SOFTBANK CORP.
CONSOLIDATED FINANCIAL REPORTFor the three-month period ended June 30, 2007
Tokyo, August 8, 2007

FINANCIAL HIGHLIGHTS
1.

Results of Operations(Millions of yen; amounts less than one million yen are omitted.)

Net sales

Operating income

Ordinary income

Net income

Amount%Amount%Amount%Amount%Three-month period ended
June 30, 2007

¥663,084

34.2¥78,74644.9¥51,15496.8¥25,130-

Three-month period ended
June 30, 2006

¥494,231

91.1¥54,357-¥25,994-¥1,418-

Fiscal year ended
March 31, 2007

¥2,544,219

129.5¥271,065

335.1¥153,423

458.1¥28,815(49.9)(Percentages are shown as year-on-year changes)2.

Net income
per share－basic(yen)

Net income
per share－diluted(yen)Three-month period ended
June 30, 2007¥23.80¥22.36

Three-month period ended
June 30, 2006

¥1.34

¥0.81

Fiscal year ended
March 31, 2007¥27.31¥26.62Financial Condition(Millions of yen; amounts less than one million yen are omitted.)

Total assets

Total equity

Equity ratio (%)

Shareholders' equity
per share (yen)Three-month period ended
June 30, 2007

¥4,456,521¥759,741

7.1¥299.27

Three-month period ended
June 30, 2006

¥4,031,003¥646,190

5.8¥222.90

Fiscal year ended
March 31, 2007

¥4,310,852¥716,237

6.6¥268.02

3. Cash Flows(Millions of yen; amounts less than one million yen are omitted.)

Operating activities

Investing activities

Financing activities

Cash and cash
equivalents
at the end of the period

Three-month period ended
June 30, 2007¥(27,478)¥(111,519)¥218,480¥457,727

Three-month period ended
June 30, 2006

¥64,675¥(1,965,832)¥1,743,429¥285,214

Fiscal year ended
March 31, 2007

¥311,201¥(2,097,937)¥1,718,384¥377,520

14. Earnings forecast for the fiscal year ending in March 2008 (April 1, 2007 – March 31, 2008)(Millions of yen; amounts less than one million yen are omitted.)

Net sales

Operating
IncomeOrdinary income

Net income

Six-month period ending
September 30, 2007

¥-

¥-

¥-

¥-

Fiscal year ending
March 31, 2008

¥-

¥-

¥-

¥-

Due to the introduction of unprecedented new sales and pricing methods in our main telecommunications business, especially in the Mobile
Communications business, forecasting the consolidated business results for the fiscal year ending March 2008 is difficult. A forecast of theconsolidated business results will therefore be announced as soon as a logical estimate can be made.

5. Others
Significant Changes in Scope of Consolidation: None
Accounting Policies(1) Apply simplification of accounting methods: None
(2) Changes in accounting methods from the latest fiscal year: None2

Qualitative Information / Financial Statements
1. Qualitative Information Relating to the Consolidated Results of Operations<<Summary of the Consolidated Results of Operations>>
Net sales¥663,084 million(a 34.2% increase year-on-year)

Operating income¥78,746 million(a 44.9% increase year-on-year)

Ordinary income¥51,154 million(a 96.8% increase year-on-year)

Net income¥25,130 million(17.7 times year-on-year)

The SOFTBANK Group (hereafter “the Group”) has entered the second fiscal year since its full-fledged entry into themobile communications market through the acquisition of Vodafone K.K. (current SOFTBANK MOBILE Corp.,
hereafter “SOFTBANK MOBILE”) in April 2006.

As in the previous fiscal year, during the first quarter (April 1st,

2007 to June 30th, 2007)the Group continued to put efforts into its four key initiatives–3G network enhancement, 3G
handset enrichment, content enhancement, and enhancement of sales structure–in order to achieve its targets ofincreasing subscriber numbers and expanding market share.
SOFTBANK MOBILE is included in the scope of consolidation from the end of April 2006; accordingly the
results for the first quarter of the previous fiscal year (FY 2007) include two months of SOFTBANK MOBILE’s
results.
1. Net Sales
In the first quarter, net sales increased by ¥168,853 million or 34.2% year-on-year, to ¥663,084 million. This
increase was primarily due to the reflection of three months of results from the Mobile Communications segmentfrom this quarter.
2. Operating Income
In the first quarter, operating income increased by ¥24,389 million or 44.9% year-on-year, to ¥78,746 million.
The Mobile Communications segment recorded operating income of ¥43,528 million (a 59.5% increaseyear-on-year).
Cost of sales in the first quarter increased by ¥79,000 million year-on-year, to ¥352,896 million.

Selling,

general and administrative expenses increased by ¥65,463 million year-on-year, to ¥231,442 million.
These increases were due to the reflection of three months of results from the Mobile Communications
segment from this quarter.
3. Non-operating Income
Non-operating income decreased by ¥7,565 million year-on-year, to ¥4,531 million in the first quarter.

This wasprimarily the result of a decrease of ¥7,610 million in equity in earnings of affiliate companies following the sale ofall shares held in SBI Holdings, Inc. in August 2006.
4. Non-operating Expenses
Non-operating expenses decreased by ¥8,335 million year-on-year, to ¥32,123 million in the first quarter. This3

decrease was mainly due to a year-on-year increase in interest expenses of ¥12,358 million, and financing related
expenses in the first quarter of the previous fiscal year totaling ¥19,954 million.
5. Special Income
Special income totaled ¥9,940 million in the first quarter.
securities of ¥4,632 million.

The primary reason was a gain on sale of investment

Accompanying the listing of consolidated subsidiaries ITmedia Inc. and Carview

Corporation, ¥2,866 million was recorded as dilution gain from changes in equity interest.
6. Special Loss
Special loss totaled ¥2,692 million in the first quarter. The primary reason was a loss on disposal of fixed assetsof ¥1,030 million.
7. Income Taxes
Current income taxes totaled ¥2,826 million, deferred income taxes totaled ¥20,065 million, and minority interests
in net income totaled ¥10,380 million.
Current income taxes primarily for Yahoo Japan Corporation and other subsidiaries totaled ¥11,719 million,
while ¥8,893 million of income tax payable for SOFTBANK Holdings Inc. was reversed, as it became unnecessary
to recognize; as a result, current income taxes were credited.
Results by business segment are as follows:[Mobile Communications]<<Summary of segment results for the first quarter>>
Net sales¥391,668 million (a 68.5% increase year-on-year)

Operating income¥43,528 million (a 59.5% increase year-on-year)

No. 1 in quarterly net subscriber additions
Churn rate 1.46%, Total ARPU ¥5,000 per monthWhite Plan subscribers exceed 5 million<Analysis of Quarterly Results>
Net sales increased by ¥159,200 million, or 68.5%, on a year-on-year basis, to ¥391,668 million. Operating
income increased by ¥16,234 million, or 59.5%, to ¥43,528 million.
The acquired Vodafone K.K. (current SOFTBANK MOBILE), was included in the scope of consolidationfrom the end of April 2006, accordingly the results for the first quarter of the previous fiscal year (FY 2007)
include two months of SOFTBANK MOBILE’s results.
(Millions of yen)

FY2007

FY2008

Q1

Q2

Q3

Q4

Q1

Sales

232,467

351,991

430,328

427,252

391,668

Operating
Income27,29329,341

56,90642,202

43,5284

<Number of Subscribers>
As of the end of the first quarter, SOFTBANK MOBILE’s cumulative subscribers amounted to 16,440,500*1
subscribers, an increase of approximately 1.2 million year-on-year.

In May 2007, SOFTBANK MOBILE

recorded the highest monthly net additions (new subscribers minus cancellations) among the three mobile operators
for the first time.

It retained this top position in June for the second consecutive month, recording more than

200,000 net additions.

In addition, the net addition from April to June 2007, amounting to 530,800 was also thehighest on a quarterly basis.

Moreover, the ratio of 3G users to total number of subscribers surpassed 50% at theend of April 2007, reaching 56.1% at the end of the first quarter.
(Lines)

FY2007
Q1
Net
Additions
Total

Q2

FY2008Q3Q4Q130,30066,800189,500

412,000

530,800

15,240,200

15,307,000

15,496,500

15,908,500

16,440,500*1. The total number of subscribers for SOFTBANK MOBILE at the end of June 2007 includes 1,200 communication module
service subscribers.

<Churn Rate and Upgrade Rate>
The churn rate for the first quarter was 1.46%, a 0.04 percentage point decline year-on-year, from 1.50%. The
decrease in the churn rate was a result of the release of appealing handsets and the enhancement of services as wellas the effect of the installment sales for handsets introduced in September 2006. The upgrade rate was 2.25%, ayear-on-year increase of 0.26 percentage point.
(%)

FY2007
Q1
Churn
Rate
UpgradeRate

Q2

FY2008
Q3

Q4

Q1

1.50

1.27

1.60

1.63

1.46

1.99

2.53

3.02

2.89

2.25

<ARPU and Average Acquisition Commission per User>
Total ARPU*2 for the first quarter was ¥5,000 per month. ARPU decreased by ¥590 year-on-year due to the effectof the steady growth in the number of subscribers to the White Plan, which has a basic monthly charge of ¥980
(including tax) and exceeded five million subscribers during the first quarter, and to the special discount for
subscribers to the New Super Bonus plan. However, data ARPU increased by ¥60, to ¥1,410, and constituted
28.2% of total ARPU.
Average acquisition commission per user for the first quarter was ¥30,700.

This decline was attributable to adecrease in sales subsidies following the introduction of installment sales for handsets during the previous quarter.
*2. Average Revenue Per User

5

（Yen per month）

FY2007Q1Q2FY2008
Q3

Q4

Q1

Total

5,590

5,700

5,560

5,210

5,000

Voice

4,230

4,320

4,230

3,830

3,590

Data

1,350

1,380

1,330

1,380

1,410

<<Summary of efforts made during the first quarter concerning key challenges>>
3G base stations increased to 39,022
Announcement of 12 new handsets for summer 2007 sales period
Start of Yahoo! Streaming (beta version) video content service for SoftBank mobile phone users
Introduction of White Plan Family Discount 24, which offers free domestic calls 24 hours a day amongfamily members<3G Network Enhancement>
At the end of the first quarter, the number of 3G base stations was 39,022, an increase of approximately 10,000
from 29,404 stations at the end of the previous fiscal year.

