Japan Post : Financial Results of the Principal Subsidiaries Fiscal Year Ended March 31, 2020

Financial Results

of the Principal Subsidiaries

for the Fiscal Year Ended March 31, 2020

May 15, 2020

Copyright © 2020 JAPAN POST GROUP. All Rights Reserved.

Table of Contents

I	Japan Post Holdings .....................................................................................................	1
	Year-on-Year Changes of Income for the Fiscal Year Ended March 31, 2020 .............	1
II	Japan Post Co..............................................................................................................	3
	1.	Consolidated Balance Sheets ....................................................................................	4
	2.	Consolidated Statements of Income and Consolidated Statements of
		Comprehensive Income...........................................................................................	6
		(1) Consolidated Statements of Income ....................................................................	6
		(2) Consolidated Statements of Comprehensive Income ..........................................	7
	3.	Segment Information.................................................................................................	8
III	Japan Post Bank.........................................................................................................	9
IV	Japan Post Insurance ...............................................................................................	10

Note: Please refer to the documents on consolidated financial results announcements of Japan Post Bank and Japan Post Insurance released on the respective company's website for their consolidated financial results.

I Japan Post Holdings

Year-on-Year Changes of Income for the Fiscal Year Ended March 31, 2020

Net ordinary income

					(Billions of yen)
	Japan Post Holdings
	Japan Post Co.	Japan Post Bank	Japan Post Insurance	Others
	(Consolidated)	(Including consolidated
	(Consolidated)	(Consolidated)	(Consolidated)
		accounting procedures)
Fiscal year ended	830.6	179.8	373.9	264.8	11.9
March 31, 2019
Fiscal year ended	864.4	168.1	379.1	286.6	30.6
March 31, 2020
Year-on-year change	+33.7	(11.7)	+5.1	+21.7	+18.6

Net income

					(Billions of yen)
	Japan Post Holdings
	Japan Post Co.	Japan Post Bank	Japan Post Insurance	Others
	(Consolidated)	(Including consolidated
	(Consolidated)	(Consolidated)	(Consolidated)
		accounting procedures)
Fiscal year ended	479.4	126.6	266.1	120.4	(33.8)
March 31, 2019
Fiscal year ended	483.7	87.1	273.4	150.6	(27.5)
March 31, 2020
Year-on-year change	+4.3	(39.4)	+7.2	+30.2	+6.3

• The amounts of net income attributable to Japan Post Holdings, net income attributable to Japan Post Co., net income attributable to Japan Post Bank and net income attributable to Japan Post Insurance have been used for net income of Japan Post Holdings (consolidated), Japan Post Co. (consolidated), Japan Post Bank (consolidated) and Japan Post Insurance (consolidated), respectively.

1

2

II Japan Post Co.

3

Japan Post Co.

1. Consolidated Balance Sheets

						(Millions of yen)
				As of March 31, 2019		As of March 31, 2020
	Assets
	Current assets
	Cash and deposits			1,871,936		1,920,713
	Notes receivable and operating	347,649	302,887
	accounts receivable
	Securities			15,000		15,000
	Inventories	21,727	30,673
	Prepaid expenses			8,619		8,608
	Other accounts receivable	24,506	19,164
	Outstanding amount of banking			22,767		-
	business consignment
	Other current assets	57,763	76,990
	Reserve for possible loan losses			(2,832)		(5,291)
	Total current assets	2,367,139	2,368,745
	Non-current assets
	Tangible fixed assets
	Buildings			1,013,063		958,586
	Structures	31,141	31,301
	Machinery and equipment			144,882		113,161
	Vehicles	16,660	17,904
	Tools and fixtures			52,819		37,193
	Land	1,306,333	1,300,555
	Right-of-use assets			-		132,401
	Construction in progress	100,478	91,363
	Total tangible fixed assets			2,665,379		2,682,468
	Intangible assets
	Leasehold right			1,667		1,664
	Transferable development right	14,077	14,077
	Software			48,847		49,634
	Other intangible assets	33,352	15,702
	Total intangible assets			97,944		81,080
	Investments and other assets
	Investment securities			14,912		12,726
	Claims provable in bankruptcy	2,007	2,205
	Long-term prepaid expenses			10,464		9,372
	Asset for retirement benefits	1,122	809
	Other investments and other assets			25,843		24,211
	Reserve for possible loan losses	(2,004)	(2,207)
	Total investments and other assets			52,345		47,118
	Total non-current assets	2,815,669	2,810,668
	Total assets			5,182,809		5,179,414

