Slide 1: ORIX Corporation Consolidated Financial Results
ORIX Corporation Consolidated Financial Results For the Consolidated Fiscal Year ended March 31, 2022 Makoto Inoue Member of the Board of Directors Representative Executive Officer President & CEO May 11, 2022 1 Company Name (TSE: 8591; NYSE: IX) Copyright © 2022 ORIX Corporation All rights reserved
Slide 2: Net Income & ROE
Net Income & ROE ✓ 312.1 JPY Bn in net income (+62% YoY), annualized ROE of 9.9% ✓ Posted new quarterly net income record of 100.8 JPY Bn in Q4. Recorded largest-ever investment gain on sale of Yayoi, which offset impairments in several segments ✓ Reported record full-year EPS of 259 JPY Net Income
Slide 3: Breakdown of FY22.3 Segment Profits
Breakdown of FY22.3 Segment Profits 363.3 JPY Bn, up by 32% YoY (+87.2 JPY Bn) FY22.3 Base Profits Highest base profits reported in five years. Eight of ten segments saw base profits grow, with Segment profits performance in overseas segments particularly strong 551.2 JPY Bn +66% YoY 187.9 JPY Bn, u
Slide 4: Segment Profits
Segment Profits ✓ Record high segment profits ✓ Segment profits rose YoY in five segments, primarily in ORIX Europe, ORIX USA, Asia and Australia. Domestic segments also solid (JPY Bn) Q1 Q2 Q3 Q4 Full-Year YoY Highlight Corporate Financial Services and Segment Profits Maintenance Leasing (Ex. Yayoi
Slide 5: Segment Assets
Segment Assets ✓ Assets increased on continued new investment and project development, focused primarily in overseas segments, Environment and Energy segment (forex impact: 372.4 JPY Bn) ✓ Annualized segment asset ROA improved to 2.7%, up 1.0% points vs. end-FY21.3 (JPY Bn) 22.3 Vs. 21.3 ROA* Highli
Slide 6: Medium-term Direction: Earnings Targets and Shareholder Returns (1)
Medium-term Direction: Earnings Targets and Shareholder Returns (1) FY21.3 FY22.3 FY25.3 Targets Net income 192.4 JPY Bn 312.1 JPY Bn 440.0 JPY Bn ROE 6.4% 9.9% 11.7% Financial A rating-equivalent A rating-equivalent A rating-equivalent soundness Shareholder returns ✓ Dividends: Payout ratio of 33%
Slide 7: Medium-term Direction: Earnings Targets and Shareholder Returns (2)
Medium-term Direction: Earnings Targets and Shareholder Returns (2) FY22.3 FY25.3 Expectations *1 Segments assets 12 JPY Tn 14 JPY Tn Total assets 14 JPY Tn 16 JPY Tn Segment asset ROA 2.7% 3.1% Total asset ROA 2.2% 2.7% Ratio of overseas 33% profit *2 (excl. Yayoi sale: 47%) 51% Shareholders’ equit
Slide 8: Termination of Shareholder Benefit Programs
Termination of Shareholder Benefit Programs 1. Reasons for terminating the programs • In 2010, ORIX began its Shareholder Benefit Card program, which makes shareholders eligible for discounts on a variety of services offered by the ORIX Group. In 2015, the gift catalog-style shareholder benefit prog
Slide 9: Medium- to Long-term Growth
Medium- to Long-term Growth ✓ Operation & Investment and Asset Management positioned as growth drivers, aim to achieve 440.0 JPY Bn in net income by FY25.3 ✓ After FY25.3, will sustain growth into FY30.3 supported by new investments in environment and energy, overseas businesses Net income: Trends &
Slide 10: Medium-term Direction
Medium-term Direction Breakdown of Segment Profits FY22.3 (Actual) FY25.3 (Target) Aircraft and ships, Real estate -22.0 JPY Bn 60.0 JPY Bn operations, Concession Operation & Investment 325.7 JPY Bn 290.0 JPY Bn (Investment gains on Yayoi sale) (163.0 JPY Bn) (zero) Asset Management 100.0 JPY Bn 130
Slide 11: Medium-term Direction: Growth Strategy
Medium-term Direction: Growth Strategy ✓ Substantial capital to be invested in Operation & Investment, Asset Management ✓ In Financing & Insurance, will strengthen profitability through differentiation to attain stable growth Segment Profits Outlook (FY22.3 to FY25.3) Business Main strategy PE Inves