Furthermore, as of August 1, 2007 46,000 3G basestations, the number strived towards during the first half of fiscal 2008, are in service.
In addition, the Group has commenced trials for new technologies to diversify its information transmission
services.

These include the wireless communication system using Femto-cell*3 for which the Group acquired alicense from the Ministry of Internal Affairs and Communications in June 2007, and FMC*4 a fusion of fixed andmobile lines.
*3. Small mobile phone base stations designed to increase call quality in interior locations, such as residential or officeenvironments*4. Fixed Mobile Convergence<3G Handset Lineup Enrichment>
Twelve new handsets have been announced to be released as the lineup for the summer 2007 sales period,
revolving around the keyword style. Eight of the twelve handsets are compatible with 3G High Speed datatransmission service based on HSDPA*5 standards, enabling users to easily download large data, such as video
content.
*5. High Speed Downlink Packet Access: The high speed data transmission protocol standardized by “Release 5,” of the 3G
mobile communications standardizing body, the Third Generation Partnership Project (3GPP)<Content Enhancement>
Three companies of the Group—SOFTBANK MOBILE, TV Bank Corporation, and Yahoo Japan
Corporation—have launched the Yahoo! Streaming (beta version) video content service.

The service is available

via the Yahoo! Keitai portal for SoftBank mobile phone users. Users can enjoy over 1,000 video content titles permonth free of information charge*6, from a variety of genres such as news and sports.
*6. Separate communication charges apply for downloading content.

6

<Enhancement of the Sales Structure>
To enhance the sales force, the SoftBank shop network was expanded further. As a result, the number of
SoftBank shops reached 2,252 at the end of the first quarter, an increase of 177 from the end of the previous fiscal
year.
SoftBank mobile phone users who subscribe to the White Plan can make unlimited domestic on-net voice calls
between 1:00am and 9:00pm for a basic monthly charge of ¥980 (including tax). For calls outside of this time
range or to other operators’ users, users pay a flat fee of ¥21 (including tax) per 30 seconds. In addition, the White
Plan Family Discount 24 discount service, which offers White Plan subscribers free domestic calls 24 hours a day
between family members, was launched and applied from June 2007 usage on. In addition, accompanying the
introduction of White Plan Family Discount 24, SOFTBANK MOBILE started the Family Introduction campaign
from June 2007, which will continue until August 2007.
Subscribers to the White Plan continue to increase steadily, topping five million during the first quarter andsurpassing six million during July 2007.
[Broadband Infrastructure]<<Summary of segment results for the first quarter>>
Net sales¥65,747 million (a 3.8% increase year-on-year)

Operating income¥8,665 million (a 58.2% increase year-on-year)

Total installed lines for Yahoo! BB ADSL, 5,134,000<Results for the First Quarter >Net sales increased by ¥2,424 million, or 3.8%, year-on-year, to ¥65,747 million. Operating income increasedby ¥3,186 million, or 58.2%, to ¥8,665 million.
（Millions of yen）

FY2007Q1Q2FY2008Q3Q4Q1Net Sales

63,32265,72867,266

67,91065,747

Operating
Income

5,479

6,189

7,747

7,393

8,665

<ADSL>The number of Yahoo! BB ADSL lines installed at the end of the first quarter reached 5,134,000 lines. On acustomer payment basis, ARPU for the quarter decreased slightly year-on-year, to ¥4,358. However, the ratio ofsubscribers to faster services, such as Yahoo! BB 50M, and high value added services, such as Wireless LAN Pack,
increased steadily. SOFTBANK BB Corp. (hereafter “SOFTBANK BB”) will continue to promote efficiency inmanagement and pursue higher profits.

7

<FTTH>
Concerning FTTH connection service, SOFTBANK BB is maintaining a state of readiness that will enable it tostart full fledged operations as soon as a fair competitive environment is established. SOFTBANK BB willcontinue to implement R&D in technologies to succeed ADSL, such as trial services aimed at thecommercialization of FTTR*7 and R&D in high speed PLC*8.
*7. Fiber To The Remote terminal: transmission method using the optic fiber used for FTTH from NTT stations to equipment
located near the user’s premises. Similar to ADSL for the last mile transmission from this transmission equipment,
typically installed on electrical poles etc. to the user copper cables are used.
*8. Power Line Communication: telecommunication that uses electrical power lines as a transmission
medium.

[Fixed-line Telecommunications]<<Summary of segment results for the first quarter>>
Net sales¥90,486 million (a 2.0% increase year-on-year)

Total installed lines for Otoku Line service, 1,257,000<Results for the First Quarter>
Net sales increased by ¥1,812 million, or 2.0%, year-on-year, to ¥90,486 million. Operating loss amounted to¥111 million.

Due to a one-off factor, the reversal of reserve for retirement benefits of ¥2,575 million that

occurred in the first quarter of the previous fiscal year, operating income was recorded at ¥1,212 million.
（Millions of yen）

FY2007Q1Q2FY2008
Q3

Q4

Q1

Sales

88,673

93,276

93,712

98,46690,486

Operating
Income（loss）

1,212

(916)

(2,603)

(656)

(111)

<Operating Conditions>
SOFTBANK TELECOM Corp. (hereafter “SOFTBANK TELECOM”) is utilizing its core Otoku Line directconnection fixed-line voice service to expand its corporate customer base.

The number of Otoku Lines installed

steadily increased, reaching a total of 1,257,000 by the end of the first quarter, a year-on-year increase of 362,000.
Corporate customers constituted 63.0% of the total lines.
SOFTBANK TELECOM is focusing on three key operational areas–Otoku Line service, Data Services, andMobile Solutions offered in collaboration with SOFTBANK MOBILE. SOFTBANK TELECOM will continue tostrengthen its services for corporate customers while increasing management efficiency.

8

[Internet Culture]<<Summary of segment results for the first quarter>>
Net sales¥52,796 million (a 18.3% increase year-on-year)

Operating income¥27,148 million (a 25.5% increase year-on-year)

Number of stores on Yahoo! Shopping and Yahoo! Auctions reached 28,368<Results for the First Quarter>
Net sales increased by ¥8,153 million, or 18.3%, year-on-year, to ¥52,796 million. Operating income increasedby ¥5,517 million, or 25.5% year-on-year, to ¥27,148 million.
(Millions of yen)

FY2007Q1Q2FY2008
Q3

Q4

Q1

Sales

44,642

46,67650,04952,842

52,796

Operating
Income21,63022,71225,011

27,18927,148<Operating Conditions>Yahoo Japan Corporation focused on sales of products with a high level of branding-related effects and targeted
advertisements. In addition, sponsored site related sales rose substantially and Internet advertising sales increased.
Furthermore, in non-advertising business services, the total number of stores on Yahoo! Shopping and Yahoo!
Auctions was 28,368 at the end of the first quarter, a year-on-year increase of 8,692. Accordingly, tenant fees andcommission revenues increased substantially.

Moreover, in consumer services, Yahoo! Auctions continued to

implement initiatives to expand usage, such as enabling bidding by anyone with a Yahoo! JAPAN ID, and thetransaction volume recorded a solid increase.
[e-Commerce]<<Summary of segment results for the first quarter>>
Net sales¥61,660 million (a 4.3% increase year-on-year)

Operating income¥1,167 million (a 20.1% decrease year-on-year)

Carview Corporation listed on the Tokyo Stock Exchange (TSE) Mothers Market<Results for the First Quarter>
Net sales increased by ¥2,518 million, or 4.3% year-on-year, to ¥61,660 million. Operating income decreased by¥294 million, or 20.1% year-on-year, to ¥1,167 million.

9

（Millions of yen）

FY2007Q1Q2FY2008
Q3

Q4

Q1

Sales

59,14265,03765,36982,021

61,660Operating
Income

1,461

1,399

2,010

1,809

1,167

<Operating conditions>
In SOFTBANK BB’s distribution business, sales to corporate customers during the first quarter climbed steadily.
In addition, Carview Corporation, a consolidated subsidiary, was listed on the TSE Mothers Market on June
12th, 2007.
[Others]
The results of this segment include the performance of broadcast media business (mainly Club iT Corporation),technology services business (SOFTBANK TECHNOLOGY CORP.), media & marketing business (mainly
SOFTBANK Creative Corp. and ITmedia Inc.), overseas fund business, and other businesses (mainly TV Bank
Corp. and Fukuoka Softbank Hawks related businesses).
In addition, ITmedia Inc., a consolidated subsidiary in media & marketing operations, was listed on the TSE
Mothers Market on April 19th, 2007.

2．Qualitative Analysis Relating to the Consolidated Financial Position<<Summary of the Consolidated Financial Position>>
Total assets¥4,456,521 million(a ¥145,668 million increase from end of FY07)

Total liabilities¥3,696,779 million(a ¥102,164 million increase from end of FY07)

Total equity¥759,741 million(a ¥43,503 million increase from end of FY07)

Balance of cash and cash
equivalents¥457,727 million(a ¥80,207 million increase from end of FY07)(1) Assets, Liabilities and Equity
In this quarter, SOFTBANK MOBILE raised ¥88,161 million by securitizing a portion of the mobile handset
installment sales receivables.

Consequently, long-term debt and short-term borrowings increased to ¥51,515

million and ¥36,645 million, respectively. As a result of this fund-raising, SOFTBANK MOBILE entrusted
installment sales receivables with the asset trustee, and recorded in notes and accounts receivable–trade of ¥88,161
million. (Please refer to “(3) Major Financing Activities” on page 13 for further details.)
1. Current Assets
Current assets increased by ¥170,468 million from the end of the previous fiscal year, to ¥1,417,902 million.
This was mainly due to an increase in cash and deposits by ¥101,067 million; as a result of SOFTBANKMOBILE securitizing a portion of its installment sales receivables.

