This English translation of the financial report was prepared for reference purposes only and is qualified in its entirety by the original
Japanese version. The financial information contained in this report is derived from our unaudited consolidated financial statements
appearing in item 3 of this report.

SoftBank Corp.
Consolidated Financial Report
For the six-month period ended September 30, 2014 (IFRS)Tokyo, November 4, 2014

1.

Financial Highlights(Millions of yen; amounts are rounded to the nearest million yen)

(1) Results of Operations(Percentages are shown as year-on-year changes)

OperatingincomeNet sales
Amount%Amount%Incomebefore incometax
Amount%

Net income

Net income
attributable toowners of theparentTotal
comprehensive
incomeAmountAmountAmount%%%Six-month period ended¥4,104,364 57.9
September 30, 2014

¥596,658 (19.1) ¥995,781 58.5 ¥608,441 36.6 ¥560,710 36.7 ¥752,181 262.4

Six-month period ended¥2,598,612 72.7
September 30, 2013

¥737,171-¥628,368-

Basic earnings per
share (yen)Diluted earnings per
share (yen)Six-month period ended
September 30, 2014

¥471.74¥471.25

Six-month period ended
September 30, 2013¥344.20¥343.70¥445,512-¥410,167-¥207,532-

Note:
Year-on-year percentage changes except for net sales for the six-month period ended September 30, 2013 are not described due tothe retrospective adjustments in regard to the changes in accounting policies. Please refer to page 33 “Note 2. Significant
accounting policies” under “3. Condensed Interim Consolidated Financial Statements (6) Notes to Condensed Interim Consolidated
Financial Statements” for details.

(2) Financial Position

Total assets

Total equity

Equityattributable toowners of theparentRatio of equity
attributable toowners of the parent
to total assets (%)

As of September 30, 2014

¥18,504,445¥3,525,065¥2,558,277

13.8

As of March 31, 2014¥16,690,127¥2,830,382¥1,930,441

11.6

Note:
Retrospective adjustments in regard to the changes in accounting policies are made for each financial figure as of March, 31 2014.
Please refer to page 33 “Note 2. Significant accounting policies” under “3. Condensed Interim Consolidated Financial Statements(6) Notes to Condensed Interim Consolidated Financial Statements” for details.

2.

Dividends
Dividends per shareFirst quarter
Fiscal year ended
March 31, 2014
Fiscal year ending
March 31, 2015
Fiscal year ending
March 31, 2015
(Forecasted)

Second quarter

Third quarter

Fourth quarter

Total

(yen)

(yen)

(yen)

(yen)

(yen)

-

20.00

-

20.00

40.00

-

20.00
-

20.00

40.00

Note:
Revision of forecasts on the dividends: No

3. Forecasts on the Consolidated Results of Operations for the Fiscal Year Ending March 2015 (April 1, 2014 – March 31, 2015)

The Company projects net sales of ¥8 trillion and operating income of ¥900 billion for the fiscal year ending March
31, 2015. The operating income forecast has been downwardly revised by ¥100 billion from the original forecast
disclosed in the Consolidated Financial Report for the fiscal year ended March 31, 2014. This reflects a downward
revision of the outlook for the Sprint segment.
The operating income for the fiscal year ended March 31, 2014 of ¥1,077.0 billion (after retrospective adjustments)
includes gain from remeasurement relating to business combination of ¥253.9 billion. The forecasted operating
income of ¥900 billion for the fiscal year ending March 31, 2015 does not include any temporary gains.
* Notes(1) Significant changes in scope of consolidation (changes in scope of consolidation of specified subsidiaries): No(2) Changes in accounting policies and accounting estimate[1] Changes in accounting policies required by IFRSs: Yes[2] Changes in accounting policies other than those in [1]: No[3] Changes in accounting estimates: No
Please refer to page 23 “Changes in Accounting Policies and Accounting Estimates” under “2. Notes to Summary Information”
for details.

(3) Number of shares issued (common stock)[1] Number of shares issued (including treasury stock):
As of September 30, 2014:
1,200,660,365 shares
As of March 31, 2014:
1,200,660,365 shares[2] Number of treasury stock:
As of September 30, 2014:
11,764,234 shares
As of March 31, 2014:12,204,526 shares[3] Number of average stock during three-month period (April-September):
As of September 30, 2014:
1,188,593,575 shares
As of September 30, 2013:
1,191,661,988 shares* Implementation status of interim review proceduresThis interim consolidated financial report is not subject to interim review procedures based on the Financial Instruments andExchange Act, and the review procedures for the condensed interim consolidated financial statements were being conductedwhen this report was disclosed.
* Note to forecasts on the consolidated results of operations and other items
The Company has adopted IFRSs from the three-month period ended June 30, 2013.
The forecast figures are estimated based on the information that the Company is able to obtain at the present point andassumptions which are deemed to be reasonable. However, actual results may be different due to various factors.
On November 4, 2014, the Company will hold an earnings results briefing for the media, institutional investors, and financial
institutions. This earnings results briefing will be broadcast live on our web site in both Japanese and English at
http://www.softbank.jp/en/corp/irinfo/. The Earnings Results Data Sheet will also be posted on the Company’s web site around
4 p.m. on the same day at http://www.softbank.jp/en/corp/irinfo/presentations/.

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(Appendix)

Contents
1. Qualitative Information Regarding Six-month Period Results ...........................................................................

P. 3(1) Qualitative Information Regarding Consolidated Results of Operations ....................................................

P. 3

a. Consolidated Results of Operations ..........................................................................................................

P. 3

b. Results by Segment ..................................................................................................................................

P. 7(Reference 1: Principal Operational Data) ................................................................................................... P. 12(Reference 2: Definitions and Calculation Methods of Principal Operational Data) ................................... P. 14(Reference 3: Capital Expenditure and Depreciation) .................................................................................. P. 15(2) Qualitative Information Regarding Consolidated Financial Position .......................................................... P. 16
a. Assets, Liabilities and Equity ................................................................................................................... P. 16
b. Cash Flows ............................................................................................................................................... P. 21(3) Qualitative Information Regarding Forecast on Consolidated Results of Operations ................................. P. 22
2. Notes to Summary Information ........................................................................................................................... P. 23
Changes in Accounting Policies and Accounting Estimates .............................................................................. P. 23

3. Condensed Interim Consolidated Financial Statements ...................................................................................... P. 24(1) Condensed Interim Consolidated Financial Statements of Financial Position ............................................. P. 24(2) Condensed Interim Consolidated Statements of Income and Comprehensive Income ................................ P. 26(3) Condensed Interim Consolidated Statements of Changes in Equity ............................................................. P. 30(4) Condensed Interim Consolidated Statements of Cash Flows ....................................................................... P. 32(5) Significant Doubt about Going-Concern Assumption .................................................................................. P. 33(6) Notes to Condensed Interim Consolidated Financial Statements ................................................................. P. 33

Definition of Company Names and Abbreviations used in Appendix
Company names and abbreviations used in this appendix, except as otherwise stated or interpreted differently in thecontext, are as follows:
Company Name/ Abbreviation

Definition“SoftBank Corp.”

SoftBank Corp. (stand-alone basis)

The “Company”

SoftBank Corp. and its subsidiaries* Each of the following abbreviations indicates the respective company, and its subsidiaries if any.
“Sprint”

Sprint Corporation (formerly Sprint Nextel Corporation)“Brightstar”

Brightstar Corp.

“GungHo”

GungHo Online Entertainment, Inc.

“Supercell”

Supercell Oy“Alibaba”

Alibaba Group Holding Limited1

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

Major Changes to Subsidiaries (April 2013 - September 2014)
Period of consolidation
Date of change

Fiscal Year Ending
Mar. 31, 2015

Fiscal Year Ended Mar. 31, 2014
Three-month
Period Ended
June 30, 2013

Three-month
Period Ended
Sept. 30, 2013

Three-month
Period Ended
Dec. 31, 2013

Three-month
Period Ended
Mar. 31, 2014

Three-month
Period Ended
June 30, 2014

Three-month
Period Ended
Sept. 30, 2014

Q1

Q2

Q3

Q4

Q1

Q2

Mobile Communications
GungHo Online
Entertainment, Inc.

(Consolidated on April 1)(Merged by eAccess Ltd. on June 1)

Ymobile Corporation(formerly eAccess Ltd.) (Note 1)
WILLCOM, Inc.
(Consolidated on July 1)

Supercell Oy(Consolidated on October 31)

Brightstar (Note 2)(Consolidated on January 30)

SprintSprint Corporation(Consolidated on July 10)

Notes:
1. eAccess Ltd. changed its company name to Ymobile Corporation on July 1, 2014. Preceding this, eAccess Ltd. mergedwith WILLCOM, Inc. on June 1, 2014. The ADSL business of Ymobile Corporation is included in the Fixed-line
Telecommunications segment.
2. The commerce and service business of SoftBank BB Corp. has been included in the Mobile Communications segment.
This business was inherited by SoftBank Commerce & Service Corp., which was newly incorporated on April 1, 2014, and
SoftBank Commerce & Service Corp. was consolidated by Brightstar on the same date.

2SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

1. Qualitative Information Regarding Six-month Period Results(1) Qualitative Information Regarding Consolidated Results of Operations
a. Consolidated Results of Operations(Millions of yen)Six-month Period
Ended Sept. 30,
2013 (Note 3)

Six-month Period
Ended Sept. 30,
2014

2,598,612

4,104,364

1,505,752

57.9%

Operating income(Incl.)
Gain from remeasurement
relating to businesscombination

737,171596,658(140,513)(19.1%)

253,886-(253,886)-

Income before income tax

628,368

995,781

367,41358.5%(Incl.)
Dilution gain from changes
in equity interest

546

599,275

598,729-445,512608,441

162,92936.6%

410,167

560,710

150,543

36.7%

Net sales

Net income
Net income attributable toowners of the parent

ChangeChange %Note:
3. Retrospective adjustments are made in accordance with the adoption of IFRIC 21 “Levies.” Please refer to page 33“2. Significant accounting policies” under “3. Condensed Interim Consolidated Financial Statements, (6) Notes toCondensed Interim Consolidated Financial Statements” for details on the retrospective adjustments.

The main factors affecting earnings for the six-month period ended September 30, 2014 (the “interim period”) wereas follows:(a) Net Sales
Net sales totaled ¥4,104,364 million, for a ¥1,505,752 million (57.9%) increase from the six-month period ended
September 30, 2013 (the “same period of the previous fiscal year”).
The main reason for the increase was that in the same period of the previous fiscal year Sprint’s results werereflected only for the period from July 11 to September 30, 2013, while its results are reflected for the entire
interim period, causing net sales in the Sprint segment to increase by ¥1,022,495 million year on year.
Moreover, an increase in net sales in the Mobile Communications segment of ¥506,874 million also contributed
to the overall increase.

This was due to the operating results of Brightstar1 and Supercell being reflected in thefiscal year ended March 31, 2014 (the “previous fiscal year”) only for the periods after their acquisitions, fromJanuary 30 to March 31, 2014, and from October 31, 2013 to March 31, 2014, respectively; and therefore not forthe period from April 1 to September 30, 2013, while in the interim period the net sales of Brightstar amounting
to ¥362,232 million (before elimination) and the net sales of Supercell were recorded.
1

In “1. Qualitative Information Regarding Six-month Period Results” the earnings of Brightstar are shown excluding the earnings of SoftBank
Commerce & Service Corp. which was consolidated by Brightstar on April 1, 2014. The earnings of SoftBank Commerce & Service Corp. andthe commerce and service business of SoftBank BB Corp., from which SoftBank Commerce & Service Corp. inherited the business, have been
included in the Mobile Communications segment.

3

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014(b) Cost of Sales
Cost of sales increased ¥1,036,827 million (73.9%) year on year to ¥2,440,650 million.

This was primarily due

to a ¥663,229 million increase of cost of sales in the Sprint segment as a result of recording cost of sales at Sprint
for the entire interim period, and recording ¥328,014 million (before elimination) of cost of sales at Brightstar in
the Mobile Communications segment.

At SoftBank Mobile Corp. (before elimination), cost of sales increased

mainly due to increased depreciation and amortization expenses and access charges, offsetting a decrease in thecost of goods.

(c) Selling, General and Administrative Expenses
Selling, general and administrative expenses increased by ¥350,701 million (49.6%) year on year to ¥1,057,330
million.

This was primarily due to a ¥271,149 million increase of selling, general and administrative expenses

in the Sprint segment as a result of recording the expenses of Sprint for the entire interim period.
expenses of Supercell also incremented overall expenses.

Recording the

At SoftBank Mobile Corp. (before elimination),selling, general and administrative expenses declined mainly due to a decrease in sales commissions
accompanying the lower number of units sold.2(d) Gain from Remeasurement Relating to Business Combination
During the interim period, no gain from remeasurement relating to business combination was recorded.

In thesame period of the previous fiscal year, the Company recorded a gain of ¥253,886 million recognized following
remeasurement at fair value of its respective equity interests in GungHo and WILLCOM, Inc.3 that it alreadyheld on the dates when the Company acquired control.

(e) Other Operating Income and Loss
Other operating loss was ¥9,726 million, a deterioration of ¥4,851 million year on year (other operating loss of¥4,875 million was recorded in the same period of the previous fiscal year).

The deterioration was mainly

attributable to recording severance costs associated with reduction in the work force of Sprint of ¥17,130 million(¥4,026 million in the same period of the previous fiscal year).

