Report of Earnings and Financial Statements for the
Fiscal Year Ended March 31, 2023 (Consolidated)<IFRS>
May 10, 2023
Listed company’s name:

Kawasaki Heavy Industries, Ltd.

Listed on:
Stock code:
URL:
Representative:
Contact:

TSE (Prime Market), and NSE (Premier Market)
7012
https://global.kawasaki.com/
Yasuhiko Hashimoto, President and Chief Executive Officer
Takashi Torii, Executive Officer, Group Manager, Corporate Communication
Group Department+81 3-3435-2130

Tel:

Scheduled dates:
Ordinary general meeting of shareholders:Submission of financial statements:
Commencement of dividend payments:
Supplementary materials to financial results:
Financial Results presentation:

June 28, 2023
June 28, 2023
June 29, 2023
Available
Conducted (for institutional investors, analysts and thepress)(Amounts in millions of yen rounded down to the nearest millions of yen)

1. Consolidated Financial Results for the Fiscal Year Ended March 31, 2023
(April 1, 2022 – March 31, 2023)(1) Operating Results(Percentage figures indicate change compared with the previous fiscal year)
Business profit
Profit before tax
ProfitMillions of%Millions of%Millions of
%
yen
yen
yen

Revenue
Millions of%yenYear ended March 31,
2023
Year ended March 31,
2022

1,725,609

15.0

82,355171.2

70,349154.2

55,290272.7

1,500,879-

30,366-

27,670-14,836-

Profit attributable toowners of parent
Millions of%yenYear ended March 31,
2023
Year ended March 31,
2022

Total comprehensive
incomeMillions of%yen

Basic earnings
per shareyen

Diluted earnings
per shareyen

53,029319.6

81,83362.9

316.63-

12,638-50,241

-

75.51

-

Ratio of profit before
tax to total assets

Ratio of businessprofit to revenue

Return on equity
attributable to ownersof parent%%
Year ended March 31,
9.8
3.0
2023
Year ended March 31,
2.6
1.3
2022
For reference: Share of profit (loss) of investments accounted for using equity method
Year ended March 31, 2023: ¥3,314 million
Year ended March 31, 2022: ¥(14,410) million

1

%
4.8
2.0

(2) Financial Condition

Total assets

Total equity

Equityattributable toowners of parent

Millions of yen

Millions of yen

Millions of yen

Ratio of equity
attributable toowners of parent
to total assets%

2,457,725

596,872

576,20123.4

3,440.39

2,174,630

524,891

505,484

23.2

3,018.31

As of March 31,2023
As of March 31,2022

Equityattributable toowners of parent
per shareyen(3) Cash Flow Position(Millions of yen)
Cash and cash
Cash flows fromequivalents at end
financing activitiesof period

Cash flows fromoperating activities

Cash flows frominvesting activities

23,617(77,457)

85,305

138,420

156,890(58,396)(108,904)

108,511

Year ended March 31,
2023
Year ended March 31,
2022

2. Dividends
Dividend per share
Record date or term

1Q

2Q

3Q

yen

yen

yen

Total dividends
Payout ratio
paid(consolidated)
Year-end Full year
(annual)yen

Millions of
yen

yen

%

Year ended March 31,
20.00
20.00
40.00
6,715
53.0
2022
Year ended March 31,
30.00
60.00
90.00
15,10928.4
2023
Year ending March 31,
40.00
40.00
80.00
28.5
2024 (forecast)
Note: In the Company’s articles of incorporation, the dates of record are set as the last day of the fiscal second
quarter and the last day of the fiscal year.

Ratio ofdividends toequityattributable toowners ofparent(consolidated)
%
1.4
2.8

3. Forecast of Consolidated Earnings for the Fiscal Year Ending March 31, 2024
(April 1, 2023 – March 31, 2024)
Revenue

Full year

Millions ofyen%

1,900,000

10.1(Percentage figures indicate change compared with the previous fiscal year)
Profit attributable
Basic earnings
Business profit
Profit before tax
to owners of parent
per share
Millions of%Millions of%Millions of
%
yen
yen
yen
yen
78,000(5.3)

270,000(0.5)

47,000(11.4)

280.63

Notes1. Changes affecting the status of material subsidiaries (scope of consolidation): None
2. Changes in accounting policies and changes in accounting estimates(1) Changes in accounting policies required by IFRS: None
(2) Changes in accounting policies due to other reasons: None
(3) Changes in accounting estimates: None
3. Number of shares issued and outstanding (common shares)(1) Number of shares issued as of period-end (including treasury shares)
March 31, 2023:
167,921,800 shares
March 31, 2022:
167,921,800 shares(2) Number of shares held in treasury as of period-end
March 31, 2023:
440,255 shares
March 31, 2022:
449,527 shares(3) Average number of shares during respective periods
March 31, 2023:
167,477,726 shares
March 31, 2022:
167,361,902 shares(Reference) Financial Results of the Company for the Fiscal Year Ended March 31, 2023
(April 1, 2022 – March 31, 2023)(1) Operating Results(Percentage figures indicate change compared with the previous fiscal year)
Net salesYear ended March 31,
2023
Year ended March 31,
2022

Operating profit

Millions ofyen%Millions ofyen

791,099(11.3)(1,542)892,203(18.8)(15,804)

Earnings per share
yenYear ended March 31,
2023
Year ended March 31,
2022

Ordinary profit%

ProfitMillions ofyen%Millions of
yen

%

-

2,970

(69.0)

11,998(43.6)

-

9,578

-

21,269-Earnings per share– diluted
yen

71.63

-

127.08-(2) Financial Condition
Total assets

Net assets

Equity ratio

Millions of yen
Millions of yen
1,522,841
272,022
1,471,397
266,870
As of March 31, 2022
For reference: Shareholders’ equity
As of March 31, 2023 ¥272,022 million
As of March 31, 2022 ¥266,870 million
As of March 31, 2023

3%

Net assets per share

17.9

yen
1,624.19

18.1

1,593.52

* Report of Earnings and Financial Statements are not subject to audit.
* Appropriate Use of Financial Forecasts and Other Important Matters
Forward-Looking Statements
These materials contain various forward-looking statements and other forecasts regarding performanceand other matters. Such statements are based on information available at the time of their preparation, anddo not mean that the Company promises to achieve these figures. Actual results may differ from thoseexpressed or implied by forward-looking statements due to a range of factors. For assumptions underlying
earnings forecasts and other information regarding the use of such forecasts, refer to “1. Overview ofoperating results (4) Consolidated earnings forecast” on page 12 in the Accompanying Materials.
How to Obtain Supplementary Material on Financial Results and Details of the Financial Results
The Company plans to conduct a presentation for institutional investors, analysts and the press on
Wednesday, May 10, 2023, and to post the presentation material on financial results to be used for thepresentation on TDnet and the Company’s website simultaneously with the announcement of financial
results.
Adoption of International Financial Reporting Standards (IFRS)The Group has applied IFRS from the first quarter of the consolidated fiscal year ended March 31, 2023.
Financial figures for the previous consolidated fiscal year are also presented in accordance with IFRS. The
differences between IFRS and Japanese GAAP regarding financial figures, refer to “3. Consolidated
Financial Statements and Notes (5) Notes Concerning Consolidated Financial Statements (First-time
adoption of IFRS)” on page 20 in the Accompanying Materials.

4Accompanying Materials – Contents
1. Overview of operating results

6(1) Consolidated operating results

6(2) Consolidated financial condition

11(3) Cash flows

11(4) Consolidated earnings forecast

12

2. Basic rationale for selecting accounting standards

12

3. Consolidated Financial Statements and Notes

13(1) Consolidated Statement of Financial Position

13(2) Consolidated Statement of Profit and Loss andConsolidated Statement of Comprehensive Income

14(3) Consolidated Statement of Changes in Equity

15(4) Consolidated Statement of Cash Flow

17(5) Notes Concerning Consolidated Financial Statements

18(Notes on the going-concern assumption)

18(Segment Information)

18(Per share data)

19(Material subsequent events)

19(First-time adoption of IFRS)

20

4. Supplementary information on consolidated earnings forecasts for the fiscal year ending
March 31, 2024

533

1. Overview of operating results
Forward-looking statements in the text are based on judgments made as of the end of thisconsolidated fiscal year. From the first quarter of the consolidated fiscal year, the Group adopted theInternational Financial Reporting Standards (Hereinafter referred to as “IFRS”) in place of theconventional Japanese GAAP, and the figures for the previous fiscal year have been reclassified to
IFRS basis for comparative analysis.