Also, due to a favorable trend in the

installment sales of mobile handsets of SOFTBANK MOBILE, notes and accounts receivable–trade increased by10¥42,214 million, while inventories increased by ¥32,299 million due to stock reconstitution of mobile handsets
etc. in preparation for the summer sales season.
2. Fixed Assets(Property and equipment, net)
Property and equipment, net increased by ¥15,374 million to ¥1,045,227 million from the end of the previous
fiscal year.

This was primarily the result of an increase of ¥28,019 million in telecommunications equipment,such as base stations and switching equipment.

In addition, due to completion of construction,

construction-in-progress decreased by ¥10,099 million.
(Intangible assets)
Intangible assets decreased by ¥8,366 million to ¥1,271,344 million from the end of the previous fiscal year.
This was primarily the result of a decrease of ¥14,970 million in goodwill, whereas software increased by ¥9,518
million.
(Investments and other assets)
Investments and other assets decreased by ¥31,811 million to ¥717,866 million from the end of the previous
fiscal year.

This was primarily the result of reversing ¥24,236 million in non-current deferred tax assets due toutilization of loss carry-forwards. The other factor was a decrease of ¥13,254 million in investment securities
due to a decline in stock prices of shares held, etc.
3. Current Liabilities
Current liabilities decreased by ¥28,183 million to ¥1,114,719 million from the end of the previous fiscal year.
This is primarily the result of decreases of ¥28,798 million in accounts payable-other and accrued expenses,¥20,286 million in income taxes payable, ¥20,000 million in cash receipts as collateral, and ¥12,886 million innotes and accounts payable – trade, which offset increases of ¥27,704 million in short-term borrowing, ¥25,120
million in current portion of lease obligations, and ¥12,500 million in corporate bonds scheduled for redemption
within one year.
4. Long-term Liabilities
Long-term liabilities increased by ¥130,347 million to ¥2,582,059 million from the end of the previous fiscal
year.

Lease obligations increased by ¥101,924 million and corporate bonds rose ¥78,355 million, while

long-term borrowing decreased by ¥10,784 million.
The balance of long-term borrowings procured by SOFTBANK MOBILE through the whole businesssecuritization (WBS) financing scheme decreased by ¥12,916 million, to ¥1,342,174 million from the end of theprevious fiscal year.
5. Equity
Equity increased by ¥43,503 million to ¥759,741 million from the end of the previous fiscal year. Net income of¥25,130 million was recorded, while payment of dividends from retained earnings was ¥2,639 million, and dueto the adoption of new accounting standards at a US subsidiary, a reduction in retained earnings of ¥5,150
million was recorded. As a result, accumulated deficit improved by ¥17,016 million.

In addition, deferredgain on derivatives under hedge accounting improved by ¥28,693 million, and minority interests in consolidated
subsidiaries increased by ¥10,312 million.

However, unrealized gain on available-for-sale securities decreased11

by ¥20,354 million.
In regard to the adoption of new accounting standards for a US subsidiary, SOFTBANK Holdings Inc. adopted“Accounting for Uncertainty in Income Taxes (Financial Accounting Standards Board Interpretation No. 48)”
from this quarter. The cumulative effect of applying the provisions of this Interpretation was reported as an
adjustment to the opening balance of accumulated deficit, and accordingly, it is recorded as increase inaccumulated deficit due to the adoption of new accounting standards at a subsidiary in the US in theConsolidated Statements of Changes in Equity.
(2) Cash Flow
During the first quarter, net cash used in operating and investing activities were ¥27,478 million and ¥111,519
million, respectively while net cash provided by financing activities was ¥218,480 million.

As a result, cash andcash equivalents at the end of the first quarter amounted to ¥457,727 million, an increase of ¥80,207 million
from the end of the previous fiscal year.
1. Cash Flow from Operating Activities
Net cash used in operating activities was ¥27,478 million.
Income before income taxes and minority interests amounted to ¥58,403 million. Depreciation and amortization,
as non-cash items was recorded at ¥53,533 million and amortization of goodwill was recorded at ¥14,426 million.
Adjustment items included the subtraction of gain on sales of marketable and investment securities, net of ¥4,489
million, which is included in income before income taxes and minority interests, and the addition of interest expenseof ¥26,960 million. In addition, the increase in receivables was ¥44,016 million, and the decrease in payables was¥13,364 million. Primarily, due to an increase in inventories, cash used in other operating activities totaled¥57,793 million. Interest paid was ¥26,326 million, and income taxes paid for Yahoo Japan Corporation andothers was ¥29,770 million.
2. Cash Flow from Investing Activities
Net cash used in investing activities was ¥111,519 million.
As a result of capital investment, mainly in the telecommunications segments, the purchase of property andequipment and intangibles totaled ¥92,916 million.

In addition, purchase of marketable and investment

securities was ¥14,997 million, while proceeds from the sales of marketable and investment securities was¥14,311 million.

123. Cash Flows from Financing Activities
Net cash provided by financing activities was ¥218,480 million.
The primary factor was ¥149,864 million recorded from sale and lease back of equipment newly acquired
for the Mobile Communications segment. In addition, proceeds from issuance of bonds by the Company was¥89,483 million, and accompanying the securitization of mobile handset installment sales receivables, proceedsfrom long-term debt was ¥88,161 million. On the other hand, short-term debt and cash receipts as collateraldecreased by ¥46,077 million and ¥20,000 million, respectively.

Repayment of long-term debt was ¥31,916

million.
(3) Major Financing Activities
The major financing activities in the first quarter were as follows:
Item
Bond issueCompany NameSOFTBANK CORP.

Details

Summary

24th unsecured straight

Date of issue: April 26, 2007bond

Date of redemption: April 26, 2010
Aggregate amount of issue: ¥20,000 million
Coupon: 2.72%
Planned use: mainly repayment of existing
interest bearing debt

25th unsecured straight

Date of issue: June 19, 2007bond

Date of redemption: June 17, 2011
Aggregate amount of issue: ¥55,000 million
Coupon: 3.39%
Planned use: mainly repayment of debt

26th unsecured straight

Date of issue: June 19, 2007bond

Date of redemption: June 19, 2014
Aggregate amount of issue: ¥15,000
millionCoupon: 4.36%
Planned use: mainly repayment of debt

Execute securitization of

SOFTBANK MOBILE

Procurement of funds

Procurement date: June 29, 2007

receivables

Corp.

totaling ¥88,161 million

Redemption method: monthly pass-throughaccompanying

repayment

securitization of mobile

Planned use: capital investment andphone installment salesof funds raised via WBS

repayment

receivables (recorded as
borrowings)
Repayment of debt and

SOFTBANK CORP.

othersSOFTBANK MOBILE¥58,112 million (net of

Debt of ¥53,112 million, net of borrowings, andborrowings)

commercial paper of ¥5,000 million¥12,916 million

Repayment of debt raised via WBS

Corp.
Yahoo Japan Corporation¥10,000 million

Implementation of capital

SOFTBANK MOBILE

Implementation of capitalFunds procured during the first quarter: ¥149,864

investment through financeCorp.

investment for mobile

millionlease agreements with

communications utilizing

ownership transfer

lease agreements

13

---

SOFTBANK MOBILE has been proactively implementing its installment sales method for mobile handsets(providing handsets at the New Super Bonus prices). By securitizing the installment sales receivables, spreadover a maximum of 24 times, SOFTBANK MOBILE procured ¥88,161 million by the end of the first quarter.
The funds procured are scheduled to be used to repay existing debt and for the SOFTBANK MOBILE’s capital
investment.
These funds were raised through entrustment.

Procured funds were recorded as debt and the entrusted

account receivables were recorded as account receivable-trade.
The funds are divided into a program for institutional investors and a program for individual investors.
Moody’s, credit rating agency, awarded the program for institutional investors an Aaa rating, and Rating andInvestment Information, Inc., awarded the program for individual investors an A rating. As a result, SOFTBANKMOBILE could execute this procurement at an interest rate lower than that of existing loans.

3. Qualitative Information Related to the Forecasts of Consolidated Results
In the Group’s core telecommunication businesses, especially the Mobile Communications business, the Group has
introduced the installment sales method for mobile handsets and is introducing a range of price plans and discountservices etc. to meet diverse customer needs. These include sales and pricing methods that have no precedent in theindustry and it is difficult to estimate customer trends for them. At this point, we cannot make sound estimates, and
it is difficult to make performance forecasts.
To proactively provide enhanced information disclosure to shareholders and investors, consolidated performance
forecasts will be announced at the point when rational estimates are possible.

144. The SOFTBANK GroupAs of June 30, 2007, the SOFTBANK Group is comprised of the following ten business segments. The number ofconsolidated subsidiaries and equity-method affiliates in each business segment is as follows:Business segments
1.

MobileCommunications

2.

Broadband
Infrastructure

Consolidated
subsidiaries

Equity-method
affiliates

5

1

5

4

ADSL and fiber-optic high-speed Internet connection service, IP telephonyservice, provision of content and other operations
Main operating company: SOFTBANK BB Corp. (note 1)(Note 1)

Principal products and operational content of each business
Mobile communication services, and sale of mobile phones accompanying to
its services
Main operating company: SOFTBANK MOBILE Corp.

Fixed-line
3.
Telecommunications(Note 1)

5-

Fixed-line telecommunications such as voice transmission service, datatransmission service, private leased circuit and data center service
Main operating companies: SOFTBANK TELECOM Corp. (note 1)
SOFTBANK IDC Corp.

4. Internet Culture(Note 1)

14

17

Internet-based advertising operations, broadband portal business, andInternet-based auction business
Main operating company: Yahoo Japan Corporation (note 1)

7

4

Distribution of PC software and such hardware as PCs and peripherals,
enterprise solutions, and diversified e-commerce businesses, including business
transaction platform (B2B) and consumer-related e-commerce (B2C)
Main operating companies: SOFTBANK BB Corp. (note 1)
Vector Inc.
Carview Corporation

Broadmedia

6

1

Broadband service such as broadcasting and communications; support for
procurement of content
Main operating company: Club iT Corporation (note 2)

Technology Services

1-

System solution business and business solution business
Main operating company: SOFTBANK TECHNOLOGY CORP.

Media & Marketing3-Book and magazine publication in such areas as PCs, the Internet,
entertainment, etc., and development of web content specializing in IT
Main operating companies: SOFTBANK Creative Corp.
ITmedia Inc.

