[Translation]

Quarterly Report(The Third Quarter of 147th Business Term)
From October 1, 2015 to December 31, 2015

6-6, Marunouchi 1-chome, Chiyoda-ku, Tokyo

Hitachi, Ltd.

[Cover][Document Filed]

Quarterly Report (“Shihanki Hokokusho”)[Applicable Law]

Article 24-4-7, Paragraph 1 of the Financial Instruments and Exchange Act of Japan[Filed with]

Director, Kanto Local Finance Bureau[Filing Date]

February 12, 2016

[Fiscal Year]

The Third Quarter of 147th Business Term (from October 1, 2015 to December 31, 2015)[Company Name]

Kabushiki Kaisha Hitachi Seisakusho[Company Name in English] Hitachi, Ltd.
[Title and Name ofToshiaki Higashihara, President & COO

Representative][Address of Head Office]6-6, Marunouchi 1-chome, Chiyoda-ku, Tokyo[Phone No.]

03-3258-1111[Contact Person]

Taro Kaiho, Manager, Legal Division[Contact Address]

6-6, Marunouchi 1-chome, Chiyoda-ku, Tokyo[Phone No.]

03-3258-1111[Contact Person]

Taro Kaiho, Manager, Legal Division[Place Where Available forTokyo Stock Exchange, Inc.

Public Inspection](2-1, Nihombashi Kabutocho, Chuo-ku, Tokyo)
Nagoya Stock Exchange, Inc.
(8-20, Sakae 3-chome, Naka-ku, Nagoya)

This is an English translation of the Quarterly Report filed with the Director of the Kanto Local Finance Bureau via
Electronic Disclosure for Investors’ NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan.
The translation of the Confirmation Letter for the original Quarterly Report is included at the end of this document.
Unless the context indicates otherwise, the term “Company” refers to Hitachi, Ltd. and the term “Hitachi” refers to theCompany and its consolidated subsidiaries.
Unless otherwise stated, in this document, where we present information in millions or hundreds of millions of yen, we
have truncated amounts of less than one million or one hundred million, as the case may be. Accordingly, the total of figures
presented in columns or otherwise may not equal the total of the individual items. We have rounded all percentages to thenearest percent, one-tenth of one percent or one-hundredth of one percent, as the case may be.
References in this document to the “Financial Instruments and Exchange Act” are to the Financial Instruments andExchange Act of Japan and other laws and regulations amending and/or supplementing the Financial Instruments andExchange Act of Japan.

Contents
Part I Information on the Company ............................................................................................................................. 1
I. Overview of the Company ................................................................................................................................... 1
1. Key Financial Data...................................................................................................................................... 1
2. Description of Business .............................................................................................................................. 1
II. Business Overview ............................................................................................................................................. 2
1. Risk Factors................................................................................................................................................. 2
2. Material Agreements, etc. ........................................................................................................................... 2
3. Analyses of Consolidated Financial Condition, Operating Results and Cash Flows ................................. 3
III. Information on the Company .......................................................................................................................... 11
1. Information on the Company’s Stock, etc. ............................................................................................... 11(1) Total number of shares, etc. ................................................................................................................. 11(2) Information on the stock acquisition rights, etc. .................................................................................. 11(3) Information on moving strike convertible bonds, etc. ......................................................................... 11(4) Information on shareholder right plans ................................................................................................ 11(5) Changes in the total number of issued shares and the amount of common stock and other ................ 11(6) Major shareholders ............................................................................................................................... 11(7) Information on voting rights................................................................................................................. 12
2. Changes in Senior Management ............................................................................................................... 12
IV. Financial Information ..................................................................................................................................... 13
Part II Information on Guarantors, etc. for the Company .......................................................................................... 13[Condensed Quarterly Consolidated Financial Statements] ........................................................................................F-1[Confirmation Letter] .................................................................................................................................................. A-1

Part I Information on the Company
I. Overview of the Company
1. Key Financial Data
Consolidated financial data, etc.

Revenues(Millions of yen, unless otherwise stated)
Nine months ended Nine months ended
Year ended
December 31, 2014 December 31, 2015 March 31, 2015
6,945,817
7,230,258
9,774,930[2,393,741][2,423,370]

Income from continuing operations, before
income taxes
Net income attributable to Hitachi, Ltd.
stockholders
Comprehensive income attributable to Hitachi, Ltd.
stockholders

368,631400,574

518,994

162,382[44,751]

172,966[75,375]

217,482

297,614

109,042

337,578

Total Hitachi, Ltd. stockholders’ equity

2,903,205

2,988,750

2,942,281

Total equity

4,232,037

4,402,160

4,296,342

Total assets

12,398,337

12,823,028

12,433,727

Earnings per share attributable to Hitachi, Ltd.
stockholders, basic (yen)Earnings per share attributable to Hitachi, Ltd.
stockholders, diluted (yen)33.63[9.27]

35.82[15.61]

45.04

33.60

35.79

45.00

Total Hitachi, Ltd. stockholders’ equity ratio (%)

23.4

23.3

23.7

Net cash provided by operating activities

114,366

386,375

451,825

Net cash used in investing activities(430,578)(552,919)(612,545)

Net cash provided by financing activities

431,701

228,671

233,206

Cash and cash equivalents at end of period

749,735

736,125

701,703(Notes)

1. Our consolidated financial statements have been prepared in conformity with the International
Financial Report Standards (“IFRS”) as issued by the International Accounting Standards Board.
2. Revenues do not include the consumption tax, etc.
3. A part of the thermal power generation systems business is classified as a discontinued operationin accordance with the provision of IFRS 5 "Non-current Assets Held for Sale and Discontinued
Operations," which was not transferred to MITSUBISHI HITACHI POWER SYSTEMS, LTD. forthe business integration in the thermal power generation systems with Mitsubishi Heavy Industries,
Ltd. The results of the discontinued operation are reported separately from continuing operations.
4. The figures of “Revenues,” “Net income attributable to Hitachi, Ltd. stockholders” and “Earnings
per share attributable to Hitachi, Ltd. stockholders, basic” in square bracket are those for the threemonths ended December 31, 2014 and 2015, respectively.

2. Description of Business
There were no material changes in principal businesses of Hitachi during the nine months ended December
31, 2015. The Hitachi Group is comprised of the Company, 1,040 consolidated subsidiaries, and 301
equity-method associates and joint-ventures. Consolidated trust accounts are not included in the number ofconsolidated subsidiaries.

1Changes of businesses in each segment and principal affiliated companies during the nine months ended
December 31, 2015 were as follows.
Positioning of principal affiliated companies
Manufacturing
Sales and services(Reclassified its segment) (Note 1)
Social Infrastructure & Industrial Systems (Reclassified its segment) (Note 1)[Consolidated subsidiaries][Consolidated subsidiaries](Reclassified its segment) (Note 1)
Hitachi Power Solutions Co., Ltd.
Hitachi-GE Nuclear Energy, Ltd.
Thermal, Nuclear and Renewable
Horizon Nuclear Power Limited[Equity-method associates]
Energy Power Generation Systems,
MITSUBISHI HITACHI POWER
Transmission & Distribution Systems
SYSTEMS, LTD.
Smart Life & Ecofriendly Systems[Equity-method associates](New)
Johnson Controls-Hitachi Air
Conditioning Holding (UK) Ltd (Note 2)(Notes) 1. Effective from April 1, 2015, the Power Systems segment was abolished and the businesses and affiliatedcompanies previously constituting this segment have been integrated into the Social Infrastructure & Industrial
Systems segment.
2. Effective from October 1, 2015, Johnson Controls-Hitachi Air Conditioning Holding (UK) Ltd became theCompany’s equity-method associate. This company is a holding company for a number of companies including an
operating company which succeeded the air conditioning system business of Hitachi Appliances, Inc.
Segment

II. Business Overview
1. Risk Factors
There were no new risk factors recognized during the nine months ended December 31, 2015.
There were no material changes in the risk factors stated in the Annual Securities Report for the 146thbusiness term pursuant to the Financial Instruments and Exchange Act of Japan.
2. Material Agreements, etc.
Absorption-type Company Split
On July 21, 2015, the Company decided that it would conduct absorption-type mergers of Hitachi Medical
Corporation (“Hitachi Medical”) and Hitachi Aloka Medical, Ltd. (“Hitachi Aloka Medical”) on April 1, 2016,
aiming to strengthen Hitachi’s healthcare business and accelerate growth of this business.
After that, as a result of further consideration on the optimum business operation structure, etc., on January
13, 2016, the Company decided that it would succeed non-manufacturing divisions of Hitachi Medical and
Hitachi Aloka Medical through an absorption-type company split (the “Company Split) in place of the mergers
initially planned, and executed an absorption-type company split agreement.
The details of the Company Split are as follows.
(1) Company Split Method
This is an absorption-type company split in which the Company is the successor company and
Hitachi Medical and Hitachi Aloka Medical are the transferring companies.
(2) Effective Date of the Company Split
April 1, 2016
(3) Assets and liabilities succeeded for the Company Split (As of March 31, 2016 (forecast))
Assets: ¥174,700 million
Liabilities: ¥84,300 million(4) Details of Allotments Related to the Company Split
There will be no allotment of shares or other assets as a result of the Company Split, because theCompany directly or indirectly holds all of issued shares of Hitachi Medical and Hitachi Aloka Medical.