(f) Operating Income
As a result of (a) to (e), operating income decreased by ¥140,513 million (19.1%) year on year to ¥596,658 million.
The decline reflected the absence in the interim period of gain from remeasurement relating to businesscombination of ¥253,886 million recorded in the same period of the previous fiscal year, although operating
income increased at SoftBank Mobile Corp. and the Sprint segment by ¥26,004 million (before elimination) and¥95,246 million, respectively; and income from Supercell was recorded.

When comparing operating income forthe interim period to the amount obtained after discounting the gain from remeasurement relating to businesscombination from operating income for the same period of the previous fiscal year, the operating income for theinterim period was ¥113,373 million (23.5%) higher.

2
3Units sold: the total number of new subscriptions and handset upgrades.
WILLCOM, Inc. was merged by eAccess Ltd. (currently Ymobile Corporation) on June 1, 2014.

4

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014(g) Finance Cost
Finance cost rose ¥65,387 million (61.8%) year on year to ¥171,249 million.

The increase was mainly due tothe impact of recording the interest expense of Sprint for the entire interim period.

(h) Equity in Income and Loss of Associates
Equity in loss of associates was ¥19,296 million, a deterioration of ¥15,516 million year on year (equity in lossof associates of ¥3,780 million was recorded in the same period of the previous fiscal year).

This was mainly

due to recording equity in loss of associates of ¥27,595 million as the portion attributable to the Company out of
Alibaba’s net loss of ¥79,086 million ($797 million).
Alibaba’s net loss includes the loss of ¥398,716 million ($3,882 million) recognized as a result of the increasein the fair value of the Convertible Preference Shares issued by Alibaba.

The Convertible Preference Shares arerecorded as liabilities and measured at fair value, with fluctuations in the fair value recognized in net profit or
loss.

Under U.S. GAAP based on which Alibaba prepares its disclosure, they are recorded under mezzanine

equity at the amount paid, with no fair value measurements carried out, nor related profit or loss recognized
afterwards.
The Convertible Preference Shares were converted into common stock in conjunction with Alibaba's listing on
the New York Stock Exchange on September 19, 2014. Consequently dilution gain from changes in equity
interest was recorded for the portion attributable to the Company out of the loss incurred up until the listing inassociation with the increase in the fair value of the Convertible Preference Shares.

(i) Dilution Gain from Changes in Equity Interest
Dilution gain from changes in equity interest was ¥599,275 million, an increase of ¥598,729 million year on year.
This is mainly attributable to the Company recording dilution gain from changes in equity interest of ¥599,141
million in connection with the listing of Alibaba, primarily as a result of the issuance of new shares by Alibaba
and the conversion of its Convertible Preference Shares issued by Alibaba into common stock.

(j) Other Non-operating Income and Loss
Other non-operating loss was ¥9,607 million, a deterioration of ¥9,900 million year on year (other non-operating
income of ¥293 million was recorded in the same period of the previous fiscal year).
・Interest income decreased ¥17,257 million year on year to ¥2,027 million.
・Derivative loss was ¥1,401 million, improving by ¥24,423 million year on year.
・Loss on sales of securities was ¥3,220 million (gain on sale of securities of ¥11,367 million was recorded in
the same period of the previous fiscal year).
・Impairment loss on equity method associates of ¥19,393 million was recorded (not recorded in the same
period of the previous fiscal year).
・Gain from remeasurement relating to applying equity method of ¥6,249 million was recorded (not recordedin the same period of the previous fiscal year).
Please refer to page 52 “13. Other non-operating income and loss” under “3. Condensed Interim Consolidated
Financial Statements (6) Notes to Condensed Interim Consolidated Financial Statements” for details.

5SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014(k) Income before Income Tax
As a result of (f) to (j), income before income tax was ¥995,781 million, an increase of ¥367,413 million (58.5%)
year on year.

(l) Income Taxes
Provisions for current income taxes were ¥387,340 million, an increase of ¥204,484 million (111.8%) year on
year.

Tax effects were recognized for dilution gain from changes in equity interest related to Alibaba.

(m) Net Income
As a result of (k) to (l), net income totaled ¥608,441 million, for a ¥162,929 million (36.6%) year-on-year increase.

(n) Net Income Attributable to Owners of the Parent
After deducting net income and loss attributable to non-controlling interests in subsidiaries such as Yahoo Japan
Corporation, GungHo, Sprint, and Supercell from (m), net income attributable to owners of the parent amounted
to ¥560,710 million, for a ¥150,543 million (36.7%) increase year on year.

(o) Comprehensive Income
Comprehensive income totaled ¥752,181 million, for a ¥544,649 million (262.4%) year-on-year increase.

Of

this, comprehensive income attributable to owners of the parent was ¥681,446 million, for a ¥493,406 million(262.4%) year-on-year increase.

6SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014b. Results by Segment
The Company’s reportable segments are components of business activities for which decisions on resource allocation
and assessment of performance are made.

The Company has four reportable segments: “Mobile Communications,”“Sprint,” “Fixed-line Telecommunications,” and “Internet.”

In the Mobile Communications segment, SoftBank Mobile Corp. and other companies provide mobile
communications services and sale of mobile devices and accessories, etc., while GungHo and Supercell produce
and distribute online games for smartphones and other devices.
In the Sprint segment, Sprint provides mobile communications services in the U.S. and sale of mobile devices
and accessories accompanying the services, as well as fixed-line telecommunications services.
In the Fixed-line Telecommunications segment, SoftBank Telecom Corp. provides telecommunication services
such as fixed-line telephone and data communications services to corporate customers, while SoftBank BB Corp.
and other companies provide broadband services for individual customers.
In the Internet segment, Yahoo Japan Corporation provides Internet-based advertising operations and other services.

Main businesses and core companies of each reportable segment are as follows:
Segments

MobileCommunications

SprintReportable
Segments

Main Businesses

Core Companies

・Provision of mobile communications services inJapan・Sale of mobile devices and accessories
・Sale of PC software and peripherals
・Production and distribution of online games for
smartphones and other devices

SoftBank Mobile Corp.
Ymobile Corporation
Wireless City Planning Inc.
Brightstar Corp.
SoftBank Telecom Corp.
GungHo Online Entertainment, Inc.
Supercell Oy

・Provision of mobile communications services by Sprint Corporation
Sprint in the U.S.
・Sale of mobile devices and accessories
accompanying the above services
・Provision of fixed-line telecommunications
services by Sprint

・Provision of telecom services such as fixed-line
telephone and data communications services todomestic corporate customers
Fixed-line
Telecommunications ・Provision of broadband services to domestic
individual customers
・Services accompanying the above services
Internet

OthersSoftBank Telecom Corp.
SoftBank BB Corp.
Ymobile Corporation
Yahoo Japan Corporation

・Internet advertising・e-commerce business・Membership services

Yahoo Japan Corporation

・Fukuoka SoftBank HAWKS related businesses

Fukuoka SoftBank HAWKS Corp.

Note:
4. Income of reportable segments is based on income from operating income, excluding “Gain from remeasurement relating tobusiness combination” and “Other operating income (loss),” as follows:
Segment income = (net sales – cost of sales – selling, general and administrative expenses) in each segment

7SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014(a) Mobile Communications Segment(Millions of yen)Six-month Period
Ended Sept. 30,
2013

Six-month Period
Ended Sept. 30,
2014

1,386,527

1,893,401

506,87436.6%

356,457

401,635

45,178

12.7%

Net sales
Segment income

ChangeChange %< Overview of Operations >The segment’s net sales increased by ¥506,874 million (36.6%) year on year to ¥1,893,401 million.

The increase

was mainly due to recording the net sales of Brightstar amounting to ¥362,232 million (before elimination) andthe net sales of Supercell in the interim period, which were not recorded in the same period of the previous fiscal
year.

At SoftBank Mobile Corp., net sales increased by ¥23,593 million (before elimination) on higher service

revenue along with growth in the cumulative number of subscribers, offsetting a decrease in product sales on alower number of handsets shipped.4
Segment income increased by ¥45,178 million (12.7%) year on year to ¥401,635 million. This was mainly due
to an increase in SoftBank Mobile Corp. by ¥26,004 million (before elimination), caused by its increased service
revenue and decreased operating expenses. The decrease in its operating expenses reflected a decline in cost of
goods and sales commissions primarily resulting from a lower number of handsets shipped and units sold.
Recording the earnings of Supercell also contributed to the overall income increase.
< Overview of Business Operations >(Principal operational data of SoftBank Mobile Corp. is shown below.)・Number of Subscribers
The cumulative number of subscribers at SoftBank Mobile Corp. as of September 30, 2014 (the “end of the second
quarter”) stood at 37,047,000.

Net subscriber additions (new subscriptions minus churn) for the interim period

at SoftBank Mobile Corp. totaled 1,122,000.

This was primarily the result of solid trends in subscriber numbers,

especially for smartphones and tablets, and communication modules.

・ARPU
ARPU5 at SoftBank Mobile Corp. for the three-month period ended September 30, 2014 (the “second quarter”),
decreased by ¥260 year on year to ¥4,260. The decline in ARPU primarily reflected an increase in low-ARPU
devices and a decline in voice calls using voice devices. Meanwhile, ARPU was pushed up mainly by growth in
the number of LTE subscriptions, which have relatively higher data communication charges compared to 3G
subscriptions.

4

Handsets shipped: the number of handsets shipped (sold) to handset dealers. Includes the number of handsets sold to customers at storesoperated by SoftBank Mobile Corp. and the SoftBank ONLINE SHOP.
5
For definitions and calculation methods of ARPU and churn and upgrade rates at SoftBank Mobile Corp., see page 14 “(Reference 2: Definitions
and Calculation Methods of Principal Operational Data) (a) SoftBank Mobile Corp.”

8

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

・Number of Units Sold
The number of units sold at SoftBank Mobile Corp. in the interim period decreased by 212,000 year on year to
5,961,000.
The decrease was primarily due to a decline in the number of upgrades, reflecting the customers’ prolonged useof mobile devices.

The number of units sold in the second quarter increased year on year, due to strong sales ofiPhone.6
・Churn Rate and Upgrade Rate
The churn rate5 at SoftBank Mobile Corp. for the second quarter was 1.27%, up 0.15 of a percentage point year
on year.

This was mainly due to an increase in churn for non-voice devices reaching the end of their two-year

subscriptions.
The upgrade rate5 was 1.32%, up 0.09 of a percentage point year on year.

This was mainly due to the progressin iPhone upgrades.
(b) Sprint Segment(Millions of yen)Six-month Period
Ended Sept. 30,
2013

Six-month Period
Ended Sept. 30,
2014

ChangeChange %Net sales

760,941

1,783,436

1,022,495

134.4%

Segment income(18,520)

76,726

95,246-(4,026)(17,130)(13,104)-(Reference)
Severance costs associatedwith reduction in the workforce of Sprint(Other operating loss)

Note:
5. The Sprint segment includes the results of Sprint since July 11, 2013.

< Overview of Operations >The segment’s net sales increased by ¥1,022,495 million (134.4%) year on year to ¥1,783,436 million.

The mainfactor behind the increase was that in the same period of the previous fiscal year Sprint’s results were reflected
only from July 11 to September 30, 2013, while its results are reflected for the entire interim period.
Segment income improved by ¥95,246 million year on year from a segment loss of ¥18,520 million in the same
period of the previous fiscal year to ¥76,726 million.

The principal cause of this improvement was a decreasein depreciation and amortization expenses as a result of some of the legacy assets becoming fully depreciated asof December 31, 2013.

Moreover, as a result of the network enhancement and improvement, roaming andnetwork expenses decreased year on year.
Severance costs associated with reduction in the work force of Sprint are recorded as other operating loss on
the Company’s consolidated statements of income and do not affect segment income.
6

iPhone is a trademark of Apple Inc.

The iPhone trademark is used under license from Aiphone K.K.

9

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

< Overview of Business Operations >Net subscriber additions at Sprint for the interim period totaled 150,000, bringing the cumulative number ofsubscribers to 55,037,000 at the end of the second quarter.
Of this, Sprint platform7 net additions totaled 370,000. This primarily reflected a net subscriber addition of
1,330,000 in wholesale & affiliate, mainly due to a net addition of communication modules for automobiles. Thisoutweighed a net subscriber loss of 453,000 in postpaid caused by a net loss of mobile phones, as well as a net
subscriber loss of 507,000 in prepaid, which mainly reflected the impact of subscribers not completing the annual
recertification of the Lifeline Assistance Program. 8

As a result, the cumulative number of Sprint platform

subscribers stood at 53,921,000 at the end of the second quarter.
Sprint platform ARPU9 for the second quarter was $60.58 for postpaid and $27.19 for prepaid, and its churn rate
was 2.18% for postpaid and 3.76% for prepaid.

(c) Fixed-line Telecommunications Segment(Millions of yen)Six-month Period
Ended Sept. 30,
2013

Six-month Period
Ended Sept. 30,
2014

Net sales

270,369

264,303(6,066)(2.2%)

Segment income

60,24353,346(6,897)(11.4%)

ChangeChange %< Overview of Operations >The segment’s net sales decreased by ¥6,066 million (2.2%) year on year to ¥264,303 million.

This was mainly

due to a decline in ADSL service sales at Ymobile Corporation and the absence of temporary revenues frominterconnection charges recorded at SoftBank Telecom Corp. in the same period of the previous fiscal year.
Segment income decreased by ¥6,897 million (11.4%) year on year to ¥53,346 million.

This was mainly due

to a decrease in net sales as well as an increase in costs relating to network construction for corporate
communication services and other areas at SoftBank Telecom Corp.

