Overview ofFinancial Results

Overview
First-Half Results for FY2018
November 7, 2018

IBJ Leasing Co., Ltd.
This document contains forecasts and other forward-looking statements that are based on information
available at the time of preparation of this document and subject to certain risks and uncertainties, and is
not intended to guarantee that the company would achieve them. Actual business results may differ
materially from those expressed or implied by such forward-looking statements due to various factors.

Summary of First-Half Results for FY2018
 Recorded gross profit before write-offs and funding costs of ¥25.0 billion, anincrease of 13% y-o-y, and net income attributable to owners of the parent of ¥8.6billion, an increase of 29% y-o-y.
― Both reached record highs on a semiannual basis.
 The progress of net income attributable to owners of the parent was favorable at
60% against the full-year forecast.
(¥bn)

FY161H

FY17
1H

FY18
1H

ChangeChangeFY18
Forecast*%
progress%Revenues

181.4

178.4

179.8

+1.4

+1%

420.0

43%

Gross profit before writeoffs and funding costs

21.8

22.2

25.0+2.8+13%――

Operating income

10.6

9.5

11.1+1.6+17%

20.055%

Ordinary income

11.1

10.0

13.0+3.0+30%

21.461%

Net income attributable toowners of the parent

7.5

6.7

8.6

+1.9+29%

14.560%*Announced on May 9, 20181

Overview of Financial Results(¥bn)

FY161HFY171HFY181H

Change%ChangeRevenues

181.4

178.4

179.8

+1.4

+1%

Gross profit before writeoffs and funding costs

21.8

22.2

25.0+2.8+13%(Funding costs)

(2.6)

(3.4)

(4.1)

+0.7

+20%

Gross profit19.2

18.8

20.9+2.1+11%(Credit costs)(-1.2)(-0.4)(-0.4)+0.0―

Operating income

10.6

9.5

11.1+1.6+17%

Ordinary income

11.1

10.0

13.0+3.0+30%

Net income attributableto owners of the parent

7.5

6.7

8.6+1.9+29%

End of Mar2017

End ofMar 2018

End ofSep 2018

Change%Change1,608.7

1,683.0

1,894.8+211.8+13%

Net assets

141.8

154.6

160.6

+6.0+4%Equity ratio

7.8%

8.2%

7.6%

-0.6pt―Operating assets

POINTS Gross profit before write-offs and fundingcosts increased favorably Due to higher foreign currency borrowings
as a result of the expansion of the global
business
 Reversal of allowance for credit costs
continued

 Reached a record-high on a semiannualbasis

 Accumulated superior operating assets

2

Business Performance Overview
POINTS(¥bn)

FY16
1H
Contract
execution volume
Leasing andinstallment sales
Financing
Others

FY171HFY181H

Change%Change

535.7

641.6

795.0

+153.4

+24%

228.2

205.5

269.9

+64.4

+31%

307.4

436.1

522.6

+86.5

+20%

―

―

2.6

+2.6―■ Contract execution volume increased 24% y-o-y・For “Leasing and installment sales,” execution
volume increased in areas such as industrial andfactory as well as commerce and services

・For both “Leasing and installment sales” and“Financing,” real estate-related bridge scheme
projects increased(¥bn)

End ofMar 2017

End ofMar 2018

End ofSep 2018

Change%ChangeOperating assets

1,608.7

1,683.0

1,894.8+211.8+13%

Leasing andinstallment sales

1,088.1

1,122.2

1,215.7

+93.5

+8%

520.6

556.9

672.7

+115.8

+21%

―3.9

6.4

+2.5

+64%FY161H

FY171HFY181H

Change

2.80%

2.76%

2.79%

+0.03pt

FinancingOthers

Gross profit margin before
write-offs and funding costs■ Operating assets increased 13% from the end of
the previous fiscal year in line with an increasein contract execution volume■ Gross profit margin before write-offs andfunding costs improved y-o-yNote) Gross profit margin before write-offs and funding costs = Gross profit before write-offs and funding costs (annualized basis) / Average balance of operating assets

3Contract Execution Volume / Leasing and Installment Sales
Contract execution volume by equipment type

POINTS(¥bn)

FY161HFY171HFY181H

Change%ChangeIndustrial and factory

53.1

37.9

60.6

+22.7+60%

Information andcommunications

35.9

42.3

45.0

+2.7

+7%

Transport

25.4

26.7

28.7

+2.0+8%Construction

14.3

23.0

19.5

-3.5-15%

Medical

6.5

8.3

7.7

-0.6-8%Commerce and services

15.0

14.4

19.8

+5.4

+38%

Office equipment

5.1

4.8

4.1

-0.7

-15%

72.9

48.3

84.6

+36.3

+75%

Real estate

60.8

25.2

73.3

+48.1

+190%

Total

228.2

205.5

269.9

+64.4

+31%

Other

 Steadily captured capital investment
needs Captured needs for capital
investment and overseas store
development in the retail industry

 Increased mainly for superior bridge
scheme projects

4

Contract Execution Volume / Financing
Contract execution volume(¥bn)

FY16
1H

FY17
1H

FY181H

243.9

410.7

Aircraft

4.8

Real Estate

VesselCommercial
Distribution
Finance / Loan etc.