Slide 12: Focus Area (1): PE Investment
Focus Area (1): PE Investment ✓ Focus on larger deals (including carve-outs) in addition to current small/mid-size company-focused strategy ✓ US: Build on successes in middle-market strategy, aim to utilize more third-party capital Japan US & Europe Asia (ex-Japan) ◼ Specialize in US middle market,
Slide 13: Focus Area (2): Environment and Energy
Focus Area (2): Environment and Energy ✓ Capital investment to focus on overseas renewable energy projects (total existing projects of 2 JPY Tn), growth to be driven by Elawan, Greenko ✓ Operating capacity including pipeline projects: Elawan (80% stake), 9 GW; Greenko (20% stake), 18 GW Owned renewa
Slide 14: Focus Area (3): Asset Management Business
Focus Area (3): Asset Management Business ✓ Expansion in asset management business centered on Europe, US supports base profit growth ✓ Focus on management of diversified asset base, in addition to equities, fixed income, and alternative assets; utilizing Group resources (Top manager of renewable en
Slide 15: Aircraft and Ships, Real Estate Operations, Concession
Aircraft and Ships, Real Estate Operations, Concession ✓ Roughly two years have passed since start of COVID-19 pandemic ✓ In FY25.3, forecast recovery in segment profits to about 80% of pre-pandemic (FY20.3) levels Segment Profits (Three Heavily Impacted Segments) Aircraft and ships Real estate (ope
Slide 16: Steady Growth in Domestic Businesses
Steady Growth in Domestic Businesses ✓ Financing, other existing businesses positioned as base. Offer wide variety of solutions through nationwide network of sales offices and relationship managers as a hub ✓ In addition to M&A and fee-based businesses, strengthening tie-ups with Environment and Ene
Slide 17: Expansion in Overseas Businesses
Expansion in Overseas Businesses ✓ Enhance governance, level of expertise necessary to develop overseas business expansion ✓ Management by business leaders with specialized expertise who are well versed in the laws, regulations, business practices of each region, industry Aircraft and Ships (OAS, Av
Slide 18: Overseas Business Management Team: ORIX USA
Overseas Business Management Team: ORIX USA ✓ Promote expansion in AUM and fee business while responsibly controlling balance sheet ✓ Operate hybrid strategy utilizing third-party capital Medium-term Direction ・Focus on US middle market in credit, real estate, ORIX USA, President & CEO ORIX USA, Chi
Slide 19: Overseas Business Management Team: ORIX Europe
Overseas Business Management Team: ORIX Europe ✓ Robeco has been a global leader in the sustainable investing field since launching its first sustainable investing product in 1995 ✓ Targets growth in alternative asset portfolio in addition to traditional asset management (equities, fixed income) ORI
Slide 20: Overseas Business Management Team: Environment and Energy
Overseas Business Management Team: Environment and Energy ✓ View efforts to realize a sustainable society, such as decarbonization and a circular society, as a business opportunity, aim to continue expansion ✓ Aim to accelerate global expansion centered on renewable energy business by capitalizing o
Slide 21: Overseas Business Management Team: Aircraft and Ships
Overseas Business Management Team: Aircraft and Ships ✓ Aircraft: Aircraft leasing business enhanced market presence through pandemic Seek opportunities for new acquisitions (as a growth driver), generate gains on sales and fee income ✓ Ships: Achieve further growth in three main businesses (owned f
Slide 22: Overseas Business Management Team: Asia and Australia (Greater China Group)
Overseas Business Management Team: Asia and Australia (Greater China Group) ✓ China’s economy to continue to grow. While recognizing risks from US/China political issues, will promote growth strategy led by local management ✓ Build partnerships with regional governments, state-owned enterprises; sec