7

Sprint-operated CDMA and LTE networks.
A program where carriers in the U.S. receive a subsidy from a government fund to provide discounted services to low-income subscribers.
9
For definitions and calculation methods of ARPU and churn rate of Sprint platform, see page 14 “(Reference 2: Definitions and Calculation
Methods of Principal Operational Data) (b) Sprint Platform.”
8

10

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014(d) Internet Segment(Millions of yen)Six-month Period
Ended Sept. 30,
2013

Six-month Period
Ended Sept. 30,
2014

Net sales

196,290

198,305

2,015

1.0%

Segment income

94,86789,525(5,342)(5.6%)

ChangeChange %<Overview of Operations>
The segment’s net sales increased by ¥2,015 million (1.0%) year on year to ¥198,305 million.

The increase was

the result of revenue growth in the advertising business at Yahoo Japan Corporation, especially from display
advertising,10 offsetting a revenue decrease in the e-commerce business relating to its new strategy including
eliminating monthly store tenant and other fees.
Segment income decreased by ¥5,342 million (5.6%) year on year to ¥89,525 million.

This decrease wasmainly caused by a drop in revenue and increased sales promotion expenses in the e-commerce business at Yahoo
Japan Corporation.

Income was also adversely affected by increased depreciation and amortization and othercosts due to continued capital expenditures related to the advertising business, big data and security enhancement.

10Graphical, Flash®, and video advertising that appears on a certain defined area. Includes premium advertisements such as Brand Panel shown
on Yahoo! JAPAN’s top page and Yahoo! Display Ad Network (YDN), which shows advertisements most suitable to the user based on the content
the user is viewing and their interests, attributes, and geographical location.

11

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(Reference 1: Principal Operational Data)(a) Mobile Communications Segment
Fiscal Year Ended Mar. 31, 2014

Fiscal Year Ending
Mar. 31, 2015

Three-month Three-month Three-month Three-monthFiscal Year
Period Ended Period Ended Period Ended Period Ended
Ended
June 30, 2013 Sept. 30, 2013 Dec. 31, 2013 Mar. 31, 2014 Mar. 31, 2014

Three-month Three-month
Period Ended Period Ended
June 30, 2014 Sept. 30, 2014
Q1

Q2

35,92536,48237,047

9,899

10,011

10,002

10,066

5,310

5,403

5,546

5,516

5,470

810

778

692

1,165

3,445

557

565

Postpaid

818

790

716

1,202

3,526

591

594

Prepaid

-8

-12

-24

-36

-81

-34

-29

4,460

4,520

4,490

4,340

4,450

4,280

4,260

2,575

2,734

3,347

3,377

12,033

1,769

2,978

3,023

3,150

3,713

4,289

14,175

2,533

3,428

New subscriptions

1,790

1,904

2,015

2,921

8,629

1,761

1,968

Handset upgrades

1,233

1,246

1,698

1,368

5,546

772

1,460

0.99

1.12

1.28

1.66

1.27

1.11

1.27

0.94

1.06

1.24

1.63

1.22

1.07

1.23

1.25

1.23

1.64

1.30

1.36

0.71

1.32

Q1

Q2

Q3

SoftBank Mobile
Corp.1133,29034,06834,760YmobileCorporation12,13

9,542

9,725

5,199

Net additions11

Full Year

Q4

Cumulative
Subscribers(Thousands)(Incl.) PHS(Thousands)(¥ / month)

SoftBank Mobile Corp.

ARPU14,15(Thousands)

Handsets shipped16(Thousands)

Units sold17(% / month)

Churn rate

14

Postpaid(% / month)

Upgrade rate14

11

Includes the number of prepaid mobile phones and communication module service subscribers. The communication module subscribers’ net
additions for the interim period were 372,000 and the cumulative number at the end of the second quarter totaled 4,205,000.
12
eAccess Ltd. changed its company name to Ymobile Corporation on July 1, 2014. Preceding this, eAccess Ltd. merged with WILLCOM, Inc.
on June 1, 2014.
13
Includes the number of prepaid mobile phones and communication module service subscribers. The number of subscribers for the services
provided by Ymobile Corporation under the “Y!mobile” (formerly “EMOBILE” or “WILLCOM”) brand utilizing the communication network of
SoftBank Mobile Corp. is not included.
14
For definitions and calculation methods of ARPU and churn and upgrade rates at SoftBank Mobile Corp., see page 14 “(Reference 2: Definitions
and Calculation Methods of Principal Operational Data) (a) SoftBank Mobile Corp.”
15
ARPU in the fourth quarter of every fiscal year includes impact from revision of interconnection charges.
16
Handsets shipped: the number of handsets shipped (sold) to dealers. Includes the number of handsets sold to customers at stores operated by
SoftBank Mobile Corp. and the SoftBank ONLINE SHOP.
17
Units sold: the total number of new subscriptions and handset upgrades.

12SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014(b) Sprint Segment
Fiscal Year Ending
Mar. 31, 2015

Fiscal Year Ended Mar. 31, 2014
Three-month
Period Ended
June 30, 2013

Three-month
Period Ended
Sept. 30, 2013

Three-month
Period Ended
Dec. 31, 2013

Three-month
Period Ended
Mar. 31, 2014

Fiscal Year
Ended
Mar. 31, 2014

Three-month
Period Ended
June 30, 2014

Three-month
Period Ended
Sept. 30, 2014

Q1

Q2

Q3

Q4

Full Year

Q1

Q2

Sprint total

53,58854,87755,35454,88754,55355,037

Sprint platform

53,37653,25253,93453,55153,331

53,921

Postpaid

30,45130,09130,14929,91829,737

29,465Prepaid

15,215

15,29915,621

15,257

14,715

14,750Wholesale &affiliate

7,710

7,862

8,164

8,376

8,879

9,706

U.S. Cellular &Clearwire19

212

1,625

1,420

1,336

1,222

1,116

(Thousands)
Net additions18

-520

-95

682

-383

-220

590

Postpaid

194

-360

58

-231

-181

-272

Prepaid

-486

84

322

-364

-542

35

Wholesale &affiliate

-228

181

302

212

503

827

Postpaid

64.20

64.28

64.11

63.52

62.07

60.58

Prepaid

26.96

25.33

26.78

26.45

27.38

27.19

Postpaid

1.83

1.99

2.07

2.11

2.05

2.18

Prepaid

5.22

3.57

3.01

4.33

4.44

3.76

Sprint Platform

Cumulative Subscribers18(Thousands)($ / month)

ARPU20(% / month)

Churn rate20

18

Includes the number of communication module service subscribers.
Sprint acquired 411,000 subscribers (352,000 postpaid subscribers and 59,000 prepaid subscribers) through the acquisition of assets from U.S.
Cellular Corporation (“U.S. Cellular”) following its acquisition of U.S. Cellular when the transaction closed on May 17, 2013. Sprint alsoacquired 1,602,000 subscribers (788,000 postpaid subscribers, 721,000 prepaid subscribers, and 93,000 wholesale subscribers), following its
acquisition of Clearwire Corporation (“Clearwire”) when the transaction closed on July 9, 2013, and transferred 29,000 Sprint wholesale
subscribers relating to a Clearwire MVNO arrangement that were originally recognized on the Sprint platform, to this category.
20
For definitions and calculation methods of ARPU and churn rate of Sprint platform, see page 14 “(Reference 2: Definitions and Calculation
Methods of Principal Operational Data) (b) Sprint Platform.”
19

13

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(Reference 2: Definitions and Calculation Methods of Principal Operational Data)(a) SoftBank Mobile Corp.
i. ARPU
ARPU: Average Revenue Per User per month (rounded to the nearest ¥10)
ARPU = (data-related revenue + basic monthly charge, voice-related revenues, etc.) / number of active subscribers
Number of active subscribers: the total of the monthly numbers of active subscribers for the relevant period((subscribers at the beginning of the month + subscribers at the end of the month) / 2)
Data-related revenue: packet communication and flat-rate charges, basic monthly Internet connection charges,
content-related revenues, etc.
Basic monthly charge and voice-related revenues: basic monthly usage charges, voice call charges, revenues from incoming
calls, device warrantee services, advertising, etc.
Revenues from incoming calls: interconnection charges received from other operators for voice calls from their customers on
their network to SoftBank Mobile phones as a charge for the services provided in the
SoftBank Mobile Corp. service area.
(Calculation of ARPU excludes revenues and subscribers related to communication modules.)ii. Churn rate
Churn rate = number of churn / number of active subscribers (rounded to the nearest 0.01%)
Number of churn: the total number of subscribers that churned during the relevant period
Number of active subscribers: the total of the monthly numbers of active subscribers for the relevant period((subscribers at the beginning of the month + subscribers at the end of the month) / 2)iii. Upgrade rate
Upgrade rate = number of upgrades / number of active subscribers (rounded to the nearest 0.01%)
Number of upgrades: the total number of upgrades during the relevant period
Number of active subscribers: the total of the monthly numbers of active subscribers for the relevant period((subscribers at the beginning of the month + subscribers at the end of the month) / 2)(b) Sprint Platform
i. ARPU
ARPU: Average Revenue Per User per month (rounded to the nearest $.01)
ARPU = service revenue / number of active subscribers
Number of active subscribers: the total of the monthly numbers of active subscribers for the relevant period((subscribers at the beginning of the month + subscribers at the end of the month) / 2)

ii. Churn rate
Churn rate = number of deactivations / number of active subscribers (rounded to the nearest 0.01%)
Deactivations: the total number of subscribers that churned during the relevant period. The number of deactivations excludes
the number of subscribers who switch between prepaid and postpaid.
Number of active subscribers: the total of the monthly numbers of active subscribers for the relevant period((subscribers at the beginning of the month + subscribers at the end of the month) / 2)

14

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(Reference 3: Capital Expenditure and Depreciation)(a) Capital Expenditure (acceptance basis)(Millions of yen)
Fiscal Year Ending
Mar. 31, 2015

Fiscal Year Ended Mar. 31, 2014

Three-month Three-month Three-month Three-month Fiscal Year Three-month Three-month
Period Ended Period Ended Period Ended Period Ended
Ended
Period Ended Period Ended
June 30, 2013 Sept. 30, 2013 Dec. 31, 2013 Mar. 31, 2014 Mar. 31, 2014 June 30, 2014 Sept. 30, 2014
MobileCommunications
Segment

Q1

Q2

Q3

Q4

163,581

164,563

170,469

180,347

163,574

208,733

SprintSegment

Full Year

Q1

Q2

678,960

123,186

121,794

91,969464,276

148,793

162,025

Fixed-line
Telecommunications Segment

9,903

16,74313,091

20,73160,4689,946

14,447

Internet Segment

4,393

2,746

9,194

9,706

26,039

8,534

5,035

Others

2,835

4,694

3,082

4,896

15,507

5,552

4,446

180,712352,320

404,569

307,649

1,245,250

296,011

307,747

Consolidated total(b) Depreciation and Amortization(Millions of yen)
Fiscal Year Ending
Mar. 31, 2015

Fiscal Year Ended Mar. 31, 2014

Three-month Three-month Three-month Three-month Fiscal Year Three-month Three-month
Period Ended Period Ended Period Ended Period Ended
Ended
Period Ended Period Ended
June 30, 2013 Sept. 30, 2013 Dec. 31, 2013 Mar. 31, 2014 Mar. 31, 2014 June 30, 2014 Sept. 30, 2014
MobileCommunications
Segment

Q1

Q2

Q3

Q4

83,367

92,228100,205

119, 184

134,191

152,411

SprintSegment

Full Year

Q1

Q2

394,984

106,600

106,979

131,859

418,461

128,621

132,763

Fixed-line
Telecommunications Segment

14,80914,91815,402

16,94862,077

13,93914,988Internet Segment

3,221

3,218

3,700

5,230

15,369

3,543

4,153

Others

1,902

2,085

2,329

2,697

9,013

2,298

2,299

103,299

246,640

274,047

275,918

899,904

255,001

261,182

Consolidated total

Note:
6. The Sprint segment includes the results of Sprint since July 11, 2013.

15

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(2) Qualitative Information Regarding Consolidated Financial Positiona. Assets, Liabilities and Equity
Assets, liabilities and equity at the end of the second quarter were as follows:(Millions of yen)

As ofMarch 31, 2014 (Note 7)

As of
September 30, 2014

Total assets

16,690,127

18,504,445

1,814,318

10.9%

Total liabilities

13,859,745

14,979,380

1,119,635

8.1%

Total equity

2,830,382

3,525,065

694,68324.5%

102.92109.45

6.53

6.3%

ChangeChange %(Reference)
Exchange rate
USD/ JPY

Note:
7. Retrospective adjustments are made in accordance with the adoption of IFRIC 21 “Levies.” Please refer to page 33, “2.
Significant accounting policies” under “3. Condensed Interim Consolidated Financial Statements, (6) Notes to Condensed
Interim Consolidated Financial Statements” for details on the retrospective adjustments.

(a) Current Assets(Millions of yen)

As ofMarch 31, 2014

Item
Cash and cash equivalents

As of
September 30, 2014

Change1,963,490

2,449,612

486,122

511,562452,604(58,958)

1,669,545

1,689,260

19,715

370,564

422,433

51,869Other financial assets

164,727

187,964

23,237

Inventories

251,677

342,430

90,753

Other current assets

281,535

274,965(6,570)Total current assets

4,330,974

4,944,231

613,257

SprintTrade and other receivables
SprintCurrent assets totaled ¥4,944,231 million, for a ¥613,257 million (14.2%) increase from March 31, 2014 (the“previous fiscal year-end”).

