This document has been translated from a part of the Japaneseoriginal for reference purposes only. In the event of any
discrepancy between this translated document and theJapanese original, the original shall prevail. JAIC assumes noresponsibility for this translation or for direct, indirect or any
other forms of damages arising from the translation.

Qualitative Information on Consolidated Operating
Results for Six Months Ended September 30, 2023
(1) Outline of consolidated operating results
The consolidated operating results of the JAIC Group for the second
quarter of the current fiscal year under review (from April 1, 2023 to
September 30, 2023) recorded operating revenue of 1,269 million yen(up 14.1 % year-on-year), operating gross profit of 434 million yen (up195.8 % year-on-year), operating loss of 239 million yen (compared tooperating loss of 488 million yen for the same period of the previous
fiscal year), ordinary loss of 312 million yen (compared to ordinary loss of
579 million yen for the same period of the previous fiscal year) and loss
attributable to owners of parent of 543 million yen (compared to lossattributable to owners of parent of 671 million yen for the same period of
the previous fiscal year). Due to progress in sales of stocks invested frominvestment funds, operating revenue increased and the deficit narrowed
compared to the same period of the previous fiscal year. The breakdown
and background of operating results are as follows.
(a) Breakdown of operating revenue and operating cost
(Fund management fees)
Fundmanagement

fees

etc.

consistofmanagement

feesandadministrative fees from investment funds. Fund management fees etc.
were 60 million yen (ｕｐ 4.3 % year-on-year), about the same as year-onyear.
(Investment income)
JAIC had sold 1 mega solar project for the same period of the previous
fiscal year, however, JAIC sold only private equity investments for the1 / 7

second quarter of the current fiscal year under review. On the other hand,
JAIC has progressed sales of high margin listed and unlisted stocks inJapan invested from investment funds. The proceeds of sale ofoperational investment securities increased to 644 million yen (up 45.2 %year-on-year). Realized capital gain, which is calculated by deducting
cost of securities sold from proceeds of sales of operational investment
securities, also increased to 407 million yen (up 234.2 % year-on-year).
JAIC posted provisions for portfolio companies those their businessprogress had been slower than planned, but the amount decreased yearon-year. The total amount of investment write-offs and provision forallowance for possible investment losses decreased to 218 million yen(down 24.0 % year-on-year).
As a result, investment income, which is calculated by deducting
investment write-offs and provision for allowance for possible investment
losses from realized capital gains, increased to 188 million yen (compared
to investment loss of 166 million yen for the same period of the previous
fiscal year).
(Fund interests income, etc.)
Fund interests income, etc. consist of revenues of the projects operated
by the JAIC Group (such as revenue from electricity sales, revenue fromvegetable sales, rent fee revenue from group home for disabled people
and other revenues), interests income from the projects operated byother companies (such as net profits of the projects and gains from thesale of projects), interests income from the private equity funds operated
by other companies, interest income, dividend income and other income.
The total amount of fund interests income, etc. for the second quarter ofthe current fiscal year under review decreased to 544 million yen (down
9.3 % year-on-year). Operational dividend income decreased to 4 million
yen (down 97.9 % year-on-year). For the same period of the previous
fiscal year JAIC received profit dividends from a logistic warehouseproject that had sold the facility, however, JAIC has not sold any project
for the second quarter of the current fiscal year under review. On theother hand, revenues of the projects operated by the JAIC Group
increased to 510 million yen (up 34.5 % year-on-year). The revenues
increased as new projects have launched and existing projects have
2 / 7

expanded their business scale.
(Fund interests losses, etc.)
Fund interests losses, etc. consist of costs of the projects operated by
the JAIC Group (such as cost of electricity sales, cost of producing
vegetables, rental cost of group home for disabled people and othercosts), interests losses from the projects operated by other companies(such as losses mainly from projects in the early stage of launch),interests losses from the private equity funds operated by othercompanies, and other losses.
The total amount of fund interests losses etc. for the second quarter ofthe current fiscal year under review increased to 371 million yen (up6.3 % year-on-year). While the cost of producing vegetables decreased,
the cost of new projects and existing projects those expanded theirbusiness scale increased.
As a result, operating revenue increased by 14.1 % year-on-year to 1,269
million yen, operating cost decreased by 13.5 % year-on-year to 834
million yen and operating gross profit increased by 195.8 % year-on-year
to 434 million yen.
(b) Selling, general and administrative expenses
The total amount of selling, general and administrative expenses
increased to 674 million yen (up 6.1 % year-on-year). Expenses related
to fund formation were incurred from new mega solar projects.
(c) Other profit and loss items
Among the profit and loss items other than (a) and (b) above, net incomeattributable to non-controlling shareholders is the item that deserves
special mention for the second quarter of the current fiscal year underreview.
This item is the profit attributable to fund investors other than the JAIC
Group among the profits of the funds and projects operated by the JAIC
Group. The amount increased to 228 million yen (up 193.3 % year-onyear) as the profits of the funds and the projects increased.