Slide 23: Overseas Business Management Team: Asia and Australia
Overseas Business Management Team: Asia and Australia ✓ Formulate strategy considering post-COVID impact, market size (including each region’s population and economic trends), market growth potential, and competition ✓ Manage operations primarily through leaders with deep local ties, based on basic
Slide 24: ORIX: Outlook for Growth in 5-10 Years
ORIX: Outlook for Growth in 5-10 Years ✓ Aim to achieve global growth, revitalization of domestic businesses by working closely with a wide variety of clients to resolve their business problems and, in turn, solve social issues ✓ Redefine ORIX Group’s Corporate Philosophy for the next five to ten ye
Slide 25: Progress in ESG-Related Matters
Progress in ESG-Related Matters ✓ Outside Directors now account for over half of Board of Directors as of January 2022 ✓ Recorded 19.6 JPY Bn in impairments on Biomass and Coal Power Plants in FY22.3 ✓ Established roadmap to achieving key goals by FY30.3. Emphasis on ESG will lead to greater and acc
Slide 26: Segment Performance
Segment Performance Copyright © 2022 ORIX Corporation All rights reserved. 26
Slide 27: Corporate Financial Services and Maintenance Leasing
Corporate Financial Services and Maintenance Leasing Segment Profits: 251.4 JPY Bn YoY +180.7 JPY Bn (+255％) Segment Assets: 1,516.8 JPY Bn YTD –159.3 JPY Bn (-10%) ✓ Gain on the sale of Yayoi booked in Q4 ✓ Assets down vs. end-FY21.3 owing to Yayoi sale ✓ Auto profits significantly up on strong use
Slide 28: Corporate Financial Services and Maintenance Leasing - About the Business
Corporate Financial Services and Maintenance Leasing - About the Business Main business: Finance and fee business; leasing and rental of automobiles, electronic measuring instruments and ICT-related equipment Corporate Financial Services Auto Rentec World leader in vehicles under Core platform for c
Slide 29: Real Estate
Real Estate Segment Profits: 33.6 JPY Bn YoY +7.7 JPY Bn (30%) Segment Assets: 910.1 JPY Bn YTD +38.0 JPY Bn (+4%) ✓ Profits up sharply on development, sale of logistics facilities ✓ DAIKYO assets increased, primarily due to development of rental ✓ Facilities operations losses shrank as occupancy im
Slide 30: Real Estate – About the Business
Real Estate – About the Business Main Business: Real estate development, rental and management; facilities operation; real estate asset management Segment Assets Unrealized gains on rental （as of end-Mar, 2022） Segment Asset Trends properties* Primarily DAIKYO Primarily leased logistics facilities,
Slide 31: PE Investment and Concession
PE Investment and Concession Segment Profits: -11.3 JPY Bn YoY -15.1 JPY Bn (-393%) Segment Assets: 353.6 JPY Bn YTD -25.1 JPY Bn (-7%) ✓ Profits lower on impairments related sale of Kobayashi Kako assets, ✓ Segment assets lower owing to Kobayashi Kako-related impairments, while other PE investees p
Slide 32: PE Investment and Concession – About the Business
PE Investment and Concession – About the Business ✓ Currently invested in 17 companies (as of end-Mar 2022); aim to develop new business segments for ORIX Investment Track Record Investee Companies Leveraging our broad network and IT Services Initial investment Business Management experience we have
Slide 33: Environment and Energy
Environment and Energy Segment Profits: 2.9 JPY Bn YoY -24.6 JPY Bn (-89％) Segment Assets: 703.6 JPY Bn YTD +214.4 JPY Bn (+44%) ✓ Greenko began contributing to earnings from Q2, Elawan from Q3 ✓ Assets higher on Elawan acquisition ✓ Booked impairments on two Coal and Biomass Power Plants (Soma, Hib
Slide 34: Global Renewable Energy Portfolio
