ORIX Corporation · TSE:8591
ORIX — H1 FY2006 Earnings Presentation
32 slides from ORIX's earnings presentation, Nov 9, 2005
Slide 1: Fiscal 2006 2Q Conference Call
Fiscal 2006 2Q Conference Call 2005.11.9
Slide 2: ORIX Corporation Conference Call
ORIX Corporation Conference Call Consolidated Financial Results For the Interim Period Ended September 30, 2005 (November 9, 2005) Yasuhiko Fujiki, President & COO Masaru Hattori, Corporate Senior Vice President Raymond Spencer, Senior Manager & IR Officer Copyright © 2005 ORIX Corporation. All righ
Slide 3: Disclaimer
Disclaimer These documents may contain forward-looking statements about expected future events and financial results that involve risks and uncertainties. Such statements are based on our current expectations and are subject to uncertainties and risks that could cause actual results to differ materi
Slide 4: Contents
Contents 1. Highlights of the Interim Results 2. Forecast for Fiscal 2006 3. Details of U.S. Investment Bank Acquisition 4. Overview of Interim Results 5. Segment Information 6. Debt Structure 7. Effect of Rise in Interest Rates 8. Supplemental Information Copyright © 2005 ORIX Corporation. All righ
Slide 5: 1. Highlights of Interim Results
1. Highlights of Interim Results 1. Continuation of the Good Results of the Previous Fiscal Year with All 9 Segments Achieving Higher Profits 2. Growth of Revenues from Corporate Loans in Japan and Overseas 3. Increased of Gains on Sales due to the Strong Real Estate and Securities Markets Copyright
Slide 6: 2. Forecast for Fiscal 2006
2. Forecast for Fiscal 2006 — Upward revision in fiscal 2006 forecast based on good results achieved in first half — Main Reasons for Net Income (Billions of yen) Upward Revision Up 53% 140.0 Present Better than expected Forecast results in Japan and overseas for corporate financial services 96.0 Pr
Slide 7: 3. Details of U.S. Investment Bank Acquisition
3. Details of U.S. Investment Bank Acquisition Constantly looking for new Future Other business opportunities Growth The (Investment Americas Staying one step ahead of Banking) Segments the competition Real Accelerating speed of Estate- Accelerated Related growth Automobile Finance Expecting
Slide 8: 3. Details of U.S. Investment Bank Acquisition
3. Details of U.S. Investment Bank Acquisition — Growth of the Entire Group with Full-Scale Entry into U.S. Investment Banking Business — ORIX USA New Company Total Assets: US$2,500 million (about Corporate Finance 290 billion yen) Equity: US$500 million (about 58 Leasing billion yen) Real Estate-Re
Slide 9: 4. Overview of Interim Results: Profits
4. Overview of Interim Results: Profits — Profits almost doubled compared to the interim period of the previous fiscal year, which also achieved good results — IBIT*(Year on Year Change) Net Income (Year on Year Change) (Billions of yen) 150 150 133.1 Up 93% 100 100 Up 97% 84.0 68.9 50 50 42.7 0 0 0
Slide 10: 4. Overview of Interim Results: Segment Profits
4. Overview of Interim Results: Segment Profits — All 9 segments achieved higher profits — Segment Profits* (Billions of yen) (Year on Year Change) Corporate Financial Services 23.8 (+6.5) Stable Rental Operations 5.3 (+0.3) Profit Segments Life Insurance 7.8 (+3.8) Asia, Oceania and Europe 19.7 (+8
Slide 11: 4. Overview of Interim Results: Segment Profits
4. Overview of Interim Results: Segment Profits Business Expansion Improved Asset Quality Gains on Sales Stable Profit • Expansion of corporate • Lower provisions for • Contribution from loans in Japan securitization of leases in the Segments • Steady performance of loans, the Corporate Corporate Fi