The increase was mainly attributable to increases of ¥486,122 million in cash

and cash equivalents and of ¥90,753 million in inventories, the latter was primarily due to an increase at
Brightstar.

16

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014(b) Non-current Assets(Millions of yen)

As ofMarch 31, 2014

Item
Property, plant and equipment

As ofSeptember 30, 2014

Change3,586,327

3,831,945

245,618

1,472,679

1,693,131

220,452

1,539,607

1,559,911

20,304286,258

302,409

16,151

6,177,701

6,414,190

236,489

5,303,382

5,534,115

230,733

3,709,526

3,925,399

215,873

3,709,526

3,925,399

215,873

677,494

616,832(60,662)

579,885

531,103(48,782)

675,450

716,492

41,042

663,150

704,376

41,226

Software647,386

706,11558,729Game titles

166,522

139,473(27,049)

Others301,323

309,879

8,556

Investments accounted for using
the equity method

304,318

887,272

582,954

Other financial assets

401,693515,856

114,163

Deferred tax assets

182,246

170,957(11,289)

Other non-current assets

167,261

180,083

12,822

Total non-current assets

12,359,153

13,560,214

1,201,061

SprintGoodwill
SprintIntangible assets
Sprint
FCC licenses21
SprintCustomer relationships
SprintTrademarks
SprintNon-current assets totaled ¥13,560,214 million, for a ¥1,201,061 million (9.7%) increase from the previous
fiscal year-end.

The primary components of the change were as follows:・Investments accounted for using the equity method totaled ¥887,272 million, for a ¥582,954 million increase
from the previous fiscal year-end.

This is mainly due to the recording of dilution gain from changes inequity interest related to Alibaba.
・Property, plant and equipment totaled ¥3,831,945 million, for a ¥245,618 million increase from the previous
fiscal year-end.

This mainly reflected an increase of ¥220,452 million at Sprint, mostly due to its

acquisitions of telecommunications equipment to enhance its network, as well as the impact of the yen at
the end of the second quarter depreciating against the U.S. dollar from the previous fiscal year-end.
・Intangible assets totaled ¥6,414,190 million, for a ¥236,489 million increase from the previous fiscal yearend.
21

The increase was caused mainly by an increase in FCC licenses (non-amortized assets from an

Licenses issued by the U.S. Federal Communications Commission for use of specified spectrum.

17SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

accounting perspective) of ¥215,873 million, primarily due to the impact of the yen at the end of the second
quarter depreciating against the U.S. dollar from the previous fiscal year-end.

On the other hand, customer

relationships and game titles declined by ¥60,662 million and ¥27,049 million, respectively both mainly due
to regular amortization.

(c) Current Liabilities(Millions of yen)

As ofMarch 31, 2014

Item
Interest-bearing debt

As of
September 30, 2014

Change1,147,899

1,452,103

304,204

101,977

88,454(13,523)

Short-term borrowings

270,529

229,944(40,585)

Current portion of
long-term borrowings

393,566

469,439

75,873

139,300

103,739(35,561)

64,433

48,665(15,768)

Current portion oflease obligations

264,295

370,842

106,547

Current portion ofpreferred securities-

200,000

200,000

80,20978,139(2,070)Trade and other payables

1,705,956

1,789,367

83,411Other financial liabilities

5,847

10,557

4,710

Income taxes payables

246,013183,173(62,840)

Provisions

93,11565,488(27,627)

Other current liabilities

568,366

577,162

8,796

Total current liabilities

3,767,196

4,077,850

310,654

SprintCurrent portion of
corporate bonds
SprintOthersCurrent liabilities totaled ¥4,077,850 million, for a ¥310,654 million (8.2%) increase from the previous fiscal
year-end.

The increase mainly reflects an increase of ¥304,204 million in interest-bearing debt.

This wasmostly due to the reclassification from non-current liabilities of ¥200,000 million of the preferred (restricted
voting) securities of the subsidiary SFJ Capital Limited issued in September 2011, because it will become
possible for the holders to exercise their put option to redeem the preferred securities in cash in May 2015 orlater.

The current portion of lease obligations increased by ¥106,547 million, mainly due to thereclassification from non-current liabilities of the lease obligation relating to the FUKUOKA YAHUOKU!
DOME, as the lease contract is scheduled to end in July 2015.

18

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014(d) Non-current Liabilities(Millions of yen)

As ofMarch 31, 2014

Item
Interest-bearing debt

As of
September 30, 2014

Change8,022,154

8,530,874

508,720

3,257,182

3,428,645

171,4632,243,855

2,136,756(107,099)

4,743,073

5,610,943

867,870

3,164,192

3,349,404

185,212

Lease obligations

730,915

688,821(42,094)

Preferred securities

199,156-(199,156)

Others105,155

94,354(10,801)

Other financial liabilities

41,15135,602(5,549)Defined benefit liabilities

77,041

79,2102,169

Provisions

136,920

135,983(937)

1,533,021

1,820,267

287,246

1,448,264

1,557,336

109,072

Other non-current liabilities

282,262

299,594

17,332

Total non-current liabilities

10,092,549

10,901,530

808,981SprintLong-term borrowings
Corporate bonds
SprintDeferred tax liabilities
SprintNon-current liabilities totaled ¥10,901,530 million, for a ¥808,981 million (8.0%) increase from the previous
fiscal year-end.

The primary components of the change were as follows:・Interest-bearing debt increased by ¥508,720 million from the previous fiscal year-end.

The increase mainlyreflected SoftBank Corp.’s issuing ¥700,000 million of unsecured straight corporate bonds and an increasein Sprint’s corporate bonds by ¥185,212 million primarily due to the yen at the end of the second quarter
depreciating against the U.S. dollar from the previous fiscal year-end.

On the other hand, preferred(restricted voting) securities of SFJ Capital Limited were reclassified into current liabilities.
・Deferred tax liabilities increased by ¥287,246 million from the previous fiscal year-end.

This was mainly

due to recognition of the tax effect of the difference between the carrying amount of Alibaba on aconsolidated basis, which increased due to the recording of dilution gain from changes in equity interest,and its carrying amount on a tax basis.

19

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014(e) Equity(Millions of yen)

As ofMarch 31, 2014

As of
September 30, 2014

ChangeChange %1,930,441

2,558,277

627,83632.5%

899,941

966,788

66,8477.4%

2,830,382

3,525,065

694,683

24.5%

Equity attributable toowners of the parent
Non-controlling interests
Total equity

Equity totaled ¥3,525,065 million, for a ¥694,683 million (24.5%) increase from the previous fiscal year-end.
Of this amount, equity attributable to owners of the parent and non-controlling interests increased by ¥627,836
million (32.5%) and ¥66,847 million (7.4%), respectively.

The ratio of equity attributable to owners of theparent to total assets increased by 2.2 percentage points from the previous fiscal year-end to 13.8%.
(Equity Attributable to Owners of the Parent)(Millions of yen)

Item

As of
March 31, 2014

As of
September 30, 2014

ChangeCommon stock

238,772

238,772-

Capital surplus

405,045

374,048

Retained earnings

1,168,266

1,704,268(30,997)

536,002

Treasury stock(51,492)(49,643)

1,849

Accumulated othercomprehensive income

169,850

290,832

120,982

Available-for-sale financial
assets14,122

10,161(3,961)

Cash flow hedges(19,942)(16,051)

3,891

Exchange differences ontranslating foreign operations

175,670

296,722

121,052

1,930,441

2,558,277

627,836

Total equity attributable toowners of the parent

Equity attributable to owners of the parent totaled ¥2,558,277 million, for a ¥627,836 million (32.5%) increase
from the previous fiscal year-end.

This was mainly due to increases in retained earnings and accumulated

other comprehensive income of ¥536,002 million and ¥120,982 million, respectively.

The increase inretained earnings primarily reflected net income attributable to owners of the parent of ¥560,710 million.

The

increase in accumulated other comprehensive income was mainly attributable to an increase in exchange
differences on translating foreign operations due to the yen at the end of the second quarter depreciating against
the U.S. dollar from the previous fiscal year-end.

(Non-controlling Interests)
Non-controlling interests totaled ¥966,788 million, for a ¥66,847 million (7.4%) increase from the previous
fiscal year-end.

20

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014b. Cash Flows
Cash flows for the interim period were as follows:
Cash and cash equivalents at the end of the second quarter totaled ¥2,449,612 million, for a ¥486,122 million
increase from the previous fiscal year-end.
(Millions of yen)Six-month Period
Ended Sept. 30, 2013 (Note 8)

Six-month Period
Ended Sept. 30, 2014

ChangeCash flows from operating activities

451,229

682,348

231,119

Cash flows from investing activities(2,102,052)(736,984)

1,365,068

Cash flows from financing activities

2,410,281

510,476(1,899,805)(132,404)

49,331

181,735(Reference)
Cash flows from operating activities- capital expenditure (Note 9)

Notes:
8. Retrospective adjustments are made in accordance with the adoption of IFRIC 21 “Levies.” Please refer to page 33 “2.
Significant accounting policies” under “3. Condensed Interim Consolidated Financial Statements, (6) Notes to Condensed
Interim Consolidated Financial Statements” for details on the retrospective adjustments.
9. Outlays for purchase of property, plant and equipment and intangible assets.

(a) Cash Flows from Operating Activities
Net cash provided by operating activities totaled ¥682,348 million (compared with ¥451,229 million provided in
the same period of the previous fiscal year).

The primary components of cash flows were as follows:i. Net income totaled ¥608,441 million.
ii. The main items added to net income were ¥516,183 million in depreciation and amortization, ¥387,340
million in income taxes, and ¥171,249 million in finance cost.
iii. The main item subtracted from net income was ¥599,275 million in dilution gain from changes in equity
interest.
iv. Decrease in trade and other receivables (increase in cash flows) of ¥28,683 million and increase in trade andother payables (increase in cash flows) of ¥49,367 million were recorded.
v. Interest paid was ¥184,533 million.
vi. Income taxes paid was ¥244,886 million.
(b) Cash Flows from Investing Activities
Net cash used in investing activities was ¥736,984 million (compared with ¥2,102,052 million used in the same
period of the previous fiscal year).

The primary components of cash flows were as follows:i. Outlays for purchase of property, plant and equipment and intangible assets amounted to ¥633,017 million.
ii. Payments for acquisition of investments of ¥195,568 million and proceeds from sales/redemption of
investments of ¥178,272 million were recorded. These were mainly attributable to short-term trading ofmarketable securities by Sprint and Brightstar.

21

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014(c) Cash Flows from Financing Activities
Net cash provided by financing activities was ¥510,476 million (compared with ¥2,410,281 million provided in
the same period of the previous fiscal year).

The primary components of cash flows were as follows:(Items Increasing Cash Flows)
Proceeds from long-term interest-bearing debt amounted to ¥1,063,791 million.

The components were as

follows:
・Proceeds from issuance of corporate bonds of ¥700,000 million.

This consisted of unsecured straight

corporate bonds issued by SoftBank Corp.
・Proceeds from sale and leaseback of newly acquired equipment of ¥217,212 million.
・Proceeds from long-term borrowings of ¥146,579 million.

This was mainly due to borrowings made throughsecuritization of installment sales receivables at SoftBank Mobile Corp.

(Items Decreasing Cash Flows)i. Repayment of long-term interest-bearing debt was ¥410,914 million.

The primary components were as

follows:
・Repayment of long-term borrowings of ¥179,131 million.

This was mainly due to SoftBank Mobile Corp.

repaying borrowings made through securitization of installment sales receivables.
・Repayment of lease obligations of ¥144,059 million.
・Redemption of corporate bonds of ¥63,434 million.

This was mainly due to SoftBank Corp.’s redemptionof its unsecured straight corporate bonds totaling ¥44,900 million.
ii. Repayment of short-term interest-bearing debt was ¥65,687 million.
iii. Payment for purchase of subsidiaries’ equity from non-controlling interests of ¥43,496 million.

This wasmainly due to the additional purchase of shares of Brightstar Global Group Inc., the parent company (100%ownership) of Brightstar.

(3) Qualitative Information Regarding Forecast on Consolidated Results of Operations
The Company projects net sales of ¥8 trillion, EBITDA (Note 10) of approximately ¥2 trillion, and operating incomeof ¥900 billion for the fiscal year ending March 31, 2015.

The operating income forecast has been downwardly

revised by ¥100 billion from the original forecast disclosed in the Consolidated Financial Report for the fiscal
year ended March 31, 2014. This reflects a downward revision of the outlook for the Sprint segment.
The operating income for the fiscal year ended March 31, 2014 of ¥1,077.0 billion (after retrospective
adjustments) includes gain from remeasurement relating to business combination of ¥253.9 billion.

The

forecasted operating income of ¥900 billion for the fiscal year ending March 31, 2015 does not include any
temporary gains.
Note:
10. EBITDA = net sales - cost of sales - selling, general and administrative expenses + depreciation and amortization

22

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

2. Notes to Summary Information
Changes in Accounting Policies and Accounting Estimates(Changes in accounting policies required by IFRSs)
The following standards are applied by the Company during the three-month period ended June 30, 2014.
Standard
IAS 32(Amendments)
IFRIC 21

Presentation

Outline of the new / revised standards
To clarify the requirements of net presentation of financial assets
and liabilities

LeviesTo clarify the timing of recognition of liabilities related to thepayment of levies

Financial Instruments:

The details are described in “Note 2. Significant accounting policies” under “3. Condensed Interim Consolidated Financial
Statements (6) Notes to Condensed Interim Consolidated Financial Statements.”