Global Renewable Energy Portfolio ✓ Total net owned operating capacity of 3.3 GW worldwide （as of end-March 2022） ✓ Total operating capacity (incl. assets in operation, under construction, and in development): Elawan 9 GW, Greenko 18 GW Spain & other locations China Japan USA & other locations ・Elaw
Slide 35: Insurance
Insurance Segment Profits: 54.6 JPY Bn YoY -1.6 JPY Bn (-3%) Segment Assets: 2,072.1 JPY Bn YTD +112.6 JPY Bn (+6%) ✓ ORIX Life: Profits up on growth in insurance policies ✓ Assets up on increase in insurance policies ✓ Segment profits lower YoY on absence of FY21.3 reversal of liability reserve of
Slide 36: Life Insurance – About the Business
Life Insurance – About the Business ✓ Omni-channel strategy (including online/mail order) has allowed ORIX Life to post growth in policies well above industry average ✓ Shift from mix dominated by third-sector products (such as medical insurance CURE) to a more well-balanced portfolio with introduct
Slide 37: Banking and Credit
Banking and Credit Segment Profits: 43.8 JPY Bn YoY -6.1 JPY Bn (-12%) Segment Assets: 2,687.2 JPY Bn YTD -3.5 JPY Bn (flat) ✓ Banking: Profits flat YoY on tighter control over lending balance ✓ Assets mostly flat ✓ Credit: Profits lower on absence of year-earlier reversals of provisions for losses
Slide 38: Banking – About the Business
Banking – About the Business ✓ In addition to its mainstay real-estate investment loan business, ORIX Bank is strengthening its financing business to industries which support a sustainable society ✓ By utilizing its trust banking license, will develop and sell financial products, such as securitized
Slide 39: Aircraft and Ships
Aircraft and Ships Segment Profits: -1.8 JPY Bn YoY -7.2 JPY Bn (-134%) Segment Assets: 684.1 JPY Bn YTD +82.3 JPY Bn (+14%) ✓ Ships business profits up sharply on strong shipping market, sales of owned ✓ Ships: Assets increased with new loan execution fleet and loan executions ✓ Aircraft: Assets do
Slide 40: Aircraft and Ships – About the Business
Aircraft and Ships – About the Business GLOBALLY NARROWBODY OEM DIVERSE WEIGHTING BREAKDOWN Owned Committed （NBV） （number of aircraft） （number of aircraft） fleet fleet ORIX Aviation 57 0 ✓ Fully-owned subsidiary 13% 19% Average age ✓ Mainly trading in second-hand 6.3 years market 39% 40% ✓ Arrangeme
Slide 41: ORIX USA
ORIX USA Segment Profits : 76.3 JPY Bn YoY +36.0 JPY Bn (+89%) Segment Assets : 1,364.1 JPY Bn YTD +144.1 JPY Bn (+12%) ✓ Segment profits set new record, fueled by growth in all businesses, robust PE exits ✓ Assets higher owing forex impacts resulting from weaker yen ✓ Asset management businesses in
Slide 42: ORIX USA – About the Business
ORIX USA – About the Business ✓ A provider of capital and financing solutions to middle market companies in USA, targets rapid growth in asset management for three key verticals (total AUM / AUA $73.9 Bn) ✓ Financial stability and access to capital allows ORIX USA to operate a hybrid strategy, inves
Slide 43: ORIX Europe
ORIX Europe Segment Profits: 49.6 JPY Bn YoY +10.1 JPY Bn (+26%) Segment Assets: 401.9 JPY Bn YTD +32.3 JPY Bn (+9%) ✓ AUM and segment profits both hit new record level, buoyed by strong ✓ Assets up on increase in investment in securities markets ✓ Impairments of intangible assets booked in Q4 Segme
Slide 44: ORIX Europe – About the Business
ORIX Europe – About the Business ✓ Main Business: Equities, fixed income, renewable energy and other fund management ✓ Actively promoting ESG investing, especially through Robeco and Gravis Capital Management An ESG pioneer since the mid-1990s, Robeco is Major Subsidiaries Head Office Primary Busine
Slide 45: Asia and Australia
Asia and Australia Segment Profits : 52.3 JPY Bn YoY +39.1 JPY Bn（+298%） Segment Assets : 1,306.1 JPY Bn YTD +221.9 JPY Bn（20%） ✓ Record profit achieved on increase in finance, leasing revenues in South ✓ Assets rose substantially on growth in new leasing business in South Korea, China Korea and Chi
