Japan Exchange : Earnings Release, Q2 FY2022

(Reference Translation)

October 27, 2022

Japan Exchange Group, Inc. and Consolidated Subsidiaries

Consolidated financial results for the six months ended September 30, 2022

(Based on IFRS), unaudited

Company name:	Japan Exchange Group, Inc.	Stock Exchange Listings: Tokyo
Code number:	8697	URL: https://www.jpx.co.jp/english/
Representative:	Kiyota Akira, Director & Representative Executive Officer, Group CEO
Contact:	Lin Kay, Executive Officer (Corporate Communications and Investor Relations)
Scheduled date of filing of quarterly report:	November 11, 2022
Scheduled date of start of dividend payment:	December 1, 2022
Preparation of 2Q earnings presentation material:	Yes
Holding of 2Q earnings announcement:	Yes (For institutional investors and analysts)

1. Consolidated financial results for six months ended September 30, 2022 (from April 1, 2022 to September 30, 2022)

(Figures less than a million yen are omitted)

(1) Consolidated operating results (cumulative)

(Percentages represent changes year on year)

											Net income
	Operating	Operating	Income before	Net income	attributable to	Comprehensive
	revenue	income	income tax	owners of the	income
											parent company
	Mil. yen		%	Mil. yen	%	Mil. yen		%	Mil. yen	%	Mil. yen	%	Mil. yen	%
Six months ended	66,486		1.5	34,127	(5.3)	34,122		(5.3)	23,674	(5.3)	23,189	(5.6)	23,675	(6.0)
September 30, 2022
Six months ended	65,506		2.6	36,051	2.4	36,044		2.3	25,007	3.4	24,564	3.3	25,177	1.1
September 30, 2021
	Basic earnings	Diluted earnings
		per share			per share
				yen				yen
Six months ended			44.01
September 30, 2022						－

Six months ended

46.23－

September 30, 2021

(2) Consolidated financial position

			Total equity attributable to	Ratio of total equity
			attributable to owners of
	Total assets	Total equity	owners of the parent
	the parent company to
			company
			total assets
	Mil. yen	Mil. yen	Mil. yen	%
As of September 30,	78,465,370	321,568	312,885	0.4
2022
As of March 31, 2022	71,463,434	323,852	315,653	0.4

Note: Sizable amounts of "clearing business financial assets and liabilities" and "deposits from clearing participants" pertaining to clearing business conducted by consolidated subsidiary Japan Securities Clearing Corporation are included in assets and liabilities of JPX Group (meaning JPX and its subsidiaries). For JPX Group's financial position excluding "clearing business financial assets and liabilities" and "deposits from clearing participants", etc., see "1. QUALITATIVE INFORMATION ON OPERATING RESULTS AND FINANCIAL POSITION - (2) Explanation on Financial Position" on page 4 of the Appendix.

2. Dividends

		Annual dividends per share
	First quarter-end	Second quarter-end	Third quarter-end		Fiscal year-end	Total
	yen	yen	yen		yen	yen
Year ended		26.00			46.00	72.00
March 31, 2022	－	－
Year ending		26.00
March 31, 2023	－
Year ending March 31,					26.00	52.00
2023 (Forecast)			－

Note 1: Change in dividends forecast from the most recent announcement: None

Note 2: Breakdown of year-end dividend for the fiscal year ended March 31, 2022 ordinary dividend ¥31; special dividend ¥15.

3. Consolidated earnings forecast for the fiscal year ending March 31, 2023 (from April 1, 2022 to March 31, 2023) (Percentages represent changes year on year)

										Net income
	Operating	Operating	Income before	Net income	attributable to	Basic earnings
	revenue		income	income tax	owners of the	per share
										parent company
	Mil. yen		%	Mil. yen	%	Mil. yen	%	Mil. yen	%	Mil. yen	%	yen
Year ending	132,500		(2.2)	65,500	(10.9)	65,500	(10.8)	45,500	(10.5)	45,000	(9.9)	85.42
March 31, 2023

Note: Change in earnings forecast from the most recent announcement: None

Notes:

1. Changes in significant subsidiaries during the period (changes in specified subsidiaries that caused changes in the scope of consolidation): None
2. Changes in accounting policies/changes in accounting estimates

1. Changes in accounting policies due to revisions in accounting standards under IFRS: None
2. Changes in accounting policies other than the above: None
3. Changes in accounting estimates: Yes

• For details, please refer to "(Changes in Accounting Estimates)" of "2.CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND NOTES - (5) Notes on Condensed Consolidated Financial Statements" on page 12 of the Appendix.

