Summary of Consolidated Financial Results for the Fiscal Year Ended March 31, 2020
May 15, 2020 | |||
Company name: | Japan Post Holdings Co., Ltd. | Stock exchange listing: | Tokyo Stock Exchange |
Code number: | 6178 | URL: | https://www.japanpost.jp/en/ |
Representative: | MASUDA Hiroya, President & CEO (Representative Executive Officer) | ||
Contact: | TSURUDA Nobuo, Executive Officer, Head of IR Office | ||
Phone: | +81-3-3477-0206 |
Scheduled date of Annual General Meeting of Shareholders: | June 17, 2020 |
Scheduled date of filing securities report: | June 18, 2020 |
Scheduled date of commencing dividend payments: | June 18, 2020 |
Trading accounts: | Unestablished | ||||||||||||||
Availability of supplementary briefing material on financial results: | Available | ||||||||||||||
Schedule of financial results briefing session: | Scheduled (for institutional investors and analysts) | ||||||||||||||
(Amounts of less than one million yen are rounded down.) | |||||||||||||||
1. Consolidated Financial Results for the Fiscal Year Ended March 31, 2020 | |||||||||||||||
(April 1, 2019 to March 31, 2020) | |||||||||||||||
(1) Consolidated Results of Operations | (% indicates changes from the previous corresponding period.) | ||||||||||||||
Ordinary income | Net ordinary income | Net income attributable to | |||||||||||||
Japan Post Holdings | |||||||||||||||
Million yen | % | Million yen | % | Million yen | % | ||||||||||
Fiscal year ended | 11,950,185 | (6.5) | 864,457 | 4.1 | 483,733 | 0.9 | |||||||||
March 31, 2020 | |||||||||||||||
Fiscal year ended | 12,774,999 | (1.1) | 830,696 | (9.3) | 479,419 | 4.1 | |||||||||
March 31, 2019 | |||||||||||||||
(Note) Comprehensive income: Fiscal year ended March 31, 2020: ¥(2,225,078) million [- %] | |||||||||||||||
Fiscal year ended March 31, 2019: ¥291,836 million [146.1 %] | |||||||||||||||
Net income per | Diluted net | Net ordinary | Net ordinary | ||||||||||||
Return on equity | income to total | income to | |||||||||||||
share | income per share | ||||||||||||||
assets | ordinary income | ||||||||||||||
Yen | Yen | % | % | % | |||||||||||
Fiscal year ended | 119.64 | - | 4.0 | 0.3 | 7.2 | ||||||||||
March 31, 2020 | |||||||||||||||
Fiscal year ended | 118.57 | - | 3.6 | 0.3 | 6.5 | ||||||||||
March 31, 2019 | |||||||||||||||
(Reference) Equity in earnings (losses) of affiliates:Fiscal year ended March 31, 2020: ¥244 million Fiscal year ended March 31, 2019: ¥699 million
(Note) Because there was no potential common stock, the amount for diluted net income per share is omitted.
(2) Consolidated Financial Position
Total assets | Net assets | Equity ratio (Note) | Net assets per share | |||||||||||||||||
Million yen | Million yen | % | Yen | |||||||||||||||||
As of March 31, 2020 | 286,098,449 | 12,616,774 | 3.8 | 2,704.24 | ||||||||||||||||
As of March 31, 2019 | 286,170,709 | 14,788,654 | 4.6 | 3,287.86 | ||||||||||||||||
(Reference) Equity: As of March 31, 2020: ¥10,934,152 million | ||||||||||||||||||||
As of March 31, 2019: ¥13,293,508 million | ||||||||||||||||||||
(Note) Equity ratio = [(Net assets - Non-controlling interests) / Total assets] x 100 | ||||||||||||||||||||
(3) Consolidated Cash Flows | ||||||||||||||||||||
Net cash provided by | Net cash provided by | Net cash provided by | Cash and cash | |||||||||||||||||
(used in) operating | (used in) investing | (used in) financing | equivalents at the end | |||||||||||||||||
activities | activities | activities | of the fiscal year | |||||||||||||||||
Million yen | Million yen | Million yen | Million yen | |||||||||||||||||
Fiscal year ended | 305,850 | 1,040,484 | 99,003 | 53,603,857 | ||||||||||||||||
March 31, 2020 | ||||||||||||||||||||
Fiscal year ended | (3,609,800) | 5,186,043 | (111,256) | 52,160,289 | ||||||||||||||||
March 31, 2019 | ||||||||||||||||||||
2. Dividends | ||||||||||||||||||||
Annual dividend | Total | Dividend | Dividends on | |||||||||||||||||