23

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

3. Condensed Interim Consolidated Financial Statements(1) Condensed Interim Consolidated Statements of Financial Position(Millions of yen)

As ofMarch 31, 2014*

As of
September 30, 2014

AssetsCurrent assets
Cash and cash equivalents
Trade and other receivables
Other financial assets
Inventories
Other current assets
Total current assets

1,963,490
1,669,545
164,727
251,677
281,535
4,330,974

2,449,612
1,689,260
187,964
342,430
274,965
4,944,231

Non-current assets
Property, plant and equipment
Goodwill
Intangible assets
Investments accounted for using the equity method
Other financial assets
Deferred tax assets
Other non-current assets
Total non-current assets
Total assets

3,586,327
1,539,607
6,177,701
304,318
401,693
182,246
167,261
12,359,153
16,690,127

3,831,945
1,559,911
6,414,190
887,272
515,856
170,957
180,083
13,560,214
18,504,445

Note:
Retrospective adjustments are made in accordance with the adoption of IFRIC 21 “Levies.” The details are described in“Note 2. Significant accounting policies.”

24

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(Millions of yen)

As ofMarch 31, 2014*
Liabilities and equity
Current liabilities
Interest-bearing debt
Trade and other payables
Other financial liabilities
Income taxes payables
Provisions
Other current liabilities
Total current liabilities

As of
September 30, 2014

1,147,899
1,705,956
5,847
246,013
93,115568,366
3,767,196

1,452,103
1,789,367
10,557
183,173
65,488577,162
4,077,850

Total liabilities

8,022,154
41,151
77,041
136,920
1,533,021
282,262
10,092,549
13,859,745

8,530,874
35,602
79,210135,983
1,820,267
299,594
10,901,530
14,979,380

EquityEquity attributable to owners of the parent
Common stock
Capital surplus
Retained earnings
Treasury stock
Accumulated other comprehensive income
Total equity attributable to owners of the parent
Non-controlling interests
Total equity
Total liabilities and equity

238,772
405,045
1,168,266(51,492)
169,850
1,930,441
899,941
2,830,382
16,690,127

238,772
374,048
1,704,268(49,643)
290,832
2,558,277
966,7883,525,065
18,504,445

Non-current liabilities
Interest-bearing debt
Other financial liabilities
Defined benefit liabilities
Provisions
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities

Note:
Retrospective adjustments are made in accordance with the adoption of IFRIC 21 “Levies.” The details are described in“Note 2. Significant accounting policies.”

25

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(2) Condensed Interim Consolidated Statements of Income and Comprehensive Income
For the six-month period ended September 30
Condensed Interim Consolidated Statements of Income(Millions of yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Gain from remeasurement relating to businesscombination
Other operating loss
Operating income
Finance cost
Equity in loss of associates
Dilution gain from changes in equity interest
Other non-operating income (loss)
Income before income tax
Income taxes
Net income
Net income attributable to
Owners of the parent
Non-controlling interests

Earnings per share attributable to owners of the parent
Basic (yen)Diluted (yen)Six-month period ended
September 30, 2013*
2,598,612(1,403,823)
1,194,789

Six-month period ended
September 30, 2014
4,104,364(2,440,650)
1,663,714(706,629)(1,057,330)

253,886-(4,875)
737,171(105,862)(3,780)546
293
628,368(182,856)
445,512(9,726)596,658(171,249)(19,296)599,275(9,607)995,781(387,340)
608,441

410,167
35,345445,512560,71047,731
608,441344.20343.70471.74471.25

Note:
Retrospective adjustments are made in accordance with the adoption of IFRIC 21 “Levies.” The details are described in“Note 2. Significant accounting policies.”

26

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

Condensed Interim Consolidated Statements of Comprehensive Income(Millions of yen)Six-month period ended
September 30, 2013*
Net income
Other comprehensive income (loss), net of tax
Items that will not be reclassified to profit or loss
Remeasurements of defined benefit plan
Total items that will not be reclassified to profit
or loss
Items that may be reclassified subsequently to
profit or loss
Available-for-sale financial assets
Cash flow hedges
Exchange differences on translating foreign
operations
Share of other comprehensive income ofassociates
Total items that may be reclassified subsequently to
profit or loss
Total other comprehensive income (loss), net of tax
Total comprehensive income
Total comprehensive income attributable to
Owners of the parent
Non-controlling interests

Six-month period ended
September 30, 2014

445,512608,441

(11)

(246)

(11)

(246)

(47,207)(140,232)(1,108)4,257(57,425)

139,441

6,895

1,396

(237,969)

143,986(237,980)
207,532

143,740
752,181

188,040
19,492
207,532

681,446
70,735752,181

Note:
Retrospective adjustments are made in accordance with the adoption of IFRIC 21 “Levies.” The details are described in“Note 2. Significant accounting policies.”

27

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

For the three-month period ended September 30
Condensed Interim Consolidated Statements of Income(Millions of yen)Three-month period ended Three-month period ended
September 30, 2013*
September 30, 2014
1,717,543
2,112,148(996,628)(1,292,148)
720,915820,000

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Gain from remeasurement relating to businesscombination
Other operating loss
Operating income
Finance cost
Equity in income (loss) of associates
Dilution gain from changes in equity interest
Other non-operating income (loss)
Income before income tax
Income taxes
Net income
Net income attributable to
Owners of the parent
Non-controlling interests

Earnings per share attributable to owners of the parent
Basic (yen)Diluted (yen)(483,728)(550,673)

103,766-(3,903)
337,050(78,479)(2,697)542
11,840268,256(92,396)
175,860(10,301)
259,026(86,262)
44,129597,739(18,322)796,310(299,177)
497,133

165,790
10,070175,860

483,136
13,997497,133

139.11138.90406.44404.75

Note:
Retrospective adjustments are made in accordance with the adoption of IFRIC 21 “Levies.” The details are described in“Note 2. Significant accounting policies.”

28

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

Condensed Interim Consolidated Statements of Comprehensive Income(Millions of yen)Three-month period ended
September 30, 2013*

Three-month period ended
September 30, 2014

175,860

497,133

(5)

(2)

(5)

(2)

(70,120)(165,127)983
469(80,421)

178,952

1,281

6,757

(314,387)

187,161(314,392)(138,532)

187,159684,292(133,585)(4,947)(138,532)

637,668
46,624684,292

Net income
Other comprehensive income (loss), net of tax
Items that will not be reclassified to profit or loss
Remeasurements of defined benefit plan
Total items that will not be reclassified to profit
or loss
Items that may be reclassified subsequently to
profit or loss
Available-for-sale financial assets
Cash flow hedges
Exchange differences on translating foreign
operations
Share of other comprehensive income ofassociates
Total items that may be reclassified subsequently to
profit or loss
Total other comprehensive income (loss), net of tax
Total comprehensive income
Total comprehensive income attributable to
Owners of the parent
Non-controlling interests

Note:
Retrospective adjustments are made in accordance with the adoption of IFRIC 21 “Levies.” The details are described in“Note 2. Significant accounting policies.”

29

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(3) Condensed Interim Consolidated Statements of Changes in Equity
For the six-month period ended September 30, 2013*(Millions of yen)
Equity attributable to owners of the parent

As of April 1, 2013
Effect of retrospective
adjustments
As of April 1, 2013
(after adjustments)
Comprehensive income
Net income
Other comprehensive
loss
Total comprehensive
incomeTransactions with owners
and other transactions
Cash dividends
Transfer of accumulated
other comprehensive
income to retained
earnings
Purchase and disposal oftreasury stock
Changes from businesscombination
Changes in interests in
subsidiaries
Share-based paymenttransactions
Other
Total transactions withowners and othertransactions
As of September 30, 2013

Accumulated
othercomprehensive
incomeNoncontrollinginterests Total equity
Total
1,612,756
317,684 1,930,440

Commonstock
238,772

Capitalsurplus436,704

Retainedearnings
712,088

Treasurystock(22,834)--(18,315)--(18,315)(654)(18,969)

238,772

436,704

693,773(22,834)

248,026

1,594,441

317,030

1,911,471--

410,167--

410,167

35,345445,512

-

-

-

-

(222,127)(222,127)(15,853)(237,980)--

410,167-(222,127)

188,040

19,492

207,532--(23,830)--(23,830)(13,556)(37,386)

-

-

(11)

-

11

-

-

-

-

72

-

1,074

-

1,146

-

1,146

-

-

-

-

-

-

485,104

485,104-(14,412)---(14,412)(33,811)(48,223)

-

2,367

-

-

-

2,367

-

2,367

-

-

-

-

-

-

(273)

(273)

-

(11,973)(23,841)

1,074

11

(34,729)

437,464

402,735

238,772

424,7311,080,099(21,760)

25,9101,747,752

773,986

2,521,738

248,026

Note:
Retrospective adjustments are made in accordance with the adoption of IFRIC 21 “Levies.” The details are described in“Note 2. Significant accounting policies.”

30

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

For the six-month period ended September 30, 2014
(Millions of yen)
Equity attributable to owners of the parent

As of April 1, 2014
Effect of retrospective
adjustments*
As of April 1, 2014
(after adjustments)
Comprehensive income
Net income
Other comprehensive
incomeTotal comprehensive
incomeTransactions withowners and othertransactions
Cash dividends
Transfer of accumulated
other comprehensive
income to retained
earnings
Purchase and disposalof treasury stock
Changes from businesscombination
Changes in interestsin subsidiaries
Share-based paymenttransactions
Other
Total transactions
with owners andother transactions
As of September 30, 2014

Accumulated
othercomprehensive
income169,617

Total
1,955,374

Noncontrollinginterests
903,296

Total equity
2,858,670

233(24,933)(3,355)(28,288)(51,492)

169,850

1,930,441

899,941

2,830,382

560,710--560,71047,731

608,441---

120,736

120,736

23,004

143,740--

560,710-

120,736

681,446

70,735752,181--(23,769)--(23,769)(16,157)(39,926)

-

-

(246)

-

246

-

-

-

-

-

(693)

1,849

-

1,156

-

1,156

-

-

-

-

-

-

227

227

-

(30,984)---(30,984)

8,801(22,183)

-

(13)

-

-

-

(13)

4,650

4,637

-

-

-

-

-

-

(1,409)(1,409)-(30,997)(24,708)

1,849

246

(53,610)(3,888)(57,498)

238,772

374,048

1,704,268(49,643)

290,832

2,558,277

966,7883,525,065

Commonstock
238,772

Capitalsurplus405,111Retainedearnings
1,193,366

Treasurystock(51,492)-(66)(25,100)-

238,772

405,045

1,168,266

-

-

-

Note:
Retrospective adjustments are made in accordance with the adoption of IFRIC 21 “Levies.” The details are described in“Note 2. Significant accounting policies.”

31

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(4) Condensed Interim Consolidated Statements of Cash Flows(Millions of yen)Six-month period ended
September 30, 2013*

Six-month period ended
September 30, 2014

445,512349,939

608,441
516,183(253,886)-

105,862
3,780
(546)
(293)
182,856
27,001
19,658171,249
19,296(599,275)
9,607
387,340
28,68349,367

Other(127,371)(82,044)

Subtotal

752,512

1,108,847

Interest and dividends received
Interest paid
Income taxes paid
Net cash provided by operating activities

5,364(123,600)(183,047)
451,229

2,920(184,533)(244,886)
682,348(583,633)(633,017)(45,234)
85,696(195,568)
178,272(1,430,677)(7,801)

310,104-(299,501)-(138,807)(2,102,052)(78,870)(736,984)(89,752)(65,687)

3,769,040(1,200,555)

1,063,791(410,914)(49,645)(43,496)(23,812)(13,411)
18,4162,410,281(23,767)(16,087)
6,636
510,476(14,915)

30,282744,5431,439,057
2,183,600

486,122
1,963,490
2,449,612

Cash flows from operating activities
Net income
Depreciation and amortization
Gain from remeasurement relating to businesscombination
Finance cost
Equity in loss of associates
Dilution gain from changes in equity interests
Other non-operating (income) loss
Income taxes
Decrease in trade and other receivables
Increase in trade and other payables

Cash flows from investing activities
Purchase of property, plant and equipment, andintangible assets
Payments for acquisition of investments
Proceeds from sales/redemption of investments
Decrease from acquisition of control oversubsidiaries
Proceeds from settlement of foreign currency forward
contract for acquisition of control of subsidiaries
Increase in restricted cash
Other
Net cash used in investing activities
Cash flows from financing activities
Decrease in short-term interest-bearing debt, net
Proceeds from long-term interest-bearing debt
Repayment of long-term interest-bearing debt
Payment from purchase of subsidiaries’ equity from
non-controlling interests
Cash dividends paid
Cash dividends paid to non-controlling interests
Other
Net cash provided by financing activities
Effect of exchange rate changes on cash and cash
equivalents
Increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the period
Cash and cash equivalents at the end of the period

Note:
Retrospective adjustments are made in accordance with the adoption of IFRIC 21 “Levies.” The details are described in“Note 2. Significant accounting policies.”
32

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014(5) Significant Doubt about Going-Concern Assumption
For the six-month period ended September 30, 2014
There are no applicable items.
(6) Notes to Condensed Interim Consolidated Financial Statements
1. Definition of company name and abbreviation used in the notes
Company names and abbreviations used in the notes, except as otherwise stated or interpreted differently in thecontext, are as follows:
Company name / Abbreviation

Definition“SoftBank Corp.”