Total

Change%Change

446.3

+35.6

+9%

7.8

6.4

-1.4

-17%

53.6

12.7

60.0

+47.3

―5.1

4.8

9.8

+5.0+103%

307.4

436.1

522.6

+86.5

+20%

POINTS Volume for commercial distribution
finance increased steadily

 Captured superior bridge scheme
projects

5Balance (Real Estate/Global)
(¥bn)

306.7

POINTS

300

245.7

Real estate

219.3

219.4

200
79.9
139.4

100

20.8

98.9

81.3

25.0

87.4

8.7 138.0

7.7
47.9

146.8

219.2

87.2
Financing, etc.

66.1

62.7

Bridge / Investment, etc.

111.3

91.2

51.8

63.2

End of
Mar 2017

End of
Sep 2017

(¥bn)

178.3

179.5

33.6

33.4

Global

22.2
100

21.1
122.5

56.3

Bridge / LeasingLand Leasing / Building
Leasing0200■ Property ownership businesses(outlined in red) increased due to
execution of superior projects mainly
in metropolitan areas

End ofMar 2018

End ofSep 2018

203.1

203.4

37.3

37.6

18.8

147.0

125.0

59.9

76.2

14.8 151.0
74.8
Cross-border, etc.
Vessel

066.2

65.1

70.9

76.2

End ofMar 2017

End ofSep 2017

End ofMar 2018

End ofSep 2018

■Balance of global operations(Aircraft/Overseas subsidiaries)
increased slightly from the end of theprevious fiscal year

Global / Aircraft
Global / Overseas
subsidiaries

6Funding Interest-bearing debt increased from the end of the previous fiscal year in line with the increase in operating
assets.
― Also actively raised funds from markets(issued three-year and five-year bonds, totaling ¥45.0 billion).
 Funding costs ratio increased due to higher foreign currency borrowings as a result of the y-o-y expansion ofthe global business.

Interest-bearing debt(¥bn)

Borrowings

CP(¥bn)Bonds / securitization

FY161H1,750.7

1,800

1,492.4
1,400

Funding costs (ratio)

1,536.2

135.1

162.8

433.8

453.8

FY171HFY181H

212.2

585.0

Funding costs

2.6

3.4

4.1

Funding costs
ratio

0.34%

0.42%

0.46%

1,000Note)
Funding costs ratio = Funding costs (annualized basis) /Average balance of operating assets

600

200
0

923.5

919.6

953.5

End of Mar 2017

End of Mar 2018

End of Sep 20187

Earnings Forecasts and Dividends
 Net income attributable to owners of the parent is equivalent to 60% of the FY2018 annual plan.
【Dividends】
・In view of business results, paid interim dividend of ¥38, an increase of ¥2 from the initial forecast.
・Plan to raise annual dividend for the 17th straight year in FY2018; a ¥6 increase to ¥76/share.
(¥bn)

FY2017FY2018Change% Change(Results) (A)(Forecast) (B)1H results% progress(B)-(A)(B)/(A)

Revenues

399.7

420.0

179.8

43%

+20.3+5%

Operating income

19.2

20.0

11.1

55%

+0.8+4%

Ordinary income

20.0

21.4

13.0

61%

+1.4+7%

Net income attributableto owners of the parent

13.6

14.5

8.6

60%

+0.9+6%FY2017(Results) (A)FY2018(Initial forecast)(B)

Change(B)-(A)¥70¥74+¥4Interim dividend

¥32

¥36

+¥4Year-end dividend

¥38

¥38

±¥021.9%

21.8%

Annual dividend

Dividend payout ratio

FY2018(after dividendincrease) (C)+2(Plan)Change(C)-(A)¥76+¥6¥38+¥6¥38±¥022.4%

8

Supplemental Material
for Financial Results

9Overview of Fifth Mid-term Management Plan (FY 2017-2019)
Vision“Value-creating company tackling challenges together with clients”
Business Strategies and Reinforcement of Management Base
Basic policy

Focus areas

Reinforcement ofmanagement baseVigorously promote more profitable businesses leveraging expertiseand financial strengths gained
Existing client baseEnvironment and energy

Real estate

Global (Aircraft & overseas subsidiaries)

Medical and healthcare

Technology

Strengthening of risk-return management: Integrated operation of business portfolio
and financial ALM
Resource strategy: Promotion of diversity / improvement of operational productivity

Target figures for the final fiscal year Net income attributable to owners of the parent:
 ROE: Dividend payout ratio:¥15.0 billion
10%
Maintain 20% or more