dividends paid | payout ratio | net assets ratio | ||||||||||||||||||
1st | 2nd | 3rd | Year-end | Total | ||||||||||||||||
quarter-end | quarter-end | quarter-end | (Annual) | (Consolidated) | (Consolidated) | |||||||||||||||
Yen | Yen | Yen | Yen | Yen | Million yen | % | % | |||||||||||||
Fiscal year ended | - | 25.00 | - | 25.00 | 50.00 | 202,193 | 42.2 | 1.5 | ||||||||||||
March 31, 2019 | ||||||||||||||||||||
Fiscal year ended | - | 25.00 | - | 25.00 | 50.00 | 202,193 | 41.8 | 1.7 | ||||||||||||
March 31, 2020 | ||||||||||||||||||||
Fiscal year ending | ||||||||||||||||||||
March 31, 2021 | - | 0.00 | - | - | - | - | ||||||||||||||
(Forecast) |
(Note) The year-end dividend for the fiscal year ending March 31, 2021 (forecast) has been left undecided, as the outlook for the business environment in which the Japan Post Group operates remains unclear at present, and the Company's results may change significantly depending on future developments. The Company will consider the payment of a year-end dividend while closely monitoring results going forward.
3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2021 (April 1, 2020 to March 31, 2021)
(% indicates changes from the previous corresponding period.)
Ordinary income | Net ordinary income | Net income attributable | Net income per share | ||||
to Japan Post Holdings | |||||||
Fiscal year ending | Million yen | % | Million yen | % | Million yen | % | Yen |
11,290,000 | (5.5) | 520,000 | (39.8) | 280,000 | (42.1) | 69.25 | |
March 31, 2021 | |||||||
(Note) The consolidated financial results forecast for the fiscal year ending March 31, 2021 has been calculated based on information on the impact of the spread of COVID-19 available to the Company as of March 31, 2020, under certain assumptions. The actual future results may vary considerably depending upon various factors such as when the spread of the infection is brought under control, as well as the economic environment in major markets in Japan and overseas, foreign exchange fluctuations, etc.
* Notes:
- Changes in significant subsidiaries during the fiscal year under review (changes in specified subsidiaries resulting in changes in scope of consolidation): No
- Changes in accounting policies, changes in accounting estimates and retrospective restatement
- Changes in accounting policies due to the revision of accounting standards: Yes
- Changes in accounting policies other than 1) above: No
- Changes in accounting estimates: Yes
- Retrospective restatement: No
(Note) For details, please refer to [Attachment] "3. Consolidated Financial Statements and Primary Notes (5) Notes to Consolidated Financial Statements (Changes in Accounting Policies) and (Changes in Accounting Estimates)" on page 15.
- Total number of shares issued (common stock)
-
Total number of shares issued at the end of the fiscal year (including treasury stock): As of March 31, 2020: 4,500,000,000 shares
As of March 31, 2019: 4,500,000,000 shares - Total number of treasury stock at the end of the fiscal year:
-
Total number of shares issued at the end of the fiscal year (including treasury stock): As of March 31, 2020: 4,500,000,000 shares
As of March 31, 2020: 456,667,501 shares
As of March 31, 2019: 456,796,001 shares
3) Average number of shares during the fiscal year:
Fiscal year ended March 31, 2020: 4,043,234,313 shares
Fiscal year ended March 31, 2019: 4,043,196,447 shares
(Note) The total number of treasury stock at the end of the fiscal year includes the shares of the Company held by the management board benefit trust of 528,300 shares and 656,800 shares as of March 31, 2020 and 2019, respectively. The number of treasury stock excluded from calculation of the average number of shares during the fiscal year includes the shares of the Company held by the management board benefit trust of 626,486 shares and 664,352 shares for the fiscal year ended March 31, 2020 and 2019, respectively.