Slide 12: Corporate Financial Services Segment
5. Segment Information: Stable Profit Segments Corporate Financial Services Segment Segment Outline Financial Results Main Customers 23.8 Year on Year Change SMEs Profit Drivers 17.3 Segment Profits (Billions of yen) Business Outline Leases, loans, and the Up 38% Expansion of sale of financial cor
Slide 13: Rental Operations Segment
5. Segment Information: Stable Profit Segments Rental Operations Segment Segment Outline Financial Results Main Customers Year on Year Change Corporate Profit Drivers Segment Profits (Billions of yen) Business Outline Precision measuring Up 6% Recognition of equipment rentals and 5.0 5.3 gains on
Slide 14: Life Insurance Segment
5. Segment Information: Stable Profit Segments Life Insurance Segment Segment Outline Financial Results Main Customers Year on Year Change Corporate & Retail Profit Drivers Segment Profits (Billions of yen) Business Outline Up 95% Life insurance sales 7.8 Higher life insurance related 4.0 investme
Slide 15: Asia, Oceania and Europe Segment
5. Segment Information: Stable Profit Segments Asia, Oceania and Europe Segment Segment Outline Financial Results Main Customers Year on Year Change SMEs 19.7 Profit Drivers Segment Profits (Billions of yen) Business Outline Steady performance Leases, loans, 10.9 automobile leases, Up 81% of corpo
Slide 16: Automobile Operations Segment
5. Segment Information: Accelerated Growth Segments Automobile Operations Segment Segment Outline Financial Results Main Customers Year on Year Change Corporate & Retail 13.4 Profit Drivers Segment Profits (Billions of yen) 10.9 Business Outline Automobile leasing Expansion of Up 23% and automobil
Slide 17: Real Estate-Related Finance Segment
5. Segment Information: Accelerated Growth Segments Real Estate-Related Finance Segment Segment Outline Financial Results Main Customers Year on Year Change Corporate & Retail 20.3 Profit Drivers Segment Profits (Billions of yen) Business Outline Increase in Corporate loans, revenues from housing
Slide 18: Real Estate Segment
5. Segment Information: Accelerated Growth Segments Real Estate Segment Segment Outline Financial Results Main Customers Year on Year Change Corporate & Retail 20.6 Profit Drivers Segment Profits (Billions of yen) Business Outline Condominium development, office building 12.5 Increase in developme
Slide 19: Other Segment
5. Segment Information: New Growth Segments Other Segment Segment Outline Financial Results Main Customers Year on Year Change Corporate & Retail 16.3 Profit Drivers Segment Profits (Billions of yen) Business Outline 11.8 Card loans, venture Up 38% Increase in capital, securities revenues from bro
Slide 20: The Americas Segment
5. Segment Information: New Growth Segments The Americas Segment Segment Outline Financial Results Main Customers Year on Year Change Corporate Three-Fold 14.1 Profit Drivers Increase Segment Profits (Billions of yen) Business Outline Corporate finance, Increase in leases, and real 4.7 revenues fr
Slide 21: 6. Debt Structure: 1. Breakdown
6. Debt Structure: 1. Breakdown — Continuation of policy of focusing on the diversification of funding methods and sources — (Billions of yen) 5,000 4,679.6 Short-Term Debt 4,500 4,239.5 4,269.7 Short-Term Borrowings from 4,146.3 3,859.2 Financial Institutions 4,000 10% CP 3,500 12% Long-Term Debt 3
Slide 22: 6. Debt Structure: 2. Short- and Long-Term Debt Ratio
6. Debt Structure: 2. Short- and Long-Term Debt Ratio — Little variation in recent short- and long-term debt ratio — Long-Term Debt Short-Term Debt 100% 28% 25% 25% 24% 37% 50% 72% 75% 75% 76% 63% 0% 2002.3 2003.3 2004.3 2005.3 2005.9 Copyright © 2005 ORIX Corporation. All rights reserved. 21