Overseas Funds

42

35

U.S.- and Asia-focused global venture capital business principally focused on
Internet-related companies
Main operating company: SOFTBANK Holdings Inc.

Others24

8

Leisure and service business, holding company functions for overseas
operations, and back-office services in Japan
Main operating companies: Fukuoka Softbank Hawks Marketing Corp.
TV Bank Corporation

112

70

5. e-Commerce(Note 1)

6 Others:

Total
Notes
1.

2.

SOFTBANK BB Corp., SOFTBANK TELECOM Corp. and Yahoo Japan Corporation are included in the
consolidated subsidiaries of the Broadband Infrastructure, Fixed-line Telecommunications and Internet Culture
segments, respectively, while SOFTBANK BB Corp., SOFTBANK TELECOM Corp. and Yahoo Japan
Corporation operate multiple businesses and their operating results are allocated to multiple business segments.
Club iT Corporation will change its company name (trade name) to Broadmedia Corporation on October 1, 2007.

15

SOFTBANK subsidiaries listed on domestic stock exchanges as of June 30, 2007:
Subsidiary

Listed exchangeTokyo Stock Exchange 1st section

1.Yahoo Japan Corporation

Jasdaq Securities Exchange
2.SOFTBANK TECHNOLOGY CORP.

Tokyo Stock Exchange 1st section

3.Vector Inc.

Osaka Securities Exchange Hercules

4.Club iT Corporation

Osaka Securities Exchange Hercules

5. ITmedia Inc.

Tokyo Stock Exchange Mothers

6. Carview Corporation

Tokyo Stock Exchange Mothers

Note: ITmedia Inc. and Carview Corporation were listed on Tokyo Stock Exchange Mothers on April 19, 2007 and June 12,2007, respectively.

16

5. Consolidated Financial Statements
Consolidated Balance Sheets
June 30, 2006

(Millions of yen; amounts less than one million yen are omitted.)
Increase
June 30, 2007
March 31, 2007
(Decrease)

AmountAmountAmount%Amount¥285,351
323,034
7,173¥478,733
626,186
7,175¥193,382
303,152
2

67.8
0.0

¥377,666
583,972
8,588

78,392

109,197

30,80539.3

76,898Deferred tax assets

81,346

113,559

32,212

39.6

108,994

Other current assets
Less:
Allowance for doubtful accounts
Total current assets

92,123

116,605

24,481

26.6

119,250(15,545)851,875(33,556)
1,417,902(18,010)566,026

66.4(27,936)
1,247,433

Buildings and structures

88,56288,301

(261)

(0.3)

89,444

Telecommunications equipment

614,806

722,804

107,998

17.6

694,785

Telecommunications service lines

95,01890,341(4,676)(4.9)

92,235Land

30,10327,747(2,356)(7.8)

27,747

Construction in progress

79,457

61,678(17,779)(22.4)

71,777

Other

47,95154,354

6,403

13.4

53,861

955,899

1,045,227

89,3279.3

1,029,852

Goodwill

1,161,691

1,017,956(143,734)(12.4)

1,032,927

Software158,008

210,133

52,12433.0

200,615

Other intangibles

51,373

43,253(8,119)(15.8)

46,168

1,371,073

1,271,344(99,728)(7.3)

1,279,710

526,892

474,166(52,725)(10.0)

487,421

165,166

133,546(31,619)(19.1)

157,783

ASSETS
Current assets:
Cash and deposits
Notes and accounts receivable - tradeMarketable securities
Inventories

93.8

Fixed assets:
Property and equipment, net:

Total property and equipment
Intangible assets, net:

Total intangible assets
Investments and other assets:
Investment securities andinvestments in unconsolidated subsidiaries
and affiliated companies
Deferred tax assets
Other assets
Less:
Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
Deferred charges

166,018

121,132(44,885)(27.0)

113,877(9,432)
848,644
3,175,618
3,509(10,979)
717,866
3,034,438
4,180(1,547)(130,778)(141,179)
671(15.4)(4.4)
19.1(9,405)
749,677
3,059,240
4,178

Total assets¥4,031,003¥4,456,521¥425,517

10.6¥4,310,852

17Consolidated Balance Sheets(Millions of yen; amounts less than one million yen are omitted.)
Increase(Decrease)

June 30, 2006

June 30, 2007

AmountAmountAmount%AmountCurrent liabilities:
Accounts payable - trade
Short-term borrowings¥91,0121,534,529¥182,280
221,361¥91,268(1,313,168)

100.3(85.6)¥195,167
193,656

Commercial paper

14,600-(14,600)-

5,000

Current portion of corporate bonds
Accounts payable – otherand accrued expenses
Income taxes payable

36,06456,464

20,40056.6

43,964

273,781

386,762

112,98141.3

415,561

11,324

12,783

1,458

12.9

33,070Current portion of lease obligations-

43,16943,169-18,049Cash receipts as collateral

150,000

130,000(20,000)(13.3)

150,000

Other current liabilities

83,89981,897(2,002)(2.4)

88,433

Total current liabilities

2,195,212

1,114,719(1,080,492)(49.2)

1,142,903

March 31, 2007

LIABILITIES AND EQUITY

Long-term liabilities:
Corporate bonds

555,404

500,955(54,448)(9.8)

422,599

Long-term debt

388,997

1,718,399

1,329,401

341.8

1,729,183

Deferred revenue

37,612

22,695(14,917)(39.7)

26,392

Deferred tax liabilities

45,457

52,943

7,486

16.5

50,136

Liability for retirement benefits

17,43016,494

(936)

(5.4)

16,701

Allowance for point mileage

41,033

43,9172,884

7.0

43,787-

176,888

176,888-

74,964

Other liabilities

103,663

49,765(53,897)(52.0)

87,947

Total long-term liabilities

1,189,599

2,582,059

1,392,460

117.1

2,451,712

3,384,812

3,696,779

311,9679.2

3,594,615

162,969

163,644675

0.4

163,309

-

0

0

-

1

Additional paid-in capital

187,355

188,004

648

0.3

187,669

Accumulated deficit(219,394)(175,254)

44,139-(192,271)

Less: Treasury stock

(175)

(197)

(22)

-

(193)

130,754

176,196

45,441

34.8

158,515

125,077

102,264(22,812)(18.2)

122,619(38,764)

1,697

40,462-(26,995)

18,13035,967

17,836

98.4

28,810104,443

139,92935,48634.0

124,434

3,150

3,195

44

1.4

3,180

407,841

440,419

32,5778.0

430,106

646,190759,741

113,55017.6

716,237¥4,031,003¥4,456,521¥425,517

10.6¥4,310,852

Lease obligations

Total liabilities
Equity:Common stock
Cash receipts for new stock subscriptions

Total shareholders’ equity
Unrealized gain on available-for-salesecurities
Deferred (loss) gain on derivatives underhedge accounting
Foreign currency translation adjustments
Total valuation and translation adjustments
Stock acquisition rights
Minority interests
Total equity
Total liabilities and equity

18

Consolidated Statements of Income(Millions of yen; amounts less than one million yen are omitted.)Three-month
period ended
June 30, 2006

Three-month
period ended
June 30, 2007

Increase(Decrease)

Fiscal year ended
March 31, 2007

AmountAmountAmount%AmountNet sales
Cost of sales
Gross Profit¥494,231
273,895¥663,084
352,896¥168,853
79,00034.2
28.8¥2,544,219
1,409,520

220,336

310,188

89,85240.8

1,134,698

Selling, general and administrative expenses

165,978

231,442

65,463

39.4

863,633

Operating income

54,35778,74624,38944.9271,065Interest income
Foreign exchange gain, net

1,088
-

608
543

(480)
543

(44.2)-

3,394-

Equity in earnings of affiliated companies

9,051

1,440

(7,610)(84.1)

2,130

Other non-operating income
Non-operating income
Interest expense
Foreign exchange loss, net
Financing related expenses
Other non-operating expenses
Non-operating expenses

1,956

1,939

(16)

(0.8)

8,006

12,096
14,601
154
19,954
5,747

4,531
26,9605,162(7,565)
12,358(154)(19,954)(584)(62.5)(10.2)

13,531
79,521834
28,715
22,101

84.6-

40,45932,123(8,335)(20.6)

131,173

Ordinary income

25,994

51,15425,15996.8

153,423

Gain on sale of investment securities

3,971
300
400

4,632
2,866
938
1,503

660
2,565
938
1,103

16.6

275.5

84,106
2,598
9,576

4,672

9,940

5,267

112.7

96,282

1,365

2,692

1,326

97.2

41,132

29,30258,403

29,10099.3

208,573

10,146

2,826(7,319)(72.1)

48,726

9,224

20,065

10,841

117.5

93,6768,514¥1,418

10,380¥25,130

1,866¥23,71121.9

37,355¥28,815

Dilution gain from changes in equity interest
Gain on sale of interests in a subsidiary
Other special income
Special income
Special loss
Income before income taxes and minority
interests
Income taxes:
Current
Deferred
Minority interests in net income
Net income

19

853.4

-

-

-

-

¥162,969¥-¥187,355

52

-

-

-

-

-

52

¥187,303

Additional
paid-in
capital¥(219,394)

(833)

-

1,418
-

476

(90)

(2,637)-¥(218,561)

Accumulated
deficit

Shareholders’ equity

Note: Appropriation of retained earnings resolved at the annual shareholders’ meeting held on June 23, 2006.