(1) Consolidated operating results
The global economy has remained strong due to factors such as an increase in air travel demand
resulting from easing of travel restrictions in each country and an expansion of domestic demandfollowing the end of China's Zero-COVID-19 policy. In Japan, the economy also has been recovering
gradually mainly in service consumption and inbound tourists due to the relaxation of various
regulations related to COVID-19. In addition, the bankruptcy of a financial institution in the UnitedStates led to concerns about a temporary adverse impact on the financial system and the real economy,
but the impact has remained relatively minor at this point in time.
On the other hand, we need to keep a close watch on the global economic outlook and its impact on
the domestic economy, since there is a growing sense of caution about an economic slowdown due tohigh inflation and monetary tightening, particularly in European and American countries.
In this business environment, the Group’s consolidated orders received in the fiscal year ended
March 31, 2023, increased mainly due to increases in the Rolling Stock segment and the Powersports& Engine segment. Revenue increased from the previous fiscal year as a whole, due to higher sales in
the Powersports & Engine segment, the Aerospace Systems segment, etc. Business profit increased
year on year mainly due to increases in the Powersports & Engine segment, the Aerospace Systems
segment, and the Energy Solution & Marine Engineering segment, despite a decrease in the Precision
Machinery & Robot segment. Profit attributable to owners of parent increased due to an increase inbusiness profit, despite a deterioration in foreign exchange gains and losses.
As a result, the Group’s consolidated orders received increased by ¥435.3 billion year on year to¥2,037.4 billion, consolidated revenue increased by ¥224.7 billion year on year to ¥1,725.6 billion,
business profit increased by ¥51.9 billion year on year to ¥82.3 billion, and profit attributable to ownersof parent increased by ¥40.3 billion year on year to ¥53.0 billion. Before-tax ROIC was 7.7%, aftertax ROIC was 5.7%, and ROE was 9.8%.* In addition, the current cost of capital (WACC) is estimatedto be in the 4% range, and we have secured a higher after-tax ROIC than this.
*Before-tax ROIC = EBIT(profit before tax + interest expenses) ÷ invested capital(average of net interest-bearing debt at the beginning and end of
the fiscal year + average of shareholders' equity at the beginningand end of the fiscal year)

6After-tax ROIC = (profit attributable to owners of parent + interest expense × (1effective tax rate)) ÷ invested capital (average of net interestbearing debt at the beginning and end of the fiscal year + averageof shareholders' equity at the beginning and end of the fiscal year)
For the entire group, in order to promote dialogue with capital markets from the perspective ofpromoting management that is conscious of the cost of capital, we disclose after-tax ROIC and WACC
(weighted average cost of capital) in addition to before-tax ROIC in fiscal year 2022 and will unify
them into after-tax ROIC from fiscal year 2023 onward.
Consolidated operating performance in the fiscal year ended March 31, 2023, is summarized bysegment below.
From the third quarter of the consolidated fiscal year, the previous reportable segment of"Motorcycle & Engine" has been changed the name to "Powersports & Engine" for the purpose ofaligning with the Group's business strategy. This change is a change in the name of the reportablesegments and it has no impact on segment information.

Segment Information
Segment revenue, business profit (loss), and orders received (billions of yen)
Years ended March 312022(A)

2023(B)

Revenue

Business
profit(loss)

Systems

298.2

Rolling Stock

126.6

Orders received
Change (B – A)

Revenue

Business
profit(loss)

Revenue(10.3)

348.8

14.8

50.6

2.2

131.9

1.3

5.2

297.3

(10.8)

314.5

3.9

17.2

252.6

13.9

252.6

8.7

Engine

447.9

37.5

591.1

Other

78.0

3.1

-

(5.2)

Years ended March 31

Business
profit(loss)

2022

2023

Change(A)(B)(B – A)

25.2

383.3

345.5

(37.7)

(0.8)

71.5

313.2

241.7

14.7

343.5

439.0

95.4

0.0

(5.1)

271.8

262.0

(9.8)

71.5

143.2

34.0

447.9

591.1

143.2

86.3

(1.8)

8.3

(4.9)

84.0

86.4

2.4

-

(16.2)-(10.9)---

Aerospace

Energy Solution& Marine
Engineering
Precision
Machinery &RobotPowersports &Adjustments
Total

1,500.8
30.3
1,725.6
82.3
224.7
51.9
1,602.1
2,037.4
Notes: 1. Revenue include only sales to external customers.
2. The Powersports & Engine segment’s orders received are equal to its revenue as production is based mainlyon estimated demand.

7

435.3

Aerospace Systems
Regarding the business environment surrounding the Aerospace Systems segment, demand for
Ministry of Defense in Japan is expected to increase going forward under the Ministry of Defense’s
policy of drastic strengthening of defense capabilities. With respect to commercial aircraft, demand
for the passenger was sluggish due to the spread of the infection by COVID-19 pandemic, but ismaking significant progress toward recovering as more countries are prioritizing the resumption of
economic activities.
Amid such an operating environment, consolidated orders received decreased by ¥37.7 billion to¥345.5 billion compared to the previous fiscal year, when large scale orders for the Ministry of Defense
in Japan were received, despite an increase in component parts of jet engines for commercial aircraft.
Consolidated revenue increased by ¥50.6 billion year on year to ¥348.8 billion mainly due to anincrease in component parts of airframes and jet engines for commercial aircraft.
Business profit came to ¥14.8 billion, improving ¥25.2 billion year on year, mainly due to anincrease in component parts of airframes and jet engines for commercial aircraft.
Rolling StockRegarding the business environment surrounding the Rolling Stock segment, although there was an
impact of a decrease in the number of railway users due to the spread of the infection by COVID-19
pandemic, the number of the users is expected to recover due to the convergence of the infection, andinvestments in rolling stock are resuming in Japan and overseas. On the other hand, although theimpact on the current situation is limited, we need to keep a close watch on shortages of electronic
components, logistics disruptions, and rising raw materials prices, while they appear to be converging.
In the medium and long term, however, relatively stable growth is expected around the world due todevelopment of urban transportation as an environmental protection measure in large cities in overseas
markets, as well as demand for railway infrastructure following economic development in Asian
countries.
Amid such an operating environment, consolidated orders received increased by ¥241.7 billion to¥313.2 billion compared to the previous fiscal year mainly due to orders for option contract for new
generation subway cars for the New York City Transit.
Consolidated revenue increased by ¥5.2 billion year on year to ¥131.9 billion mainly due to anincrease in sales of railcars for the United States and domestic market.
Business profit of ¥1.3 billion was on par with the previous year's result, mainly due to the impact
of delays in the process of railcar’s project for Long Island Rail Road in the United States, despite anincrease in the revenue.