Slide 46: Asia and Australia – About the Business
Asia and Australia – About the Business ✓ Main Business: Finance and investment businesses in Asia and Australia ✓ Investment: PE mainly in greater China and South Korea. Leasing: Primarily industrial equipment and auto leasing across Asia and Australia Segment Assets NET Segment Revenue* Yields on
Slide 47: Appendix
Appendix Copyright © 2022 ORIX Corporation All rights reserved. 47
Slide 48: About ORIX: Proven Track Record of Profitability
About ORIX Proven Track Record of Profitability ✓ ORIX has achieved 57 years of sustained, profitable growth Net Income Attributable to ORIX Corporation Shareholders JPY Bn FY2021.3 Covid-19 crisis 350 300 250 FY2002.3 FY2009.3 Burst of IT bubble Global financial crisis 200 150 FY1998.3 Asian curren
Slide 49: About ORIX: Expertise in Business and Collective Capabilities
About ORIX Expertise in Business and Collective Capabilities of the Group ✓ ORIX will continue to enhance our expertise in finance and tangible assets as we synergistically expand our businesses Copyright © 2022 ORIX Corporation All rights reserved. 49
Slide 50: About ORIX: Global Network
About ORIX Global Network ✓ Using its expertise cultivated in Japan, ORIX has expanded its business globally, with operations in 28 countries and regions worldwide Copyright © 2022 ORIX Corporation All rights reserved. 50
Slide 51: Breakdown of Investment Gains
Breakdown of Investment Gains Investment Gains* Major Business Sales (JPY Bn) Segment FY18.3 FY19.3 FY20.3 FY21.3 FY22.3 No. Company Timing of sale ORIX Electric Power ① FY18.3 Real estate 42.9 ② 56.5 ③ 53.6 16.9 21.4 Corporation ② ORIX Golf Management FY19.3 PE and concession 26.9 0.3 16.4 -0.7 -19
Slide 52: Funding Structure / Employed Capital Ratio
Financials Funding Structure / Employed Capital Ratio ✓ Diversified funding methods and maintained a high ratio of long-term debt Funding Structure and Ratio of Long-term Debt*1 Shareholders’ Equity / Employed Capital Ratio*2 4.5 88% 88% 93% 93% 93% 93% 91% 86% 4.0 85% 85% (JPY Tn) 3.5 3.3 Deposits
Slide 53: Funding Structure
Financials Funding Structure ✓ Diversified funding. Controlled costs while maintaining a high long-term debt ratio Breakdown of Funding Trends in Fundings Costs Foreign currency funding costs Yen funding cost Deposits 32% Borrowings from financial 3.27% 3.28% 2.76% End-FY22.3 institutions 2.45% 51%
Slide 54: D/E Ratio & Credit Ratings
Financials D/E Ratio & Credit Ratings ✓ Since global financial crisis, have realized ROE growth while controlling D/E ratio D/E Ratio・ROE Credit Ratings 3.8x End-March 2022 3.4x 11.5% 10.5% 11.7% 12.1% 11.3% 11.6% S&P A- (Stable) 2.7x 10.3% 9.9% 7.4% Moody’s A3 (Stable) 6.2% 6.4% 2.2x Fitch A- (Stab
Slide 55: Shareholder Returns
Shareholder Returns ✓ FY23.3-FY25.3 dividend policy: Payout ratio of 33% or previous fiscal year’s dividend, whichever is higher ✓ Share buybacks to be carried out opportunistically (50 JPY Bn planned for FY23.3) Dividend Per Share and Payout Ratio Share Buybacks and Total Return Ratio 78% (JPY) 50%
Slide 56: Disclaimer
Disclaimer ◼ These materials have been prepared by ORIX Corporation (“ORIX” or the “Company”) solely for your information and are subject to change without notice. The information contained in these materials has not been independently verified and its accuracy is not guaranteed. No representations,
Slide 57: ORIX Corporation Investor Relations
For the current IR materials and archives of past financial data, please access our website. IR Section https://www.orix.co.jp/grp/en/ir/ IR Library https://www.orix.co.jp/grp/en/ir/library/ ORIX Corporation Investor Relations and Sustainability Department Tel: +81-3-3435-3121 57 Company Name Copyri