SoftBank Corp. (stand-alone basis)

The “Company”

SoftBank Corp. and its subsidiaries*Each of the following abbreviations indicates the respective company, and its subsidiaries if any.
“Sprint”

Sprint Corporation (formerly Sprint Nextel Corporation)“Clearwire”

Clearwire Corporation“GungHo”

GungHo Online Entertainment, Inc.

“Supercell”

Supercell Oy“Alibaba”

Alibaba Group Holding Limited

2. Significant accounting policies
The significant accounting policies applied in these condensed interim consolidated financial statements are
consistent with those for the fiscal year ended March 31, 2014, except for the adoption of the following new
standards and interpretations. Income taxes for the six-month period ended September 30, 2014 are calculated
based on the estimated effective tax rate for the year. Certain defined benefit liabilities as of September 30, 2014
are calculated based on reasonable estimates with the actuarial calculation made as of March 31, 2014.

Adoption of new standards and interpretations
The following standards are applied by the Company during the three-month period ended June 30, 2014.
Standard
IAS 32(Amendments)
IFRIC 21

Financial Instruments:
Presentation
LeviesOutline of the new / revised standards
To clarify the requirements of net presentation of financial assets
and liabilities
To clarify the timing of recognition of liabilities related to thepayment of levies

IFRIC 21 is applied retrospectively in accordance with its transition method. Condensed interim consolidated
financial statements for the six-month period ended September 30, 2013, the three-month period ended September
30, 2013 and for the fiscal year ended March 31, 2014 are presented after the retrospective application.
Effects on the condensed interim consolidated financial statements by the above adoption are as follows.

33SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(Condensed Interim Consolidated Statements of Financial Position)(Millions of yen)

As ofMarch 31, 2014
(11,686)
7,302
9,514
5,130

As of
September 30, 2014
(7,451)
7,695
3,563
3,807

Increase in other current liabilities
Increase in total liabilities

33,41833,418

10,403
10,403

Decrease in capital surplus
Decrease in retained earnings
Increase in accumulated other comprehensive income
Decrease in non-controlling interests
Decrease in total equity(66)(25,100)
233(3,355)(28,288)(66)(5,775)394(1,149)(6,596)Six-month period
ended
September 30, 2013
Decrease in cost of sales
21,085Decrease in selling, general and administrative expenses
1,016
Increase in income taxes(5,462)
Increase in net income
16,639Six-month period
ended
September 30, 2014
26,725815(5,951)
21,589Decrease in other current assets
Increase in goodwill
Increase in deferred tax assets
Increase in total assets(Condensed Interim Consolidated Statements of Income)(Millions of yen)

Earnings per share attributable to owners of the parent
Increase in earnings per share-basic (yen)Increase in earnings per share-diluted (yen)

12.80
12.78

16.26
16.24

Six-month period
ended
September 30, 2013
16,639Six-month period
ended
September 30, 2014
21,589(17)

208

16,622

21,797(Condensed Interim Consolidated Statements of Comprehensive Income)(Millions of yen)

Increase in net income
Increase (decrease) in exchange differences ontranslating foreign operations
Increase in total comprehensive income

34

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(Condensed Interim Consolidated Statements of Cash Flows)(Millions of yen)

Cash flows from operating activities
Increase in net income
Increase in income taxes
Decrease in otherNet cash provided by (used in) operating activities

Six-month period
ended
September 30, 2013

Six-month period
ended
September 30, 2014

16,6395,462(22,101)-

21,5895,951(27,540)-

There are no significant effects on the Company due to the adoption of other new standards and interpretations.

3. Business combinations
For the six-month period ended September 30, 2013
(1) GungHo Online Entertainment, Inc.
a. Overview of consolidation
Masayoshi Son, chairman and CEO of the SoftBank Corp., has entered into a Memorandum of Understanding
on Exercise of Voting Rights for Deferment of Execution of Pledges (the “MOU”) with respect to the shares of
GungHo on April 1, 2013, with Heartis G.K. (“Heartis”; percentage of voting interest: 18.50%), which is thesecond largest shareholder of GungHo and Taizo Son’s asset management company and of which Taizo Son,chairman of GungHo, is the representative director. Under the MOU, in order to have Son Holdings Inc., ofwhich Masayoshi Son is a director and which is a Masayoshi Son’s asset management company, defer the
execution of pledges over the shares of GungHo held by Heartis, Heartis has agreed, effective as of April 1,
2013, to the effect that at the shareholders meeting of GungHo, Heartis will exercise the voting rights for all of
the shares of GungHo it holds in accordance with Masayoshi Son’s directions. Also, a subsidiary of theCompany, SoftBank Mobile Corp., undertook the Tender Offer from April 1, 2013 to April 26, 2013 andacquired 6.37% of GungHo shares (purchase price: ¥24,976 million). The Company and Heartis together
came to represent the majority of the voting rights in GungHo’s shares (percentage of voting interest: 58.50%)
and GungHo Online Entertainment changed from an equity method associate to a subsidiary of the Company.
With this transaction, the Company expects that it will be able to enhance mobile content, and to improve theefficiency in operation of the mobile communications business and profitability competitiveness by combining
smartphone-focused development capability and infrastructure held by the Company, and planning and creating
capabilities in the smartphone game industry held by GungHo.
(Business Description of GungHo)(a) Planning, development, operation and distribution of online games(b) Planning, development and sales of mobile content(c) Planning, development and sales of character goods(d) Planning, development and distribution of other entertainment content(Acquisition date)
April 1, 201335

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014b. Consideration transferred and the components(Millions of yen)

Payment by cash
Fair value of equity interest in GungHo already held at
the time of the acquisition
Total consideration transferred

Acquisition date
(April 1, 2013)
24,976
153,620
178,596

A

Acquisition-related costs of ¥109 million arising from the business combinations are recognized in “Selling,
general and administrative expenses.”
As a result of the reevaluation of 33.63% in equity interest already held at the time of the acquisition of control
by the Company in GungHo at fair value on the acquisition date, the Company recognized a gain on the step
acquisition of ¥150,120 million. This gain is presented as “Gain from remeasurement relating to businesscombination” in the condensed interim consolidated statements of income.
c. Fair values of assets and liabilities, non-controlling interests and goodwill on the acquisition date(Millions of yen)

Acquisition date
(April 1, 2013)
36,90380,814
4,511
122,228

Current assets
Intangible assets1
Other non-current assets
Total assets

10,89729,94940,846

Current liabilities
Non-current liabilities
Total liabilities
Net assets

B

81,382

Non-controlling interests2
Goodwill3

C48,818146,032

A-(B-C)

Notes:
1. Intangible assets
Game titles of ¥77,796 million are included.
2. Non-controlling interests
Non-controlling interests in an acquiree that are present ownership interests and entitle their holders to a proportionate
share of the entity’s net assets in the event of liquidation are measured based on the proportionate interests at theacquisition date in the identifiable net assets of the acquiree at the acquisition date.
3. Goodwill
Goodwill reflects excess earning power expected from the future business development and assembled workforce forgame development and other, and the synergy with existing businesses.

36SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

d. Decrease from acquisition of control over subsidiaries(Millions of yen)

Payment for the acquisition by cash
Cash and cash equivalents held by the acquiree at the time ofacquisition of control
Decrease in cash from the acquisition of control over thesubsidiary

Acquisition date
(April 1, 2013)(24,976)
11,025(13,951)e. Sales and net income of the acquiree
The amount of the acquiree’s sales and net income before elimination of inter-company transactions and after
the acquisition date are ¥85,357 million and ¥22,258 million, respectively, which are recorded in the condensed
interim consolidated statements of income for the six-month period ended September 30, 2013.
In addition, the above net income includes amortization expenses, which are related to intangible assets
recognized at the acquisition date, and other.

(2) Sprint
a. Overview of consolidation
On October 15, 2012, the Company and Sprint entered into a series of definitive agreements under which theCompany will invest in Sprint. After the completion of negotiations, the Company and Sprint agreed to amend a
portion of the transaction on June 11, 2013.
On July 10, 2013, SoftBank Corp. capitalized, through a wholly owned subsidiary, Starburst I, Inc., Sprint withan additional $18.5 billion and the total investment of SoftBank Corp. amounted to $21.6 billion, including $3.1
billion of corporate bonds with stock acquisition rights issued by Sprint Nextel Corporation (the “Bond”)
invested by Starburst II, Inc. on October 22, 2012. Of the invested amounts of $21.6 billion, $16.6 billion was
distributed to existing individual Sprint’s shareholders and $5 billion is used to strengthen Sprint. The Bond
held by Starburst II, Inc. was converted into shares.
Through the transaction, approximately 72% of Sprint Nextel Corporation shares were acquired for $7.65 pershare in cash, and the remaining shares were converted into Sprint shares on a one-to-one basis, which
succeeded Sprint Nextel Corporation and became listed on the New York Stock Exchange.
As a result of the transaction, Starburst I, Inc., owns approximately 78% of the shares of Sprint and Sprint
became a subsidiary of SoftBank Corp.
Prior to the transaction, Clearwire, a company providing high-speed wireless communication services in the
U.S., became a wholly owned subsidiary of Sprint on July 9, 2013.
From August 1, 2013 to September 16, 2013, SoftBank Corp., through Galaxy Investment Holdings, Inc., awholly-owned subsidiary in the U.S., additionally purchased approximately 2% of the shares of Sprint(purchase price: $500 million). As a result, the Company’s ownership in the outstanding Sprint common
stock became approximately 80% as of September 30, 2013.

37

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(Structure after completion of the transaction)b. Purpose of consolidation(a) Enables the Company to establish an operating base as one of the largest mobile Internet companies in theworld. The combined subscriber base will be one of the largest between the U.S. and Japan*.
(b) Enables the Company to leverage its deep expertise in smartphones and next-generation mobile networks,
and its track record of success in competing in mature markets with large incumbents, to enhancecompetitiveness of Sprint in the U.S.
(c) Provides Sprint $5 billion of new capital for its mobile network, strategic investments, and balance sheet aspart of its continued efforts to fortify its operating base towards future growth.
Note:
Based on Telecommunications Carriers Association (“TCA”) data and disclosed material by relevant companies as ofthe end of June 2013.

c. Summary of Sprint

Name

Sprint Corporation

Address

6200 Sprint Parkway, Overland Park, Kansas

Name and title of representative

Business description

Marcelo Claure, Chief Executive Officer and Director(Assumed the post on August 11, 2014)
Holding company
Provision of telecommunications services through its operating subsidiaries

Note

The Chairman of the Board and the Vice Chairman of the Board wereassumed by Masayoshi Son, the Chairman & CEO of SoftBank Corp. andRonald Fisher, Director of SoftBank Corp., respectively. Adm. Mike Mullen,
former Chairman of the Joint Chiefs of Staff, has been appointed as the
Director in charge of security.

Consolidated sales$35,493 million (Fiscal year ended December 31, 2013, US GAAP)

d. Acquisition dateJuly 10, 201338

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014e. Consideration transferred and the component(Millions of yen)

Payment by cash
Conversion of corporate bonds with stock acquisition rights
held at the time of acquisition
Total consideration transferredA

Acquisition date(July 10, 2013)
1,875,149
313,534
2,188,683

Acquisition-related costs of ¥12,106 million arising from the business combination are recognized in “Selling,
general and administrative expenses,” with ¥3,751 million for the year ended March 31, 2013, and ¥8,355
million for the six-month period ended September 30, 2013.
f. Fair values of assets and liabilities, non-controlling interests and goodwill on the acquisition date1(Millions of yen)

Acquisition date(July 10, 2013)
Current assets
Cash and cash equivalents
Trade and other receivables2
Other financial assets
Inventories
Other current assets
Total current assets

447,873332,553
111,764
105,318
43,236
1,040,744

Non-current assets
Property, plant and equipment3
Intangible assets3
Other financial assets
Other non-current assets
Total non-current assets
Total assets

1,291,364
5,305,965
23,93814,1396,635,406
7,676,150

Current liabilities
Interest-bearing debt3
Trade and other payables
Income taxes payables
Provisions4
Other current liabilities
Total current liabilities

86,961
634,371
4,553
101,404
291,398
1,118,687

Non-current liabilities
Interest-bearing debt3
Other financial liabilities
Defined benefit liabilities
Provisions4Deferred tax liabilities5
Other non-current liabilities
Total non-current liabilities
Total liabilities

2,668,163
5,662
65,763
146,492
1,422,965
184,1074,493,152
5,611,839

Net assets

B

2,064,311

Non-controlling interests6

C

466,735

D
311,659
Basis adjustment78
A-(B-C)-D
279,448
Goodwill
The above amount is translated at the exchange rate (USD = JPY101.14) as of the acquisition date.

39

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

Notes:
1. Adjustment of the provisional amount
Consideration transferred is allocated to acquired assets and assumed liabilities based on the fair value on the acquisition
date.

Allocation of the consideration transferred was completed during the three-month period ended June 30, 2014.

details of the adjustments from the initial provisional amounts are as follows.

The

Due to the additional analysis performed by

Sprint management on the fair value of FCC licenses, intangible assets increased by ¥30,342 million and non-controllinginterests increased by ¥29,029 million.

As a result, goodwill decreased by ¥14,970 million.