(Summary of non-consolidated financial results)
1. Non-consolidated Financial Results for the Fiscal Year Ended March 31, 2020 (April 1, 2019 to March 31, 2020)
(1) Non-consolidated Results of Operations | (% indicates changes from the previous corresponding period.) | ||||||||||
Operating income | Net operating income | Net ordinary income | Net income | ||||||||
Million yen | % | Million yen | % | Million yen | % | Million yen | % | ||||
Fiscal year ended | 289,447 | 5.4 | 236,452 | 10.7 | 243,027 | 12.6 | 397,647 | 80.1 | |||
March 31, 2020 | |||||||||||
Fiscal year ended | 274,551 | (2.2) | 213,623 | (2.3) | 215,900 | (1.7) | 220,791 | 12.5 | |||
March 31, 2019 | |||||||||||
Net income per share | Diluted net income | ||||||||||
per share | |||||||||||
Yen | Yen | ||||||||||
Fiscal year ended | 98.35 | - | |||||||||
March 31, 2020 | |||||||||||
Fiscal year ended | 54.61 | - | |||||||||
March 31, 2019 | |||||||||||
(Note) Because there was no potential common stock, the amount for diluted net income per share is omitted.
(2) Non-consolidated Financial Position
Total assets | Net assets | Equity ratio (Note) | Net assets per share | |
Million yen | Million yen | % | Yen | |
As of March 31, 2020 | 8,129,402 | 8,031,667 | 98.8 | 1,986.40 |
As of March 31, 2019 | 8,079,602 | 7,940,442 | 98.3 | 1,963.90 |
(Reference) Equity: As of March 31, 2020: ¥8,031,667 million As of March 31, 2019: ¥7,940,442 million
(Note) Equity ratio = (Net assets / Total assets) x 100
- This summary of consolidated financial results is outside the scope of audit procedures by Certified Public Accountants or Audit Firm.
- Explanation on appropriate use of financial results forecast and other specific matters
Forecasts and other forward-looking statements presented in this document are based on information that the Company is aware of as of March 31, 2020 and certain assumptions that the Company has deemed reasonable, and the Company provides no assurance that the forecasts will be achieved or with respect to any other forward- looking statements. The actual future results may vary considerably depending upon various factors, such as the impact of the spread of COVID-19, interest rate fluctuations, stock price fluctuations, foreign exchange fluctuations, asset value fluctuations, changes in the economic and financial environment, changes in the competitive environment, the occurrence of large-scale disasters, etc. and changes in laws and regulations. The Company disclaims any responsibility to update any forward-looking statements contained herein to the extent permitted by law or stock exchange rule. Please refer to 1. Overview of Results of Operations etc. (1) Explanation of Results of Operations (Consolidated financial results forecast for the fiscal year ending March 31, 2021) on page 4 of the Attachment for the assumptions on which the financial results forecasts have been based, and precautions etc. regarding their use.
Japan Post Holdings Co., Ltd
Supplementary Briefing Material:
Materials for Consolidated Financial Results for the Fiscal Year Ended March 31, 2020
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Japan Post Holdings Co., Ltd
1. Overview of Results of Operations etc.
(1) Explanation of Results of Operations
Consolidated ordinary income amounted to ¥11,950,185 million (down ¥824,813 million year-on-year) and consolidated net ordinary income amounted to ¥864,457 million (up ¥33,761 million year-on-year). Net income attributable to Japan Post Holdings amounted to ¥483,733 million (up ¥4,313 million year-on-year), which comprises consolidated net ordinary income after adjusting for items including extraordinary gains (losses) and provision for reserve for policyholder dividends.
Financial results by segment are as follows.
(Postal and Domestic Logistics Business Segment)
In the postal and domestic logistics business, Japan Post Co. made efforts to maintain the use of mails through SNS-linked services such as New Year's postcards, as well as to expand profitability and enhance convenience by providing new services for sending and receiving mail. Regarding operations, we launched OKIPPA, a service for leaving parcels in designated areas, and engaged in cost control through labor management and the management of personnel expenses for each area of responsibility. In terms of telematics (services utilizing mobile communications systems), we carried out trials of the automated receipt of redelivery requests using AI voice recognition technology, as well as implementing field tests and trials of drones and delivery robots. In addition, we also commenced the introduction of cashless settlement at mail service counters.
With regard to the total volume of items handled for the fiscal year ended March 31, 2020, the volume of mails handled decreased by 2.6% year-on-year to 16,350.05 million, the volume of Yu-Mail handled decreased by 2.2% year-on-year to 3,568.61 million, the volume of Yu-Pack handled increased by 3.4% year-on-year to
974.46 million (including an increase of the volume of Yu-Packet handled by 19.7% year-on-year to 427.65 million) at Japan Post Co. (non-consolidated).