2(5) Profile of the Successor Company after the Company Split
Name
Hitachi, Ltd.
Head office
6-6, Marunouchi 1-chome, Chiyoda-ku, Tokyo
Representative Toshiaki Higashihara, President & CEO
Capital458,790 million yen
Development, manufacture and sales of products and provision of services across
9 segments: Information & Telecommunication Systems, Social Infrastructure & Industrial
Business
Systems, Electronic Systems & Equipment, Construction Machinery, High Functional
Materials & Components, Automotive Systems, Smart Life & Ecofriendly Systems,
Others (Logistics and Other services) and Financial Services (consolidated basis)
3. Analyses of Consolidated Financial Condition, Operating Results and Cash Flows(1) Outline of Business Results
Effective from April 1, 2015, the Power Systems segment has been integrated to the Social Infrastructure& Industrial Systems segment. Figures for the Social Infrastructure & Industrial Systems segment, including
those for the nine months ended December 31, 2014, reflect the new segmentation.
Results of Operations
During the nine months ended December 31, 2015, the U.S. economy continued to show an improvement
in employment and income conditions, and recovery trend in consumer spending. The European economy also
showed the signs of improvement with the support of quantitative easing policy. The Chinese economic growthcontinued to decelerate owing to the slowdown in investment and production primarily in the manufacturingindustry saddled with excessive production capacity. Economic growth in emerging countries also slowed down
owing to declines in crude oil and raw materials prices. The Japanese economy was on a recovery trend, due
mainly to solid consumer spending supported by improvement in employment and income conditions as well asa sustained recovery in corporate earnings. However, the pace of recovery slowed down because of sluggish
growth in production resulting mainly from decline in exports to China.
Under these conditions, results of operations in the nine months ended December 31, 2015 were as
follows.
Revenues increased 4% to ¥7,230.2 billion, as compared with the nine months ended December 31, 2014,
due mainly to higher revenues in the Information & Telecommunication Systems, Social Infrastructure &Industrial Systems, High Functional Materials & Components and Automotive Systems segments. This increase
was partially offset by lower revenues in the Construction Machinery and Smart Life & Ecofriendly Systems
segments, etc.
Cost of sales increased 4% to ¥5,360.3 billion, as compared with the nine months ended December 31,
2014, and the ratio of cost of sales to revenues was 74%, which was the same level as the nine months ended
December 31, 2014. Gross profit increased 3% to ¥1,869.9 billion, as compared with the nine months ended
December 31, 2014.
Selling, general and administrative expenses (“SG&A”) increased 3% to ¥1,461.5 billion, as comparedwith the nine months ended December 31, 2014, and the ratio of SG&A to revenues was 20%, which was thesame level as the nine months ended December 31, 2014.
Other income increased ¥41.4 billion to ¥49.5 billion, as compared with the nine months ended December
31, 2014, due mainly to increased net gain on business reorganization and others partly because of the sale of apart of equity interest in Hitachi Tool Engineering, Ltd. by Hitachi Metals, Ltd. and the reorganization of the
air-conditioning systems business with Johnson Controls Inc. Other expenses decreased ¥3.4 billion to ¥50.9
billion, as compared with the nine months ended December 31, 2014, due mainly to decreased net loss on sales
and disposal of fixed assets and expenses related to competition law and others. This decrease was partially
offset by increased restructuring charges.
Financial income (excluding interest income) decreased ¥2.9 billion to ¥10.0 billion and financial
expenses (excluding interest charges) increased ¥17.2 billion to ¥20.9 billion, as compared with the nine months
ended December 31, 2014, respectively. This was due mainly to posting exchange loss, while exchange gain was
posted in the nine months ended December 31, 2014.
Share of profits of investments accounted for using the equity method decreased ¥7.0 billion to ¥14.7
billion, as compared with the nine months ended December 31, 2014.
EBIT (earnings before interest and taxes, which is presented as income from continuing operations, before
income taxes less interest income plus interest charges) increased ¥31.8 billion to ¥410.9 billion, as comparedwith the nine months ended December 31, 2014.

3

Interest income decreased ¥0.4 billion to ¥9.0 billion and interest charges decreased ¥0.5 billion to ¥19.3
billion, as compared with the nine months ended December 31, 2014, respectively.
Income from continuing operations, before income taxes increased ¥31.9 billion to ¥400.5 billion, as
compared with the nine months ended December 31, 2014.
Income taxes increased ¥23.2 billion to ¥116.6 billion, as compared with the nine months ended December
31, 2014.
Loss from discontinued operation decreased ¥10.0 billion to ¥14.4 billion, as compared with the ninemonths ended December 31, 2014.
Net income increased ¥18.7 billion to ¥269.4 billion, as compared with the nine months ended December
31, 2014.
Net income attributable to non-controlling interests increased ¥8.1 billion to ¥96.5 billion, as comparedwith the nine months ended December 31, 2014.
As a result of the foregoing, net income attributable to Hitachi, Ltd. stockholders increased ¥10.5 billion to¥172.9 billion, as compared with the nine months ended December 31, 2014.
Operations by Segment
The following is an overview of results of operations by segment. Revenues for each segment include
intersegment transactions. Segment profit is measured by EBIT.
(Information & Telecommunication Systems)
Revenues increased 6% to ¥1,501.6 billion, as compared with the nine months ended December 31, 2014,
due mainly to strong performances by the system solutions business, centered on financial systems, and higher
revenues from the storage solutions business as a result of the effects of foreign exchange rate fluctuations.
Segment profit increased ¥7.2 billion to ¥70.6 billion, as compared with the nine months ended December
31, 2014, due mainly to higher profits in the system solutions business resulting from increased revenues. This
increase was partially offset by lower profits in the platform business owing to the effect of reduction in capital
investment by Japanese telecommunications carriers in the telecommunications & network business, todecreased demand for high-end storage in North America and to posting expenses for business restructuring.
(Social Infrastructure & Industrial Systems)
Revenues increased 9% to ¥1,514.4 billion, as compared with the nine months ended December 31, 2014,
due mainly to significantly increased revenues from the railway systems business mainly resulting from theacquisition of signaling systems and railway businesses of Finmeccanica S.p.A., an Italian company, and tostrong performances by the elevators and escalators business.
Segment profit decreased ¥16.6 billion to ¥33.8 billion, as compared with the nine months ended
December 31, 2014, due mainly to increased losses from certain overseas projects in the infrastructure systems
business and a decrease in share of profits of investments accounted for using the equity method in the powersystems business. This decrease was partially offset by the higher profits in the railway systems business and theelevators and escalators business due mainly to higher revenues.
(Electronic Systems & Equipment)
Revenues increased 3% to ¥808.1 billion, as compared with the nine months ended December 31, 2014,
due mainly to higher sales of semiconductor manufacturing equipments at Hitachi Kokusai Electric Inc. andelectron microscopes and medical analysis equipments at Hitachi High-Technologies Corporation.
Segment profit increased ¥4.9 billion to ¥47.1 billion, as compared with the nine months ended December
31, 2014, due mainly to higher profits as a result of increased revenues at Hitachi Kokusai Electric Inc., andposting non-recurring gain for the shift to a defined contribution pension plan at Hitachi High-Technologies
Corporation.
(Construction Machinery)
Revenues decreased 5% to ¥549.1 billion, as compared with the nine months ended December 31, 2014,
due mainly to sluggish market conditions in Asia, in particular China, as well as Oceania and Russia.
Segment profit decreased ¥37.2 billion to ¥5.4 billion, as compared with the nine months ended December
31, 2014, due mainly to lower revenues and a higher ratio of compact models with lower profitability in the
product mix owing to exhaust emission regulations in Japan and product mix changes in China. This decrease4was also attributable to disposal of inventories, foreign exchange losses due to the depreciation of
emerging-market currencies and expenses for business restructuring.
(High Functional Materials & Components)
Revenues increased 8% to ¥1,188.2 bullion, as compared with the nine months ended December 31, 2014,
due mainly to the effects of the consolidation of Waupaca Foundry, Inc. by Hitachi Metals, Ltd. in November
2014 and higher sales for automobile-related products mainly in North America.
Segment profit increased ¥34.0 billion to ¥119.5 billion, as compared with the nine months ended
December 31, 2014, due mainly to higher revenues, the effects of business restructuring and posting net gain on
business reorganization and others related to the sale of a part of equity interest in Hitachi Tool Engineering,
Ltd. by Hitachi Metals, Ltd.
(Automotive Systems)
Revenues increased 9% to ¥741.5 billion, as compared with the nine months ended December 31, 2014,
due mainly to growth in sales driven by robust demand for automobiles in North America and China.
Segment profit increased ¥14.4 billion to ¥39.5 billion, as compared with the nine months ended
December 31, 2014, due mainly to higher revenues and the absence of expenses related to competition law andothers recorded in the nine months ended December 31, 2014.
(Smart Life & Ecofriendly Systems)
Revenues decreased 3% to ¥539.0 billion, as compared with the nine months ended December 31, 2014,
due mainly to the effect of reorganization of the air-conditioning systems business with an equity-method
associate, a joint venture company with Johnson Controls, Inc.
Segment profit increased ¥9.0 billion to ¥34.8 billion, as compared with the nine months ended December
31, 2014, due mainly to posting net gain on business reorganization and others related to the reorganization of
the air-conditioning systems business. This increase was partially offset by the decreased revenues.
(Others (Logistics and Other services))
Revenues decreased 1% to ¥935.6 billion, as compared with the nine months ended December 31, 2014,
due mainly to lower revenues of optical disk drives business owing to lower demand, despite higher revenues at
Hitachi Transport System, Ltd.
Segment profit increased ¥10.6 billion to ¥38.1 billion, as compared with the nine months ended
December 31, 2014, due mainly to increased earnings at Hitachi Transport System, Ltd. resulting from higher
revenues and improved profitability.
(Financial Services)
Revenues increased 3% to ¥272.9 billion, as compared with the nine months ended December 31, 2014,
due mainly to a strong performance in overseas business, particularly in North America.
Segment profit increased ¥7.4 billion to ¥35.7 billion, as compared with the nine months ended December
31, 2014, due mainly to higher revenues and the effects of business restructuring.
Revenues by Market
Revenues in Japan decreased 1% to ¥3,609.6 billion, as compared with the nine months ended December
31, 2014, due mainly to lower revenues in the High Functional Materials & Components and Automotive
Systems segments, despite higher revenues in the Information & Telecommunication Systems and Social
Infrastructure & Industrial Systems segments, etc.
Overseas revenues increased 10% to ¥3,620.6 billion, as compared with the nine months ended December
31, 2014, due mainly to higher revenues in North America mainly in the High Functional Materials &Components segment, primarily resulting from the consolidation of Waupaca Foundry, Inc. by Hitachi Metals,Ltd., higher revenues in Europe mainly in the Social Infrastructure & Industrial Systems segment, primarily
resulting from the acquisition of signaling systems and railway businesses of Finmeccanica S.p.A., and theeffects of yen’s depreciation against local currencies in North America and Asia.
As a result, the ratio of overseas revenues to total revenues increased 2% to 50%, as compared with thenine months ended December 31, 2014.

5

(2) Summary of Financial Condition, etc.
Liquidity and Capital Resources
During the nine months ended December 31, 2015, there were no major changes in the Company’s
policies of maintaining liquidity and ensuring funds, efforts for improvement in fund management efficiency,
and ideas regarding funding sources and fundraising.
Cash Flows(Cash flows from operating activities)
Net income in the nine months ended December 31, 2015 increased ¥18.7 billion to ¥269.4 billion, as
compared with the nine months ended December 31, 2014. Increase in inventories in the nine months ended
December 31, 2015 decreased ¥86.7 billion to ¥163.5 billion, as compared with the nine months ended
December 31, 2014. Decrease in trade receivables in the nine months ended December 31, 2015 increased¥170.9 billion to ¥184.2 billion, as compared with the nine months ended December 31, 2014. This is because
collection of receivables recorded at the end of the fiscal year ended March 31, 2015 proceeded in the ninemonths ended December 31, 2015. Decrease in trade payables in the nine months ended December 31, 2015
decreased ¥15.5 billion to ¥66.5 billion, as compared with the nine months ended December 31, 2014. Decrease
in retirement and severance benefits in the nine months ended December 31, 2015 increased ¥8.4 billion to ¥51.5
billion, as compared with the nine months ended December 31, 2014. As a result of the foregoing, cash flows
from operating activities recorded net cash inflow of ¥386.3 billion in the nine months ended December 31,
2015, an increase of ¥272.0 billion compared with the nine months ended December 31, 2014.
(Cash flows from investing activities)
A net sum of ¥474.9 billion in the nine months ended December 31, 2015 was recorded as investments
related to property, plant and equipment, where the proceeds from sale of property, plant and equipment, andintangible assets, the proceeds from sale of leased assets and the collection of lease receivables were subtracted
from the amount of the purchase of property, plant and equipment, the purchase of intangible assets and thepurchase of leased assets. This net sum increased by ¥75.3 billion compared with the nine months ended
December 31, 2014. Purchase of investments in securities and other financial assets (including investments in
subsidiaries and investments accounted for using the equity method) in the nine months ended December 31,
2015 increased ¥35.5 billion to ¥160.7 billion, as compared with the nine months ended December 31, 2014, due
mainly to the acquisition of signaling systems and railway businesses of Finmeccanica S.p.A. and the acquisitionof Pentaho Corporation by Hitachi Data Systems Corporation. Proceeds from sale of investments in securities
and other financial assets (including investments in subsidiaries and investments accounted for using the equity
method) in the nine months ended December 31, 2015 decreased ¥15.8 billion to ¥77.8 billion, as compared with
the nine months ended December 31, 2014. As a result of the foregoing, cash flows from investing activities
recorded net cash outflow of ¥552.9 billion in the nine months ended December 31, 2015, an increase of ¥122.3
billion compared with the nine months ended December 31, 2014.
(Cash flows from financing activities)
Net increase in short-term debt was ¥199.7 billion in the nine months ended December 31, 2015, a
decrease of ¥75.2 billion compared with the nine months ended December 31, 2014. A net sum of ¥134.1 billion
in the nine months ended December 31, 2015 was recorded as proceeds related to long-term debt, where thepayments on long-term debt were subtracted from the proceeds from long-term debt. This net inflow decreasedby ¥124.5 billion compared with the nine months ended December 31, 2014. As a result of the foregoing, cash
flows from financing activities recorded net cash inflow of ¥228.6 billion in the nine months ended December
31, 2015, a decrease of ¥203.0 billion compared with the nine months ended December 31, 2014.
As a result of the foregoing, cash and cash equivalents as of December 31, 2015 was ¥736.1 billion, an
increase of ¥34.4 billion from March 31, 2015. Free cash flows, the sum of cash flows from operating andinvesting activities, were an outflow of ¥166.5 billion in the nine months ended December 31, 2015, a decreaseof ¥149.6 billion compared with the nine months ended December 31, 2014.