4

Japan Post Co.

(Millions of yen)

As of March 31, 2019

As of March 31, 2020

Liabilities

Current liabilities

Notes payable and operating accounts payable

Short-term borrowings

Current portion of long-term

borrowings

Other accounts payable

Outstanding amount of banking business consignment

Outstanding amount of life insurance business consignment

Accrued expenses

Income taxes payable

Consumption taxes payable

Unearned postage income

Deposits received

Fund deposits for post offices

Reserve for bonuses

Other current liabilities

Total current liabilities

Long-term liabilities

Long-term borrowings

Lease obligations

101,504	98,997
124,752	159,972
76,509	108,804
311,386	279,410
-	3,160
2,577	1,004
46,610	37,821
16,837	17,656
57,458	28,297
47,278	45,063
280,030	247,054
870,000	870,000
108,463	108,042
37,443	67,692
2,080,852	2,072,977
75,760	23,324
16,595	148,492

	Deferred tax liabilities			12,167			10,215
	Reserve for losses on rebuilding of	197			197
	branches
	Reserve for management board benefit			310			280
	trust

Liability for retirement benefits

Other long-term liabilities

Total long-term liabilities

Total liabilities

Net assets

Shareholders' equity

Capital stock

Capital surplus

Retained earnings

Total shareholders' equity

Accumulated other comprehensive income

Net unrealized gains (losses) on available-for-sale securities

Net deferred gains (losses) on hedges Foreign currency translation

adjustments Accumulated adjustments for

retirement benefits

2,010,351	1,994,725
71,443	73,822
2,186,826	2,251,057
4,267,678	4,324,035
400,000	400,000
142,661	141,919
294,738	256,175
837,400	798,095
38	11
30	56
(89,350)	(89,698)
153,924	137,082

	Total accumulated other comprehensive			64,644		47,451
	income
	Non-controlling interests	13,085	9,831
	Total net assets			915,130		855,378
Total liabilities and net assets	5,182,809	5,179,414

5

Japan Post Co.

2. Consolidated Statements of Income and Consolidated Statements of Comprehensive Income

(1) Consolidated Statements of Income

	(Millions of yen)
Fiscal year ended March 31,	Fiscal year ended March 31,
2019	2020

Operating income

Postal service business income Commissions for banking business

consignment

Commissions for life insurance business consignment

Funds to maintain post office network International logistics business income Other operating income

2,095,579	2,107,126
600,661	369,716
358,100	248,798
-	295,273
700,650	634,788
205,678	183,615

	Total operating income	3,960,669	3,839,318
	Operating costs				3,519,626		3,408,378
	Gross operating income			441,043	430,939
	Sales, general and administrative costs				259,021		251,905
Net operating income	182,021	179,034
	Other income
	Interest income	617	248
	Equity in earnings of affiliates				473		-
	Foreign exchange gains	522	798
	Subsidy income				1,371		523
	Others	3,060	2,484
	Total other income				6,045		4,055
Other expenses
	Interest expenses				6,469		13,576
	Equity in losses of affiliates	-	31
	Others				1,731		1,371
	Total other expenses	8,201	14,979
	Net ordinary income				179,865		168,111
Extraordinary gains
	Gains on sales of fixed assets				7,225		2,375
	Contribution for post office refurbishment	20,216	12,094
	expenses
	Others				2,414		3,403
	Total extraordinary gains	29,855	17,874
	Extraordinary losses
	Losses on sales of fixed assets	114	410
	Losses on disposal of fixed assets				3,138		2,775
	Losses on impairment of fixed assets	8,896	20,833
	Post office refurbishment expenses				20,216		12,094
	Others	11,026	17,985
	Total extraordinary losses				43,391		54,099
Income before income taxes	166,329	131,885
	Income taxes current				38,811		45,898
Income taxes deferred	362	(1,943)
	Total income taxes				39,174		43,955
Net income	127,155	87,930
	Net income attributable to				541		775
	non-controlling interests
Net income attributable to	126,614	87,155
	Japan Post Co.