3 / 7

As a result, the deficit narrowed compared to the same period of theprevious fiscal year. Loss attributable to owners of parent amounted to543 million yen (compared to loss attributable to owners of parent of 671
million yen for the same period of the previous fiscal year).
(2) Cash flows
Cash and cash equivalents as of September 30, 2023, decreased by 115
million yen from March 31, 2023, to 1,646 million yen. The main factors
for increase and decrease are as follows:(Cash flow from operating activities)
Net cash generated from operating activities increased to 385 million yen(compared to 126 million yen generated from for the same period of theprevious fiscal year). Distributions from investment funds increased as
investment recovery progressed.
(Cash flow from financing activities)
Net cash used in financing activities with repayments of long-termborrowings was 509 million yen (compared to 494 million yen used in forthe same period of the previous fiscal year).
(3) Financial position(Assets)
Total assets as of September 30, 2023, decreased to 17,780 million yen(compared to 18,775 million yen as of March 31, 2023). The main factor
for the decrease in total assets was a decrease in operational investment
securities.
Operational investment securities consist of private equity investments,
the projects operated by the JAIC Group and that are in the initial stagesof development, and the projects operated by other companies.
Operational investment securities as of September 30, 2023, decreased
to 8,131 million yen (compared to 9,375 million yen as of March 31, 2023).
The main reasons for the decrease were positive investment collection
and a decrease of unrealized gain of listed shares.
Allowance for possible investment losses as of September 30, 2023,
increased to 1,763 million yen (compared to 1,588 million yen as of March
4 / 7

31, 2023) due to posting of provisions.
As a result, the investment loss provision ratio (ratio of allowance forpossible investment losses to operational investment securities) as of
September 30, 2023, was 21.7 %, up 4.8 points from March 31, 2023.
(Liabilities)
Total liabilities as of September 30, 2023, increased to 10,158 million yen(compared to 9,673 million yen as of March 31, 2023). The main factor
for the increase in total liabilities was an increase in loans payable.
Of liabilities, total of loans payable and bonds as of September 30, 2023,
increased to 9,271 million yen (compared to 8,993 million yen as of March31, 2023).
Due to repayment, loans payable of JAIC itself decreased to 4,633 million
yen (compared to 5,137 million yen as of March 31, 2023). JAIC will repay
its loans payable in accordance with the agreement.
As for project finance and bonds for the projects operated by the JAIC
Group, the balance as of September 30, 2023, increased to 4,638 million
yen (compared to 3,856 million yen as of March 31, 2023). A new megasola project and several group home for disabled people projects haveraised new debt.
Project finance and bond for the projects operated by the JAIC Group will
limitedly affect the financial soundness of the JAIC Group, since its
source of repayments is limited to the assets and revenues of theprojects. Therefore, the JAIC Group will continue to expand fundprocurement through project finance and bond. The JAIC Group will
promote leveraged investment in a wide range of projects such as
renewable energy projects operated by the JAIC Group. This enhances
profitability of the JAIC Group while maintaining financial soundness.
(Net assets)
Of net assets, total shareholders’ equity as of September 30, 2023,decreased to 6,841 million yen (compared to 7,581 million yen as ofMarch 31, 2023) due to loss attributable to owners of parent and adecrease in unrealized gain of listed shares. As a result, the equity ratio
as of September 30, 2023, was down 1.9 points to 38.5 % (compared to40.4% as of March 31, 2023).
5 / 7

Non-controlling interests also decreased to 744 million yen (compared to1,487 million yen as of March 31, 2023). The main reasons for thedecrease were a decrease in unrealized gain of listed shares held by thefunds and execution of fund distributions.
As a result, total net assets as of September 30, 2023, decreased to
7,621 million yen (compared to 9,101 million yen as of March 31, 2023).
(4) Business Position(a) Investment and loan activities
For the second quarter of the current fiscal year under review,
execution of investments and loans decreased by 15.5 % year-on-year to
1,118 million yen in 19 companies/projects. As of September 30, 2023,
the balance of investments and loans decreased to 13,458 million yen in
127 companies/projects (compared to 14,133 million yen in 131
companies/projects as of March 31, 2023).
Looking at project-oriented investment, it decreased by 6.2 % year-onyear to 563 million yen in 12 projects that total amount of execution ofinvestments and loans in new projects and in existing projects. JAIC did
not execute new investments in smart agriculture projects. Additionally,
the investment amount per project was smaller compared to the same
period of the previous fiscal year.
As for investment collection, redemption of bonds and distributions fromexisting projects decreased the balance. Fund interest income/loss alsoincreased/decreased the balance. As a result, the balance of investments
and loans as of September 30, 2023, decreased to 6,980 million yen in55 projects (compared to 7,123 million yen in 50 projects as of March 31,2023).
Looking at private equity investment, it decreased by 23.3 % year-on-year
to 555 million yen in 7 companies that total amount of execution ofinvestments and loans in new companies and in existing companies. The
main reason for the decrease was a decrease in strategic investment.
As for investment collection, JAIC sold listed shares and unlisted sharesin Japan. As a result, the balance of investments and loans decreased to
6,478 million yen in 72 companies (compared to 7,010 million yen in 81
6 / 7

companies as of March 31, 2023).
(b) Management of investment funds
As of September 30, 2023, the number of investment funds, for which
the JAIC Group is responsible for management, operation or provision ofinvestment information, totaled 8, and the balance of total commitment
amounts under management decreased to 14,664 million yen (comparedto 9 investment funds with 15,850 million yen as of March 31, 2023).
In the second quarter of the current fiscal year under review, 1 fund withthe commitment amount of 1,880 million yen decreased due tocompletion of liquidation procedures. On the other hand, “Succession
Investment Limited Partnership, Ⅱ” increased its commitment amounts.
Foreign exchange fluctuation also increased the balance of totalcommitment amounts.
On October 31, 2023, Succession Investment Limited Partnership, Ⅱ
increased its total commitment amount again and completed the final
closing with a total amount 5,101 million yen.

(End)

7 / 7