Second Quarter ended September 30, 2019
Financial Results Meeting Q&A (Summary)
Hitachi Capital Corporation【Date】

November 6, 2019 (Wed.) 3:30 PM to 4:00 PM【Questionees】Seiji Kawabe, President and Chief Executive Officer
Satoshi Inoue, Vice President and Executive Officer【Question 1】
・Operating assets in China and the Americas decreased year-on-year. How much of
it is attributable to the business review (the closing of large-scale factoring business,etc.)?
【Answer 1】
・In both China and the Americas, a decrease in operating assets excluding foreignexchange effects is mostly attributable to the business review.
【Question 2】
・How much of operating assets in large-scale factoring business in the Americas isleft now?
【Answer 2】
・As large-scale factoring business in the Americas is settled in short time, not muchis left. They will be nearly zero by next March.
【Question 3】
・It seems that decreases in cost of capital and SG&A are larger than the foreignexchange effects in the revised FY2019 forecasts. What are the factors?
【Answer 3】
・We made the revision based on various factors including lower cost of capital in theAmericas due to the review of large-scale factoring business, etc. and a slightdecline in interest rates, in addition to foreign exchange effects.
As for SG&A, we are making an ongoing cost-saving effort including for business
management expenses, etc., throughout the year. We are trying to reduce SG&A in
the Head Office, as well as China and the Americas where the large-scale factoringbusiness will be closed.
1【Question 4】
・At the announcement released on July 25, 2019, strengthening of business related
expenses of ¥2.5 billion was included as a decreasing factor for profit before tax,
but it’s not included in this announcement. Will it be incurred in the second half?
【Answer 4】・Part of strengthening of business related expenses cost is included in bad debt
related expenses, etc. of ¥1.1 billion.
【Question 5】
・I believe Hong Kong accounted for around 40% of profit in China business. Has
there been any specific impact?
【Answer 5】・Hong Kong was offering syndicated loan, but we determined it shouldn’t be ourfocused business as it is banks’ forte. Therefore we have been closing it.
As a result, profit in Hong Kong decreased year-on-year, but it is mostly in line withour plan.
【Question 6】
・Does the demonstrations and recession (a decline in GDP) in Hong Kong affect thebusiness?
【Answer 6】
・In Hong Kong, we have been closing syndicated loan business, and although westill have office appliances finance and auto finance, we have long-establishedstrengths in both of them.
There hasn’t been any impact of demonstrations in Hong Kong so far. Our officeappliances finance business holds approx. 70% share of the market, and we will
strive to further enhance our services so as not to lose it. Auto finance businessfaces increasingly tough competition, but there is room for further improving cost
efficiency and we will work to boost our price competitiveness by reducing OHR.

2

【Question 7】
・You explained that a decline in profit in Europe business was due to investment costin continental Europe. How about U.K. business alone?
【Answer 7】
・The investment cost in continental Europe in 2019 relates to a new investment toacquire mobility solutions business in Germany. As a result, in the first half ofFY2019, the expense surpassed the contribution by gross profit. Most of theremaining business in Europe is U.K. business, which maintains very strong
performance.
End3