8

Energy Solution & Marine Engineering
The business environment surrounding the Energy Solution & Marine Engineering segment remains
on a recovery track as the global economy moves from stagnation due to the COVID-19 pandemic tonormalization. Demand for distributed power sources in Japan and overseas and, for energy
infrastructure development in emerging countries, remains strong, while there is ongoing demand forthe replacement of aging facilities for refuse incineration plants in Japan. Also, demand for LPG/NH3
carriers is expected to be strong. In addition, there is a growing worldwide trend toward achievingcarbon neutrality, and contacts and requests for cooperation are increasing regarding decarbonization
solutions, including hydrogen products of the Company’s strength. On the other hand, besides theuncertainty about the current situation, such as the stability of fuel gas supply required for the operationof power generation facilities, it is necessary to pay attention to the impact on orders and revenues dueto the recent persistently high prices of raw material, equipment, fuel, and transportation.
Amid such an operating environment, consolidated orders received increased by ¥95.4 billion fromthe previous fiscal year to ¥439.0 billion mainly due to order for submarine for Ministry of Defense
in Japan and increases in orders for LPG/NH3 carriers and power generation facilities.
Consolidated revenue increased by ¥17.2 billion year on year to ¥314.5 billion mainly due to anincrease in the volume of work of energy business and submarines for Ministry of Defense in Japan,
despite a decrease in the volume of work of domestic waste disposal facilities.
Business profit came to ¥3.9 billion, improving ¥14.7 billion year on year, mainly due to higher
sales in energy business and submarines for Ministry of Defense in Japan and an improvement in shareof profit and loss of investments accounted for using equity method, despite a decrease in the volume
of work of domestic waste disposal facilities.
Precision Machinery & Robot
Regarding the business environment surrounding the Precision Machinery & Robot segment, in the
precision machinery field, while the performance has continued to be strong in the construction
machinery market outside China, demand in the Chinese construction machinery market was sluggish
due to the effects of lockdowns associated with the Zero-COVID-19 policy and other factors. In the
robotics field, although demand for robots for semiconductor manufacturing equipment has slowed
down due to the impact of the recent decline in the semiconductor market, centered on memory andeconomic frictions between the United States and China, the performance was favorable for the full
year. Also, general industrial robots have continued high demand for the automation investment
globally .
Amid such an operating environment, consolidated orders received decreased by ¥9.8 billion year
on year to ¥262.0 billion mainly due to a decrease in hydraulic equipment for the Chinese construction
machinery market, despite an increase in various robots.
Consolidated revenue of ¥252.6 billion was on par with the previous year's result, mainly due to an
9increase in sales of various robots resulting from sales expansion and easing of component supply
shortages, despite a decrease in sales of hydraulic equipment for the Chinese construction machinery
market.
Business profit decreased by ¥5.1 billion year on year to ¥8.7 billion due to an increase in soaring
costs of electronic components and materials, a temporary decrease in operations during the
lockdowns in China, and a decrease in hydraulic equipment for the Chinese construction machinery
market.
Powersports & Engine
Regarding the business environment surrounding the Powersports & Engine segment, the impact
on the marketplace from the spread of the infection by the COVID-19 pandemic has gradually
weakened. Although we still need to keep a close watch on the remaining impact on product supply
due to shortages of semiconductors etc., logistics disruptions have settled down. Demand in the UnitedStates, the major market, is slightly slowing down, however, it is going strong for the time being. In
addition, the Southeast Asian market has been recovering from the previous fiscal year as a whole,although it varies by country.
Amid such an operating environment, consolidated revenue increased by ¥143.2 billion year on year
to ¥591.1 billion mainly due to an increase in motorcycles for North America and Southeast Asia, fourwheeled vehicles for North America, and general-purpose engines as well as a weaker yen on foreignexchange rates.
Business profit increased by ¥34.0 billion year on year to ¥71.5 billion due to the steady progressin price pass-through despite a rise in raw materials and logistics costs and an increase in fixed costs,
the sales expansion of motorcycles, four-wheeled vehicles and general-purpose engines and the impactof foreign exchange rates.
Other Operations
Consolidated revenue increased by ¥8.3 billion year on year to ¥86.3 billion.
Business loss came to ¥1.8 billion, deteriorating ¥4.9 billion year on year.
In the Group Vision 2030, the Group will focus on three fields; “A Safe and Secure Remotely
Connected Society,” “Near-Future Mobility” and “Energy and Environmental Solutions,” and ismaking steady progress in creating solutions to social issues, such as the medical and healthcare
business including surgical support robots, and moreover, the commercialization of delivery robots
and unmanned transport helicopters, as well as the promotion of hydrogen business and electrification
to realize a carbon neutral society at an early date.

10

(2) Consolidated financial condition
Assets, liabilities, and equity
1. Assets
Current assets were ¥1,570.3 billion, ¥250.1 billion increase from the previous fiscal year mainly
due to an increase in inventories, trade and other receivables, and contract assets.
Non-current assets were ¥887.3 billion, ¥32.9 billion increase from the previous fiscal year mainly
due to an increase in right-of-use assets.
As a result, total assets were ¥2,457.7 billion, ¥283.0 billion increase from the previous fiscal year.

2. Liabilities
Interest-bearing debt was ¥589.8 billion, ¥35.9 billion increase from the previous fiscal year.
Liabilities were ¥1,860.8 billion, ¥211.1 billion increase from the previous fiscal year mainly due
to an increase in bonds, borrowings and other financial liabilities.

3. Equity
Equity was ¥596.8 billion, ¥71.9 billion increase from the previous fiscal year mainly due to therecording of profit attributable to owners of parent.

(3) Cash flows
Cash flows
Cash and cash equivalents (Hereinafter referred to as “net cash”) at the end of this fiscal year were¥138.4 billion, an increase of ¥29.9 billion compared to the previous fiscal year. The cash flow
situations and relevant factors in this fiscal year are stated below.

1. Cash flows from operating activities
Operating activities provided net cash of ¥23.6 billion, ¥133.2 billion decrease from the previous
fiscal year. Major sources of operating cash flows included depreciation and amortization of ¥77.3
billion and an increase in trade and other payables of ¥42.2 billion. Major uses of operating cash flows
included an increase in inventories of ¥64.2 billion, an increase in contract assets of ¥50.2 billion, andan increase in trade and other receivables of ¥59.3 billion.

2. Cash flows from investing activities
Investing activities used net cash of ¥77.4 billion, which is ¥19.0 billion more than in the previous
fiscal year. This was mainly due to purchase of property, plant and equipment, as well as intangible
assets.

3. Cash flows from financing activities
Financing activities provided net cash of ¥85.3 billion, which is ¥194.2 billion more than in theprevious fiscal year. This was mainly due to proceeds from fluidity of lease receivables.

11

(4) Consolidated earnings forecast
With respect to the earnings forecasts for the fiscal year ending March 31, 2024, the Company is
expecting revenue of ¥1,900.0 billion, a ¥174.4 billion year on year increase, mainly due to an increasein the revenue caused by a further recovery in passenger demand in the Aerospace Systems segment,
although revenue will decrease in the Powersports & Engine segment.
In terms of profit, the Company is forecasting business profit of ¥78.0 billion and profit attributableto owners of parent of ¥47.0 billion. Furthermore, the Company is expecting after-tax ROIC of 4.9%
and ROE of 7.9%. These forecasts are based on the expectation for an increase in profit mainly due toan increase in the revenue in the Aerospace Systems segment, although profits are expected to decrease
due to an increase in sales promotion expenses in the Powersports & Engine segment.
The forecast of consolidated orders received is expected to decrease ¥137.4 billion year on year to¥1,900.0 billion.
In this forecast, exchange rates are assumed to be ¥130 to the U.S. dollar and ¥140 to the euro.
Note regarding consolidated earnings forecast
The above earnings forecast is based on information available at the time of preparation, andincludes risks and uncertainties. We therefore discourage making investment decisions depending
solely on this forecast. Please note that actual earnings may differ materially from this forecast, due toa variety of important factors stemming from changes the external environment and/or the Company’s
internal environment. Important factors that impact actual operating performance include, but are notlimited to, the economic situation surrounding the Company’s scope of business, foreign exchange
rates, in particular the yen/dollar exchange rate, tax codes and other regulatory system-related issues.

2. Basic rationale for selecting accounting standards
Considering the progress of global business activities, the Group voluntarily applies International
Financial Reporting Standards (IFRS) from the first quarter of the fiscal year ended March 31, 2023,
to enhance the global comparability of financial statements in the capital market and to improve thegroup management by standardizing the accounting process within the group.