As a result of these initiatives and other factors, in the postal and domestic logistics business for the fiscal year ended March 31, 2020, ordinary income amounted to ¥2,128,187 million (up ¥8,854 million year-on-year) and net ordinary income amounted to ¥149,185 million (up ¥24,728 million year-on-year). In addition, operating income amounted to ¥2,125,313 million (up ¥10,362 million year-on-year) and net operating income amounted to ¥147,505 million (up ¥26,116 million year-on-year) in the postal and domestic logistics business of Japan Post Co. for the fiscal year ended March 31, 2020. The increases were partly due to a rise in income in the parcel field, particularly Yu-Pack, as well as other factors such as the effects of nationwide local elections and the House of Councilors elections, and a temporary rise in the volume of mail sent, related to the increase in consumption tax on premium gift certificates, etc.
(Post Office Business Segment)
During the fiscal year ended March 31, 2020, it was discovered that in the post office business, Japan Post Co. had engaged in insurance solicitations, carried out on commission from Japan Post Insurance, in a manner that was not in line with customers' intentions, causing them disadvantages. We strove to instill a range of measures to prevent recurrence, while placing top priority on our response to customers, but in December 2019, we received a business suspension order and business improvement order from the Minister for Internal Affairs and Communications and the Financial Services Agency of Japan. We submitted a business improvement plan in January 2020, and strove to prevent recurrence. We also implemented employee training to contribute to customer-first sales activities and comprehensive consulting services, including enhancing solicitation quality, strengthening operational knowledge and enhancing communication skills, in order to provide a wide range of products and services that more closely fit customers' goals and future life plans. In addition, we expanded initiatives aimed at regional revitalization, such as the comprehensive contracting of local public organization operations and the provision of clerical processes for regional banks, through measures such as reviewing the positioning of post offices. We also worked on measures to protect customer data, combat money laundering and the financing of terrorism, as well as for the insurance solicitation problem described above, based on our view of compliance as a top-priority management issue.
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As a result of these initiatives, in the post office business for the fiscal year ended March 31, 2020, insurance commissions fell due to refraining from sales proposal activities of Japan Post Insurance products and partial suspension of operations in line with the administrative dispositions, and income declined in the merchandising business due to the contraction of certain businesses. As a result, ordinary income amounted to ¥1,299,930 million (down ¥63,827 million year-on-year), and net ordinary income amounted to ¥45,086 million (down ¥14,753 million year-on-year). In addition, operating income amounted to ¥1,298,774 million (down ¥63,805 million year-on-year) and net operating income amounted to ¥44,598 million (down ¥15,020 million year-on- year) in the post office business of Japan Post Co. for the fiscal year ended March 31, 2020.
(International Logistics Business Segment)
In the international logistics business, we continued to engage in transformation plan of Toll Holdings Limited, a consolidated subsidiary of Japan Post Co. A new president was appointed in January 2020, and the company embarked on further transformation plan. We also continued to expand B-to-B businesses mainly through our contract logistics, utilizing JP Toll Logistics Co., Ltd. Business results for the fiscal year ended March 31, 2020 continued to be lackluster, however, with the impact of a harsh external business environment, due a slowdown in the Australian economy, U.S.-China trade frictions and the spread of COVID-19, further compounded by the effect of cyber-attacks.
As a result of these initiatives, fixed costs such as personnel expenses weighed on results, in addition to the effects of the foreign exchange rate, and ordinary income amounted to ¥635,194 million (down ¥66,062 million year-on-year), net ordinary loss amounted to ¥21,447 million (net ordinary income of ¥5,094 million in the previous fiscal year), operating income in the international logistics business of Japan Post Co. amounted to ¥634,954 million (down ¥65,695 million year-on-year) and net operating loss (EBIT) in the international logistics business of Japan Post Co. amounted to ¥8,683 million (net operating income of ¥10,300 million in the previous fiscal year) for the fiscal year ended March 31, 2020.
(Banking Business Segment)
In the banking business, at Japan Post Bank, we implemented various initiatives aimed at "providing high- quality financial services with a focus on the customer", "promoting sophisticated and diversified investment", "creating a flow of funds into regional areas, etc." and "strengthening the business management system".
