This document has been translated from a part of the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the original shall prevail. JAIC assumes no responsibility for this translation or for direct, indirect or any other forms of damages arising from the translation.

Qualitative Information on Consolidated Operating

Results for the six months Ended September 30, 2022

(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, 2022 to September 30, 2022) recorded operating revenue of 1,112 million yen (up 9.3% year-on-year), operating gross profit of 146 million yen (down

50.0 % year-on-year), operating loss of 488 million yen (compared to operating loss of 413 million yen for the second quarter of the previous fiscal year), ordinary loss of 579 million yen (compared to ordinary loss of 529 million yen for the second quarter of the previous fiscal year) and loss attributable to owners of parent of 671 million yen (compared to loss attributable to owners of parent of 651 million yen for the the second quarter of the previous fiscal year). The breakdown of operating results are as follows.

  1. Breakdown of operating revenue and operating cost (Fund management fees)
    Fund management fees etc. consist of management fees and administrative fees from investment funds. Fund management fees etc. were 58 million yen (down 1.3% year-on-year), about the same as year- on-year. The management fees from funds in liquidation process decreased.

(Investment income)

The proceeds of sale of operational investment securities increased to 444 million yen (up 108.0 % year-on-year). As for private equity investment, sales of domestic listed shares increased. As for project-

1 / 9

oriented investment, 1 mega-solar project was sold. Realized capital gain, which is calculated by deducting cost of securities sold from proceeds of sales of operational investment securities, also increased to 121 million yen (up 170.9% year-on-year).

The total amount of investment write-offs and provision for allowance for possible investment losses increased to 287 million yen (up 88.7 % year- on-year). JAIC posted provisions for investee companies those experienced significant delays in business progress or for which negotiation for the recovery of investment took a long time.

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, amounted to loss of 166 million yen (compared to investment loss of 107 million yen for the second quarter 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 from vegetable sales and other revenues), interests income from the projects operated by other companies (such as net profits of the projects and gains from the sale of projects), interests income from private equity funds operated by other companies, interest and dividend income and other income.

The total amount of fund interests income, etc. for the second quarter of the current fiscal year under review decreased to 599 million yen (down

17.9 % year-on-year). Out of this, revenues of the projects operated by the JAIC Group (such as revenue from electricity sales, revenue from vegetable sales, rent fee revenue from group homes for the handicapped and other revenues) accounted for 379 million yen (down 45.0 % year- on-year). Revenue from electricity sales decreased because some mega solar projects that are selling electricity were sold in the previous fiscal year.

On the other hand, operational dividend income increased 217 million yen (up 2,204.1 % year-on-year). JAIC received profit dividend from a logistic warehouse project that sold the facility in the previous fiscal year.

2 / 9

(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 and other costs), interests losses of the projects operated by other companies (such as losses mainly from projects in early stage) and interests losses of the private equity funds operated by other companies and others.

The total amount of fund interests losses etc. for the current fiscal year under review decreased to 348 million yen (down 12.4 % year-on-year). Out of this, costs of the projects operated by the JAIC Group (such as cost of electricity sales, cost of producing vegetables, rental cost of group homes for the handicapped and other costs) accounted for 319 million yen (down 12.1 % year-on-year). Cost of electricity sales decreased because some mega solar projects that are selling electricity were sold in the previous fiscal year.

As a result, operating revenue increased by 9.3 % year-on-year to 1,112 million yen, operating cost increased by 33.3 % year-on-year to 965 million yen and operating gross profit decreased by 50.0 % year-on-year to 146 million yen.

  1. Selling, general and administrative expenses and operating income The total amount of selling, general and administrative expenses decreased to 635 million yen (down 10.1 % year-on-year). Administrative expenses from projects decreased because some mega solar projects that are selling electricity were sold in the previous fiscal year.

As a result, operating loss was 488 million yen (compared to operating loss of 413 million yen for the second quarter of the previous fiscal year).

