previous method, the segment
loss in the transportation segment for the first nine months of the fiscal year improved by ¥2,518
million.
(Significant Subsequent Events)
None- 17 -