123. Consolidated Financial Statements and Notes(1) Consolidated Statement of Financial Position
Millions of yen
As ofMarch 31, 2022

As ofMarch 31, 2023

122,166
355,061
148,523565,860
3,482
6,660
23,1101,224,865

108,511409,246
109,132
615,476
3,046
10,60664,184
1,320,204

138,420
470,398
159,422
690,431551
10,741
100,385
1,570,350

449,155
62,51055,50473,464
69,913
106,430
48,835865,8142,090,679

444,375
61,94058,52470,43870,752102,20946,183
854,425
2,174,630

451,010
66,24868,42277,44070,224110,264
43,763887,374
2,457,725

Transition date
(As of April 1, 2021)
AssetsCurrent assets
Cash and cash equivalents
Tradeandcashotherequivalents
receivables
Cash andContract assets
Inventories
cash equivalents
Incometaxes receivable
Other financial assets
Other current assets
cash equivalents
Total current assets
Non-current
assetscash equivalents
Property, plant and equipment
Intangible assets
cash equivalents
Right-of-use assets
Investments accounted for using equity method
Other financial assets
Deferred tax assets
Other non-current assets
Total non-current assets
Total assets
Liabilities and equity
Liabilitiesand equity
Liabilities
Current liabilities
Trade and other payables
Liabilities
equity and other financial liabilities
Bonds,andborrowings
Income taxes payable
Contract liabilities
Provisions
Other current liabilities
Total current liabilities
Non-current liabilities
Bonds, borrowings and other financial liabilities
Retirement benefit liability
Provisions
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities

418,070
266,724
4,753
159,476
26,918116,244992,187

399,892
208,773
8,506
256,189
24,409161,951
1,059,723

452,250
340,176
18,071
256,247
22,897
219,019
1,308,661

478,002115,218
7,082
1,038
17,504
618,847
1,611,034

458,068
107,024
4,136
1,382
19,403590,014
1,649,738

445,082
91,552
1,942
833
12,779552,190
1,860,852

EquityEquity attributable to owners of parent
Share capital
Capital surplus
Retained earnings
Treasury shares
Other components of equity
Total equity attributable to owners of parent
Non-controlling interests
Total equity
Total liabilities and equity

104,484
54,542
299,409(136)
3,846
462,146
17,498479,645
2,090,679

104,484
55,525
320,671(1,129)25,931
505,484
19,407
524,891
2,174,630

104,484
55,716380,255(1,107)36,852576,201
20,670596,872
2,457,725

13

(2) Consolidated Statement of Profit and Loss andConsolidated Statement of Comprehensive Income
Consolidated Statement of Profit and Loss
Millions of yen

Revenue
Cost of sales
Gross profit
Selling, general and administrative expenses
Share of profit (loss) of investments accounted for using equity
methodOther income
Other expenses
Business profit
Finance income
Finance costs
Profit before tax
Income tax expense
ProfitProfit attributable to:
Owners of parent
Non-controlling interests
Earnings per share
Basic earnings per share

Year ended
March 31, 2022

Year ended
March 31, 2023

1,500,879
1,247,615
253,263
211,134

1,725,609
1,391,787
333,822
252,311(14,410)

3,314

6,795
4,147
30,366
2,556
5,251
27,67012,834
14,8364,850
7,320
82,3552,291
14,29770,34915,05855,29012,6382,198

53,029
2,261

75.51

316.63

Consolidated Statement of Comprehensive Income

ProfitOther comprehensive income
Items that will not be reclassified to profit or loss
Financial assets measured at fair value through othercomprehensive income
Remeasurements of defined benefit plans
Share of other comprehensive income of investments accounted
for using equity method
Total of items that will not be reclassified to profit or loss
Items that may be reclassified to profit or loss
Cash flow hedges
Exchange differences on translation of foreign operations
Share of other comprehensive income of investments accounted
for using equity method
Total of items that may be reclassified to profit or loss
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to:
Owners of parent
Non-controlling interests

14

Millions of yen
Year ended
Year ended
March 31, 2022
March 31, 2023
55,29014,836

2,350

(363)

10,281

14,353(1)

0

12,63013,989(125)
13,680

1,932
10,112

9,220

508

22,77535,40550,241

12,553
26,542
81,83347,186
3,055

78,785
3,048

(3) Consolidated Statement of Changes in Equity
Millions of yen
Equity attributable to owners of parent
Other components of equity

Balance as of April 1, 2021
ProfitOther comprehensive income
Comprehensive income
Issuance of new shares
Purchase of treasury shares
Disposal of treasury shares
Transfer of loss on disposal oftreasury shares
Dividends
Transfer to retained earnings
Change in scope of
consolidation
Loss of control of subsidiaries
Change in ownership interest ofparent due to transactions with
non-controlling interests
Transfer to non-financial
assets
Other
Total transactions with owners
Balance as of March 31, 2022

Share capital

Capital surplus

104,484

54,542Retainedearnings

299,409
12,638Treasury shares

Remeasurementsof defined
benefit plans

Financial assets
measured at fairvalue throughothercomprehensive
income

(136)

-

4,025

10,224
10,224

2,343
2,343

(10,224)(1,933)(992)(1,129)(10,224)-(1,933)
4,435

Total equity
attributable toowners ofparentNon-controllinginterests

462,146
12,63834,54847,186
1,916
(994)
3

17,498
2,198
857
3,055

12,638
1,916
(994)
1

2
0

(0)
(3,357)
12,158(936)

104,484

(177)
8,623
320,671982
55,525Equity attributable to owners of parent
Other components of equity

Balance as of April 1, 2021
ProfitOther comprehensive income
Comprehensive income
Issuance of new shares
Purchase of treasury shares
Disposal of treasury shares
Transfer of loss on disposal oftreasury shares
Dividends
Transfer to retained earnings
Change in scope of
consolidation
Loss of control of subsidiaries
Change in ownership interest ofparent due to transactions with
non-controlling interests
Transfer to non-financial
assets
Other
Total transactions with owners
Balance as of March 31, 2022

Cash flow
hedgesExchangedifferences ontranslation offoreign
operations

(179)

-

3,846

200
200

21,77921,77934,54834,548

Total(12,158)(3,357)-

Total

479,645
14,83635,40550,241
1,916
(994)
3
-

(936)
795

(4,294)
795
-

(936)
(305)
(305)
(284)

0
0
21,780

15

(305)

(305)

0
(12,463)
25,931(176)(3,849)505,484(1,004)(1,940)(305)(1,145)
19,407(176)(4,995)524,891

Millions of yen
Equity attributable to owners of parent
Other components of equity

Balance as of April 1, 2022
ProfitOther comprehensive income
Comprehensive income
Issuance of new shares
Purchase of treasury shares
Disposal of treasury shares
Transfer of loss on disposal oftreasury shares
Dividends
Transfer to retained earnings
Change in scope of
consolidation
Loss of control of subsidiaries
Change in ownership interest ofparent due to transactions with
non-controlling interests
Transfer to non-financial
assets
Other
Total transactions with owners
Balance as of March 31, 2023

Share capital

Capital surplus

104,484

55,525Retainedearnings

320,67153,029Treasury shares

Remeasurementsof defined
benefit plans

Financial assets
measured at fairvalue throughothercomprehensive
income(1,129)-4,435

14,235
14,235

(370)
(370)

(14,235)43

22(1,107)(14,235)
-

43
4,109

Total equity
attributable toowners ofparentNon-controllinginterests

505,484
53,02925,75578,785

19,407
2,261
787
3,048

53,029
(4)
26

(0)
0

(0)
(8,394)
14,191

190

104,484756
6,554
380,255190
55,716Equity attributable to owners of parent
Other components of equity

Balance as of April 1, 2022
ProfitOther comprehensive income
Comprehensive income
Issuance of new shares
Purchase of treasury shares
Disposal of treasury shares
Transfer of loss on disposal oftreasury shares
Dividends
Transfer to retained earnings
Change in scope of
consolidation
Loss of control of subsidiaries
Change in ownership interest ofparent due to transactions with
non-controlling interests
Transfer to non-financial
assets
Other
Total transactions with owners
Balance as of March 31, 2023

Cash flow
hedgesExchangedifferences ontranslation offoreign
operations(284)

21,78025,931

1,603
1,603

10,286
10,28625,75525,755

Total(14,191)(4)
26

524,891
55,29026,542
81,833
(4)
26

-

-

(8,394)
-

190
(643)

(643)

(643)

(643)
676

(14,834)
36,852756(8,067)576,201

32,066

16

Total

(964)

(9,358)
-

366

366

(2,079)(2,079)

891

1,082
(643)

(1,785)
20,670756(9,852)596,872

(4) Consolidated Statement of Cash FlowMillions of yen

Cash flows from operating activities
ProfitDepreciation and amortization
Impairment losses
Finance income and finance costs
Share of loss (profit) of investments accounted for using equity method
Loss (gain) on sale of fixed assets
Income tax expense
Increase (decrease) in retirement benefit liability
Decrease (increase) in trade and other receivables
Decrease (increase) in contract assets
Decrease (increase) in inventories
Increase (decrease) in trade and other payables
Decrease (increase) in advance payment
Increase (decrease) in contract liabilities
Increase (decrease) in other current liabilities
Other
SubtotalInterest received
Dividends received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Purchase of intangible assets
Payments for equity method investment and purchase of other financial
assetsProceeds from equity method investment and sale of other financial
assetsPayments for acquisition of subsidiaries
Decrease due to loss of control over subsidiaries
Proceeds from acquisition of subsidiaries
Other
Net cash provided by (used in) investing activities
Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Repayments of lease liabilities
Proceeds from long-term borrowings
Repayments of long-term borrowings
Proceeds from issuance of bonds
Redemption of bonds
Dividends paid
Proceeds from fluidity of lease receivables
Repayment of payables under fluidity lease receivables
Dividends paid to non-controlling interests
Other
Net cash provided by (used in) 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