6

Assets, Liabilities and Equity
The following is an overview of Hitachi’s assets, liabilities and equity as of December 31, 2015.
Total assets were ¥12,823.0 billion, an increase of ¥389.3 billion from March 31, 2015. This was due
mainly to the acquisition of signaling systems and railway businesses of Finmeccanica S.p.A., the acquisition ofPentaho Corporation by Hitachi Data Systems Corporation and an increase in trade receivables associated withbusiness expansion, especially for foreign markets, in the Financial Services segment. This decrease waspartially offset by the effect of reorganization of the air-conditioning systems business, decreases in the value of
assets denominated in foreign currency owing to the appreciation of yen and the effect of lower stock price.
Total interest-bearing debt, the sum of short-term debt and long-term debt, was ¥3,909.9 billion, an
increase of ¥352.6 billion from March 31, 2015. This was due mainly to higher demand for funds in line withbusiness expansion in the Financial Services segment.
Total Hitachi, Ltd. stockholders’ equity increased by ¥46.4 billion from March 31, 2015, to ¥2,988.7
billion, due mainly to posting of net income attributable to Hitachi, Ltd. stockholders, despite a decrease inaccumulated other comprehensive income. The ratio of total Hitachi, Ltd. stockholders’ equity to total assets
decreased 0.4% from March 31, 2015 to 23.3%.
Non-controlling interests were ¥1,413.4 billion, an increase of ¥59.3 billion from March 31, 2015.
Total equity was ¥4,402.1 billion, an increase of ¥105.8 billion from March 31, 2015. The ratio ofinterest-bearing debt to total equity was 0.89, as compared with 0.83 as of March 31, 2015.
(3) Challenges Facing Hitachi Group
1) Business and Financial Condition
There were no material changes in Hitachi’s business strategy during the nine months ended December 31,
2015.
2) Fundamental Policy on the Conduct of Persons Influencing Decision on the Company’s Financial andBusiness Policies
The Group invests a great deal of business resources in fundamental research and in the development ofmarket-leading products and businesses that will bear fruit in the future, and realizing the benefits from thesemanagement policies requires that they be continued for a set period of time. For this purpose, the Company
keeps its shareholders and investors well informed of not just the business results for each period but also of theCompany’s business policies for creating value in the future.
The Company does not deny the significance of the vitalization of business activities and performance thatcan be brought about through a change in management control, but it recognizes the necessity of determining
the impact on company value and the interests of all shareholders of the buying activities and buyout proposals
of parties attempting to acquire a large share of stock of the Company or a Group company by duly examining
the business description, future business plans, past investment activities, and other necessary aspects of such aparty.
There is no party that is currently attempting to acquire a large share of the Company’s stocks nor is therea specific threat, neither does the Company intend to implement specified so-called anti-takeover measures inadvance of the appearance of such a party, but the Company does understand that it is one of the natural duties
bestowed upon it by the shareholders and investors to continuously monitor the state of trading of theCompany’s stock and then to immediately take what the Company deems to be the best action in the event of
the appearance of a party attempting to purchase a large share of the Company’s stock. In particular, together
with outside experts, the Company will evaluate the buyout proposal of the party and hold negotiations with thebuyer, and if the Company deems that said buyout will not maintain the Company’s value and is not in the bestinterest of the shareholders, then the Company will quickly determine the necessity, content, etc., of specificcountermeasures and prepare to implement them. The same response will also be taken in the event a party
attempts to acquire a large percentage of the shares of a Group company.
(4) Research and Development
There were no material changes in the research and development of the Hitachi Group (the Company andconsolidated subsidiaries) stated in the Annual Securities Report for the 146th business term pursuant to the
Financial Instruments and Exchange Act of Japan. The Hitachi Group’s R&D expenditures in the nine months
ended December 31, 2015 were ¥246.5 billion, 3.4% of revenues. A breakdown of R&D expenditures bysegment is shown below.

7

(Billions of yen)
Nine months ended
December 31, 2015
44.4
33.5
36.1
13.7
34.8
53.6
7.7
3.8
0.0
18.3
246.5

Segment
Information & Telecommunication Systems
Social Infrastructure & Industrial Systems
Electronic Systems & Equipment
Construction Machinery
High Functional Materials & Components
Automotive Systems
Smart Life & Ecofriendly Systems
Others (Logistics and Other services)
Financial Services
Corporate
Total(5) Employees

The number of employees of the Company increased by 6,379 persons during the nine months ended
December 31, 2015, to 37,754 persons.
For this increase, the following shows segments where the number of employees of the Company
significantly increased.
The number of employees of the Company in the Information & Telecommunication Systems segment
increased by 3,451 persons, to 17,324 persons. This increase was due mainly to the absorption-type company
split in which the Company succeeded the system solutions business in the social infrastructure, financial, andgovernment & public sectors in Hitachi Solutions, Ltd. on April 1, 2015.
The number of employees of the Company in the Electronic Systems & Equipment segment increased by
3,270 persons, to 3,369 persons. This increase was due mainly to temporally transfer of employees of Hitachi
Medical Corporation and Hitachi Aloka Medical, Ltd. to the Company on April 1, 2015 for integrated
management of the healthcare business.
There were no material changes in the number of employees of the Hitachi Group (the Company andconsolidated subsidiaries).
(6) Property, Plants and Equipment
The major property, plants and equipment materially changed during the nine months ended December 31,
2015 are as follows. This was due mainly to the absorption-type company split in which the Company succeeded
the system solutions business in the social infrastructure, financial, and government & public sectors in Hitachi
Solutions, Ltd. on April 1, 2015.
The Company(As of December 31, 2015)
Book value (Millions of yen)
Details ofLand
Tools,
Number of
Facility
Buildings Machinery
Segment
major
facilities
Construction[Areainfurniture(Main location)
employees
and
and
Total
Other
and equipment thousands
andin progressstructures vehicles
2of m ]
fixtures
Systemdevelopment
Information &Telecommunication Information & facilities,
15,820manufacturing
Systems Company Telecommuni- facilities for
58,005
1,999 26,656 3,431
961 106,876
16,621[609](Shinagawa-ku,
cation Systems servers,
Tokyo)
mainframes,
etc.

8Domestic subsidiaries(As of December 31, 2015)
Facility(Main location)

HitachiSolutions, Ltd.,
Head Office(Shinagawa-ku,
Tokyo)

Segment

Book value (Millions of yen)
Details ofTools,
Land
Number ofmajor facilities [Area in Buildings Machinery furniture
Construction
employees
and
and
Total
Other
and equipment thousands
andinprogress
structures
vehiclesfixturesof m2]

Information &Telecommuni- Other facilities
cation Systems

－
[－]

504

－

691

79

－

1,275

(7) Forward-Looking Statements
Certain statements found in “3. Analyses of Consolidated Financial Condition, Operating Results and Cash
Flows” and other descriptions in this report may constitute “forward-looking statements” as defined in the U.S.
Private Securities Litigation Reform Act of 1995. Such “forward-looking statements” reflect management’s
current views with respect to certain future events and financial performance and include any statement that does
not directly relate to any historical or current fact. Words such as “anticipate,” “believe,” “expect,” “estimate,”“forecast,” “intend,” “plan,” “project” and similar expressions which indicate future events and trends may
identify “forward-looking statements.” Such statements are based on currently available information and are
subject to various risks and uncertainties that could cause actual results to differ materially from those projectedor implied in the “forward-looking statements” and from historical trends. Certain “forward-looking statements”
are based upon current assumptions of future events which may not prove to be accurate. Undue reliance should
not be placed on “forward-looking statements,” as such statements speak only as of the date of this report.
Factors that could cause actual results to differ materially from those projected or implied in any“forward-looking statement” and from historical trends include, but are not limited to:
•

•
•
•
•
•
•
•
•
•
•
•
•
•
•
•

economic conditions, including consumer spending and plant and equipment investment in Hitachi’s major
markets, particularly Japan, Asia, the United States and Europe, as well as levels of demand in the majorindustrial sectors Hitachi serves, including, without limitation, the information, electronics, automotive,
construction and financial sectors;
exchange rate fluctuations of the yen against other currencies in which Hitachi makes significant sales or inwhich Hitachi’s assets and liabilities are denominated, particularly against the U.S. dollar and the euro;
uncertainty as to Hitachi’s ability to access, or access on favorable terms, liquidity or long-term financing;
uncertainty as to general market price levels for equity securities, declines in which may require Hitachi towrite down equity securities that it holds;
uncertainty as to Hitachi’s ability to continue to develop and market products that incorporate newtechnologies on a timely and cost-effective basis and to achieve market acceptance for such products;
the possibility of cost fluctuations during the lifetime of, or cancellation of, long-term contracts for which
Hitachi uses the percentage-of-completion method to recognize revenue from sales;credit conditions of Hitachi’s customers and suppliers;
fluctuations in the price of raw materials including, without limitation, petroleum and other materials, suchas copper, steel, aluminum, synthetic resins, rare metals and rare-earth minerals, or shortages of materials,
parts and components;
fluctuations in product demand and industry capacity;
uncertainty as to Hitachi’s ability to implement measures to reduce the potential negative impact offluctuations in product demand, exchange rates and/or price of raw materials or shortages of materials, partsand components;
increased commoditization of and intensifying price competition for products;
uncertainty as to Hitachi’s ability to achieve the anticipated benefits of its strategy to strengthen its Social
Innovation Business;
uncertainty as to the success of acquisitions of other companies, joint ventures and strategic alliances andthe possibility of incurring related expenses;
uncertainty as to the success of restructuring efforts to improve management efficiency by divesting orotherwise exiting underperforming businesses and to strengthen competitiveness;
uncertainty as to the success of cost reduction measures;
general socioeconomic and political conditions and the regulatory and trade environment of countries where
Hitachi conducts business, particularly Japan, Asia, the United States and Europe, including, without