Balance at June 30, 2006

(5)

-

-

52

-

-

Total changes in this period--

Bonuses to directors (Note)

Adjustments of accumulated deficit due tochange in scope of the consolidation
Net income
Purchase of treasury stock
Items other than changes in shareholders’equity

(5)

¥5

-

52

¥162,916-

Cash dividends (Note)

Changes of items during the period
Exercise of warrants

Balance at April 1, 2006

Common Cash receipts for
new stockstock
subscriptions

Consolidated Statements of Changes in Equity

From April 1, 2006 to June 30, 2006:20¥(175)

(5)

-

(5)

-

-

-

-

¥(169)

Treasurystock¥130,754

(739)

-

1,418
(5)

476

(90)

(2,637)99¥131,494

Total¥125,077(3,974)(3,974)

-

-

-

-

-

¥129,051¥ (38,764)(1,923)(1,923)

-

-

-

-

-

¥(36,840)¥18,130

(932)

(932)

-

-

-

-

-

¥19,062

Valuation and translation adjustments
Unrealized gain Deferred gain
Foreign currency(loss) on(loss) on
translation
available-for- derivatives underadjustments
hedgesale securities
accounting¥104,443(6,830)(6,830)

-

-

-

-

-

¥111,273

Total¥3,150

-

-

-

-

-

-

-

¥3,150Stockacquisitionrights¥407,841

306,495

306,495

-

-

-

-

-

¥101,346

Minority
interests¥646,190

298,926

299,666

1,418
(5)

476

(90)

(2,637)99¥347,263

Total equity(Millions of yen, amounts less than one million yen are omitted)

-

-

-

Cash dividends (Note)

Adjustments of accumulated deficit due tochange in scope of the consolidation
Net income
Purchase of treasury stock
Items other than changes in shareholders’equity163,644

334
0

(0)

-

188,004

334

-

-

-

-

-

334

-

187,669

Additional
paid-in
capital(175,254)

17,016-25,130-(323)(2,639)--(5,150)(192,271)

Accumulated
deficit

Shareholders’ equity

Note: Appropriation of retained earnings resolved at the annual shareholders’ meeting held on June 22, 2007.

Balance at June 30, 2007

Total changes in this period--

Cash receipts for new stock subscriptions

-

0
-

(1)

-

-

1

-

163,309

Common Cash receipts for
new stockstock
subscriptions

334

Changes of items during the period
Increase in accumulated deficit due toadoption of new accounting standards at a
subsidiary in the U.S.
Exercise of warrants

Balance at April 1, 2007

From April 1, 2007 to June 30, 2007:

21
(197)

(4)

-

(4)

-

-

-

-

-

(193)

Treasurystock

176,196

17,681-

25,130(4)(323)(2,639)0667(5,150)158,515

Total

102,264(20,354)(20,354)

-

-

-

-

-

-

122,619

1,697

28,693

28,693

-

-

-

-

-

-

(26,995)

35,967

7,156

7,156

-

-

-

-

-

-

28,810

Valuation and translation adjustments
Unrealized gain Deferred gain
Foreign currency(loss) on(loss) on
translation
available-for- derivatives underadjustments
hedgesale securities
accounting

139,929

15,495

15,495

-

-

-

-

-

-

124,434

Total

3,195

14

14

-

-

-

-

-

-

3,180

Stock
acquisitionrights440,419

10,312

10,312

-

-

-

-

-

-

430,106

Minority
interests

759,741

43,50325,822

25,130(4)(323)(2,639)0667(5,150)716,237

Total equity(Millions of yen, amounts less than one million yen are omitted)

-

-

-

Net income

Purchase of treasury stock
Items other than changes in shareholders’equity¥163,309

¥1

(3)

-

-

-

¥187,669

366

-

-

-

(26)

-

-

-

393

¥187,303

Additional
paid-in
capital¥(192,271)

26,289--28,815202(90)(2,637)--¥(218,561)

Accumulated
deficit

Shareholders’ equity

Note: Appropriation of retained earnings resolved at the annual shareholders’ meeting held on June 23, 2006.

Balance at March 31, 2007

393

-

-

Adjustments of accumulated deficit due tochange in scope of the consolidation

Total changes in the year--

Bonuses to directors (Note)--

Cash dividends (Note)

1

(5)

¥5

-

393

¥162,916

Common Cash receipts for
new stockstock
subscriptions

Cash receipts for new stock subscriptions

Exercise of warrants

Changes of items during the year

Balance at April 1, 2006

From April 1, 2006 to March 31, 2007:22¥(193)

(23)

-

(23)

-

-

-

-

-

-

¥(169)

Treasurystock¥158,515

27,021-(23)

28,815176(90)(2,637)1780¥131,494

Total¥122,619(6,432)(6,432)

-

-

-

-

-

-

-

¥129,051¥ (26,995)

9,845

9,845

-

-

-

-

-

-

-

¥(36,840)¥28,810

9,747

9,747

-

-

-

-

-

-

-

¥19,062

Valuation and translation adjustments
Unrealized gain Deferred gain
Foreign currency(loss) on(loss) on
translation
available-for- derivatives underadjustments
hedgesale securities
accounting¥124,434

13,16013,160

-

-

-

-

-

-

-

¥111,273

Total¥3,180

30

30

-

-

-

-

-

-

-

¥3,150Stockacquisitionrights¥430,106328,760

328,760

-

-

-

-

-

-

-

¥101,346

Minority
interests¥716,237

368,973

341,951(23)

28,815176(90)(2,637)1

780¥347,263

Total equity(Millions of yen, amounts less than one million yen are omitted)

Consolidated Statements of Cash Flows(Millions of yen; amounts less than one million yen are omitted.)Three-month period
ended June 30, 2006

Three-month period
ended June 30, 2007

Fiscal year ended
March 31, 2007

Cash flows from operating activities:
Income before income taxes and minority interests¥29,302¥58,403¥208,573

Depreciation and amortization

38,04853,533

189,092

Amortization of goodwill

10,94014,42653,595Equity in earnings of affiliated companies
Dilution gain from changes in equity interest, net
Valuation loss on investment securities
Gain on sale of marketable and investment securities, net
Foreign exchange (gain) loss, net(9,051)(293)
143(3,970)(88)(1,440)(2,790)169(4,489)(829)(2,130)(2,484)
5,351(79,885)
1,136Interest and dividend income(1,276)(854)(3,713)

Interest expense

14,601

26,96079,521

Decrease (increase) in receivables – trade34,259(44,016)(225,489)(Decrease) increase in payables - trade(12,776)(13,364)

91,184(1,248)(57,793)

98,977

98,593

27,914

413,729

Interest and dividends received

2,797

704

5,519

Interest paid

(9,168)(26,326)(62,081)

Income taxes paid

(27,546)(29,770)(45,964)

64,675(27,478)

311,201

Adjustments for:

Changes in operating assets, and liabilities

Other, net
Sub-total

Net cash provided by (used in) operating activities- Continued -23

Consolidated Statements of Cash Flows (Continued)(Millions of yen; amounts less than one million yen are omitted.)Three-month period
ended June 30, 2006

Three-month period
ended June 30, 2007

Fiscal year ended
March 31, 2007

Cash flows from investing activities:
Purchase of property and equipment, and intangibles¥(76,776)¥ (92,916)¥(297,764)

Purchase of marketable and investment securities
Proceeds from sale of marketable and investment securities
Acquisition of interests in subsidiaries newly consolidated,
net of cash acquired
Sale of interests in subsidiaries previously consolidated, net
Proceeds from sales of interests in consolidated subsidiaries
Increase in loan receivables(60,754)
5,958(14,997)
14,311(114,022)
168,354(1,835,955)-(1,844,849)

11(4,750)

1,012(10,262)(89)
10(16,519)

Collection of loan receivables

2,277

9,891

15,749Other, net

4,157(18,558)(8,805)(1,965,832)(111,519)(2,097,937)

1,286,475(46,077)(8,848)4,200(5,000)(5,400)

Proceeds from long-term debt

210,070

88,161

1,586,970

Repayment of long-term debt

(7,272)(31,916)(98,151)-

89,48372,558

Redemption of bonds(1,899)-(205,334)

Exercise of warrants
Proceeds from issuance of shares to minority shareholders
Cash dividends paid

105
300,084(1,846)669
6,023(1,983)786
300,378(2,640)Cash dividends paid to minority shareholders
Proceeds from sale and lease back of equipment newly
acquired
Increase (decrease) in cash receipts as collateral, net(2,968)(3,497)(3,143)-

149,864

65,81850,000(20,000)

50,000

Other, net(93,519)(7,247)(34,607)

1,743,429

218,480

1,718,384

134

1,495

3,073

(157,593)

80,978(65,277)(3,886)(771)(3,896)446,694

377,520446,694¥285,214¥457,727¥377,520

Net cash used in investing activities
Cash flows from financing activities:
Increase (decrease) in short-term borrowings, net
Increase (decrease) in commercial paper, net

Proceeds from issuance of bonds

Net cash provided by financing activities
Effect of exchange rate changes
on cash and cash equivalents
Net (decrease) increase in cash and cash equivalents
Decrease in cash and cash equivalents due to exclusion ofpreviously consolidated subsidiaries
Cash and cash equivalents, beginning of the period
Cash and cash equivalents, end of the period

24Condensed Quarterly Financial Information
Condensed Statements of Income(Millions of yen; amounts less than one million yen are omitted.)First quarter

Second quarter

Third quarter

Fourth quarter

First quarter

April 1, 2006 toJune 30, 2006

July 1, 2006 to
September 30, 2006

October 1, 2006 to
December 31 2006

January1, 2007 to
March 31, 2007

April 1, 2007 toJune 30, 2007

AmountAmountAmountAmountAmount¥494,231
273,895
220,336¥625,941
341,443
284,498¥702,195
390,157
312,037¥721,850
404,024
317,826¥663,084
352,896
310,188

165,978

226,303

227,304

244,045

231,442

54,357
12,09640,45925,994
4,672
1,365

58,194
4,540
26,03936,696
66,795
13,89584,733
1,829
37,63748,924
15,788
6,688

73,7804,259
36,23141,808
9,024
19,18278,746
4,531
32,12351,1549,940
2,692

29,30289,59658,02431,65058,403

10,146
9,224
8,514¥1,41870,826(3,182)
8,930¥13,021

12,552
27,211
10,765¥7,494(44,798)
60,4239,145¥6,881

2,826
20,065
10,380¥25,130

Net sales
Cost of sales
Gross profit
Selling, general andadministrative expenses
Operating income
Non-operating income (Note)
Non-operating expenses (Note)
Ordinary income
Special income
Special loss
Income before income taxes andminority interests
Income taxes - Current
Income taxes - Deferred
Minority interests in net income
Net income

Note: Foreign exchange gain (loss), equity in earnings (loss) of affiliated companies, and income (expenses) from investments in partnerships
were included in “Non-operating income” and “Non-operating expenses” and were netted on quarterly basis for presentation purposes.
Condensed Statements of Cash Flows(Millions of yen; amounts less than one million yen are omitted.)