As a result of these initiatives, in the banking business for the fiscal year ended March 31, 2020, deposits balance of Japan Post Bank as of March 31, 2020 was ¥183,004,733 million (up ¥2,005,599 million year-on- year). Net interest income dropped in an extremely adverse business environment, from factors such as the continuation of a low interest rate environment and deterioration of the market environment due to the spread of COVID-19, and ordinary income amounted to ¥1,799,538 million (down ¥45,872 million year-on-year), while net ordinary income amounted to ¥379,131 million (up ¥5,155 million year-on-year).
(Life Insurance Business Segment)
Japan Post Insurance has been working for some time on comprehensive initiatives aimed at improving the solicitation quality, including strengthening the solicitation management system and ensuring basic procedures when soliciting business from elderly customers. However, during the fiscal year ended March 31, 2020, it was discovered that Japan Post Insurance and Japan Post Co. had engaged in actions that were not in line with customers' intentions, and may have caused them disadvantages. Upon this discovery, an investigation into insurance policies was implemented, and we endeavored to resolve any disadvantage suffered by customers. The Company, Japan Post Insurance and Japan Post Co. established a Special Investigative Committee, thoroughly investigated the case and its causes, and progressively considered measures to prevent recurrence. Japan Post Insurance was subsequently issued with a business suspension order and business improvement order from the Financial Services Agency of Japan in December 2019. We submitted a business improvement plan to the Financial Services Agency of Japan in January 2020, and have engaged in measures to instill customer-first business operation, ensure appropriate business operation, and protect policyholders. We have focused on
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Japan Post Holdings Co., Ltd
"providing after-sales service to meet the needs of customers", "launching new products", "service improvement and greater operational efficiency through effective utilization of ICT", as well as "diversification of asset management and increasing the sophistication of risk management".
As a result of these initiatives, in the life insurance business for the fiscal year ended March 31, 2020, 644 thousand new policies for individual insurance with a policy amount of ¥1,893,727 million were acquired. Despite a decrease in the number of policies in force and an increase in expenses due to the investigation into insurance policies, operating expenses decreased, affected mainly by the suspension of active sales activities, while positive spreads increased. Ordinary income amounted to ¥7,211,405 million (down ¥705,250 million year-on-year), while net ordinary income amounted to ¥286,601 million (up ¥21,731 million year-on-year).
(Consolidated financial results forecast for the fiscal year ending March 31, 2021)
With regard to the consolidated financial results forecast for the fiscal year ending March 31, 2021, ordinary income of ¥11,290,000 million, net ordinary income of ¥520,000 million and net income attributable to Japan Post Holdings of ¥280,000 million are anticipated.
The forecast of segment profit by segment (net ordinary income for each segment) is as follows:
・Postal and domestic logistics business | ¥90,000 | million |
・Post office business | ¥(35,000) | million |
・International logistics business | ¥(10,000) | million |
・Banking business | ¥275,000 | million |
・Life insurance business | ¥200,000 | million |
In addition, net income forecasts at the principal subsidiaries are as follows.
At Japan Post Co. (consolidated), net income attributable to Japan Post Co. is forecast at ¥0 million (down ¥87,155 million year-on-year) due to a decrease in commission income from Japan Post Insurance, as well as a decrease in the volume of mails.
At Japan Post Bank (consolidated), the financial results forecast has been calculated based on the assumption that overseas credit spreads would remain high during the first half of the fiscal year ending March 31, 2021, then gradually shrink as the impact of the spread of COVID-19 is brought under control. Due to the assumption of persistently high overseas credit spreads, large year-on-year increases are forecast in special distributions not recognized as income, among distributions from investment trusts held as securities by the Japan Post Bank, and net income attributable to Japan Post Bank is forecast at ¥200,000 million (down ¥73,435 million year-on-year).
At Japan Post Insurance (consolidated), net income attributable to Japan Post Insurance is forecast at ¥124,000 million (down ¥26,687 million year-on-year) due to a decrease in the number of policies in force, as well as a decrease in income from interest and stock dividends due to a deterioration in the market environment from the impact of the spread of COVID-19.