Slide 23: 6. Debt Structure: 3. Long-Term Debt Repayment Schedule
6. Debt Structure: 3. Long-Term Debt Repayment Schedule Long-Term Debt Repayment Schedule More than 5 years 10% Less than 1 year 4-5 years 25% 14% 14% 3-4 years 20% 1-2 years 17% 2-3 years As of March 31, 2005 Copyright © 2005 ORIX Corporation. All rights reserved. 22
Slide 24: 7. Effect of Rise in Interest Rates: 1. Collection of Leases & Loans
7. Effect of Rise in Interest Rates: 1. Collection of Leases & Loans — Over one-third of direct financing leases and one-quarter of installment loans are collected within one year — Direct Financing Leases Installment Loans --Minimum lease payments receivable-- --Contractual maturities-- More than 5
Slide 25: 7. Effect of Rise in Interest Rates: 2. Floating Rate Loans
7. Effect of Rise in Interest Rates: 2. Floating Rate Loans — A rise in interest rates would be reflected fairly quickly in floating rate loans — Installment Loans: Fixed & Floating Rate Fixed 37% Floating 63% As of March 31, 2005 Copyright © 2005 ORIX Corporation. All rights reserved. 24
Slide 26: 7. Effect of Rise in Interest Rates: 3. Trend in Interest Rates
7. Effect of Rise in Interest Rates: 3. Trend in Interest Rates —Inverted yield curve does not occur often— % 10 Overnight Call Rates 8 6 10Y JGB Futures 4 2 Spread 0 Inflation Rate -2 -4 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Source: Bank
Slide 27: 8. Supplementary Information: Summary of Interim Results
8. Supplementary Information: Summary of Interim Results Change on Change on (Millions of yen except as notes) 2004.4‐ 9 2005.4‐ 9 2004.4-9 2004.4-9 Revenues 415,931 442,927 26,996 ＋6% Income before Income Taxes (IBIT)* 68,860 133,109 64,249 ＋93% Net Income 42,688 83,954 41,266 ＋97% Basic Earnings P
Slide 28: 8. Supplementary Information: Revenues & Expenses
8. Supplementary Information: Revenues & Expenses Revenues (Year on Year) Revenues (Quarterly Trend) (Billions of yen) (Billions of yen) 500 500 415.9 Up 6% 442.9 400 400 300 300 230.6 213.8 200 200 100 100 0 0 04.4-9 05.4-9 2Q 3Q 4Q 1Q 2Q 04.7-9 04.10-12 05.1-3 05.4-6 05.7-9 Expenses (Year on Year)
Slide 29: 8. Supplementary Information: IBIT & Net Income
8. Supplementary Information: IBIT & Net Income IBIT (Year on Year Change) IBIT (Quarterly Trend) (Billions of yen) (Billions of yen) 150 133.1 150 Up 93% 120 120 90 68.9 90 74.8 60 60 32.3 30 30 0 0 04.4-9 05.4-9 2Q 3Q 4Q 1Q 2Q 04.7-9 04.10-12 05.1-3 05.4-6 05.7-9 Net Income (Year on Year Change) N
Slide 30: 8. Supplementary Information: Assets, Debt & Shareholders' Equity
8. Supplementary Information: Assets, Debt & Shareholders’ Equity Operating Assets Total Assets (Billions of yen) (Billions of yen) 8,000 8,000 6,069.0 6,333.1 6,000 5,262.8 6,000 5,129.1 Up 3% Up 4% 4,000 4,000 2,000 2,000 0 0 4Q 2Q 4Q 2Q 2005.3 2005. 9 2005. 3 2005.9 Short- and Long-Term Debt & De
Slide 31: 8. Supplementary Information: Key Financial Data
8. Supplementary Information: Key Financial Data (Billions of yen) Net Income & ROE (%) (Billions of yen) Total Assets & ROA (%) 100 25.0 8,000 Total Assets (left scale) 3.0 91.5 Net Income (left scale) ROA (right scale) 2.71 84.0 ROE (right scale) 6,350.2 6,333.1 80 20.0 (annualized) 5,931.1 6,069.
Slide 32: Additional Information
Additional Information For annual and more historical data please access our website. A list of major disclosure materials is given below. ORIX Website: URL: http://www.orix.co.jp/grp/index_e.htm IR Website: URL: http://www.orix.co.jp/grp/ir_e/ir_index.htm Financial Reports: URL: http://www.orix.co.