10

Approach for Promoting Fifth Mid-term Management Plan Focus Areas■ Meet diverse client needs with new business strategies, and expand businesses in high-growth potential areas■ Accelerate initiatives that span focus areas based on clients’ needs over the mid- to long-term

Promote business with clients

Further reinforce initiatives in focus areas

Meet the diverse needs of both existingand new clients with new businessstrategies

Aim to expand businesses in high-growthpotential areas in response to changes insocial and industrial structure

New business strategies
Support clients’ commercial distribution
Jointly promote service business with clients
Promote JVs with clients

Real estateMedical and healthcare
Environment and energy
Aircraft
GlobalOverseas subsidiaries
TechnologyInitiatives spanning focus areas
Offer higher value-added services by providing comprehensive package solutions thatspan focus areas based on clients’ needs

11Marketing Strategies and Results in Focus Areas
Existing client base

Real estate

Large and mid-sizedcompanies• In addition to the financial solutions,promote new business strategies tostrengthen profitability
New business strategies(1) Support clients’ commercial
distribution(2) Jointly promote service businesswith clients(3) Promote JVs with clients• Continue focusing on store leasing incollaboration with major developers and onbridge schemes• Expand the scope from sales to hospitals• Tackle new domains such as healthcare,childcare, hotels and overseas real estate• Develop service business• Integrate with the real estate business－Strengthen consulting functions• Strengthen capturing demand of thepower-related business－Power generation, transmission
and distribution, energy supply“Community-based integrated care system”“Data health and preventive healthmanagement”

Balance atthe end of September 2018:

Execution volume :in FY18 1H¥306.7 bn¥16.1 bn

Environment andenergy• Extensively capture demandassociated with companies’
investment in energy saving

Medical andhealthcare

Global (Aircraft /Overseas subsidiaries)• Promote collaboration in the aircraft JV• Consider operations in the engines and parts
sectors• Support overseas business development ofJapanese companies

Technology• Provide solutions reflecting change in theindustrial structure, that is, the shift from“sales to services”• Proactively collaborate with pioneering
companies in each field• Expand business with non-Japanese companies
at full scale
Balance at the end of September 2018 :Execution volume in FY18 1H:¥20.0 bn

Aircraft
Overseas subsidiaries¥74.8 bn
¥76.2 bn

12

Topics in Focus Areas (1)Existing client base

Real estate

Medical and healthcare

Met client needs by being involved in commercial distribution, both in procurement and sales
Leasing of large hotel building in metropolitan areas (see (1) below)
Bridge scheme for logistics facilities, hotels, and office buildings
Spans focus
areas

Investing in healthcare real estate fund (see (2) below)
Leasing of cutting-edge surgical support robots

Entered into a contract for a service scheme provided jointly with a medical equipment manufacturer.
(1) Leasing of large hotel building
Leased Daiwa Roynet
Hotel building in Ariake(Tokyo), which boasts morerooms than any otherDaiwa Roynet Hotel(2) Investing in healthcare real estate fund
Medical andhealthcarexReal estate

Invested in healthcare realestate fund for nursing homes
and other facilities
13Topics in Focus Areas (2)Environment and energy

GlobalMedical and healthcare

Installation of energy-efficient/low-cost equipment in hospital in collaboration withengineering company (see (3) below)

Spans focusareas

Investment in solar power projects, and bridge schemes for solar power businessStarted in-house management of aircraft in addition to JVs
Leasing to non-Japanese clients by offering vendor finance through local subsidiaries of Japanese companies (see (4)below)

Leasing of equipment to Thai conglomerate
Passed resolution to make Indonesian auto finance company a subsidiary(3) Installation of equipment in hospital incollaboration with engineering company(4) Expanded business through vendor finance

Environmentand energy

Increased business with nonJapanese clients by offeringvendor finance through thesubsidiaries (in Thailand andthe Philippines) of our clientsin Japanx

Medical andhealthcare

Collaborated with engineering
company to install energy-efficientequipment such as highly efficient
air conditioning and lighting inhospitals

14

Company Profile

15

Company Profile
Company Name

IBJ Leasing Company, Limited

Address

1-2-6 Toranomon, Minato-ku, Tokyo 105-0001

Representative

Hiroshi Motoyama, President and CEO

Establishment

December 1, 1969

Listing

Tokyo Stock Exchange, 1st Section (Code: 8425)

Capital Stock

17,874 million yen (Outstanding shares: 42,649,000)

Employees

1,140 (consolidated, as of September 30, 2018)

Business Sites

14 in Japan (Tokyo, Osaka, Nagoya, others)
6 overseas (5 in Asia, 1 in Europe)

Key Group Companies:
IBJL-TOSHIBA Leasing Company, Limited, Dai-ichi Leasing Co., Ltd.,
Universal Leasing Co., Ltd., IBJ Auto Lease Company Limited,

KL Lease & Estate Co., Ltd. (building leases),
KL & Co., Ltd. (used property purchase / sales),IBJ Air Leasing Limited (aircraft operating leases)
16