9

2,543

•
•
•
•
•
•
•
•
•

limitation, direct or indirect restrictions by other nations on imports and differences in commercial andbusiness customs including, without limitation, contract terms and conditions and labor relations;
uncertainty as to the success of alliances upon which Hitachi depends, some of which Hitachi may notcontrol, with other corporations in the design and development of certain key products;
uncertainty as to Hitachi’s access to, or ability to protect, certain intellectual property rights, particularly
those related to electronics and data processing technologies;
uncertainty as to the outcome of litigation, regulatory investigations and other legal proceedings of which
the Company, its subsidiaries or its equity-method associates and joint ventures have become or may
become parties;
the possibility of incurring expenses resulting from any defects in products or services of Hitachi;
the potential for significant losses on Hitachi’s investments in equity-method associates and joint ventures;the possibility of disruption of Hitachi’s operations by natural disasters such as earthquakes and tsunamis,the spread of infectious diseases, and geopolitical and social instability such as terrorism and conflict;uncertainty as to Hitachi’s ability to maintain the integrity of its information systems, as well as Hitachi’s
ability to protect its confidential information or that of its customers;
uncertainty as to the accuracy of key assumptions Hitachi uses to evaluate its significant employee
benefit-related costs; anduncertainty as to Hitachi’s ability to attract and retain skilled personnel.

The factors listed above are not all-inclusive and are in addition to other factors contained elsewhere in thisreport and in other materials published by Hitachi.

10III. Information on the Company
1. Information on the Company’s Stock, etc.
(1) Total number of shares, etc.
1) Total number of shares

Common stock

Total number of shares authorized to be issued(shares)
10,000,000,000

Total

10,000,000,000

Class2) Issued shares
Class

Number of sharesissued as of the end of
third quarter (shares)(December 31, 2015)

Number of sharesissued as of the filingdate (shares)(February 12, 2016)

Commonstock

4,833,463,387

4,833,463,387

Total

4,833,463,387

4,833,463,387

Stock exchange on which
the Company is listed
Tokyo, Nagoya

Description
The number ofshares per one unit ofshares is 1,000
shares.

－－(2) Information on the stock acquisition rights, etc.
Not applicable.
(3) Information on moving strike convertible bonds, etc.
Not applicable.
(4) Information on shareholder right plans
Not applicable.
(5) Changes in the total number of issued shares and the amount of common stock and other

Date
From October 1, 2015
to December 31, 2015

Change in the Balance of the Change in Balance of Change in Balance of
total number total number of common
capitalcommoncapitalof issuedstockreservestock
reserveissued sharesshares(Millions of (Millions of (Millions of (Millions of(shares)(shares)
yen)
yen)
yen)
yen)
－

4,833,463,387(6) Major shareholders
Not applicable.

11－458,790－

176,757

(7) Information on voting rights
Information on voting rights as of September 30, 2015 is stated in this item because the Company does not
identify the number of voting rights as of December 31, 2015 due to the lack of information on the number of
the Company’s shares held by the entity which the Company holds one quarter or more of total number ofvoting rights of such entity as of December 31, 2015.
1) Issued sharesClassification(As of September 30, 2015)
Number of voting
Description
rightsNumber of shares (shares)

Shares without voting right
Shares with restricted voting
right (treasury stock, etc.)
Shares with restricted voting
right (others)
Shares with full voting right(treasury stock, etc.)
Shares with full voting right(others)
Shares less than one unit

－

－

－

－

－

－

－

－

－

－

－

Common stock

5,248,000

Common stock

4,805,396,000

4,805,396－

Common stock

22,819,387－－

4,833,463,387－－

4,805,396－

Number of issued shares
Total number of voting rights－(Note) The “Shares with full voting right (others)” column includes 26,000 shares registered in the name ofJapan Securities Depository Center, Incorporated (account for managing stocks whose shareholders havenot transferred titles) and 26 voting rights for those shares.
2) Treasury stock, etc.

Name ofshareholder

Hitachi, Ltd.
Aoyama Special
Steel Co., Ltd.
ISHIIDENKOSHA
Co., Ltd.
SAITAKOUGYOU CO.,LTD.

Address

6-6, Marunouchi 1-chome,
Chiyoda-ku, Tokyo
9-11, Shinkawa 2-chome,
Chuo-ku, Tokyo
1-11, Oroshishinmachi
3-chome, Higashi-ku,
Niigata-shi, Niigata

Number of
Number ofshares held
shares held
under theunder own name names of(shares)others(shares)(As of September 30, 2015)
Ownership
percentage to
Total shares
the total
held (shares)
number ofissued shares(%)

5,082,000－

5,082,000

0.11

10,000－10,000

0.00

1,000

－

1,000

0.00

88,000－88,0000.00

5-3, Takinogawa 5-chome,
Kita-ku, Tokyo

52,000－52,0000.00

Mizuho Co., Inc.

3268, Nagaoka,
Ibarakimachi,
Higashiibaraki-gun, Ibaraki
4-1, Koishikawa 5-chome,
Bunkyo-ku, Tokyo

15,000－15,000

0.00

Total

－

5,248,000－

5,248,000

0.11

Nitto Jidosha
Kiki K.K.

2. Changes in Senior Management
There were no changes in senior management from the filing date of the Annual Securities Report for the146th business term pursuant to the Financial Instruments and Exchange Act of Japan to December 31, 2015.

12

IV. Financial Information
Refer to the condensed quarterly consolidated financial statements incorporated in this Quarterly Report.

Part II Information on Guarantors, etc. for the Company
Not applicable.

13

CONDENSED QUARTERLY CONSOLIDATED FINANCIAL STATEMENTSCONDENSED QUARTERLY CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
Millions of yen
December 31,

March 31,

2015

2015

736,1252,800,339
333,658
1,587,466
577,761

701,7032,870,042
337,353
1,458,119
515,195

6,035,349

5,882,412

710,970
1,415,609
724,875
2,509,081
1,081,143
346,001

681,623
1,449,734
680,620
2,472,497
933,582
333,259

Total non-current assets

6,787,679

6,551,315

Total assets

12,823,028

12,433,727

Current liabilities
Short-term debt
Current portion of long-term debt (note 6)
Other financial liabilities (note 6)
Trade payables
Accrued expenses
Advances received
Other current liabilities

1,169,423
602,674
321,569
1,437,134
624,764
496,491
443,116

977,701
483,521296,425
1,426,523
759,191374,241
461,876

Total current liabilities

AssetsCurrent assets
Cash and cash equivalents
Trade receivables (note 6)
Lease receivables (note 6)
Inventories
Other current assets (note 6)
Total current assets
Non-current assets
Investments accounted for using the equity method
Investments in securities and other financial assets (note 6)
Lease receivables (note 6)
Property, plant and equipment
Intangible assets
Other non-current assets

Liabilities

5,095,171

4,779,478

Non-current liabilities
Long-term debt (note 6)
Other financial liabilities (note 6)
Retirement and severance benefits
Other non-current liabilities

2,137,893
122,400
661,616
403,788

2,096,134
117,535
724,223420,015

Total non-current liabilities

3,325,697

3,357,907

Total liabilities

8,420,868

8,137,385

Hitachi, Ltd. stockholders’ equity
Common stock
Capital surplus
Retained earnings (note 7)
Accumulated other comprehensive income
Treasury stock, at cost

458,790
603,977
1,602,358
327,412(3,787)458,790
608,416
1,477,517
401,100(3,542)

Total Hitachi, Ltd. stockholders’ equity
Non-controlling interests

2,988,750
1,413,410

2,942,281
1,354,061

Total equity

4,402,160

4,296,342

Total liabilities and equity

12,823,028

12,433,727

EquitySee accompanying notes to condensed quarterly consolidated financial statements.

F-1

CONDENSED QUARTERLY CONSOLIDATED STATEMENTS OF PROFIT OR LOSS ANDCONDENSED QUARTERLY CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Nine months ended December 31, 2015 and 2014
Condensed Quarterly Consolidated Statements of Profit or Loss
Nine months ended December 31
Revenues
Cost of sales
Gross profit
Selling, general and administrative expenses
Other income (note 8)
Other expenses (note 8)
Financial income (note 9)
Financial expenses (note 9)
Share of profits of investments accounted for using the equity method
EBIT (Earnings before interest and taxes)
Interest income
Interest charges
Income from continuing operations, before income taxes
Income taxes
Income from continuing operations
Loss from discontinued operations (note 10)
Net income
Net income attributable to:
Hitachi, Ltd. stockholders
Non-controlling interests

Millions of yen
2015
2014
7,230,258
6,945,817(5,360,333) (5,130,138)
1,869,925
1,815,679(1,461,536) (1,421,548)
49,5298,073(50,918)(54,401)
10,077
13,047(20,914)(3,624)
14,78921,836410,952
379,062
9,008
9,495(19,386)(19,926)
400,574
368,631(116,668)(93,439)
283,906
275,192(14,423)(24,439)
269,483
250,753

Earnings per share from continuing operations,
attributable to Hitachi, Ltd. stockholders (note 11)
Basic
DilutedEarnings per share attributable to Hitachi, Ltd. stockholders (note 11)
Basic
DilutedSee accompanying notes to condensed quarterly consolidated financial statements.

F-2

172,966
96,517

162,382
88,371

38.81
38.78

Yen
38.69
38.66

35.82
35.79

33.63
33.60

Condensed Quarterly Consolidated Statements of Comprehensive Income
Nine months ended December 31
Net income

Millions of yen
2015
2014
269,483
250,753

Other comprehensive income (OCI)
Items not to be reclassified into net income
Net changes in financial assets measured at fair value through OCI
Remeasurements of defined benefit plans
Share of OCI of investments accounted for using the equity method
Total items not to be reclassified into net income(21,662)
(494)
(537)
(22,693)

62,9591,431
169
64,559Items that can be reclassified into net income
Foreign currency translation adjustments
Net changes in cash flow hedges
Share of OCI of investments accounted for using the equity method
Total items that can be reclassified into net income(79,559)
7,244
5,869
(66,446)

219,597(26,112)(51,859)
141,626(89,139)
180,344

206,185456,938

109,042
71,302

297,614
159,324

Other comprehensive income (OCI)
Comprehensive income
Comprehensive income attributable to:
Hitachi, Ltd. stockholders
Non-controlling interests
See accompanying notes to condensed quarterly consolidated financial statements.