17Year ended
March 31, 2022

Year ended
March 31, 2023

14,83676,998728
2,172
14,410(554)
12,834
4,778(38,213)
39,412(37,984)(11,848)(31,707)
92,07240,939(8,122)
170,751
1,755
865(4,318)(12,164)
156,890

55,29077,374
4,606
7,312(3,314)
1,042
15,0581,281(59,334)(50,291)(64,217)
42,213(28,508)(3,730)43,231
5,962
43,9753,328
332(5,005)(19,013)
23,617(58,943)
2,929(8,700)(58,943)2,180(11,001)(2,042)(6,702)

6,347

160

489
1,522
(58,396)(648)(3,224)
722(77,457)(74,247)(13,436)
15,500(17,001)
10,000(30,000)(3,384)62,749(56,186)(913)(1,983)(108,904)(3,244)(13,654)
122,166
108,51136,664(14,545)
18,500(21,987)
9,000(20,000)(8,383)
130,662(37,861)(964)(5,777)85,305(1,556)29,909108,511
138,420

(5) Notes Concerning Consolidated Financial Statements
Notes on the going-concern assumption
Not applicable

Segment information
Year ended March 31, 2022 (April 1, 2021 – March 31, 2022)
Aerospace
Systems
Revenue fromexternal customers
Intersegment
revenue andtransfers*1
Total revenue
Business profit(loss) *3
Finance income
Finance costs
Profit before tax
Other items
Depreciation andamortization
Impairment loss
Share of profit(loss) ofinvestments
accounted forusing equity
methodEnergyPrecision
Solution &Powersports
Machinery & & Engine
MarineRobot
Engineering

Rolling
Stock

Millions of yen
Other

Total

Eliminations Consolidated
and
total
corporate *2

298,212

126,684

297,306

252,678

447,927

78,0701,500,879-

1,500,879

10,12333

15,936

19,746845

20,164

66,850(66,850)-

308,335

126,718

313,243

272,425

448,773

98,234

1,567,730(66,850)

1,500,879(10,346)

2,250(10,884)

13,92837,523

3,151

35,623(5,257)30,366
2,556(5,251)
27,67030,906

1,567

6,184

10,835

17,521

1,285

68,301

8,696

76,998

-

-

728

-

-

-

728

-

728

-

17

(11,261)(3,437)81

156(14,442)32(14,410)Notes:1. Intersegment revenue and transfers are recorded at normal market prices.
2. Eliminations and corporate of negative ¥5,257 million include negative ¥517 million for intersegment
transactions and negative ¥4,740 million for general and administrative expenses not attributed reportablesegments.
3. Business profit (loss) is calculated by deducting cost of sales, selling, general and administrative expenses,
share of profit and loss of investments accounted for using equity method, other income, and otherexpenses from revenue.

18

Year ended March 31, 2023 (April 1, 2022 – March 31, 2023)
Aerospace
Systems
Revenue fromexternal customers
Intersegment
revenue andtransfers*1
Total revenue
Business profit(loss) *3
Finance income
Finance costs
Profit before tax
Other items
Depreciation andamortization
Impairment loss
Share of profit(loss) ofinvestments
accounted forusing equity
methodEnergyPrecision
Solution & Machinery & Powersports
Marine& Engine
Robot
Engineering

Rolling
Stock

Millions of yen
Other

Total

Eliminations
Consolidated
and
total
corporate *2

348,880

131,935

314,552

252,697591,151

86,392

1,725,609-

1,725,609

10,25414

21,303

19,315

1,033

23,27075,191(75,191)-

359,134

131,949

335,856

272,013592,184

109,662

1,800,801(75,191)

1,725,609

14,877

1,372

3,905

8,766

71,533(1,845)98,611(16,256)

82,3552,291(14,297)
70,34929,499

1,913

6,231

11,271

17,408

1,413

67,738

9,636

77,374

1,649

-

554

-

-

2,402

4,606

-

4,606

-

8

6,016

(2,761)

(40)

104

3,328

(14)

3,314

Notes:1. Intersegment revenue and transfers are recorded at normal market prices.
2. Eliminations and corporate of negative ¥16,256 million include negative ¥838 million for intersegment
transactions and negative ¥15,418 million for general and administrative expenses not attributed reportablesegments.
3. Business profit (loss) is calculated by deducting cost of sales, selling, general and administrative expenses,
share of profit and loss of investments accounted for using equity method, other income, and otherexpenses from revenue.

Per share data
Basis for calculating basic earnings per share attributable to owners of parent is as follows:Year ended
Year ended
March 31, 2022
March 31, 2023
Profit attributable to owners of parent (Millions of yen)
12,63853,029Average number of common shares (Thousands of shares)
167,361
167,477
Basic earnings per share (yen)75.51
316.63
Notes:1. Diluted earnings per share are not stated because there are no potential shares.
2. The company’s shares held by trusts whose beneficiaries are directors and others recorded as treasury
shares under equity include the number of shares held in treasury to be deducted from the calculation of
the average number of shares during respective periods in computing the earnings per share. (At the endof the previous consolidated fiscal year: 409,600 shares, at the end of this consolidated fiscal year: 398,600
shares).

Material subsequent events
Not applicable.

19First-time adoption of IFRSThe Group disclosed its consolidated financial statements in accordance with IFRS from thisconsolidated fiscal year. The most recent consolidated financial statements prepared in accordancewith Japanese GAAP are those for the consolidated fiscal year ended March 31, 2022, and IFRStransition date is April 1, 2021.

1. Mandatory exceptions and exemption provisions under IFRS 1
In principle, IFRS requires companies that adopt IFRS for the first time to apply the standards
required by IFRS retrospectively. However, for some of the standards required under IFRS, IFRS 1
specifies standards for which the exemption is applied mandatorily and those for which the exemption
is applied voluntarily.
Items that must apply mandatory exemptions are “estimates,” “derecognition of financial assets andfinancial liabilities,” “hedge accounting,” “non-controlling interests,” and “classification andmeasurement of financial instruments,” and they are prohibited retrospective application of IFRS.
Except for “derecognition of financial assets and financial liabilities,” the Group applies the
exemptions prospectively from the transition date. “Derecognition of financial assets and financial
liabilities” is applied prospectively from the date selected by the Group.
Major exemptions adopted by the Group when transitioning from Japanese GAAP to IFRS are as
follows.
(1) Business combinations
The Group elects not to apply IFRS 3, “Business combinations” retrospectively to the businesscombinations that occurred before the date of transition to IFRS.
(2) Leases
The Group determines whether a contract existing at the date of transition to IFRS includes leases
based on the facts and circumstances existing as of that date, and the lease liability is the present valueof the remaining lease payments discounted using the lessee’s incremental borrowing rate as of thetransition date. In addition, the right-of-use asset is measured as of the transition date and is equal to
the lease liability.
(3) Exchange differences on translation of foreign operations
The Group deems the cumulative translation differences of all foreign operations to be zero at thetransition date of IFRS.
(4) Financial instruments
The designation in accordance with IFRS 9, “Financial Instruments” for financial instruments
20

recognized prior to the date of transition to IFRS is based on the facts and circumstances that existed
at the date of transition to IFRS.

2. Reconciliations
In preparing the consolidated financial statements based on IFRS, the Company reconcile equity,
profit and loss, and comprehensive income which previously reported in the consolidated financial
statements based on Japanese GAAP. The effects of this adjustment on the Group’s financial condition,
operating results and cash flows are as follows.
In the reconciliations below, “Reclassification” includes items that do not affect retained earnings
and comprehensive income, while “Differences in recognition and measurement” include items that
affect retained earnings and comprehensive income.