2. Estimation of fair values of acquired receivables, contractual amounts receivables and amounts not expected to be collected
As for the fair value of ¥332,553 million of acquired receivables and other receivables (mainly sales receivables), the total
amount of contracts is ¥353,388 million and the estimate of the contractual cash flows not expected to be collected at theacquisition date is ¥20,835 million.
3. Property, plant and equipment, intangible assets and interest-bearing debt
The components of the carrying amounts are as follows:(Property, plant and equipment)(Millions of yen)
Acquisition date(July 10, 2013)
Buildings and structures

140,270

Telecommunications equipment

794,524Land

18,362

Construction in progress

298,928

Other

39,280Total

1,291,364(Intangible assets)(Millions of yen)
Acquisition date(July 10, 2013)
Intangible assets with finite useful lives
Software138,330

Customer relationships

700,192

Favorable lease contracts

148,979

Trademarks

52,593

Other

47,928Intangible assets with indefinite useful lives
FCC licenses

3,617,677

Trademarks

600,266

Total

5,305,965

40

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(Interest-bearing debt)(Millions of yen)
Acquisition date(July 10, 2013)
Current
Current portion of long-term borrowings

13,380Current portion of corporate bonds

63,317

Current portion of lease obligations

10,264

Total

86,961

Non-current
Long-term borrowings

34,854

Corporate bonds

2,590,208

Lease obligations

43,101

Total

2,668,163

4. Provisions
Provisions recognized by the business combination are mainly asset retirement obligations, lease exit costs related to the
shutdown of the Nextel Platform, and exit costs related to payments that will continue to be made under Sprint’s backhaul
access contracts for which it will no longer be receiving any economic benefit. Backhaul is an intermediary network whichconnects the cell towers to the local switching center.
5. Deferred tax liabilities
Deferred tax liabilities recognized by this business combination are mainly temporary differences related to FCC licenses,
and trademarks with indefinite useful lives.
6. Non-controlling interests
Non-controlling interests in an acquiree that are present ownership interests and entitle their holders to a proportionate shareof the entity’s net assets in the event of liquidation are measured based on the proportionate interests at the acquisition datein the identifiable net assets of the acquiree at the acquisition date.
7. Basis adjustment
The Company entered into a foreign currency forward contract to hedge exchange risks resulting from the investment in
Sprint.

This scheduled transaction was designated as a cash flow hedge.

¥311,659 million, the fair value of the hedging

instruments at the acquisition date was deducted from initial amount of goodwill which was recognized from the acquisition.
8. Goodwill
Goodwill reflects excess earning power expected from the future business development and the synergy with existing
businesses.

g. Decrease from acquisition of control over subsidiaries(Millions of yen)

Payment for the acquisition by cash
Cash and cash equivalents held by the acquiree at the time ofacquisition of control
Decrease in cash from the acquisition of control over the subsidiary
Proceeds from settlement of foreign currency forward contract for
acquisition of control of subsidiaries
Decrease in cash from the acquisition of control over the subsidiary,net

41

Acquisition date(July 10, 2013)(1,875,149)
447,873(1,427,276)
310,104(1,117,172)

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014h. Sales and net loss of the acquiree
The amounts of the acquiree’s sales and net loss before elimination of inter-company transactions after theacquisition date, which are recorded in the condensed interim consolidated statements of income for thesix-month period ended September 30, 2013, are ¥760,941 million and ¥62,523 million, respectively.
In addition, the above net loss includes amortization expenses, which are related to intangible assets recognized at
the acquisition date, and other.
(3) WILLCOM, Inc.
a. Overview of consolidation
SoftBank Corp. owns 100% of shares issued by WILLCOM, Inc. However, WILLCOM, Inc. was in the processof rehabilitation under the Corporate Reorganization Act and SoftBank Corp. did not have effective control over
WILLCOM, Inc. Therefore, WILLCOM, Inc. was not treated as a subsidiary.
WILLCOM, Inc. made prepayments of rehabilitation claims and rehabilitation security interests in June 2013,
and filed a petition with the Tokyo District Court for the termination of its rehabilitation proceedings.
WILLCOM, Inc. received an order of termination of rehabilitation proceedings from the Tokyo District Court on
July 1, 2013. Consequently, WILLCOM, Inc. became a subsidiary of SoftBank Corp.
WILLCOM, Inc. conducted an absorption type merger with eAccess Ltd., eAccess Ltd. being the surviving
company and WILLCOM, Inc. being the dissolving company on June 1, 2014 and changed its company name to
Ymobile Corporation on July 1, 2014.
(Business description of WILLCOM, Inc.)
Telecommunications business(Acquisition date）
July 1, 2013b. Consideration transferred and the components(Millions of yen)

Acquisition date(July 1, 2013)
Fair value of equity interest in WILLCOM, Inc. alreadyheld at the time of the acquisition

104,070
A

Total consideration transferred

104,070

As a result of the reevaluation of 100% equity interest already held by the Company at the time of the acquisitionof control in WILLCOM, Inc. at fair value, the Company recognized a gain of ¥103,766 million. This gain ispresented as “Gain from remeasurement relating to business combination” in the condensed interim consolidated
statements of income.

42SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014c. Fair value of assets and liabilities, non-controlling interests and goodwill on the acquisition date(Millions of yen)

Acquisition date(July 1, 2013)
79,75446,026
43,63914,883
184,302

Current assets
Property, plant and equipment
Intangible assets1
Other non-current assets
Total assets

83,95816,284
100,242

Current liabilities
Non-current liabilities
Total liabilities
Net assets

B

84,060Non-controlling interests2

C

222

A-(B-C)

20,232

3

Goodwill
Notes:

1. Intangible assets
Customer relationships of ¥25,004 million are included.
2. Non-controlling interests
Non-controlling interests are from WILLCOM OKINAWA, Inc. (proportionate interest held by the Company is 80%), a
subsidiary of WILLCOM Inc., and they are measured based on the proportionate interests after the acquisition in theidentifiable net assets of the acquiree at the acquisition date.
3. Goodwill
Goodwill reflects excess earning power expected from the future business development, assembled workforce and thesynergy with existing business.

d. Estimation of fair values of acquired receivables, contractual amounts receivables and amounts not expected to becollected
The main components of acquired trade and other receivables are installment receivables and the fair value is¥31,039 million. The total amount of contractual receivables is ¥31,328 million and the best estimate of thecontractual cash flows not expected to be collected as of the acquisition date is ¥289 million.
e. Increase from acquisition of control over subsidiaries(Millions of yen)

Acquisition date(July 1, 2013)
Cash and cash equivalents held by the acquiree at the time ofacquisition of control
Increase in cash from the acquisition of control over thesubsidiary43

14,043
14,043

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

f. Sales and net loss of the acquiree
The amounts of the acquiree’s sales and net loss before elimination of inter-company transactions after theacquisition date, which are recorded in the condensed interim consolidated statements of income for thesix-month period ended September 30, 2013, are ¥ 41,323 million and ¥2,567 million, respectively.
In addition, the above net loss includes amortization expenses, which are related to intangible assets recognized at
the acquisition date, and other.

4. Segment information(1) Description of reportable segments
The Company’s reportable segments are components of business activities for which discrete financial
information is available, and such information is regularly reviewed by the Company’s board of directors in orderto make decisions about the allocation of the resources and assess its performance.
The Company has four segments, the Mobile Communications segment, the Sprint segment, the Fixed-line
Telecommunications segment, and the Internet segment.
The Mobile Communications segment provides, mainly through SoftBank Mobile Corp., mobile communication
services, and sales of mobile handsets and accessories. In addition, online games for smartphones and otherdevices are produced and distributed through GungHo and Supercell.
The Sprint segment provides, through Sprint, mobile communication services, sale of mobile handsets andaccessories accompanying the mobile communication services, and the fixed-line telecommunication services in
the U.S.
The Fixed-line Telecommunications segment provides, mainly through SoftBank Telecom Corp.,
telecommunication services such as data communication and fixed-line telephone services for corporate
customers. It also provides, mainly through SoftBank BB Corp., broadband services for individual customers.
The Internet segment provides, mainly through Yahoo Japan Corporation, Internet-based advertising operations.

(2) Net sales and income of reportable segments
Income of reportable segments is based on income from operating income, excluding “Gain from remeasurement
relating to business combination” and “Other operating income (loss),” as follows:
Segment income = (net sales – cost of sales – selling, general and administrative expenses) in each segment
Intersegment transactions are conducted under the same general business conditions as applied for externalcustomers.
The following is information about the Company’s net sales and income by reportable segment. The Company
also discloses “EBITDA (segment income before depreciation and amortization)” by reportable segment.

44

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

For the six-month period ended September 30, 2013
(Millions of yen)
Reportable segments
Fixed-line
Telecommunications
Internet

MobileCommunications

Sprint3

1,377,300

760,858

218,668

195,160

2,551,986

46,626-2,598,612

9,227

83

51,701

1,130

62,141

18,147(80,288)-

1,386,527

760,941

270,369

196,2902,614,127

64,773(80,288)2,598,612

532,052

115,671

89,970101,306

838,999

9,431(10,331)

838,099(175,595) (134,191)(29,727)(6,439)(345,952)(3,336)(651)(349,939)

356,457

60,243

94,867493,047

6,095(10,982)

488,160

Total

Other1

Reconciliations2

Consolidated

Net sales
Customers
Intersegment
Total
EBITDA
Depreciation andamortization
Segment income (loss)
Gain from remeasurement
relating to businesscombination(18,520)

253,886(4,875)

Other operating loss
Operating income

737,171

Finance cost(105,862)

Equity in loss of associates(3,780)

Dilution gain from changes
in equity interests
Other non-operating
income546
293

Income before income tax

628,368

For the six-month period ended September 30, 2014
(Millions of yen)
Reportable segments
MobileCommunications

1,878,987

SprintFixed-line
Telecommunications

Internet

Total

Other1

Reconciliations2

Consolidated

1,774,301

212,964

196,642

4,062,894

41,470-4,104,364

Net sales
Customers
Intersegment
Total
EBITDA
Depreciation andamortization
Segment income
Gain from remeasurement
relating to businesscombination

14,4149,135

51,3391,663

76,551

13,952(90,503)-

1,893,401

1,783,436

264,303198,305

4,139,445

55,422(90,503)

4,104,364

615,214338,110

82,273

97,221

1,132,818

689(10,940)

1,122,567(213,579)(261,384)(28,927)(7,696)(511,586)(3,943)(654)(516,183)

401,635

76,72653,34689,525621,232(3,254)(11,594)606,384-

Other operating loss

(9,726)

Operating income

596,658

Finance cost

(171,249)

Equity in loss of associates(19,296)

Dilution gain from changes
in equity interests

599,275

Other non-operating loss

(9,607)

Income before income tax

995,781

Notes:
1.“Other” includes Fukuoka SoftBank HAWKS-related business.
2.“Reconciliations” includes an elimination of intersegment transactions and the corporate general expenses unallocated to eachreportable segment.
3. The Sprint segment includes the results of Sprint after the acquisition date.

45

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

For the three-month period ended September 30, 2013
(Millions of yen)
Reportable segments

Sprint3

Fixed-line
Telecommunications

Internet

Total

Other1

720,073

760,858

111,794

99,665

1,692,390

25,153-

1,717,543

4,536

83

25,169427

30,215

9,045(39,260)-

MobileCommunications
Customers
Intersegment

Reconciliations2

Consolidated

Net sales

Total

724,609760,941

136,963

100,092

1,722,605

34,198(39,260)

1,717,543

EBITDA
Depreciation andamortization

267,826

115,671

46,52651,323

481,346

6,493(4,012)483,827(92,228)(134,191)(14,918)(3,218)(244,555)(1,749)(336)(246,640)

175,598(18,520)

31,608

48,105

236,791

4,744(4,348)237,187

Segment income (loss)
Gain from remeasurement
relating to businesscombination

103,766(3,903)

Other operating loss
Operating income

337,050

Finance cost

(78,479)

Equity in loss of associates
Dilution gain from changes
in equity interests
Other non-operating
income(2,697)542
11,840

Income before income tax

268,256

For the three-month period ended September 30, 2014
(Millions of yen)
Reportable segments

SprintFixed-line
Telecommunications

Internet

Total

Other1

1,004,613

878,258

106,587

100,7622,090,220

5,887

7,441

25,880685

39,893

Total

1,010,500

885,699

132,467

101,447

EBITDA
Depreciation andamortization

300,724

147,784

41,617(106,979)(132,763)(14,988)

193,745

15,021

26,629

MobileCommunications

Reconciliations2

Consolidated

21,928-2,112,148

7,362(47,255)-

2,130,113

29,290(47,255)

2,112,148

48,195538,320(2,422)(5,389)530,509(4,153)(258,883)(2,010)(289)(261,182)

44,042

279,437(4,432)(5,678)269,327

Net sales
Customers
Intersegment

Segment income
Gain from remeasurement
relating to businesscombination-

Other operating loss

(10,301)

Operating income

259,026

Finance cost

(86,262)

Equity in income ofassociates
Dilution gain from changes
in equity interests

597,739

Other non-operating loss

(18,322)44,129

Income before income tax

796,310Notes:
1.“Other” includes Fukuoka SoftBank HAWKS-related business.
2.“Reconciliations” includes an elimination of intersegment transactions and the corporate general expenses unallocated to eachreportable segment.
3. The Sprint segment includes the results of Sprint after the acquisition date.