F-3

CONDENSED QUARTERLY CONSOLIDATED STATEMENTS OF PROFIT OR LOSS ANDCONDENSED QUARTERLY CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three months ended December 31, 2015 and 2014
Condensed Quarterly Consolidated Statements of Profit or Loss
Three months ended December 31
Revenues
Cost of sales
Gross profit
Selling, general and administrative expenses
Other income
Other expenses
Financial income
Financial expenses
Share of profits of investments accounted for using the equity method
EBIT (Earnings before interest and taxes)
Interest income
Interest charges
Income from continuing operations, before income taxes
Income taxes
Income from continuing operations
Loss from discontinued operations
Net income
Net income attributable to:
Hitachi, Ltd. stockholders
Non-controlling interests

Millions of yen
2015
2014
2,423,370
2,393,741(1,803,870) (1,772,009)
619,500
621,732(485,118)(491,352)
18,155
1,540(7,458)(31,292)
2,631
4,845
(2,181)(1,076)
2,792
9,299
148,321
113,696
3,518
3,737(5,958)(7,021)
145,881
110,412(39,583)(28,423)
106,298
81,989(2,665)(8,089)103,633
73,900Earnings per share from continuing operations,
attributable to Hitachi, Ltd. stockholders (note 11)
Basic
DilutedEarnings per share attributable to Hitachi, Ltd. stockholders (note 11)
Basic
DilutedSee accompanying notes to condensed quarterly consolidated financial statements.

F-4

75,37528,25844,751
29,149

16.16
16.16

Yen
10.94
10.93

15.61
15.60

9.27
9.26

Condensed Quarterly Consolidated Statements of Comprehensive Income
Three months ended December 31
Net income

Millions of yen
2015
2014
103,633
73,900

Other comprehensive income (OCI)
Items not to be reclassified into net income
Net changes in financial assets measured at fair value through OCI
Remeasurements of defined benefit plans
Share of OCI of investments accounted for using the equity method
Total items not to be reclassified into net income

19,178(1,625)(538)
17,01530,5081,089(6)31,591

Items that can be reclassified into net income
Foreign currency translation adjustments
Net changes in cash flow hedges
Share of OCI of investments accounted for using the equity method
Total items that can be reclassified into net income(26,351)
7,631
985(17,735)

140,254(17,314)(11,576)
111,364(720)
102,913

142,955
216,855

78,421
24,492

145,294
71,561Other comprehensive income (OCI)
Comprehensive income
Comprehensive income attributable to:
Hitachi, Ltd. stockholders
Non-controlling interests
See accompanying notes to condensed quarterly consolidated financial statements.

F-5

CONDENSED QUARTERLY CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Nine months ended December 31, 2015 and 2014
Millions of yen
Nine months ended December 31, 2015

Balance at beginning of period
Changes in equity
Reclassified into retained
earnings
Net income
Other comprehensive loss
Dividends to Hitachi, Ltd.
stockholders
Dividends to non-controllinginterests
Acquisition of treasury stock
Sales of treasury stock
Changes in non-controllinginterests

Accumulated
othercomprehensive
incomeTreasurystock,
at cost

Total
Hitachi, Ltd.
stockholders’equityNoncontrollinginterests

Total equity

Commonstock

CapitalsurplusRetainedearnings(note 7)458,790

608,416

1,477,517

401,100(3,542)

2,942,281

1,354,061

4,296,342

-

-

9,816
172,966-(9,816)(63,924)-

172,966(63,924)

96,517(25,215)

269,483(89,139)--(57,941)--(57,941)-(57,941)

-

1

-

-

(260)
15

(260)
16

(39,265)-(39,265)
(260)
16

-

(4,440)-52-(4,388)27,312

22,924

Total changes in equity-(4,439)124,841(73,688)(245)

46,46959,349105,818

Balance at end of period

458,790

603,977

1,602,358

327,412(3,787)2,988,750

1,413,410

4,402,160
Millions of yen

Nine months ended December 31, 2014

Balance at beginning of period
Changes in equity
Reclassified into retained
earnings
Net income
Other comprehensive income
Dividends to Hitachi, Ltd.
stockholders
Dividends to non-controllinginterests
Acquisition of treasury stock
Sales of treasury stock
Changes in non-controllinginterests

Accumulated
othercomprehensive
incomeTreasurystock,
at cost

Total
Hitachi, Ltd.
stockholders’equityNoncontrollinginterests

Total equity

Commonstock

CapitalsurplusRetainedearnings(note 7)458,790

617,496

1,277,970

317,547(3,146)

2,668,657

1,200,174

3,868,831--

50,091
162,382-(50,091)
135,232-

162,382
135,232

88,371
70,953

250,753
206,185--(55,532)--(55,532)-(55,532)

-

2

-

-

(324)
21

(324)
23

(29,667)-(29,667)
(324)
23

-

(7,547)-314-(7,233)(999)(8,232)

Total changes in equity-(7,545)

156,941

85,455(303)

234,548

128,658

363,206

Balance at end of period

458,790609,951

1,434,911

403,002(3,449)2,903,205

1,328,832

4,232,037

See accompanying notes to condensed quarterly consolidated financial statements.

F-6

CONDENSED QUARTERLY CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine months ended December 31, 2015 and 2014
Millions of yen
2015

2014

269,483

250,753

372,305
3,847
116,668(14,029)
1,246(47,671)
3,948
184,292(163,589)(26,954)(66,538)(51,590)(93,704)
15,172502,886
9,064
26,418(20,773)(131,220)386,375

348,414
4,121
95,267(21,732)
7,118(4,027)
14,641
13,334(250,331)(30,661)(82,088)(43,183)(60,424)(521)
240,681
10,716
12,957(20,958)(129,030)
114,366(283,113)(79,827)(392,234)
8,843
20,110251,285(257,670)(90,558)(314,073)
20,01923,854
218,822(160,710)(125,205)

77,863
4,864(552,919)

93,721
512(430,578)

199,782
548,196(414,058)
963(57,929)(41,492)(260)
16275,051
719,549(460,885)
2,495(55,529)(31,520)(324)
23(6,441)(17,357)(106)
228,671339(141)
431,701

Effect of exchange rate changes on cash and cash equivalents
Net increase in cash and cash equivalents(27,705)
34,42273,589189,078

Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

701,703
736,125

560,657
749,735

Cash flows from operating activities:
Net income
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization
Impairment losses
Income taxes
Share of profits of investments accounted for using the equity method
Financial income and expenses
Net gain on business reorganization and others
Loss on sale of property, plant and equipment
Decrease in trade receivables
Increase in inventories
Increase in other assets
Decrease in trade payables
Decrease in retirement and severance benefits
Decrease in other liabilities
Other
SubtotalInterest received
Dividends received
Interest paid
Income taxes paid
Net cash provided by operating activities
Cash flows from investing activities:
Purchase of property, plant and equipment
Purchase of intangible assets
Purchase of leased assets
Proceeds from sale of property, plant and equipment, and intangible assets
Proceeds from sale of leased assets
Collection of lease receivables
Purchase of investments in securities and other financial assets(including investments in subsidiaries andinvestments accounted for using the equity method)
Proceeds from sale of investments in securities and other financial assets(including investments in subsidiaries andinvestments accounted for using the equity method)Other
Net cash used in investing activities
Cash flows from financing activities:
Increase in short-term debt, net
Proceeds from long-term debt
Payments on long-term debt
Proceeds from payments from non-controlling interests
Dividends paid to Hitachi, Ltd. stockholders
Dividends paid to non-controlling interests
Acquisition of common stock for treasury
Proceeds from sales of treasury stock
Purchase of shares of consolidated subsidiaries from
non-controlling interests
Proceeds from partial sales of shares of consolidated
subsidiaries to non-controlling interests
Other
Net cash provided by financing activities

See accompanying notes to condensed quarterly consolidated financial statements.

F-7

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015
(1) Nature of Operations
Hitachi, Ltd. (the Company) is a corporation domiciled in Japan, whose shares are listed on the Tokyo
Stock Exchange. The condensed quarterly consolidated financial statements of the Company as of and forthe nine months ended December 31, 2015 comprise the Company, its subsidiaries, and the Company’s
interests in associates and joint ventures. The Company’s and its subsidiaries’ businesses are global anddiverse, and include manufacturing and services in nine segments consisting of information andtelecommunication systems, social infrastructure and industrial systems, electronic systems andequipment, construction machinery, high functional materials and components, automotive systems,
smart life and ecofriendly systems, others (logistics and other services) and financial services.
(2) Basis of Presentation
As the Company meets the requirements of a “Specified Company” pursuant to Article 1-2 of theOrdinance on the Terminology, Forms, and Preparation Methods of Quarterly Consolidated Financial
Statements (Cabinet Office Ordinance No.64 of 2007), the condensed quarterly consolidated financial
statements of the Company have been prepared in accordance with International Accounting Standards(IAS) 34 “Interim Financial Reporting”, as permitted by the provision of Article 93 of the Ordinance.
They do not include all the information and disclosures required for a complete set of financial statements
prepared in accordance with International Financial Reporting Standards (IFRS), and should be read in
conjunction with the financial statements and notes included in the Company’s annual consolidated
financial statements for the year ended March 31, 2015.
Management of the Company has made a number of judgments, estimates and assumptions relating to theapplication of accounting policies, reporting of revenues and expenses and assets and liabilities in the
preparation of these condensed quarterly consolidated financial statements. Actual results could differ
from those estimates.
Estimates and assumptions are continually evaluated. The effects of a change in accounting estimates, ifany, is recognized in the reporting period in which the change was made and in future periods.
Judgments, estimates and assumptions that could have a material effect on these condensed quarterly
consolidated financial statements are basically the same as those disclosed in the Company’s annual
consolidated financial statements for the year ended March 31, 2015.
(3) Significant Accounting Policies
Significant accounting policies adopted in preparation of the condensed quarterly consolidated financial
statements are consistent with those used in the preparation of the Company’s annual consolidated
financial statements for the year ended March 31, 2015.
Income taxes for the nine months ended December 31, 2015 are computed using the estimated annual
effective tax rate.

F-8

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015(4) Segment Information
The operating segments of the Company are the components for which separate financial information isavailable and which is evaluated regularly by the chief operating decision maker in deciding how toallocate resources and in assessing performance.
The Company discloses its business in nine reportable segments, corresponding to categories of activities
classified primarily by the nature of markets, products and services and economic characteristics. Several
operating segments are aggregated into Social Infrastructure & Industrial Systems, Electronic Systems &Equipment and High Functional Materials & Components for financial reporting purposes so that
financial statement users better understand the Company’s financial position and business performance.
The Company aggregates operating segments based on the similarities of economic characteristics
mainly using operating segment profit margin ratios. The primary products and services included in eachsegment are as follows:
Information & Telecommunication Systems:
Systems integration, Consulting, Cloud services, Servers, Storage, Software, Telecommunication &network and ATMs
Social Infrastructure & Industrial Systems:
Thermal, Nuclear and Renewable energy power generation systems, Transmission & distribution systems,
Industrial machinery and plants, Elevators, Escalators and Railway systems
Electronic Systems & Equipment:
Semiconductor manufacturing equipment, Test and measurement equipment, Advanced industrial
products, Medical electronics equipment and Power tools
Construction Machinery:Hydraulic excavators, Wheel loaders and Mining machinery
High Functional Materials & Components:
Semiconductor and display related materials, Circuit boards and materials, Automotive parts (molded
plastics, etc.), Energy storage devices, Specialty steels, Magnetic materials and components, High grade
casting components and materials and Wires and cables
Automotive Systems:
Engine management systems, Electric power train systems, Drive control systems and Car information
systems
Smart Life & Ecofriendly Systems:
Air-conditioning equipment, Room air conditioners, Refrigerators and Washing machines
Others (Logistics and Other services):
Logistics, Optical disk drives, Property management and others
Financial Services:
Leasing and Loan guarantees
Due to a change in management reporting, the "Power Systems" was unified to the "Social Infrastructure& Industrial Systems". Figures for the segment, including the previous fiscal year, reflect the changed
segmentation.