Net cash provided by (used in)operating activities
Net cash provided by (used in)investing activities
Net cash provided by (used in)financing activities
Effect of exchange rate changes
on cash and cash equivalents
Net increase (decrease) in cash
and cash equivalents
Decrease in cash and cash
equivalents due to exclusion ofpreviously consolidated
subsidiaries
Cash and cash equivalents,
beginning of the period
Cash and cash equivalents, endof the period
Note:“Depreciation and amortization”
and “amortization of goodwill”
included in net cash provided byoperating activities

First quarter

Second quarter

Third quarter

Fourth quarter

First quarter

April 1, 2006 toJune 30, 2006

July 1, 2006 to
September 30, 2006

October 1, 2006 to
December 31, 2006

January 1, 2007 to
March 31, 2007

April 1, 2007 toJune 30, 2007

AmountAmountAmountAmountAmount¥64,675¥122,464¥71,193¥52,868¥(27,478)(1,965,832)

8,847(71,675)(69,276)(111,519)

1,743,429(144,656)

124,058(4,446)

218,480134

703(2,716)

4,951

1,495

(157,593)(12,641)

120,859(15,902)80,978(3,886)

-

(9)

-

(771)

446,694285,214272,572

393,423

377,520¥285,214¥272,572¥393,423¥377,520

457,727¥48,989¥62,424¥66,271¥65,001¥67,96025

Basis of Presentation of Consolidated Financial Statements
1. Changes in scope of consolidation
As of June 30, 2007, SOFTBANK CORP. (hereafter the “Company”) consolidated 112 subsidiaries. 72 subsidiaries were
not consolidated as the individual and aggregate amounts were not considered material in relation to the consolidated total
assets, net sales, net income and retained earnings (accumulated deficit) of the SOFTBANK Consolidated Financial
Statements.
Changes in scope of consolidation were as follows:<Increase>
None<Decrease>
6 companies
2. Changes in scope of equity method
As of June 30, 2007, the Company held 70 affiliates, all of which were accounted for under the equity method. 72
non-consolidated subsidiaries and 25 affiliates were not accounted for under the equity method, as the individual andaggregate amounts were not considered material in relation to the net income and retained earnings (accumulated deficit) of
the SOFTBANK Consolidated Financial Statements.
Changes in application of equity method were as follows:<Increase>
5 companies<Decrease>1 company
3.

Summary of significant accounting policies[1] Evaluation standards and methods for major assets(1) Marketable securities and investment securities
Held-to-maturity debt securities: Stated at amortized cost
Available-for-sale securities:
With market quotations:
Stated at fair value, which represents the market prices at the balance sheet date(unrealized gain/loss is included as a separate component in equity, net of tax, while
cost is primarily determined using the moving-average method)
Without market quotations:
Carried at cost, primarily based on the moving-average method(2) Derivative instruments:
Stated at fair value(3) Inventories:

Carried at cost, primarily based on the moving-average method[2] Depreciation and amortization(1) Property and equipment
Buildings and structures:
Telecommunications equipment:
Telecommunications service lines:
Others:Computed primarily using the straight line method
Computed using the straight line method
Computed using the straight line method
Computed primarily using the straight line method(2) Intangible assets:

Computed using the straight-line method26

[3] Accounting principles for major allowances and accruals(1) <Allowance for doubtful accounts>
Allowance for doubtful accounts is calculated based on the aggregate amount of estimated credit losses on doubtfulreceivables, plus an amount for receivables other than doubtful receivables calculated using historical write-off
experience ratios from certain prior periods.
(2) <Accrued retirement benefits>
SOFTBANK MOBILE Corp., SOFTBANK TELECOM Corp., and certain other subsidiaries have defined benefit
pension plans for their employees. These companies account for the obligation for retirement benefits based on the
projected benefit obligations at the end of the fiscal year end.
SOFTBANK MOBILE Corp. and SOFTBANK TELECOM Corp. amended the pension plans by suspending thedefined benefit pension plans at the end of March 2007 and March 2006, respectively, and implementing defined
contribution pension plans. The retirement benefit existed and calculated under the benefit pension plan was fixed andwill be paid at the retirement of applicable employees, and the projected benefit obligations are calculated based on these
fixed retirement benefit. As a result, service cost under the defined benefit pension plans at SOFTBANK MOBILE
Corp. and SOFTBANK TELECOM Corp. do not occur, but only interest cost occurred for the three-month period
ended June 30, 2007.
(3) <Allowance for point mileage >SOFTBANK MOBILE Corp. has an allowance for point mileage which is accrued based on the estimated future
obligation arising from point service, based on past experience.
[4] Translation of foreign currency transactions and accounts
All assets and liabilities in foreign currencies are translated at the foreign currency exchange rates prevailing at the respectivebalance sheet dates. Foreign currency exchange gains or losses are charged to net income when incurred.
The translation of foreign currency denominated revenues and expenses in the financial statements of foreign consolidated
subsidiaries into Japanese yen is performed by using the average exchange rate for the period. Assets and liabilities aretranslated using the foreign currency exchange rates prevailing at the balance sheet dates, and capital stock is translated using
the historical foreign currency exchange rates. Foreign currency financial statement translation differences are presented asa separate component of “Equity,” and the portion pertaining to minority shareholders, which is included in “Minority
interests.”[5] Lease
Under Japanese accounting standards for leases, finance leases that deem to transfer ownership of the leased property to thelessee are to be capitalized, while other finance leases are permitted to be accounted for as operating lease transactions if
certain “as if capitalized” information is disclosed in the notes to the lessee’s financial statements.
[6] Accounting for significant hedge transactions(1) Collar transaction① <Hedge accounting>Unrealized gains and losses, net of tax, on a collar transaction that qualifies as an effective cash flow hedge at
consolidated subsidiaries in the United States of America are reported as a separate component of “Equity” in the
Company’s Consolidated Balance Sheets. As such, unrealized gains and losses associated with the collar transaction
will be recognized into earnings in the same period during which the hedged assets and liabilities are recognized inearnings.
② <Derivative instruments for hedging and hedged items>
Derivative instruments for hedging:
Prepaid variable share forward contract (the collar transaction)
Hedged items:
Equity security27

③ <Hedging policy>
The purpose of the collar transaction is to hedge the variability of cash flows associated with the future market price of
the underlying equity security, which is used for the settlement of loans at maturity.
④ <Effectiveness of hedge transactions>
The effectiveness of hedge transaction is assessed by measuring high correlation between the variability of cash flows
associated with the market price of hedged items and variability of cash flows of hedge instruments.
(2) Interest rate swap
① <Hedge accounting>
For interest rate swaps whose amounts, index and periods are same as the conditions for hedged items, the “exceptional
method” is adopted. Under this method, a certain domestic consolidated subsidiary does not account for gains and lossesof those interest rate swaps on a fair value basis and recognizes swap interest on an accrual basis.
② <Derivative instruments for hedging and hedged items>
Derivative instruments for hedging:Interest rate swap contracts
Hedged items:
Interest expense on borrowings③ <Hedging policy>
The domestic consolidated subsidiaries use derivative financial instruments to hedge the risk of exposures to fluctuationsin interest rates in accordance with its internal policies, regarding the authorization and credit limit amount.
④ < Effectiveness of hedge transactions >Effectiveness of the hedge transaction is omitted due to the adoption of “exceptional method.”(3) Forward-exchange contract① <Hedge accounting>Long-term debt denominated in foreign currencies for which foreign exchange forward contracts are used to hedge theforeign currency fluctuation are translated at the contracted rate, if the forward contracts qualify for hedge accounting.
② <Derivative instruments for hedging and hedged items>
Derivative instruments for hedging:
Forward-exchange contract
Hedged items:
Foreign currency-denominated bond
③ <Hedging policy>
In accordance with the Company’s policy, the Company uses derivatives to hedge foreign exchange risk associated withcertain assets and liabilities denominated in foreign currencies.
④ < Effectiveness of hedge transactions >Effectiveness of the hedge transaction is omitted due to qualifying for hedge accounting.

[7] Accounting method for consumption taxes
Consumption taxes are accounted for using the net method of reporting.

28

4. Accounting for business combinations
All assets and liabilities of an acquired entities are revalued at the respective fair market value at the combination date.
5. Amortization of goodwill“Goodwill” is amortized on a straight-line basis over reasonably estimated periods in which economic benefits are expected tobe realized. Immaterial goodwill is expensed as incurred.
The goodwill resulted from acquisition of Vodafone K.K. (currently SOFTBANK MOBILE Corp.) is amortized over
20-year-period.
6. Scope of cash and cash equivalents in the consolidated statements of cash flows“Cash and cash equivalents” are comprised of cash on hand, bank deposits withdrawable on demand and highly liquid
investments with initial maturities of three months or less and a low risk of fluctuation in value.