6

Japan Post Co.

(2) Consolidated Statements of Comprehensive Income

	(Millions of yen)
Fiscal year ended March 31,	Fiscal year ended March 31,
2019	2020

Net income

Other comprehensive loss

Net unrealized gains (losses) on available-for-sale securities

Net deferred gains (losses) on hedges Foreign currency translation adjustments Adjustments for retirement benefits Share of other comprehensive loss

of affiliates

Total other comprehensive loss

Comprehensive income

Total comprehensive income (loss) attributable to:

Japan Post Co.

Non-controlling interests

127,155	87,930
57	(22)
80	25
(3,888)	(2,786)
(19,605)	(16,842)
(2)	(4)
(23,358)	(19,629)
103,796	68,300
103,664	69,962
131	(1,662)

7

Japan Post Co.

3. Segment Information

1. Operating income and segment profit (loss) of reportable segments Fiscal year ended March 31, 2019

					(Millions of yen)
		Reportable segments
	Postal and		International		Other	Total
	domestic	Post office	logistics	Subtotal
	logistics	business	business
	business		(Note 2)
Operating income (Note 1)
Operating income from	2,101,029	1,158,989	700,650	3,960,669	-	3,960,669
third parties
Intersegment operating	13,921	203,589	-	217,510	-	217,510
income
Total	2,114,950	1,362,579	700,650	4,178,180	-	4,178,180
Segment profit	121,388	59,619	10,300	191,308	-	191,308

(Notes)

1. "Operating income" is presented instead of net sales which is typical for companies in other industries.
2. The amount presented in segment profit for the international logistics business segment is EBIT.

Fiscal year ended March 31, 2020

					(Millions of yen)
		Reportable segments
	Postal and		International		Other	Total
	domestic	Post office	logistics	Subtotal
	logistics	business	business
	business		(Note 2)
Operating income (Note 1)
Operating income from	2,112,596	1,091,933	634,788	3,839,318	-	3,839,318
third parties
Intersegment operating	12,717	206,840	165	219,724	-	219,724
income
Total	2,125,313	1,298,774	634,954	4,059,042	-	4,059,042
Segment profit (loss)	147,505	44,598	(8,683)	183,420	-	183,420

(Notes)

1. "Operating income" is presented instead of net sales which is typical for companies in other industries.
2. The amount presented in segment profit (loss) for the international logistics business segment is EBIT.

1. Reconciliation between total segment profit (loss) of reportable segments and net operating income on the consolidated statements of income

		(Millions of yen)
Items	Fiscal year ended	Fiscal year ended
March 31, 2019	March 31, 2020
Total segment profit (loss) of reportable segments	191,308	183,420
Segment profit in other business	-	-
Eliminations of intersegment transactions	1,302	1,342
Corporate expenses (Note)	(1,983)	(2,263)
Other adjustments	(8,605)	(3,465)
Net operating income on the consolidated	182,021	179,034
statements of income

(Note)

"Corporate expenses" consists mainly of general and administrative costs which are not attributable to any reportable segments.

8

III Japan Post Bank

Note: Please refer to the documents on consolidated financial results announcements of Japan Post Bank for consolidated financial results of the company.

9

IV Japan Post Insurance

Note: Please refer to the documents on consolidated financial results announcements of Japan Post Insurance for consolidated financial results of the company.

10