F-9

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015
Effective from April 1, 2016, the Company will change its business structure into the service-focusedbusinesses and the product-focused businesses, in order to strengthen front-line functions. Due to thistransition, the Company is currently considering classification of its segment reporting.
The following tables show business segment information for the nine months ended December 31, 2015
and 2014.
Revenues from Outside Customers

Information & Telecommunication Systems
Social Infrastructure & Industrial Systems
Electronic Systems & Equipment
Construction Machinery
High Functional Materials & Components
Automotive Systems
Smart Life & Ecofriendly Systems
Others (Logistics and Other services)
Financial Services
Subtotal
Corporate items
Total

2015
1,329,500
1,329,333
727,197
537,561
1,140,449
737,895
513,174
654,743
256,688
7,226,540
3,718
7,230,258

Millions of yen
2014
1,263,229
1,224,511
706,592
575,376
1,050,494
681,594528,287
665,081250,077
6,945,241
576
6,945,817

2015
172,146
185,083
80,910
11,58147,791
3,632
25,884
280,944
16,235824,206(824,206)-

Millions of yen
2014
151,880
170,537
80,0004,397
52,901
1,760
27,269277,760
15,555782,059(782,059)-

Revenues from Intersegment Transactions

Information & Telecommunication Systems
Social Infrastructure & Industrial Systems
Electronic Systems & Equipment
Construction Machinery
High Functional Materials & Components
Automotive Systems
Smart Life & Ecofriendly Systems
Others (Logistics and Other services)
Financial Services
Subtotal
Corporate items and Eliminations
Total

F-10

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015
Total Revenues

Information & Telecommunication Systems
Social Infrastructure & Industrial Systems
Electronic Systems & Equipment
Construction Machinery
High Functional Materials & Components
Automotive Systems
Smart Life & Ecofriendly Systems
Others (Logistics and Other services)
Financial Services
Subtotal
Corporate items and Eliminations
Total

2015
1,501,646
1,514,416
808,107549,142
1,188,240
741,527
539,058
935,687
272,923
8,050,746(820,488)
7,230,258

Millions of yen
2014
1,415,109
1,395,048
786,592
579,773
1,103,395
683,354555,556
942,841
265,632
7,727,300(781,483)
6,945,817

2015
70,61833,87947,1595,493
119,563
39,50434,802
38,10535,762424,885(13,933)
410,952
9,008(19,386)

Millions of yen
2014
63,35050,482
42,19342,701
85,52325,00725,76327,44828,292
390,759(11,697)
379,062
9,495(19,926)

400,574

368,631

Segment Profit (Loss)

Information & Telecommunication Systems
Social Infrastructure & Industrial Systems
Electronic Systems & Equipment
Construction Machinery
High Functional Materials & Components
Automotive Systems
Smart Life & Ecofriendly Systems
Others (Logistics and Other services)
Financial Services
Subtotal
Corporate items and Eliminations
Total
Interest income
Interest charges
Income from continuing operations,
before income taxes

Segment profit (loss) is measured by EBIT.
Intersegment transactions are generally recorded at the same prices used in transactions with third parties.
Corporate items include unallocated corporate expenses, such as expenditures for leading-edge R&D andothers.

F-11

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015(5) Business Acquisitions and Divestitures
Hitachi Rail Italy S.p.A. (HRI) and Hitachi Rail Italy Investments S.r.L. (HRII), subsidiaries of theCompany in the Social Infrastructure & Industrial Systems segment, signed binding agreements with
Finmeccanica S.p.A. (FNM) to acquire;1) the current business of AnsaldoBreda S.p.A. (Breda), a manufacturer of rail vehicles for mass transit,
with the exclusion of some revamping activities and certain residual contracts,
2) the entire interest owned by FNM in Ansaldo STS S.p.A. (STS) , a company engaged in the design
and implementation and management of systems for signaling and supervision of railways, equal toapproximately 40% of the share capital,
in order to strengthen their manufacturing footprint and expand their customer base in the global railway
business. On November 2, 2015 (the acquisition date), HRI and HRII closed the deal and acquired thebusiness of Breda and the entire interest owned by FNM in STS in accordance with the binding
agreements. The Company obtained control of STS, due to factors such as the acquisition of the sharecapital and the fact that the Company’s recommended directors represent the majority of the board of
directors elected at the shareholders’ meeting held on the acquisition date, and therefore STS became aconsolidated subsidiary of the Company effective on the same date.
The total consideration, paid in cash, for the business of Breda was EUR 30 million (¥4,041 million) andthe total consideration, paid in cash, for the shares of STS was EUR 761 million (¥101,184 million).
HRII commenced a tender offer for the outstanding publicly held shares of STS. However, it has notbeen completed as of the date of this quarterly report.
The following table summarizes the fair value of the consideration paid for STS and the business of
Breda, and the provisional amounts of the assets acquired and liabilities assumed recognized as of theacquisition date.

Cash and cash equivalents
Trade receivables
Other current assets
Non-current assets (excluding intangible assets)
Intangible assets
Goodwill (not deductible for tax purposes)
Other intangible assets
Total

Millions of yen
STSThebusinessof Breda
30,115
2,702
131,343
66,59037,42436,21734,494
16,16467,443
6,978
307,797239
121,912Current liabilities
Non-current liabilities
Total

150,006
7,391
157,397

107,326
10,545
117,871

Cash paid for acquisitionNon-controlling interests
Total

101,184
49,216
150,400

4,041
4,041

The goodwill mainly comprises excess earning power and expected synergies arising from theacquisition.
Non-controlling interests are measured by the appropriate share in the fair value of identifiable net assetsof STS.
The Company is currently evaluating the fair values to be assigned to assets and liabilities of STS and thebusiness of Breda at the acquisition date, and therefore the above amounts are subject to change.
F-12Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015

HRI repaid EUR 111 million (¥14,754 million yen) of loans from FNM which were included in thebusiness of Breda in addition to these acquisitions.
The results of operations of STS and the business of Breda for the period from the acquisition date to
December 31, 2015 were not material.
On a pro forma basis, revenues and net income attributable to Hitachi, Ltd. stockholders using anassumed acquisition date for STS and the business of Breda of April 1, 2015 would not differ materiallyfrom the amounts reported in the condensed quarterly consolidated financial statements for the ninemonths ended December 31, 2015.
On February 7, 2015, Hitachi Data Systems Corporation (HDS), a subsidiary of the Company in the
Information & Telecommunications Systems segment, signed a definitive agreement with theshareholders of Pentaho Corporation (Pentaho) to acquire all the shares of Pentaho, for enhancing
big-data technologies and solutions. Pentaho integrates data, develops technologies for big-data analysis
and visualization, and delivers solutions and supports. On May 29, 2015, HDS acquired all the shares ofPentaho in accordance with the definitive agreement, and HDS obtained control of Pentaho, and it
became a wholly owned subsidiary.
The following table summarizes the fair value of the consideration paid for Pentaho, the assets acquired
and liabilities assumed recognized as of the acquisition date.
Cash and cash equivalents
Trade receivables
Other current assets
Non-current assets (excluding intangible assets)
Intangible assets
Goodwill (not deductible for tax purposes)
Other intangible assets
Total

Millions of yen
988
807
182
82
55,901
10,275
68,235Current liabilities
Non-current liabilities
Total

3,449
9
3,458

Cash paid for acquisition

64,777

The goodwill mainly comprises excess earning power and expected synergies arising from theacquisition.
The results of operations of Pentaho for the period from the acquisition date to December 31, 2015 were
not material.
On a pro forma basis, revenues and net income attributable to Hitachi, Ltd. stockholders using anassumed acquisition date for Pentaho of April 1, 2015 would not differ materially from the amounts
reported in the condensed quarterly consolidated financial statements for the nine months ended
December 31, 2015.

F-13

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015
On August 19, 2014, Hitachi Metals, Ltd. (Hitachi Metals), a subsidiary of the Company in the High
Functional Materials & Components segment, in order to strengthen its global iron casting business on a
medium and long term basis, signed a definitive agreement with WF Global II B.V., an entity which was
owned by private equity funds managed and controlled by KPS Capital Partners, LP (KPS), to acquire all
the shares of Waupaca Foundry Holdings, Inc. (Waupaca HD), which held a 100% stake in Waupaca
Foundry, Inc. (Waupaca), engaged in the iron casting business for transportation machinery in the North
America market and headquartered in the U.S.A. On November 10, 2014 (the acquisition date), Hitachi
Metals acquired all the shares of Waupaca HD in accordance with the definitive agreement. Accordingly,
Hitachi Metals obtained control of Waupaca HD and it became a wholly owned subsidiary.
The following table summarizes the fair value of the consideration paid for Waupaca HD, the assets
acquired and liabilities assumed recognized as of the acquisition date.
Cash and cash equivalents
Trade receivables
Other current assets
Non-current assets (excluding intangible assets)
Intangible assets
Goodwill (not deductible for tax purposes)
Other intangible assets
Total

Millions of yen
888
26,446
12,13257,28070,99035,109202,845

Current liabilities
Non-current liabilities
Total

27,801
83,148110,949

Cash paid for acquisition

91,896

The goodwill mainly comprises excess earning power and expected synergies arising from theacquisition.
The results of operations of Waupaca HD for the period from the acquisition date to December 31, 2014
were not material.
On a pro forma basis, revenues and net income attributable to Hitachi, Ltd. stockholders using anassumed acquisition date for Waupaca HD of April 1, 2014 would not differ materially from the amounts
reported in the condensed quarterly consolidated financial statements for the nine months ended
December 31, 2014.