21

(1) Reconciliations of equity(i) Transition date (As of April 1, 2021)
Millions of yen
Line items underJapanese GAAP
AssetsCurrent assets
Cash and deposits
Notes and accounts
receivable - trade, andcontract assets
Allowance for doubtful
accounts
Merchandise and finished
goodsWork in process
Raw materials andsupplies

Other
Total current assets
Non-current assets
Property, plant andequipment
Intangible assets
Investments and otherassetsInvestment securities
Retirement benefit asset
Deferred tax assets
Other
Allowance for doubtful
accounts
Total non-current assets
Total assets

Japanese
GAAP

Reclassification

Differences inrecognition
andmeasurement

IFRS

Notes

Line items under IFRS
AssetsCurrent assets
Cash and cash equivalents
Trade and otherreceivables

126,702(4,536)-

122,166(a)429,673(102,212)

27,600355,061(b),(c),(d),(j)(3,589)

3,589

-

-

(c)

-

114,664

33,858148,523(d),(j)69,223(69,223)

-

-

(e)

399,847(399,847)

-

-

(e)

138,215(138,215)

-

-

(e)

43,314
1,203,387

607,285
3,482
6,660(21,648)-(41,425)
1,443
21,477565,860
3,482
6,660
23,1101,224,865

451,259(10,564)8,460

449,155(k)22,427-(37)
10,60240,12044,90262,51055,504(k)(l)

12,721(12,721)

-

-

(g)

-

73,464-73,464

(f)

155

(155)

-

-

-

58,057

11,856

69,91381,587
165,967(120,047)

24,843
2,916

106,430
48,835(1,403)

1,403

-

-

732,715
1,936,103-

133,099
154,576865,8142,090,679

22(e),(k)(a),(g)(b),(g)(c),(g),(o)(p)(f),(g)Contract assets

Inventories
Income taxes receivable
Other financial assets
Other current assets
Total current assets
Non-current assets
Property, plant andequipment
Intangible assets
Right-of-use assets

Investments accounted
for using equity method
Other financial assets
Deferred tax assets
Other non-current assets(c)
Total non-current assets
Total assets

Millions of yen
Line items underJapanese GAAP
Liabilities
Current liabilities
Notes and accounts
payable - trade
Electronically recorded
obligations - operating
Short-term borrowings
Current portion of bonds
payableLease liabilities

Japanese
GAAP

Reclassification

Differences inrecognition
andmeasurement

IFRS

Notes

247,294

170,776-

418,070(b)

107,849(107,849)

-

-

(b)

141,579(141,579)

-

-

(h)

30,000(30,000)

-

-

(h)

1,061

(1,061)---

207,395

59,328

266,724(h)(g),(h),(j),(l)4,753
159,476
18,239(18,239)-

4,753
159,476-(i)

12,550(12,550)

-

-

(i)

14,367(14,367)

-

-

(i)

-

26,918-26,918

Other

192,849(79,441)

2,836

116,244

Total current liabilities
Non-current liabilities
Bonds payable
Long-term borrowings
Lease liabilities

930,022-

62,165992,187

190,000
199,177
9,532(190,000)(199,177)(9,532)---421,831

56,170478,002

115,456-(238)

115,218

(n)

5,984

(5,984)--(i)

Deferred tax liabilities

1,125

7,082
-

(87)

7,082
1,038

(i)
(p)

Other

41,668(24,220)57

17,504(g),(n)562,944-

55,902

618,847

1,492,967-

118,067

1,611,034

104,484
54,542
266,937(136)-

32,472-

104,484
54,542
299,409
(136)

(134)

-

3,980

3,846

425,693-

36,453462,146

17,442
443,135-55
36,50917,498479,645

1,936,103-

154,576

2,090,679

Income taxes payable
Contract liabilities
Provision for bonuses
Provision for
construction warranties
Provision for loss on
construction contracts

Retirement benefit
liability
Provision for thein-service issues ofcommercial aircraft jetengines

Total non-current
liabilities
Total liabilities
Net assets
Share capital
Capital surplus
Retained earnings
Treasury shares
Total accumulated othercomprehensive income
Non-controlling interests
Total net assets
Total liabilities and net
assets23(i)(b),(g),(h),(i),(m)Line items under IFRS
Liabilities
Current liabilities
Trade and other payables

Bonds, borrowings andother financial liabilities
Income taxes payable
Contract liabilities

Provisions
Other current liabilities
Total current liabilities
Non-current liabilities

(h)
(h)
(h)
(g),(h),(j),(l)(r)(n),(o),(q)

Bonds, borrowings andother financial liabilities
Retirement benefit
liability

Provisions
Deferred tax liabilities
Other non-current
liabilities
Total non-current
liabilities
Total liabilities
EquityShare capital
Capital surplus
Retained earnings
Treasury shares
Other components ofequityTotal equity attributable toowners of parent
Non-controlling interests
Total equity
Total liabilities and equity

(ii) As of March 31, 2022
Millions of yen
Line items underJapanese GAAP
AssetsCurrent assets
Cash and deposits
Notes and accounts
receivable - trade, andcontract assets
Allowance for doubtful
accounts
Merchandise and finished
goodsWork in process
Raw materials andsupplies

Other
Total current assets
Non-current assets
Property, plant andequipment
Intangible assets
Investments and otherassetsInvestment securities

Retirement benefit asset

Deferred tax assets
Other
Allowance for doubtful
accounts
Total non-current assets
Total assets

Japanese
GAAP

Reclassification

114,469

Differences inrecognition
andmeasurement(5,957)-

Notes

Line items under IFRS

108,511(a)(b),(c),(d),(j)AssetsCurrent assets
Cash and cash equivalents
Trade and otherreceivables

IFRS

418,625(39,268)

29,890409,246(3,908)

3,908

-

-

(c)

-

74,13035,002

109,132(d),(j)78,616(78,616)

-

-

(e)

419,954(419,954)

-

-

(e)

160,113(160,113)

-

-

(e)

109,911
1,297,781

658,684
3,046
10,606(46,465)-(43,208)739
22,423

615,476
3,046
10,60664,184
1,320,204

444,262(10,815)

10,928444,375(k)23,413-(112)
10,927

38,63847,597

61,94058,524(k)(l)

14,539(14,539)

-

-

(g)

-

70,4362

70,438(f)

Investments accounted
for using equity method

200

(200)

-

-

-

57,85812,89470,752Other financial assets

86,249157,668(114,921)

15,9593,437

102,20946,183(c),(g),(o)(p)(f),(g)(1,366)

1,366

-

-

724,967
2,022,748-

129,458
151,881854,425
2,174,630

24(e),(k)(a),(g)(b),(g)Contract assets

Inventories
Income taxes receivable
Other financial assets
Other current assets
Total current assets
Non-current assets
Property, plant andequipment
Intangible assets
Right-of-use assets

Deferred tax assets
Other non-current assets(c)
Total non-current assets
Total assets

Millions of yen
Line items underJapanese GAAP
Liabilities
Current liabilities
Notes and accounts
payable - trade
Electronically recorded
obligations - operating
Short-term borrowings
Current portion of bonds
payableLease liabilities

Japanese
GAAP

Reclassification

Differences inrecognition
andmeasurement

IFRS

Notes

239,976

159,935(19)399,892(b)

104,336(104,336)

-

-

(b)

96,108(96,108)

-

-

(h)

20,000(20,000)

-

-

(h)

1,175

(1,175)---141,069

67,704

208,773

8,506
256,189
23,938(23,938)-(h)(g),(h),(j),(l)8,506
256,189-(i)

14,797(14,797)

-

-

(i)

9,602

(9,602)

-

-

(i)

-

24,409-24,409

Other

212,696(55,455)

4,709

161,951

Total current liabilities
Non-current liabilities
Bonds payable
Long-term borrowings
Lease liabilities

987,328-

72,394

1,059,723

180,000
194,297
9,899(180,000)(194,297)(9,899)---404,82153,247458,068

106,803-

220

107,024

(n)

3,054

(3,054)--(i)

Deferred tax liabilities

1,593

4,112
-

24
(210)

4,136
1,382

(i)
(p)

Other

41,249(21,683)(162)

19,403(g),(n)536,896-

53,117590,014

1,524,225-

125,512

1,649,738

104,484
55,526285,381(1,129)-(0)35,290-104,484
55,525
320,671(1,129)34,917-(8,986)25,931