29

Notes(Consolidated Balance Sheets)
1. Accumulated depreciation of property and equipment
As of June 30, 2006
626,519

As of June 30, 2007

million yen

752,539

million yen

As of March 31, 2007
719,297 million yen

2. Contingent liability
Based on debt assumption agreements with financial institutions, SOFTBANK MOBILE Corp. has transferred its debt
repayment obligation for straight bonds previously issued to financial institutions. The bonds and payments to financial
institutions incurred from transferring its debt repayment obligation for the bonds are eliminated in the Company’s
Consolidated Balance Sheets.
However, under the terms of the indenture, SOFTBANK MOBILE Corp. will continue to be responsible for payments on thebonds until maturity or redemption of the bonds.
Subject Bonds

As of June 30, 2006

As of June 30, 2007

First Series Unsecured Bond

- million yen

25,000 million yen

25,000 million yen

Third Series Unsecured Bond

- million yen

25,000 million yen

25,000 million yen

Fifth Series Unsecured Bond

- million yen

25,000 million yen

25,000 million yen- million yen

25,000 million yen

25,000 million yen

100,000 million yen

100,000 million yen

Seventh Series Unsecured Bond
Total

- million yen

As of March 31, 2007

3. Assets pledged as collateral(1) For future lease liabilities
As of June 30, 2006

As of June 30, 2007

As of March 31, 2007

Assets pledged as collateral:
Notes and accounts receivable – trade

10,697 million yen

10,891 million yen

10,877 million yen

In addition to above, amounts eliminated in the consolidated balance sheet as an intercompany balance:
Notes and accounts receivable – trade

13,219 million yen

14,143 million yen

14,029 million yen

Note: The collateral for the future lease liabilities (finance lease accounted for as operating lease transactions) was
provided by mortgaging against the aggregate of the current and future receivables due from customers of certain
consolidated subsidiaries. The future lease liabilities at the end of periods are as follows:
As of June 30, 2006

As of June 30, 2007

As of March 31, 2007

Future lease liabilities(finance lease accounted for as operating lease

20,542 million yen

transactions)30

11,343 million yen

13,026 million yen

(2) For short-term borrowings and long-term debt
Assets pledged as collateral and secured liabilities by consolidated subsidiaries are as follows:
June 30, 2006

June 30, 2007

March 31, 2007

532 million yen

169,157 million yen
261,446
14,017301,094
172
15,567
4362,644

208,169

180,388

196,552

-

228

115

Assets pledged as collateral:
Cash and deposits
Notes and accounts receivable – trade993

Buildings and structures

503

Telecommunications equipment

1,284

Telecommunications service lines

-

Land

5,001

Property and equipment- other0

Investment securities andinvestments in unconsolidated
subsidiaries and affiliated companies
Investments and other assets – other assets
Total

70,897 million yen
303,486
13,986226
15,566
0

216,484 million yen

942,076 million yen

963,475 million yen

June 30, 2006

June 30, 2007

March 31, 2007

Secured liabilities:
Accounts payable - trade
Short-term borrowings

Total

118,283

1,474,523

174,313 million yen

1,478,029 million yen

1,481,267 million yen

55,299Accounts payable – other and accrued expenses
Long-term debt

1,214 million yen
8,774
1,468,040

614 million yen
116

1,246 million yen
5,373
123

SOFTBANK MOBILE Corp. shares owned by BB Mobile Corp. and BB Mobile Corp. shares owned by Mobiletech
Corporation are pledged as collateral for long-term debt (totaled to ¥1,342,174 million) resulted from the refinancing theloan accompanying the acquisition of SOFTBANK MOBILE Corp., in addition to the assets pledged as collateral above.
The fund procured through the securitization of installment sales receivables of SOFTBANK Mobile Corp. in the amountof ¥36,645 million and ¥51,515 million were recorded as “Short-term borrowings” and “Long-term debt,” respectively,
as of June 30, 2007. The installment sales receivables, equivalent to ¥88,161 million which is the amount of senior trust
certificate of the securitized installment sales receivables for this procurement, was included in “Notes and accountreceivable-trade,” along with the amount of trust beneficial certificate held by the SOFTBANK MOBILE Corp. Trustee
procured the fund through asset backed loans which were backed by these installment sales receivables.
4. Securities loaned
A portion of investment securities was lent to financial institutions according to stock lending agreements, and the amounts ofapplicable investment securities recorded in the Company’s Consolidated Balance Sheets are as follows:
As of June 30, 2006
Investment securities

40,527 million yen

As of June 30, 2007
194 million yen

As of March 31, 2007
193 million yen

5. Cash receipts as collateral
Cash receipts as collateral from financial institutions, to whom the Company has lent shares in its subsidiary under security
deposit agreements, are presented as follows:
As of June 30, 2006
Cash receipts as collateral

150,000 million yen

As of June 30, 2007
130,000 million yen

As of March 31, 2007
150,000 million yen

According to the security deposit agreements, the Company paid a fixed rate amount as stock bailment fees and other fees
totaling ¥581 million, ¥914 million, and ¥3,539 million for the periods ended at June 30, 2006, June 30, 2007, and March 31,
2007, respectively, and recorded the fees as other non-operating expenses in the Consolidated Statements of Income.

31

6. Line of credit as a creditor (not used)
As of June 30, 2006

As of March 31, 2007

As of June 30, 2007

14,373 million yen

7,708

10,903 million yen

million yen

7. Cash receipts for new stock subscriptions
Cash receipts for new stock subscriptions represent amounts paid at the exercise of warrants as advance on subscriptions. In
July 2007, the Company issued 600 new shares.
(Consolidated Statements of Income)
1. Selling, general and administrative expenses
Three-month period ended
June 30, 2006
45,770 million yen

Sales commission

Three-month period ended
June 30, 2007
67,660 million yen

Fiscal year ended
March 31, 2007
260,478 million yen

Sales promotion expense

26,05342,403

145,382

Payroll and bonuses

20,55525,352

94,723988

7,345

16,614

Allowance for doubtful accounts(Consolidated Statements of Changes in Equity)
From April 1, 2006 to June 30, 2006:
1. Class and number of outstanding shares:
March 31, 2006
Number of common stocks

Increase

1,055,231,478

Decrease

72,000June 30, 2006-

1,055,303,478

Note: Increase resulted from the exercise of stock acquisition rights.
2. Class and number of treasury stocks:
March 31, 2006
Number of common stocks

Increase

Decrease

June 30, 2007

2,005

-

151,396

149,391

Note: Increase resulted from the acquisition of the fractional shares.
3. Stock acquisition rights:
Type
SOFTBANK,
Corp.
Consolidated
Subsidiaries

Detail of stock acquisitionrightsClass of shares

Stock acquisition rights
issued in 2004

CommonstocksNumber of shares for stock acquisition rights
June 30,
March 31,
Increase Decrease
2006
2006
24,000,000

Total

-

-

24,000,000

Millions of yen
June 30, 2006
3,150

-

0

-

3,150

4. Dividends:
Dividend paid
Resolution

Class ofAmount of dividend

Dividend pershares(Millions of yen)share

Ordinary general meeting ofCommonshareholders, June 23, 2006

stocks

2,637

32

¥2.50

Record date
March 31, 2006

Effective dateJune 23, 2006

From April 1, 2007 to June 30, 2007:
1. Class and number of outstanding shares:
March 31, 2007
Number of common stocks

Increase

1,055,862,978

Decrease

614,400

June 30, 2007-

1,056,477,378

Note: Increase resulted from the exercise of stock acquisition rights.
2. Class and number of treasury stocks:
March 31, 2007
Number of common stocks

Increase

Decrease

June 30, 2007

1,593

-

160,204

158,611

Note: Increase resulted from the acquisition of the fractional shares.
3. Stock acquisition rights:
Type
SOFTBANK,
Corp.
Consolidated
Subsidiaries

Detail of stock acquisitionrightsClass of shares

Stock acquisition rights
issued in 2004

CommonstocksNumber of shares for stock acquisition rights
June 30,
March 31,
Increase Decrease
2007
2007
24,000,000

Total

-

-

Millions of yen
June 30, 2007

24,000,000

3,150

-

45

-

3,195

4. Dividends:
Dividend paid
Resolution

Class ofAmount of dividend

Dividend pershares(Millions of yen)share

Ordinary general meeting ofCommonshareholders, June 22, 2007

stocks

2,639

¥2.50

Record date
March 31, 2007

Effective dateJune 25, 2007

5. Adoption of new accounting standards at a subsidiary in the United States of America.
A subsidiary of the Company in the United States of America applied “Accounting for Uncertainty in Income Taxes”(Financial Accounting Standard Board Interpretation No. 48) from the period beginning on April 1, 2007. The cumulative
effect of applying the provisions of this Interpretation was reported as an adjustment to the opening balance of accumulated
deficit, and accordingly, it is recorded as “Increase in accumulated deficit due to adoption of new accounting standards at a
subsidiary in the U.S.” in the Consolidated Statements of Changes in Equity.

33

From April 1, 2006 to March 31, 2007:
1. Class and number of outstanding shares:
March 31, 2006
Number of common stocks

Increase

Decrease

March 31, 2007-

1,055,862,978

Increase

Decrease

March 31, 2007

9,220

-

158,611

1,055,231,478

631,500

Note: Increase resulted from the exercise of stock acquisition rights.
2. Class and number of treasury stocks:
March 31, 2006
Number of common stocks

149,391

Note: Increase resulted from the acquisition of the fractional shares.
3. Stock acquisition rights:
Type
SOFTBANK,
Corp.
Consolidated
Subsidiaries

Detail of stock acquisitionrightsClass of shares

Stock acquisition rights
issued in 2004

CommonstocksNumber of shares for stock acquisition rights
March 31,
March 31,
Increase Decrease
2007
2006
24,000,000

-

Total

-

24,000,000

Millions of yen
March 31, 2007
3,150

-

30

-

3,180

4. Dividends:(1) Dividend paid
Resolution

Class ofAmount of dividend

Dividend pershares(Millions of yen)share

Ordinary general meeting ofCommonshareholders, June 23, 2006

stocks2,637

Record date

¥2.50

March 31, 2006

Effective dateJune 23, 2006

(2) Dividends which recorded date is in the fiscal year 2007 and effective date for payment is in the fiscal year 2008.
Resolution

Class ofAmount of dividend

Source ofDividend

shares(Millions of yen)

dividend

per share

Ordinary general meeting ofCommonshareholders, June 22, 2007

stocks2,639

34

Retainedearnings¥2.50

Record date

Effective date

March 31, 2007

June 25, 2007

(Consolidated Statements of Cash Flows)
1. Reconciliation of cash and cash equivalents to the amounts presented in the accompanying Consolidated Balance Sheets

Cash and deposits

As of June 30, 2006

As of June 30, 2007

As of March 31, 2007

285,351 million yen

478,733

377,666 million yen

million yen

Marketable securities

7,173

7,175

8,588

Time deposits with original maturity over three months（1,595）(22,615)(1,989)Stocks and bonds with original maturity over three months（5,714）(5,566)(6,744)