F-14

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015
(6) Fair Value of Financial Instruments(a) Fair Value Measurements
The following methods and assumptions are used to measure the fair value of financial assets andliabilities.
Cash and cash equivalents, Short-term loans receivable, Short-term debt, Other payables andTrade payables
The carrying amount approximates the fair value because of the short maturity of these instruments.
Trade receivables
Fair value is measured by the present value of future cash flows discounted by risk-free rates after
considering early settlements, cancellation and the balance of doubtful accounts, for each type ofreceivable, class of receivable based on collection records and term of collection.
Lease receivables
Fair value is based on the present value of lease payments receivable based on years to maturity, using
discount rates that reflect the time to maturity and credit risk.
Investments in securities and Other financial assets
Investment securities with quoted market prices are estimated using the quoted share prices. In theabsence of an active market for investment securities, quoted prices for similar investment securities,
quoted prices associated with transactions that are not distressed for identical or similar investment
securities or other relevant information including market interest rate curves, referenced credit spreads
or default rates, are used to determine fair value. If significant inputs of fair value measurement areunobservable, the Company uses price information provided by financial institutions to evaluate suchinvestments. The information provided is corroborated by the income approach using its own valuation
model, or the market approach using comparisons with prices of similar securities.
The fair value of long-term loans receivable is estimated based on the present value of future cash flows
using the interest rate applicable to an additional loan of the same type.
Derivative assets are measured at fair value based on quoted prices associated with transactions that are
not distressed, prices in inactive markets, or based on models using interest rate curves and forward andspot prices for currencies and commodities. If significant inputs are unobservable, the Company mainly
uses the income approach or the market approach to corroborate relevant information provided byfinancial institutions and other available information.
Fair values of subordinated interests and beneficiary interests in trust that are retained in transactions oftransferring financial assets are estimated by discounting future cash flows based on economic
assumptions including expected rate of credit loss and discount rate since significant inputs for
estimation of the fair value are unobservable.
Long-term debt
The fair value of long-term debt is estimated based on quoted market prices or the present value of
future cash flows using the market interest rates applicable to the same contractual terms.
Other financial liabilities
Derivative liabilities are measured at fair value based on quoted prices associated with transactions thatare not distressed, prices in inactive markets, or based on models using interest rate curves and forward
and spot prices for currencies and commodities. If significant inputs are unobservable, the Company
uses mainly the income approach or the market approach to corroborate relevant information provided
by financial institutions and other available information.
F-15

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015
Contract guarantee deposits are financial liabilities received from some customers and other parties as acredit enhancement to trade and lease receivables, and normally returned after the underlying assets are
fully collected. The fair value of contract guarantee deposits is measured by discounting the sum of theprincipals over the time to the contractual return dates, using the risk-free discount rate.
(b) Financial Instruments Measured at Amortized Cost
The carrying amounts and estimated fair values of the financial instruments measured at amortized cost
are as follows.
The fair value estimated for financial assets and liabilities measured at amortized cost is classified in
Level 2 of the fair value hierarchy.

AssetsTrade receivables [1]Lease receivables
Investments in securities and otherfinancial assets [2]Debt securities
Long-term loans receivable
Liabilities
Long-term debt [3]Lease obligations
Bonds
Long-term debt
Other financial liabilities
Contract guarantee deposits

December 31, 2015
Carrying
Estimatedamounts
fair values

Millions of yen
March 31, 2015
Carrying
Estimatedamounts
fair values

3,529,413
1,058,533

3,539,953
1,091,338

3,556,315
1,017,973

3,574,933
1,050,232

77,13265,583

77,166
66,20285,72585,48185,75887,37945,983794,187
1,900,397

45,821
802,866
1,916,809

50,311
797,510
1,731,834

50,035805,668
1,747,654

32,65631,70936,88235,567[1] Trade receivables are included in Trade receivables and Investments in securities and other financial
assets in the condensed quarterly consolidated statements of financial position.
[2] Investments in securities and other financial assets are included in Other current assets andInvestments in securities and other financial assets in the condensed quarterly consolidated statementsof financial position.
[3] Long-term debt is included in Current portion of long-term debt and Long-term debt in thecondensed quarterly consolidated statements of financial position.
(c)Financial Instruments Measured at Fair Value in Condensed Quarterly Consolidated
Statements of Financial Position
Financial instruments measured at fair value on a recurring basis after the initial recognition are classified
into three levels of the fair value hierarchy based on the measurement inputs’ observability as follows:
Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets
Level 2: Valuations measured by direct or indirect observable inputs other than Level 1
Level 3: Valuations measured by significant unobservable inputs
When several inputs are used for a fair value measurement, the level is determined based on the inputthat is significant with the lowest level in the fair value measurement as a whole.

F-16

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015
Transfers between levels are deemed at the beginning of each quarter period.
The following tables present the assets and liabilities that are measured at fair value on a recurring basis.
December 31, 2015
Class of financial instruments
FVTPL financial assets:
Investments in securities and otherfinancial assets [1]Equity securities
Debt securities
Derivatives
FVTOCI financial assets:
Investments in securities and otherfinancial assets [1]Equity securities
Total financial assets at fair value
FVTPL financial liabilities:
Other financial liabilities
Derivatives
Total financial liabilities at fair value
March 31, 2015
Class of financial instruments
FVTPL financial assets:
Investments in securities and otherfinancial assets [1]Equity securities
Debt securities
Derivatives
FVTOCI financial assets:
Investments in securities and otherfinancial assets [1]Equity securities
Total financial assets at fair value
FVTPL financial liabilities:
Other financial liabilities
Derivatives
Total financial liabilities at fair value

Level 1

Level 2Millions of yen
Total

Level 316
12,091-

4
7,700
17,696

1,023
44,7486,061

1,043
64,53923,757346,167
358,274

221
25,621

118,395
170,227

464,783
554,122-102,238
102,238-

102,238
102,238

Level 1

Level 2Millions of yen
Total

Level 3

2,624
12,665-

7,807
15,478

1,799
57,299-4,423
77,771
15,478392,977
408,266

1,413
24,698110,833
169,931505,223
602,895-

104,730
104,730-

104,730
104,730[1] Investments in securities and other financial assets are included in Other current assets andInvestments in securities and other financial assets in the condensed quarterly consolidated statementsof financial position.

F-17

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015
The following tables present the changes in Level 3 instruments measured on a recurring basis for thenine months ended December 31, 2015 and 2014.
Millions of yen

December 31, 2015
Level 3 financial assets
Balance at beginning of period
Loss in profit or loss [1]Gain in OCI [2]Purchases
Sales and redemption
Acquisitions and divestitures
Transfer from Level 3 [3]OtherBalance at end of period
Unrealized loss relating to financial
assets still held at end of period [4]Equitysecurities
112,632
(357)
5,303
1,496
(1,662)
7,118(4,874)(238)
119,418

Debt
securities
57,299(486)
2,024(14,482)249
144
44,748

(358)

(547)

Equitysecurities
108,125
72
3,202
1,824
(725)
258
587
113,343

Debt
securities
82,006(940)
1,862(17,987)272
664
65,877100(756)

Derivatives
6,061
6,061

Balance at beginning of period
Gain (loss) in profit or loss [1]Gain in OCI [2]Purchases
Sales and redemption
Acquisitions and divestitures
Other
Balance at end of period
Unrealized gain (loss) relating tofinancial assets still held at end of
period [4]169,931
(843)
5,303
9,581
(16,144)7,367(4,874)(94)
170,227-(905)
Millions of yen

December 31, 2014
Level 3 financial assets

Total

Derivatives

Total

-

190,131
(868)
3,202
3,686
(18,712)530
1,251
179,220-(656)[1] Gain (loss) in profit or loss related to FVTPL financial assets is included in Financial income andFinancial expenses in the condensed quarterly consolidated statements of profit or loss.
[2] Gain in OCI related to FVTOCI financial assets is included in Net changes in financial assets
measured at fair value through OCI in the condensed quarterly consolidated statements ofcomprehensive income.
[3] Transfer from Level 3 for the nine months ended December 31, 2015 is mainly the result of aninvestee being listed on the stock market.
[4] Unrealized gain (loss) related to FVTPL financial assets still held at the end of period are includedin Financial income and Financial expenses in the condensed quarterly consolidated statements ofprofit or loss.

F-18

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015
Valuation techniques and unobservable inputs used for measuring financial instruments categorized as
Level 3 on a recurring basis as of December 31 and March 31, 2015 are as follows:
December 31, 2015
Level 3 financial instruments
Subordinated interests and beneficiaryinterests in trusts that are retained
relating to securitization of financial
assetsMarch 31, 2015
Level 3 financial instruments
Subordinated interests and beneficiaryinterests in trusts that are retained
relating to securitization of financial
assetsFair
value
31,840

Valuationtechnique
DCF

Fair
value
43,391

Valuationtechnique
DCF

Unobservable inputs

Millions of yen
Range

Discount rate
Expected rate of credit
loss of the entire
transferred financial assets
Unobservable inputs

0.09-1.20%
0.15-0.36%

Millions of yen
Range

Discount rate
Expected rate of credit
loss of the entire
transferred financial assets

0.14-0.88%
0.15-0.36%

The impact on the fair value is not material if different amounts are used as unobservable inputs inestimating the fair value of subordinated interests and beneficiary interests in trusts that are retained
relating to securitization of financial assets. Similarly, the effect of changing unobservable inputs toreasonably possible alternative assumptions is not material.
Fair values are measured by the Finance Department of the Company in accordance with theCompany’s policies and procedures. Valuation models are determined so that they reflect each financial
instrument’s nature, characteristics and risks most appropriately. The Finance Department continually
examines changes in important inputs that could affect the fair value. In case the fair value of afinancial instrument was significantly impaired, the Department administrator reviews and approves theimpairment loss.

F-19

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015(7)

Dividends
Dividends paid on common stock for the nine months ended December 31, 2015 are as follows:

Decision

Cash dividends(millions of yen) Appropriation fromCashdividends
per share(yen)

Record date

Effective date

The Board of Directors
on May 14, 2015

28,971Retained earnings

6.0

March 31, 2015

June 1, 2015

The Board of Directors
on October 28, 2015

28,970Retained earnings

6.0

September 30, 2015

November 26, 2015

Dividends paid on common stock for the nine months ended December 31, 2014 are as follows:

Decision

Cash dividends(millions of yen) Appropriation fromCashdividends
per share(yen)

Record date

Effective date

The Board of Directors
on May 12, 2014

26,559Retained earnings

5.5

March 31, 2014

June 2, 2014

The Board of Directors
on October 29, 2014

28,973Retained earnings

6.0

September 30, 2014

November 26, 2014

F-20

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015(8) Other Income and Expenses
2015
Net loss on sales and disposal of fixed assets
Impairment losses
Net gain on business reorganization and others
Restructuring charges
Expenses related to competition law and others(3,948)(3,847)47,671(28,168)(4,653)

Millions of yen
2014(15,026)(4,121)
4,027(17,925)(12,350)

Impairment losses are mainly recognized on property, plant and equipment, investment properties andintangible assets. Net gain on business reorganization and others include gains and losses related toobtaining and losing control of investees and gains and losses related to obtaining and losing significant
influence over investees.
(9) Financial Income and Expenses
2015
Dividends received
Net loss on FVTPL financial assets
Exchange gain (loss)

6,748
(414)
(17,199)

Dividends are from FVTOCI financial assets.