479,180-

26,303

505,484

19,342498,522-65
26,36919,407
524,891

2,022,748-

151,881

2,174,630

Income taxes payable
Contract liabilities
Provision for bonuses
Provision for
construction warranties
Provision for loss on
construction contracts

Retirement benefit
liability
Provision for thein-service issues ofcommercial aircraft jetengines

Total non-current
liabilities
Total liabilities
Net assets
Share capital
Capital surplus
Retained earnings
Treasury shares
Total accumulated othercomprehensive income
Non-controlling interests
Total net assets
Total liabilities and net
assets25(i)(b),(g),(h),(i),(m)Line items under IFRS
Liabilities
Current liabilities
Trade and other payables

Bonds, borrowings andother financial liabilities
Income taxes payable
Contract liabilities

Provisions
Other current liabilities
Total current liabilities
Non-current liabilities

(h)
(h)
(h)
(g),(h),(j),(l)(r)(n),(o),(q)

Bonds, borrowings andother financial liabilities
Retirement benefit
liability

Provisions
Deferred tax liabilities
Other non-current
liabilities
Total non-current
liabilities
Total liabilities
EquityShare capital
Capital surplus
Retained earnings
Treasury shares
Other components ofequityTotal equity attributable toowners of parent
Non-controlling interests
Total equity
Total liabilities and equity

(iii) Notes on reconciliation of equity(Reclassification)(a) Reclassification of cash and deposits
Time deposits with maturities of more than three months, which were included in “Cash and deposits”
under Japanese GAAP, are reclassified to “Other financial assets” of current assets under IFRS.
(b) Reclassification of account receivables, electronically recorded obligations-operating, and accountpayableAccount receivables which were included in “Other” of current assets under Japanese GAAP, arereclassified to “Trade and other receivables” under IFRS. In addition, “Electronically recorded
obligations-operating,” which were presented separately, and account payable which was included in“Other” of current liabilities under Japanese GAAP, are reclassified to “Trade and other payables”
under IFRS.
(c) Reclassification of allowance for doubtful accounts“Allowance for doubtful accounts,” which was presented separately in current assets under Japanese
GAAP, is reclassified to directly deducting the item from “Trade and other receivables” etc. under
IFRS. In addition, “Allowance for doubtful accounts” which was presented separately in non-current
assets under Japanese GAAP, is reclassified to directly deducting the item from “Other financial assets”
of non-current assets.
(d) Reclassification of contract assets“Contract assets,” which were included in “Notes and accounts receivable - trade, and contract assets”
under Japanese GAAP, are presented separately under IFRS.
(e) Reclassification of inventories“Merchandise and finished goods,” “Work in process,” and “Raw materials and supplies,” whichwere presented separately under Japanese GAAP, are reclassified to “Inventories” under IFRS.
(f) Reclassification of investments accounted for using equity method“Investments accounted for using equity method,” which were included in “Other” of investments
and other assets under Japanese GAAP, are presented separately under IFRS.
(g) Reclassification of other financial assets and other financial liabilities
Derivative assets, etc. which were included in “Other” of current assets under Japanese GAAP, arereclassified to “Other financial assets” of current assets under IFRS. In addition, “Investment
securities,” which were presented separately under Japanese GAAP, and long-term accounts receivable,
26etc. which were included in “Other” of investments and other assets under Japanese GAAP, arereclassified to “Other financial assets” of non-current assets under IFRS.
Derivative liabilities, which were included in “Other” of current liabilities under Japanese GAAP,
are reclassified to “Bonds, borrowings and other financial liabilities” of current liabilities under IFRS.
In addition, long-term accounts payable, etc. which were included in “Other” of non-current liabilities
under Japanese GAAP, are reclassified to “Bonds, borrowings and other financial liabilities” of noncurrent liabilities under IFRS.
(h) Reclassification of bonds payable, commercial paper, borrowings, and lease liabilities“Short-term borrowings,” “Current portion of bonds payable,” and “Lease liabilities,” which were
presented separately in current liabilities under Japanese GAAP, and commercial paper which was
included in “Other” of current liabilities under Japanese GAAP, are reclassified to “Bonds, borrowings
and other financial liabilities” of current liabilities under IFRS. In addition, “Bonds payable,” “Longterm borrowings,” and “Lease liabilities,” which were presented separately in non-current liabilities
under Japanese GAAP, are reclassified to “Bonds, borrowings and other financial liabilities” of noncurrent assets under IFRS.
(i) Reclassification of provisions“Provision for construction warranties,” and “Provision for loss on construction contracts,” whichwere presented separately under Japanese GAAP, are reclassified to “Provisions” of current liabilities
under IFRS. In addition, “Provision for the in-service issues of commercial aircraft jet engines,” which
was presented separately under Japanese GAAP, is reclassified to “Provisions” of non-current
liabilities under IFRS.
“Provision for bonuses,” which was presented separately under Japanese GAAP, is reclassified to“Other current liabilities” under IFRS.

(Differences in recognition and measurement)(j) Adjustments to receivables securitization transaction
Certain trade receivables that were derecognized regarding receivables securitization transaction
under Japanese GAAP, are recognized as “Contract assets” instead of being derecognized because they
do not meet the derecognition criteria under IFRS. In addition, payables associated with receivables
securitization are recognized as “Bonds, borrowings and other financial liabilities” under current andnon-current liabilities.
(k) Adjustments to property, plant and equipment, and intangible assets
Under Japanese GAAP, development expenses were treated as research and development expenses
and expensed as “Selling, general and administrative expenses” when incurred as well as a portion of27

costs related to mass production of new products and models, etc. was recorded as “Work in process.”
Under IFRS, development expenses that meet the criteria for capitalization are recorded as “Intangible
assets.” In addition, certain expenses that were expensed as “Selling, general and administrative
expenses” when incurred development expenses under Japanese GAAP are recorded as “Property,
plant and equipment” as they have the criteria for capitalization under IFRS. Furthermore, since IFRS
does not allow depreciation for asset acquisitions other than government subsidies, and records
processed using the direct depreciation method under Japanese GAAP have been canceled.
(l) Adjustments to right-of-use assets and lease liabilities
Under Japanese GAAP, except for finance lease transactions, lease payments are expensed at thetime they incurred. Under IFRS, the present value is measured based on the future lease payments at
the lease commencement date and recorded as “Right-of-use assets” and “Lease liabilities.” “Leaseliabilities” are included in “Bonds, borrowings and other financial liabilities” under current and noncurrent liabilities.
(m) Adjustments to levies
Under Japanese GAAP, expenses were recognized for items qualified as levies such as property
taxes, over the fiscal year. On the other hand, under IFRS, they are expensed at the time the tax
assessment is determined and recognized as “Other current liabilities” under current liabilities.
(n) Adjustments to employee benefit
With respect to retirement benefit liability, under Japanese GAAP, actuarial gains and losses andprior service costs were recognized in other comprehensive income as incurred, and for the amountprorated over a certain number of years within the average remaining service period of employees at
the incurrence, actuarial gains and losses were expensed from the following fiscal year of theincurrence while prior service costs were expensed from the fiscal year in which they incurred. Under
IFRS, actuarial gains and losses are recognized in other comprehensive income as incurred and
immediately reclassified to “Retained earnings.” Prior service costs are recognized in profit or loss as
incurred.
In addition, special holidays, etc. granted subject to a certain number of years of service, which were
not accounted for under Japanese GAAP, are recorded as “Other non-current liabilities” under IFRS.
(o) Adjustments to equity financial instruments
Under Japanese GAAP, unlisted shares and investments with no market value were measured using
the cost method, however, they are measured at fair value under IFRS. In addition, for equity financial
assets, gains or losses on sales and impairment losses were recognized as profit or loss under Japanese
GAAP, however, under IFRS, the changes in fair value are recognized as other comprehensive income
28when subsequent changes in fair value are designated to be presented in other comprehensive income.
(p) Adjustment to tax effects
Regarding the adoption of IFRS, “Deferred tax assets” and “Deferred tax liabilities” have increased
or decreased due to the reconsideration of the recoverability of all deferred tax assets. In addition,
under Japanese GAAP, tax effects arising from the elimination of unrealized profits and losses arecalculated using the effective tax rate of the seller, however, under IFRS, these are calculated using
the effective tax rate of the buyer.
(q) Reclassification of exchange differences on translation of foreign operations
At a first-time adoption, the Group has opted to apply the exemption provided in IFRS 1 andtransferred the entire balance of cumulative exchange differences of foreign operations to “Retained
earnings” at the transition date.
(r) Retained earnings
The impact of the above adjustments on retained earnings is as follows. (loss)
Millions of yen
As ofMarch 31, 2022