Cash and cash equivalents

285,214 million yen

457,727 million yen

377,520 million yen

2. Scope of Purchase of property and equipment, and intangibles in the Consolidated Statement of Cash flows“Purchase of property and equipment, and intangibles” are comprised of cash outflow from purchasing property and equipment,
and intangible assets (excluding goodwill) and long-term prepaid expenses.
3. Proceeds from sale and lease back of equipment newly acquired
Once SOFTBANK MOBILE Corp. purchases telecommunications equipment for the purpose of assembly, installation andinspection, SOFTBANK MOBILE Corp. sells the equipment to lease companies for sale and lease back purpose. The leased
asset and lease obligation are recorded in the Consolidated Balance Sheet.
The cash outflows from the purchase of the equipment from vendors are included in “Purchase of property and equipment, andintangibles” and the cash inflows from the sale of the equipment to a lease company are included in “Proceeds from sale andlease back of equipment newly acquired.”35Segment Information
1. Business segment information(1) For the three-month period ended June 30, 2006
(Millions of yen; amounts less than one million yen are omitted.)
MobileBroadband

Fixed-line

InternetCommunications

Infrastructure

Telecommunications

Culture¥231,545¥62,797¥81,892

922

524

6,781

232,467

63,322

88,673Elimination

e-Commerce

OthersTotal¥44,453¥55,886¥17,655¥494,231

¥-

189

3,256

2,634

14,307(14,307)-44,64259,142

20,289508,539(14,307)494,231or Corporate

Consolidated

Net sales(1) Customers(2) Inter-segment
Total¥494,231

Operating expenses

205,174

57,842

87,461

23,012

57,681

21,007452,179(12,305)

439,874

Operating income (loss)¥27,293¥5,479¥1,212¥21,630¥1,461¥(717)¥56,360¥(2,002)¥54,357(2) For the three-month period ended June 30, 2007
(Millions of yen; amounts less than one million yen are omitted.)
MobileFixed-line

Internet

Telecommunications

Culture¥64,326¥77,851¥51,893

Broadband

Communications Infrastructure

Elimination

e-Commerce

OthersTotal¥58,270¥21,705¥663,084¥-

or Corporate

Consolidated

Net sales(1) Customers(2) Inter-segment¥389,037¥663,084

2,630

1,420

12,634

902

3,390

3,166

24,145(24,145)-

391,668

65,74790,486

52,796

61,66024,871

687,230(24,145)

663,084

Operating expenses

348,140

57,08190,59725,64760,49325,560607,521(23,183)

584,338

Operating income (loss)¥43,528¥8,665¥ (111)¥ 27,148¥ 1,167¥ (689)79,709¥ (962)¥78,746

Total(3) For the fiscal year ended March 31, 2007
(Millions of yen; amounts less than one million yen are omitted.)
MobileBroadband

Fixed-line

InternetCommunications

Infrastructure

Telecommunications

Culture¥1,430,821¥258,824¥332,136

11,218

5,402

41,993Elimination

e-Commerce

OthersTotal¥191,509¥256,923¥74,003¥2,544,219¥-¥2,544,219

2,702

14,647

16,781

92,746(92,746)-or Corporate

Consolidated

Net sales(1) Customers(2) Inter-segment

1,442,040

264,227

374,129

194,212271,570

90,7852,636,966(92,746)2,544,219

Operating expenses

Total

1,286,296

237,418

377,095

97,667

264,889

95,5152,358,883(85,729)

2,273,153

Operating income (loss)¥155,743¥26,809¥(2,965)¥96,544¥6,680¥(4,730)¥278,082¥(7,017)¥271,065

Notes:
1. Business segments are categorized primarily based on the nature of business operations, type of services, and similarity of sales
channels, etc. which the SOFTBANK Group uses for its internal management purpose.
2. Please refer to the chart of “The SOFTBANK Group” for the main businesses segments.
3. Unallocated operating expenses for the three-month periods ended June 30, 2007, June 30, 2006 and for the fiscal year ended
March 31, 2007 in the column “Elimination or Corporate,” mainly represent expenses of the corporate division of the Company,
were totaling ¥1,519 million, ¥1,395 million and ¥8,481 million, respectively.
4. In the Mobile Communications segment, which was established for the fiscal year ended March 31, 2007, net sales and operating
expenses of SOFTBANK MOBILE Corp. and its consolidated subsidiaries were consolidated from May 2006.

36

Leases
1. Finance leases in which the ownership of leased assets is not transferred to lessees at the end of lease periods(as a lessee)(1) Amounts equivalent to acquisition costs, accumulated depreciation, and accumulated impairment loss of leased property for eachperiod:Telecommunications equipment andtelecommunications service lines
Acquisition cost
Accumulated depreciation
Accumulated impairment loss

As of June 30, 2006

As of June 30, 2007

202,110（74,630）

185,841(61,842)

185,251(60,294)

million yen(21,703)102,295 million yen(21,703)103,252 million yen

million yen

48,240(6,789)41,451 million yen

48,237(6,127)
42,109 million yen

million yen

18,533(4,997)(1,330)12,205 million yen

20,187(6,168)(1,388)
12,630 million yen

million yen

10,158(2,246)(221)
7,690 million yen

10,124(2,254)(234)
7,635 million yen

million yen

262,772(75,875)(23,255)
163,642 million yen

263,800(74,846)(23,326)
165,628 million yen

Net leased property（21,703）
105,776

Buildings and structures
Acquisition cost
Accumulated depreciation
Accumulated impairment loss
Net leased property

48,232（4,143）44,088Property and equipment - others
Acquisition cost
Accumulated depreciation
Accumulated impairment loss
Net leased property

17,232（5,788）（1,656）
9,786

Intangible assets
Acquisition cost
Accumulated depreciation
Accumulated impairment loss
Net leased property

6,702（1,252）
（287）
5,161

Total
Acquisition cost
Accumulated depreciation
Accumulated impairment loss
Net leased property

274,277（85,815）（23,647）
164,814

As of March 31, 2007

Long-term prepaid expenses relating to a lease contract, in which the contract term and payment term are different, for the period
ended at June 30, 2006, June 30, 2007 and for the fiscal year ended at March 31, 2007 were ¥3,169 million, ¥9,718 million and¥7,848 million, respectively and are included in “other assets” of investments and other assets in the Consolidated Balance
Sheets.
(2) Obligations under finance lease at the end of each period:
As of June 30, 2006

As of June 30, 2007

As of March 31, 2007

Total

34,831
161,845
196,676 million yen

32,950
162,513
195,463 million yen

33,088
165,966
199,055 million yen

Balance of allowance for impairment loss on
leased property

21,942 million yen

16,937 million yen

18,170 million yen

Due within one year
Due after one year37

(3) Lease payments, reversal of allowance for impairment loss on leased property, amounts equivalent to depreciation andinterest expense for each period:

Lease payments
Reversal of allowance for impairment loss on
leased property
Depreciation expense
Interest expenseThree-month period ended

Three-month period ended

Fiscal year ended

June 30, 2006

As of June 30, 2007

March 31, 2007

12,829 million yen

12,046 million yen

52,875 million yen

1,484

1,233

5,256

9,988
3,522

9,134
3,312

41,52914,086(4) Calculation method used to determine the amount equivalent to depreciation and interest expense:
The amount equivalent to depreciation is computed using the straight-line method over the period of the capital leases,
assuming no residual value except in cases where the residual value is guaranteed in the lease contract.
The amount equivalent to interest expense is calculated by subtracting acquisition costs from the total lease payments andallocated over the lease periods based on the interest method.
(as a lessor)(1) Acquisition cost and accumulated depreciation at the end of each period:
As of June 30, 2006

Property and equipment - others
Acquisition cost
Accumulated depreciation
Net leased property

164
(149)
15 million yen

As of June 30, 2007

- million yen

As of March 31, 2007

- million yen(2) The future lease receivables under finance lease at the end of each period:
As of June 30, 2006

Due within one year
Due after one year
Total

17
0
17 million yen

As of June 30, 2007

- million yen

As of March 31, 2007

- million yen(3) Lease income, depreciation and amount equivalent to interest income under finance lease for each period:
Three-month period ended

Three-month period ended

Fiscal year ended

June 30, 2006

June 30, 2007

March 31, 2007

Lease income
Depreciation expense
Interest income

11 million yen
100- million yen-

29 million yen
290(4) Calculation method of amount equivalent to interest income
The amount equivalent to interest income is calculated by subtracting acquisition costs from total lease income andestimated residual value and allocated over the lease periods based on the interest method.

38

2. Non-cancelable operating lease transactions(as a lessee)
The future lease payments under non-cancelable operating leases at the end of each period:
As of June 30, 2006

Due within one year
Due after one year
Total

12,922
9,258
22,181 million yen

As of June 30, 2007

6,968
3,962
10,931 million yen

As of March 31, 2007

9,898
4,386
14,284 million yen(as a lessor)
The future lease receivables under non-cancelable operating leases at the end of each period:
As of June 30, 2006

Due within one year
Due after one year
Total

1,309
2,161
3,470 million yen

39

As of June 30, 2007

1,461
2,206
3,668 million yen

As of March 31, 2007

1,258
1,700
2,958 million yen

Investment in Debt and Equity Securities
1. Marketable and investment securities at fair value(Millions of yen; amounts less than one million yen are omitted.)
As of June 30, 2007
As of March 31, 2007

As of June 30, 2006

(1)
(2)

Equity securities
Other
Total

Investment
Cost

Carrying
AmountDifferences

Investment
Cost

Carrying
AmountDifferences

Investment
Cost

Carrying
AmountDifferences

36,418233,887

197,469

40,776

201,796

161,01940,068

231,789

191,722

59

59

-

1,026

1,027

1

1,100

1,100

0

36,477

233,947

197,469

41,802

202,823

161,021

41,168232,890

191,721

2. The carrying amounts of the unlisted investment securities(Millions of yen; amounts less than one million yen are omitted.)
As of June 30, 2006
As of June 30, 2007
As of March 31, 2007

Carrying Amount

Carrying Amount

Carrying Amount(1)

Held-to-maturity debt securities:
Foreign debt securities
Debt securities(2) Available-for-sale securities:
Equity securities
Investments in limited partnerships
Money Management Fund
Foreign debt securities
Designated Money Trust
Preferred fund certificate
Other
Total

-

700

-

675

468

170

81,127

146,068

141,790

5,884

5,018

5,802

5,219

4,227

6,053

156

1,247

148

1,000

1,000

1,000

2,000

-

2,000

470

1,100

618

96,534

159,830

157,58340