F-21

Millions of yen
2014
6,726
(3,624)6,299

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015(10) Discontinued Operations
The Company classified the part of thermal power generation system business which was not transferredto Mitsubishi Hitachi Power Systems, Ltd. for business integration in the thermal power generation
systems business with Mitsubishi Heavy Industries, Ltd. but was operated by the Company and certain
subsidiaries as discontinued operations in the condensed quarterly consolidated statements of profit orloss.
Profit or loss and cash flows from the discontinued operations for the nine months ended December 31,
2015 and 2014 are as follows:
Millions of yen
2015
2014
Profit or loss from discontinued operations
Revenues
7,258
25,518
Cost of sales and expenses(21,681)(48,129)
Loss from discontinued operations, before taxes(14,423)(22,611)
Income taxes(1,828)Loss from discontinued operations(14,423)(24,439)
Millions of yen
2014

2015
Cash flows from discontinued operations
Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities(5,931)
16
10,812

F-22(25,535)
1,565
25,201

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015(11) Earnings Per Share (EPS) Information
The computations of net income attributable to Hitachi, Ltd. stockholders used to derive basic anddiluted EPS for the nine months ended December 31, 2015 and 2014 are as follows:
Nine months ended December 31
Number of shares
2014

2015
Weighted average number of shares on which basic
EPS is calculated
Effect of dilutive securities
Number of shares on which diluted EPS is
calculated

4,828,413,052-

4,828,881,171-

4,828,413,052

4,828,881,171

2015

Millions of yen
2014

Net income from continuing operations,
attributable to Hitachi, Ltd. stockholders
Basic
Effect of dilutive securities
Other
DilutedNet loss from discontinued operations,
attributable to Hitachi, Ltd. stockholders
Basic
Effect of dilutive securities
Other
Diluted
Net income attributable to Hitachi, Ltd. stockholders
Basic
Effect of dilutive securities
Other
Diluted187,389

186,821(147)
187,242(130)
186,691(14,423)(24,439)(14,423)(24,439)

172,966

162,382(147)
172,819(130)
162,252
Yen

2015
EPS from continuing operations,
attributable to Hitachi, Ltd. stockholders
Basic
DilutedEPS from discontinued operations,
attributable to Hitachi, Ltd. stockholders
Basic
DilutedEPS attributable to Hitachi, Ltd. stockholders
Basic
Diluted

F-23

2014
38.81
38.78

38.69
38.66

(2.99)(2.99)(5.06)(5.06)

35.82
35.79

33.63
33.60

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015
The computations of net income attributable to Hitachi, Ltd. stockholders used to derive basic anddiluted EPS for the three months ended December 31, 2015 and 2014 are as follows:
Three months ended December 31
Number of shares
2014

2015
Weighted average number of shares on which basic
EPS is calculated
Effect of dilutive securities
Number of shares on which diluted EPS is
calculated

4,828,316,981-

4,828,755,633-

4,828,316,981

4,828,755,633

2015

Millions of yen
2014

Net income from continuing operations,
attributable to Hitachi, Ltd. stockholders
Basic
Effect of dilutive securities
Other
DilutedNet loss from discontinued operations,
attributable to Hitachi, Ltd. stockholders
Basic
Effect of dilutive securities
Other
Diluted
Net income attributable to Hitachi, Ltd. stockholders
Basic
Effect of dilutive securities
Other
Diluted78,04052,840(32)
78,008(43)
52,797(2,665)(8,089)(2,665)(8,089)75,37544,751(32)
75,343(43)
44,708Yen

2015
EPS from continuing operations,
attributable to Hitachi, Ltd. stockholders
Basic
DilutedEPS from discontinued operations,
attributable to Hitachi, Ltd. stockholders
Basic
DilutedEPS attributable to Hitachi, Ltd. stockholders
Basic
Diluted

F-24

2014
16.16
16.16

10.94
10.93

(0.55)(0.55)(1.68)(1.68)

15.61
15.60

9.27
9.26

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015(12) Contingencies
In December 2006, the Company and a subsidiary in Europe received requests for information from theEuropean Commission in respect of alleged antitrust violations relating to liquid crystal displays.
However, in December 2015, these companies received information that the European Commission
would terminate the investigation of this matter.
In November 2007, a subsidiary in the U.S.A. received a grand jury subpoena in connection with theinvestigation conducted by the Antitrust Division of the U.S. Department of Justice in respect of alleged
antitrust violations relating to cathode ray tubes. In addition, in November 2007, two subsidiaries in
Asia and in Europe received requests for information from the European Commission. Furthermore, inNovember 2007, a subsidiary in Canada received requests for information from the CanadianCompetition Bureau.
In June 2009, a subsidiary in Japan received a grand jury subpoena in connection with the investigation
conducted by the Antitrust Division of the U.S. Department of Justice and received requests for
information from the European Commission in respect of alleged antitrust violations relating to opticaldisk drives. In November 2011, the subsidiary in Japan paid a fine in relation to the investigation fromthe Antitrust Division of the U.S. Department of Justice. In July 2012, the subsidiary in Japan received astatement of objections from the European Commission in respect of alleged antitrust violations. In
October 2015, the European Commission announced the amount of the fine for the subsidiary in respectof alleged antitrust violations. Two subsidiaries in Japan and in Korea made provision for estimated loss
on a reasonable basis.
In July 2011, a subsidiary in the U.S.A. was investigated by and received a grand jury subpoena fromthe Antitrust Division of the U.S. Department of Justice, the Company and a subsidiary in Europe
received requests for information from the European Commission, and a subsidiary in Canada received
requests for information from the Canadian Competition Bureau, all in respect of alleged antitrust
violations relating to automotive equipment. In November 2013, a subsidiary in Japan, which had been
also primarily responsible for responding to the investigation from the Antitrust Division of the U.S.
Department of Justice, paid a fine. In January 2016, the Company and a subsidiary in Europe reached asettlement with the European Commission, and agreed to pay fines. The subsidiary in Japan madeprovision for estimated loss on a reasonable basis.
In June 2014, a subsidiary in Japan was investigated by the Japan Fair Trade Commission in respect ofalleged antitrust violations relating to capacitors. The subsidiaries in Europe, the U.S.A., and others arebeing investigated by competition authorities in each country or region, all in respect of alleged antitrust
violations relating to capacitors. In November 2015, the subsidiaries in Japan received a statement ofobjections from the European Commission in respect of the alleged antitrust violations. The subsidiaryin Japan made provision for estimated loss on a reasonable basis.
The Company, its subsidiaries and associates have cooperated with the competent authorities.
Depending upon the outcome of these matters, fines or surcharge payments, the amount of which is
uncertain, may be imposed on them. Also, in connection with pending and settled antitrust violations,civil disputes, including class action lawsuits, involving the Company and some of these companies
have arisen in a number of countries, including in the U.S.A. and Canada. An amount, which wasconsidered to be a reasonable estimate in respect of these claims, was accrued for the potential losses inrelation to certain of these civil disputes.
In August 2012, a subsidiary in Europe received a complaint filed by a customer in Europe seeking
compensation for consequential losses of EUR 1,058 million (¥139,490 million), additional costs andinterest allegedly incurred by the delay in the construction process of a power plant against, jointly andseverally, the Company, the subsidiary in Europe, a consortium including the Company and theF-25

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015
subsidiary in Europe, and two other companies. In addition, in October 2013, the subsidiary in Europe
received an additional complaint requesting compensation for consequential losses of EUR 239 million(¥31,558 million). Although the Company, the subsidiary in Europe and the consortium will vigorously
defend themselves against this lawsuit, there can be no assurance that they will not be held liable forany amounts claimed.
In December 2013, the Company, a subsidiary in Europe and a consortium consisting of the Company
and the subsidiary in Europe, jointly and severally received a request from a customer in Europe to refera dispute to arbitration seeking compensation for EUR 606 million (¥79,957 million) including
consequential losses allegedly incurred by the delay in the construction process of a power plant. As of
December 31, 2015, the amount of compensation claimed by the customer was changed to EUR 637
million (¥83,960 million). In December 2015, these companies, jointly and severally received a request
for arbitration from the customer demanding EUR 161 million (¥21,258 million) in compensation for
performance related deficiencies of a power plant. Although the Company, the subsidiary in Europe,and the consortium consisting of the Company and the subsidiary in Europe, will vigorously defend
themselves against this claim, there can be no assurance that they will not be held liable for any
amounts claimed.
In November 2014, the Company received a compensation claim from a customer in Japan for theconsequential loss allegedly incurred by the delay in an operation system development. In March 2015,
the dispute was settled, and in June and October 2015, the Company paid the settlement.
In June 2015, the Company, a subsidiary, associates, joint ventures in Asia, and one other entity
received a summons from a partner in the joint ventures involving the Company and the subsidiarydemanding an injunction against certain competing business operations claiming these are in breach of
the joint venture agreements. The Company, the subsidiary, the associates, the joint ventures, and one
other entity will vigorously defend themselves against this claim.
In January 2016, a subsidiary in Europe notified a customer in Europe that the subsidiary hadcommenced arbitration proceedings to resolve a disagreement about construction of a power plant.
Since the customer elected an arbitrator in response to this notice, the arbitration is expected to start.
While the subsidiary will seek payments of the unpaid amounts based on the contract, a counterclaim is
expected to be filed by the customer. Thus, there can be no assurance that the subsidiary will not be held
liable for any amounts.
The Company and its subsidiaries execute a number of business reorganizations, including mergers,
acquisitions and divestitures. Contracts for these reorganizations include clauses for transaction priceadjustments subsequent to the reorganizations. The Company had reasonably estimated a loss for the
price adjustments in some business reorganizations and accrued liabilities.
Depending upon the outcome of the above legal proceedings, there may be an adverse effect on the
consolidated financial position or results of operations. Currently the Company is unable to estimate theadverse effect, if any, of many of these proceedings. Accordingly, except as otherwise stated, no accrualfor potential loss has been made. The actual amount of fines, surcharge payments or any other payments
resulting from these legal proceedings may be different from the accrued amounts.
In addition to the above, the Company and its subsidiaries are subject to legal proceedings and claims
which have arisen in the ordinary course of business and have not been finally adjudicated. These
actions when ultimately concluded and determined will not, in the opinion of management, have amaterial adverse effect on the consolidated financial position or results of operations of the Company
and subsidiaries.
F-26

Notes to Condensed Quarterly Consolidated Financial Statements
December 31, 2015(13) Approval of Condensed Quarterly Consolidated Financial Statements
The condensed quarterly consolidated financial statements were approved on February 12, 2016 by
Toshiaki Higashihara, President and COO of the Company.

F-27

[Cover][Document Filed]

Confirmation Letter[Applicable Law]

Article 24-4-8, Paragraph 1 of the Financial Instruments and Exchange Act ofJapan[Filed with]

Director, Kanto Local Finance Bureau[Filing Date]

February 12, 2016

[Company Name]

Kabushiki Kaisha Hitachi Seisakusho[Company Name in English] Hitachi, Ltd.
[Title and Name ofToshiaki Higashihara, President & COO

Representative][Name and title of CFO]

Toyoaki Nakamura, Executive Vice President and Executive Officer[Address of Head Office]6-6, Marunouchi 1-chome, Chiyoda-ku, Tokyo[Place Where Available forTokyo Stock Exchange, Inc.

Public Inspection](2-1, Nihombashi Kabutocho, Chuo-ku, Tokyo)
Nagoya Stock Exchange, Inc.
(8-20, Sakae 3-chome, Naka-ku, Nagoya)A-1

1. Matters Related to Adequacy of Statements Contained in the Quarterly Report
Mr. Toshiaki Higashihara, President & COO, and Mr. Toyoaki Nakamura, Executive Vice President
and Executive Officer, confirmed that statements contained in the Quarterly Report for the third quarter of147th fiscal year (from October 1, 2015 to December 31, 2015) were adequate under the Financial
Instruments and Exchange Act.
2. Special Notes
None.

A-2