The above-mentioned forecasts for the fiscal year ending March 31, 2021 are based on information that the Company is aware of as of March 31, 2020 and certain assumptions that the Company has deemed reasonable, and the Company provides no assurance that the forecasts will be achieved. For example, the forecast at Japan Post Bank (consolidated) is calculated based on the assumption that overseas credit spreads would remain high during the first half of the fiscal year ending March 31, 2021, then gradually shrink as the impact of the spread of COVID-19 is brought under control. The actual future results may vary considerably depending upon various factors, such as the impact of the spread of COVID-19, interest rate fluctuations, stock price fluctuations, the economic environment in major markets in Japan and overseas, foreign exchange fluctuations, asset value fluctuations, changes in the economic and financial environment, changes in the competitive environment, the occurrence of large-scale disasters, etc. and changes in laws and regulations. The Company will issue a notice through timely disclosure etc. in the event of any significant change in circumstances going forward.
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Japan Post Holdings Co., Ltd
- Explanation of Financial Position
- Condition of assets, liabilities and net assets
Consolidated total assets were ¥286,098,449 million, down ¥72,259 million from the end of the previous fiscal year.
Major factors include an increase in cash and due from banks of ¥1,435,917 million, an increase in receivables under resale agreements of ¥1,363,758 million and an increase in money held in trust of ¥1,025,814 million, as well as a decrease in securities of ¥4,520,056 million.
Consolidated total liabilities were ¥273,481,674 million, up ¥2,099,619 million from the end of the previous fiscal year.
Major factors include an increase in payables under repurchase agreements of ¥3,286,253 million and an increase in deposits of ¥1,752,024 million, as well as a decrease in policy reserves of ¥2,767,383 million.
Consolidated total net assets were ¥12,616,774 million, down ¥2,171,879 million from the end of the previous fiscal year.
Major factors include an increase in retained earnings of ¥257,113 million, as well as a decrease in net unrealized gains (losses) on available-for-sale securities of ¥2,285,094 million and a decrease in net deferred gains (losses) on hedges of ¥236,408 million.
2) Cash flows
Cash and cash equivalents at the end of the current fiscal year were ¥53,603,857 million, up ¥1,443,568 million from the beginning of the current fiscal year.
(Cash flows from operating activities)
Net cash provided by operating activities amounted to ¥305,850 million (up ¥3,915,650 million in inflow year-on-year), as a result of investment and procurement of funds in the banking business, along with income from insurance premiums and payment of insurance claims, etc. in the life insurance business.
(Cash flows from investing activities)
Net cash provided by investing activities amounted to ¥1,040,484 million (down ¥4,145,558 million in inflow year-on-year), as a result of cash inflows mainly owing to proceeds from sale and redemption of securities in the banking business and life insurance business, as well as cash outflows mainly due to purchases of securities.
(Cash flows from financing activities)
Net cash provided by financing activities amounted to ¥99,003 million (up ¥210,260 million in inflow year-on-year), as a result of the partial sale of stocks of subsidiaries, etc.
(3) Basic Policy on Profit Distribution and Dividends for the Current Fiscal Year and Next Fiscal Year
The Company considers returning profits to shareholders to be an important management measure and sets out its basic policy to continuously provide stable return to shareholders in accordance with the results of operations.
With regard to dividends from retained earnings, the Company aims to provide stable returns to shareholders while maintaining required internal reserves and paying attention to capital efficiency. Accordingly, the Company aims to sustain stable dividend per share, while maintaining an annual dividend per share of roughly ¥50 or higher until the fiscal year ending March 31, 2021. However, in view of the adverse business environment at present, primarily due to the impact of COVID-19, the Company will decide on dividends for the fiscal year ending March 31, 2021 based on the level of income and the amount available for distribution.
The decision-making body concerning dividends from retained earnings is set to be the Board of Directors as per the provisions of the Articles of Incorporation in order to ensure flexible management operations. In addition, it is stipulated that dividends from retained earnings are to be paid with March 31 and September 30 of each year as record dates.
With regard to dividends from retained earnings for the fiscal year ended March 31, 2020, based on a comprehensive judgment of the consolidated financial results and other factors, the annual dividend on common
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stock will be ¥50 (of which interim dividend of ¥25) per share.
The dividend for the fiscal year ending March 31, 2021 has been left undecided, as the outlook for the business environment in which the Japan Post Group operates remains unclear at present, and the Company's results may change significantly depending on future developments. The Company will consider the payment of a year-end dividend while closely monitoring results going forward.