46

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

5. Property, plant and equipment
The components of the carrying amounts of property, plant and equipment are as follows:(Millions of yen)

Buildings and structures
Telecommunications equipment
Land
Construction in progress
Other
Total

As of
March 31, 2014
258,637
2,827,064
92,545
266,136
141,9453,586,327

As ofSeptember 30, 2014
260,232
2,959,612
93,724357,062
161,315
3,831,945

6. Intangible assets
The components of the carrying amounts of intangible assets are as follows:(Millions of yen)

As ofMarch 31, 2014
Intangible assets with indefinite useful lives
FCC licenses
Trademarks
Intangible assets with finite useful lives
Software
Customer relationships
Favorable lease contracts
Game titles
Trademarks
Other
Total

47

As of
September 30, 2014

3,709,526
622,975

3,925,399
661,546647,386
677,494140,217
166,52252,475
161,106
6,177,701

706,115
616,832
140,913
139,473
54,946
168,966
6,414,190

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

7. Interest-bearing debt
(1) Components of interest-bearing debt
The components of interest-bearing debt are as follows:(Millions of yen)

As ofMarch 31, 2014
Current
Short-term borrowings
Commercial paper
Current portion of long-term borrowings
Current portion of corporate bonds
Current portion of lease obligations
Current portion of preferred securities
Current portion of installment payables
Total
Non-current
Long-term borrowings
Corporate bonds
Lease obligations
Preferred securities
Installment payables
Total

As of
September 30, 2014

270,529
32,000393,566
139,300
264,295
48,209
1,147,899

229,944
32,000469,439
103,739
370,842200,000
46,1391,452,103

2,243,855
4,743,073
730,915
199,156
105,155
8,022,154

2,136,756
5,610,943
688,821
94,3548,530,874(2) Components of decrease in short-term interest-bearing debt
The components of “Decrease in short-term interest-bearing debt, net” in the condensed interim consolidated
statements of cash flows are as follows:(Millions of yen)

Net decrease of short-term borrowings*
Net increase of commercial paper
Total

Six-month period
ended
September 30, 2013(131,752)
42,000(89,752)

Six-month period
ended
September 30, 2014
(65,687)(65,687)

Note:
The Company borrowed a permanent loan in September 2013 and refinanced the bridge loan which was made for the
consolidation of Sprint. The increase and the decrease in short-term borrowings for the six-months period ended September 30,
2013 include the increase of borrowings of ¥1,034.9 billion on July 10, 2013, from the bridge loan and the decrease ofborrowings by the repayment of the bridge loan in the amount of ¥1,284.9 billion (including the amount of repayment of ¥250
billion on December 21, 2012).

48

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(3) Components of proceeds from long-term interest-bearing debt
The components of “Proceeds from long-term interest-bearing debt” in the condensed interim consolidated
statements of cash flows are as follows:(Millions of yen)

Proceeds from long-term borrowings
Proceeds from issuance of corporate bonds1,5
Proceeds from sale and leaseback of newly acquired equipment
Total

Six-month period
ended
September 30, 2013
2,179,419
1,362,682
226,939
3,769,040

Six-month period
ended
September 30, 2014
146,579
700,000
217,212
1,063,791

Notes:
1. Corporate bonds issued for the six-month period ended September 30, 2013 are as follows:

Company name / Name of bonds
SoftBank Corp.

Date of issuanceTotal amountof issuanceInterest
rate

Date of maturity

USD-denominated Senior Notes
due year 2020

April 23, 2013

$2,485 million¥244,176 million2

4.50%
3.29%3

April 15, 2020

Euro-denominated Senior Notes
due year 2020

April 23, 2013€625 million¥80,206 million2

4.63%
4.05%3

April 15, 2020

43rd Unsecured Straight
Corporate Bond

June 20, 2013

¥400,000 million

1.74%

June 20, 2018

7.25% Notes due 2021

Sept. 11, 2013

$2,250 million¥220,950 million

7.25%

Sept. 15, 2021

7.875% Notes due 2023

Sept. 11, 2013

$4,250 million¥417,350 million

7.88%

Sept. 15, 2023

Sprint Corporation4

Notes:
2. The cash outflow amount, fixed by the currency swap contract designated as a cash flow hedge, at the time of redemption, is
described in JPY.
3. The interest rate, after considering the impact of converting the fixed interest rate in foreign currency into a fixed interest rate in
JPY by the currency swap contract, designated as a cash flow hedge, is described.
4. These corporate bonds were issued after the acquisition of Sprint.
5. Corporate bonds issued for the six-month period ended September 30, 2014 are as follows:

Date of issuanceTotal amountof issuanceInterest
rate

Date of maturity

45th Unsecured Straight
Corporate Bond

May 30, 2014

¥300,000 million

1.45%

May 30, 201946th Unsecured Straight
Corporate Bond

Sept. 12, 2014

¥400,000 million

1.26%

Sept.12, 2019

Company name / Name of bonds
SoftBank Corp.

49

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

(4) Components of repayment of long-term interest-bearing debt
The components of “Repayment of long-term interest-bearing debt” in the condensed interim consolidated
statements of cash flows are as follows:(Millions of yen)Six-month period
ended
September 30, 2013
(859,335)(195,624)(119,667)(25,929)(1,200,555)

Repayment of long-term borrowings
Redemption of corporate bonds1,3
Payment of lease obligations
Payment of installment payables
Total

Six-month period
ended
September 30, 2014
(179,131)(63,434)(144,059)(24,290)(410,914)

Notes:
1. Corporate bonds redeemed for the six-month period ended September 30, 2013 are as follows:

Company name / Name of bonds

Date of issuance

Amount of redemption

Interest
rate

Date of redemption

June 2, 2010

¥25,000 million

1.17%

May 31, 2013

Sept. 17, 2010

¥130,000 million

1.24%

Sept. 17, 2013

Nov. 24, 2009

$414 million¥40,613 million

12.00%

Sept. 11, 2013
Sept. 26, 2013

SoftBank Corp.
31st Unsecured Straight
Corporate Bond
33rd Unsecured Straight
Corporate Bond
Clearwire Communications LLC2
12% Senior Secured Notes due
2015

Notes:
2. These corporate bonds were redeemed after the acquisition of Sprint. Clearwire Communications LLC is a subsidiary of Sprint.
3. Major corporate bonds redeemed for the six-month period ended September 30, 2014 are as follows:

Company name / Name of bonds

Date of issuance

Amount of redemption

Interest
rate

Date of redemption

June 19, 2007

¥14,900 million

4.36%

June 19, 2014

June 10, 2011

¥30,000 million

0.65%

June 10, 2014

April 23, 2007

$181 million¥18,513 million

3.49%

May 1, 2014

SoftBank Corp.
26th Unsecured Straight
Corporate Bond
37th Unsecured Straight
Corporate Bond
iPCS, Inc.4
Second Lien Senior Secured
Floating Rate Notes due 2014

Notes:
4. iPCS, Inc. is a subsidiary of Sprint.

50

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

8. Foreign exchange rate
Exchange rates of the major currencies used for translating financial statements of foreign operations are as follows:(1) Rate at the end of the period

U.S. dollars

(yen)
As of
September 30, 2014109.45

As ofMarch 31, 2014102.92(2) Average rate for the quarter
For the six-month period ended September 30, 2013

U.S. dollars(yen)Three-month period
ended
September 30, 2013
98.20

Three-month period
endedJune 30, 201397.94

For the six-month period ended September 30, 2014

U.S. dollars(yen)Three-month period
ended
September 30, 2014
104.35Three-month period
endedJune 30, 2014
102.14

9. Equity
Accumulated other comprehensive income
The components of accumulated other comprehensive income are as follows:(Millions of yen)

As ofMarch 31, 2014

As of
September 30, 2014

Available-for-sale financial assets

14,122

10,161

Cash flow hedges
Exchange differences on translating
foreign operations(19,942)(16,051)

175,670

296,722

169,850

290,832Total

10. Other operating loss
The components of other operating loss are as follows:(Millions of yen)Six-month period
ended
September 30, 2013
Severance costs associated with reduction inwork force of Sprint
Other
Total

(4,026)(849)(4,875)51

Six-month period
ended
September 30, 2014
(17,130)
7,404(9,726)

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

11. Finance cost
The components of finance cost are as follows:(Millions of yen)Six-month period
ended
September 30, 2013
(105,862)Interest expense

Six-month period
ended
September 30, 2014
(171,249)

12. Dilution gain from changes in equity interest
For the six-month period ended September 30, 2014
The Company recorded dilution gain from changes in equity interest of ¥599,141 million related to Alibaba, which is anassociate of the Company. This is mainly due to the issuance of new shares by Alibaba and the conversion ofConvertible Preference Shares issued by Alibaba into common stock in connection with its listing on the New York
Stock Exchange on September 19, 2014.

13. Other non-operating income and loss
The components of other non-operating income and loss are as follows:(Millions of yen)Interest income1
Derivative loss1,2Gain and loss on sales of securities
Impairment loss on equity method associates3
Gain from remeasurement relating to applying
equity method4
Other
Total

Six-month period
ended
September 30, 2013
19,284(25,824)
11,367-Six-month period
ended
September 30, 2014
2,027
(1,401)(3,220)(19,393)-

6,249(4,534)
293

6,131(9,607)

Notes:
1. Stock acquisition rights in the convertible bonds issued by Sprint Nextel Corporation and undertaken by Starburst II on
October 22, 2012, were reported at fair value as a derivative, being bifurcated from the host contracts as they are classified
as embedded derivatives and were recorded in “Other financial assets” in the consolidated statements of financial position.
As the Company exercised the relevant stock acquisition right and the Company derecognized the derivatives, a derivativeloss of ¥16,356 million was recorded during the six-month period ended September 30, 2013.
With regard to the host contract (the bonds), the amount of payment less the fair value of the embedded derivative at
inception of the bond was recorded in the consolidated statements of financial position at inception. This deduction
amount is accreted using the effective interest method with corresponding adjustments to interest income. Initially, theexpected remaining accretion period for the bond discount was seven years based on the contract term of the bond.
However, based on the approval for the acquisition at the shareholders’ meeting of Sprint on June 25, 2013, the Company
changed the estimate of the expected remaining term to the completion of the acquisition. During the six-month period
ended September 30, 2013, the Company recognized interest income of ¥16,219 million. There was an increase ofinterest income of ¥15,568 million from the reflection of this change in the expected remaining term of the bond.

52

SoftBank Corp. Consolidated Financial Report
For the six-month period ended September 30, 2014

2. Of the foreign currency forward contract totaling $22.0 billion which was related to the acquisition of Sprint, with regard to$5.0 billion that did not meet the criteria for hedge accounting, a derivative loss of ¥13,186 million was recorded for thesix-month period ended September 30, 2013. Hedge accounting was applied to $17.0 billion as a cash flow hedge. Fairvalue of ¥311,659 million of hedge instruments on the acquisition date was deducted from the initial amount of goodwill
which was recognized upon the acquisition.
3.The Company recorded impairment loss of ¥19,393 million with regard to the equity method associate for the six-month
period ended September 30, 2014 as the fair value had been declining for a prolonged period and the carrying amount was
reduced to the recoverable amount.
4. Due to the increase in percentage of voting rights, the equity method is newly applied to the investment in an associate andthe gain is arising from remeasurement of the interest already held by the Company at the time of the equity method
application, based on the fair value on the date of the equity method application.

14. Supplemental information to the condensed interim consolidated statements of cash flows(1) Scope of purchase of property, plant and equipment and intangible assets“Purchase of property, plant and equipment and intangible assets” includes cash outflows from purchasing
long-term prepaid expenses that are included in “Other non-current assets” in the condensed interim
consolidated statements of financial position.
(2) Presentation of cash flow regarding finance leases
Once the Company purchases telecommunications equipment for the purpose of assembly, installation andinspection, the Company sells the equipment to lease companies for sale and leaseback purposes. The leased
asset and lease obligation are recorded in the condensed interim consolidated statements of financial position.
The cash outflows from the purchase of the equipment from vendors are included in “Purchase of property, plantand equipment and intangible assets" under cash flows from investing activities, and the cash inflows from thesale of the equipment to lease companies are included in “Proceeds from long-term interest-bearing debt" undercash flows from financing activities.
(3) Proceeds from settlement of foreign currency forward contract for acquisition of control of subsidiaries
For the six-month period ended September 30, 2013
The proceeds are from the settlement of a foreign currency forward contract of $18.5 billion with regard toconsolidation of Sprint.
(4) Increase in restricted cash
For the six-month period ended September 30, 2013
It is an increase in restricted cash as Sprint was required to maintain a segregated reserve account until theearlier of the time when existing Clearwire indebtedness is repaid, redeemed or otherwise retired, or December
31, 2013 at which time the waivers related to financial covenants expired.
On September 11, 2013, Sprint issued $2.25 billion aggregate principal amount of 7.250% Notes due 2021 and$4.25 billion aggregate principal amount of 7.875% Notes due 2023. After giving effect to the above, there
was a risk Sprint would have exceeded the threshold set in contract, the ratio of total indebtedness to EBITDA
with certain adjustments, by a significant level at September 30, 2013. Accordingly, Sprint obtained a limited
waiver from each of the lenders under the credit facilities, which enabled compliance with this financial
covenant until December 31, 2013. However, as a requirement under the waivers, Sprint had to maintain asegregated reserve account of $3.5 billion until the earlier of the time a certain amount of existing Clearwire
indebtedness is prepaid, redeemed or otherwise retired, or December 31, 2013 at which time the waivers expired.
As a certain amount of the Clearwire indebtedness was repaid during the three-month period ended December 31,
2013, the balance of restricted cash was reduced to zero as of December 31, 2013.
53