1. Number of issued shares (common shares)

1. Number of issued shares at the end of the period (including treasury shares):

	As of September 30, 2022:	528,578,441
	As of March 31, 2022:	528,578,441
2)	Number of treasury shares at the end of the period:
	As of September 30, 2022:	1,861,043
	As of March 31, 2022:	1,037,782
3)	Average number of shares:
	Six months ended September 30, 2022:	526,953,869
	Six months ended September 30, 2021:	531,421,385

• This release is outside the scope of the quarterly review by certified public accountants and audit firms.
• Explanation on appropriate use of forecast and other special items

This material contains an earnings forecast and other forward-looking statements which are based on available information and certain assumptions that are considered reasonable at the time of preparation. Various factors may cause actual results, etc. to be materially different from those expressed in these forward-looking statements.

DISCLAIMER: This translation may be used for reference purposes only. This English version is not an official translation of the original Japanese document. In cases where any differences occur between the English version and the original Japanese version, the Japanese version shall prevail. This translation is subject to change without notice. Japan Exchange Group, Inc., and/or its affiliates shall individually or jointly accept no responsibility or liability for damage or loss caused by any error, inaccuracy, misunderstanding, or changes with regard to this translation.

(Appendix)

Contents of Appendix

1. QUALITATIVE INFORMATION ON OPERATING RESULTS AND FINANCIAL POSITION …2
2. 1. Explanation on Operating Results …2
   2. Explanation on Financial Position …4
   3. Explanation on Forecast Information such as Consolidated Earnings Forecast, etc. …5
3. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND NOTES …6
4. 1. Condensed Consolidated Statement of Financial Position …6
   2. Condensed Consolidated Statement of Income …8
   3. Condensed Consolidated Statement of Comprehensive Income …9
   4. Condensed Consolidated Statement of Changes in Equity …10
   5. Notes on Condensed Consolidated Financial Statements …12

(Note on Going-Concern Assumption) …12 (Changes in Accounting Estimates) …12 (Operating Revenue) …12

(Operating Expenses) …12

- 1 -

1. QUALITATIVE INFORMATION ON OPERATING RESULTS AND FINANCIAL POSITION

1. Explanation on Operating Results

During the consolidated cumulative second quarter (from April 1, 2022 to September 30, 2022), JPX Group recorded operating revenue of ¥66,486 million (increased 1.5% from the same period of the previous fiscal year (i.e., year on year)), and operating expenses were ¥33,240 million (increased 10.2% year on year). As a result, JPX Group recorded operating income of ¥34,127 million (decreased 5.3% year on year) and income before income tax of ¥34,122 million (decreased 5.3% year on year).

In addition, net income attributable to owners of the parent company after tax was ¥23,189 million (decreased 5.6% year on year).

(Operating revenue)

1) Trading services revenue

Trading services revenue is comprised of "transaction fees" based on the value of cash equities traded or volume of financial and commodity derivatives traded, "basic fees" based on the types of the trading participant's trading qualification, "access fees" based on the number of orders, "trading system facilities usage fees" based on the types of trading system facilities used, and other similar fees.

During the consolidated cumulative second quarter, trading services revenue increased 4.9% year on year to

¥26,404 million due mainly to an increase in revenue from transaction fees resulting from year-on-year increases in trading value of cash equities and trading volume of financial derivatives.

Breakdown of trading services revenue

			(Mil. yen)
	Six months ended	Six months ended
	September 30, 2021	September 30, 2022
			Change (%)
Trading services revenue	25,159	26,404	4.9
Transaction fees	20,347	21,411	5.2
Cash equities	15,009	15,412	2.7
Financial derivatives	4,601	5,319	15.6
TOPIX futures transactions	909	1,031	13.4
Nikkei 225 futures transactions*	1,785	2,242	25.6
Nikkei 225 options transactions**	1,112	1,176	5.8
10-year JGB futures transactions	702	756	7.7
Others	92	111	20.3
Commodity derivatives	736	679	(7.8)
Basic fees	500	494	(1.3)
Access fees	2,446	2,611	6.7
Trading system facilities usage fees	1,815	1,833	1.0
Others	48	53	9.8

*Figures include Nikkei 225 mini futures transactions. **Figures exclude Nikkei 225 weekly options transactions.

2) Clearing services revenue

Clearing services revenue is comprised of clearing fees related to the assumption of obligations of financial instrument transactions carried out by Japan Securities Clearing Corporation and other similar fees.

During the consolidated cumulative second quarter, clearing services revenue increased 3.6% year on year to ¥14,142 million.

- 2 -