  1. Non-operatingincome, non-operating expenses and ordinary income Non-operating income decreased to 5 million yen (down 62.1 % year-on- year) mainly because of a decrease of foreign exchange gains.
    Non-operating expenses mainly consists of interest expenses and decreased to 95 million yen (down 26.6 % year-on-year). On the non- consolidated basis, interest expenses decreased with the reduction of

3 / 9

loans payable. On the consolidated basis, interest expenses also decreased with the reduction of loans payable by project finance due to the sale of some mega solar projects in the previous fiscal year.

As a result, ordinary loss was 579 million yen (compared to ordinary loss of 529 million yen for the second quarter of the previous fiscal year).

  1. Extraordinary income/loss and Profit/Loss attributable to owners of parent
    Loss on valuation of investment securities was main item among extraordinary income/loss for both the second quarter of the previous fiscal year and for the second quarter of the current fiscal year under review. Total extraordinary loss decreased to 13 million yen (down 86.7 % year-on-year) for the second quarter of the current fiscal year under review.
    Profit attributable to non-controlling shareholders is the profit attributable to fund investors other than the JAIC Group among the profits of the funds subject to consolidation. The amount increased to 77 million yen (up 379.9 % year-on-year) as the profits of the funds subject to consolidation increased.
    As a result of adding extraordinary income and deducting extraordinary loss, income taxes and profit attributable to non-controlling interests from ordinary loss, loss attributable to owners of parent amounted to 671 million yen (compared to loss attributable to owners of parent of 651 million yen for the second quarter of the previous fiscal year). JAIC properly estimated tax effect accounting and did not recognize deferred tax assets for both the second quarter of the previous fiscal year and the second quarter of the current fiscal year under review.
  1. Cash flows

(Cash flow from operating activities)

Net cash generated from operating activities amounted to 126 million yen (compared to 1,232 million yen used in for the second quarter of the previous fiscal year). Distributions from investment funds increased and payment for investment of investment funds decreased.

4 / 9

(Cash flow from investing activities)

Net cash used in investing activities was 0 million yen (compared to 55 million yen generated from for the second quarter of the previous fiscal year). There were no proceeds from sales of non-operational investment securities for the second quarter of the current fiscal year under review.

(Cash flow from financing activities)

Net cash used in financing activities with repayments of long-term borrowings decreased year-on-year to 494 million yen (compared to 697 million yen for the second quarter of the previous fiscal year).

Cash and cash equivalents as of September 30, 2022 decreased by 342 million yen from March 31, 2022 to 2,055 million yen, after adding effect of exchange rate change on cash and cash equivalents of 26 million yen.

  1. Financial position (Assets)
    Total assets as of September 30, 2022 decreased to 18,405 million yen (compared to 20,231 million yen as of March 31, 2022).
    Cash and deposits decreased to 3,857 million yen (compared to 5,666 million yen as of March 31, 2022) because of repayment of loans payable, payment of expenses and interests, and new investment executions.
    Meanwhile, the amount of the cash and deposits included deposits attributable to the investment funds operated by the JAIC Group. Those deposits must be managed in accordance with each fund's partnership agreement. The JAIC Group clearly separates and manages those deposits from cash and deposits belonging to the JAIC Group. Cash and deposits belonging to the JAIC Group were cash and cash equivalents of 2,055 million yen as of September 30, 2022 (compared to 2,397 million yen as of March 31, 2022) in the consolidated statements of cash flows.

In addition, private equity investments conducted by the JAIC Group are highly affected by factors such as stock market fluctuations due to the nature of their business. It is difficult to make a reasonable forecast of business results in the current volatile environment. As a result, the amount of funds recovered from private equity investments could decline

5 / 9

This is an excerpt of the original content. To continue reading it, access the original document here.

Attachments

  • Original Link
  • Original Document
  • Permalink

Disclaimer

JAIC - Japan Asia Investment Co. Ltd. published this content on 14 November 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 November 2022 06:11:24 UTC.