IFRS transition date
(As of April 1, 2021)

Consolidated Statement of Financial Position(k) Adjustments to property, plant and equipment,
and intangible assets(l) Adjustments to right-of-use assets and leaseliabilities(m) Adjustments to levies(n)Adjustments
to employee benefitCashand cash equivalents(o) Adjustments to equity financial instruments(p) Adjustment to tax effects
cashReclassificationequivalents of exchange differences on(q)translation of foreign operations
Other
cash equivalents
Adjustments on retained earnings
cash equivalents(April 1, 2021) IFRS transition date

6,785

6,646

-

(132)

(3,402)(2,240)5,094
28,940(3,395)8,563
5,116
22,262

(931)

(931)

(1,772)
32,472(2,840)35,290(April 1, 2021) date
(April 1, 2021)

cash equivalents29

(2) Reconciliations of profit or loss and comprehensive income(i) Year ended March 31, 2022 (April 1, 2021 – March 31, 2022)
Millions of yen

Reclassification

Differences inrecognition
andmeasurement

1,500,879
1,244,300
256,578-

210,772

Line items under Japanese
GAAP

Japanese
GAAPNet sales
Cost of sales
Gross profit
Selling, generaland administrative expenses

IFRS

Notes

3,314
(3,314)1,500,879
1,247,615
253,263(a),(c)123239

211,134(c)-(14,289)(120)(14,410)(a)45,805
9,342
25,213
1,633
715
30,853
6,867
23,985

6,292
7,245(15,366)(9,342)(25,213)(1,633)
(715)
4,684
4,270
-

503
(3,098)(72)(2,128)981(3,182)
5,966(9,149)

6,795
4,147
30,366
2,556
5,251
27,67012,834
14,836

(a)
(a)
(a)
(a)
(a)
(a)
(a),(d)(a),(d)Net unrealized losses on
securities

(524)

-

2,874

2,350

(d)

Remeasurement of defined
benefit plans

11,130-(848)

10,281

(c)

-

(1)

-

(1)

(337)

-

211

(125)

16,407-(2,727)

13,680Share of othercomprehensive incomeof associates accounted forusing equity method

9,218

1

-

9,220

Total other comprehensive
incomeComprehensive Income

35,895-(489)

35,40559,880-(9,639)50,241

Operating profit
Non-operating income
Non-operating expenses
Extraordinary income
Extraordinary losses

Profit before income taxes
Income taxes
ProfitOther comprehensive
incomeDeferred losses on hedges
Foreign currency translation
adjustment

30(b),(e)Line items under IFRSRevenue
Cost of sales
Gross profit
Selling, general andadministrative expenses
Share of profit (loss) ofinvestments accounted forusing equity method
Other income
Other expenses
Business profit

Finance income
Finance costs
Profit before tax
Income tax expense
ProfitOther comprehensive
incomeItems that will not bereclassified to profit or loss:
Financial assets measured
at fair value through othercomprehensive income
Remeasurements ofdefined benefit plans
Share of othercomprehensive income ofinvestments accounted forusing equity method
Items that may bereclassified to profit or loss:
Cash flow hedges
Exchange differences ontranslation of foreign
operations
Share of othercomprehensive income ofinvestments accounted forusing equity method
Total other comprehensive
incomeComprehensive income

(ii) Notes on reconciliation of profit and loss and comprehensive income(Reclassification)(a) Reclassification of line items
For items presented as “Non-operating income,” “Non-operating expenses,” “Extraordinary income”
and “Extraordinary losses” under Japanese GAAP, finance-related profits or losses are recorded as“Finance income” and “Finance costs”, and other items are presented as “Cost of sales,” “Other
income,” “Other expenses,” and “Share of profit (loss) of investments accounted for using equity
method,” under IFRS.
(b) Income tax expense“Income taxes - current” and “Income taxes - deferred,” which were separately presented underJapanese GAAP, are presented in total as “Income tax expense” under IFRS.

(Differences in recognition and measurement)(c) Adjustment to employee benefit
Under Japanese GAAP, actuarial gains and losses and prior service costs were recognized in othercomprehensive income as incurred, and for the amount prorated over a certain number of years within
the average remaining service period of employees at the incurrence, actuarial gains and losses were
expensed from the following fiscal year of the incurrence while prior service costs were expensed
from the fiscal year in which they incurred. Under IFRS, actuarial gains and losses are recognized inother comprehensive income as incurred and immediately reclassified to “Retained earnings.” Prior
service costs are recognized in profit or loss as incurred.

(d) Adjustments to equity financial instruments
Under Japanese GAAP, unlisted shares and investments with no market value were measured using
the cost method, however, they are measured at fair value under IFRS. In addition, for equity financial
assets, gains or losses on sales and impairment losses were recognized as profit or loss under Japanese
GAAP, however, under IFRS, the changes in fair value are recognized as other comprehensive income
when subsequent changes in fair value are designated to be presented in other comprehensive income.

(e) Adjustment to tax effects
Regarding the adoption of IFRS, “Deferred tax assets” and “Deferred tax liabilities” have increased
or decreased due to the occurrence of temporary differences and the reconsideration of therecoverability of all deferred tax assets. In addition, under Japanese GAAP, tax effects arising fromthe elimination of unrealized profits and losses are calculated using the effective tax rate of the seller,
however, under IFRS, these are calculated using the effective tax rate of the buyer.

31

(3) Adjustment to cash flow
Major differences between the consolidated cash flows statement based on Japanese GAAP and theconsolidated cash flows statement based on IFRS are as follows.
・Receivables securitization transactions that do not meet the criteria for derecognition of financial
assets under IFRS have been changed the classification from cash flows from operating activities tocash flows from financing activities.
・With the application of IFRS 16, lease payments under operating leases have been changed theclassification from cash flows from operating activities to cash flows from financing activities as“Repayments of lease liabilities.”
・Expenditures of development expenses that meet the criteria for capitalization under IFRS have beenchanged the classification from cash flows from operating activities to cash flows from investing
activities.

32

4. Supplementary information on consolidated earnings forecasts for the fiscal year
ending March 31, 2024
(i) Revenue and business profit (loss)
Billions of yen

Reportable segment

Forecast for the year
ending March 31, 2024
(fiscal 2023)
(A)

440.0
190.0

Business
profit(loss)
24.0
4.0

340.0
260.0
580.0
90.0

Revenue
Aerospace Systems
Rolling StockEnergy Solution & Marine
Engineering
Precision Machinery & Robot
Powersports & Engine
Other
Adjustments
Total

1,900.0

Year ended March 31,
2023 (fiscal 2022)(Actual)
(B)

348.8
131.9

Business
profit(loss)
14.8
1.3

9.0

314.5

10.0
47.0
2.0
(18.0)
78.0

252.6
591.1
86.3

Revenue

1,725.6

Change (A – B)

91.2
58.1

Business
profit(loss)
9.2
2.7

3.9

25.5

5.1

8.7
71.5
(1.8)
(16.2)
82.3

7.4(11.1)
3.7

1.3(24.5)
3.8
(1.8)
(4.3)

Revenue

174.4(ii) Orders received
Billions of yen

Reportable segment

Forecast for the year
ending March 31, 2024
(fiscal 2023)(A)

Year ended March 31,
2023 (fiscal 2022)(Actual)(B)

Change (A – B)

540.0
345.5
194.5
Aerospace Systems
80.0
313.2
(233.2)
Rolling StockEnergy Solution & Marine
330.0
439.0
(109.0)Engineering
270.0
262.0
8.0
Precision Machinery & Robot
580.0
591.1
(11.1)
Powersports & Engine
100.0
86.4
13.6
Other
1,900.0
2,037.4(137.4)Total
Note: 1. Assumed exchange rate for the fiscal year ending March 31, 2024: ¥130/USD, ¥140/EUR
2. The Powersports & Engine segment’s orders received are equal to its revenue as production is based
mainly on estimated demand.

33