In the past, the Company has paid dividends from retained earnings biannually, as an interim dividend and year-end dividend, but in view of the uncertainty surrounding the future business environment, and the present situation regarding the amount available for distribution, the Company will pay no interim dividend and only a year-end dividend for the fiscal year ending March 2021.
Internal reserves will be utilized mainly for investments to capture growth opportunities and capital policies with awareness on capital efficiency, aiming at enhancement of corporate value.
In accordance with Article 11 of the Act on Japan Post Holdings Co., Ltd., payment of dividends from retained earnings or other appropriation of retained earnings (excluding disposition of loss) of the Company shall not be effective without approval of the Minister for Internal Affairs and Communications.
2. Basic Approach Concerning Selection of Accounting Standards
The Company is considering the future adoption of IFRS to improve international comparability of financial information.
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3. Consolidated Financial Statements and Primary Notes
(1) Consolidated Balance Sheets
(Millions of yen) | |||
As of March 31, 2019 | As of March 31, 2020 | ||
Assets | |||
Cash and due from banks | 52,244,467 | 53,680,384 | |
Call loans | 550,000 | 1,420,000 | |
Receivables under resale agreements | 8,368,139 | 9,731,897 | |
Receivables under securities borrowing transactions | 2,792,202 | 3,304,202 | |
Monetary claims bought | 650,638 | 634,394 | |
Trading account securities | 2 | 31 | |
Money held in trust | 6,778,335 | 7,804,150 | |
Securities | 195,647,107 | 191,127,051 | |
Loans | 12,083,499 | 10,624,482 | |
Foreign exchanges | 80,396 | 147,469 | |
Other assets | 2,419,069 | 2,787,487 | |
Tangible fixed assets | 3,155,062 | 3,186,558 | |
Buildings | 1,172,950 | 1,133,110 | |
Land | 1,538,589 | 1,538,190 | |
Construction in progress | 113,808 | 97,283 | |
Other tangible fixed assets | 329,714 | 417,974 | |
Intangible assets | 321,964 | 291,694 | |
Software | 299,378 | 269,867 | |
Goodwill | 2,718 | 2,550 | |
Other intangible assets | 19,867 | 19,276 | |
Asset for retirement benefits | 50,214 | 55,308 | |
Deferred tax assets | 1,035,930 | 1,312,378 | |
Reserve for possible loan losses | (6,323) | (9,043) | |
Total assets | 286,170,709 | 286,098,449 |
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Japan Post Holdings Co., Ltd | |||
(Millions of yen) | |||
As of March 31, 2019 | As of March 31, 2020 | ||
Liabilities | |||
Deposits | 179,625,834 | 181,377,859 | |
Payables under repurchase agreements | 11,569,371 | 14,855,624 | |
Policy reserves and others | 67,093,751 | 64,191,926 | |
Reserve for outstanding claims | 519,568 | 461,224 | |
Policy reserves | 65,060,549 | 62,293,166 | |
Reserve for policyholder dividends | 1,513,634 | 1,437,535 | |
Payables under securities lending transactions | 5,896,268 | 6,509,525 | |
Commercial papers | 28,029 | - | |
Borrowed money | 281,021 | 302,200 | |
Foreign exchanges | 628 | 511 | |
Bonds | 100,000 | 100,000 | |
Other liabilities | 2,474,349 | 2,820,086 | |
Reserve for bonuses | 122,665 | 121,875 | |
Liability for retirement benefits | 2,236,273 | 2,220,241 | |
Reserve for employee stock ownership plan trust | 839 | 605 | |
Reserve for management board benefit trust | 1,033 | 984 | |
Reserve for reimbursement of deposits | 88,332 | 80,324 | |
Reserve for insurance claims and others | - | 29,722 | |
Reserve under the special laws | 897,492 | 858,339 | |
Reserve for price fluctuations | 897,492 | 858,339 | |
Deferred tax liabilities | 966,160 | 11,845 | |
Total liabilities | 271,382,054 | 273,481,674 | |
Net assets | |||
Capital stock | 3,500,000 | 3,500,000 | |
Capital surplus | 4,135,429 | 4,084,763 | |
Retained earnings | 3,799,974 | 4,057,087 | |
Treasury stock | (831,887) | (831,707) | |
Total shareholders' equity | 10,603,516 | 10,810,143 | |
Net unrealized gains (losses) on available-for-sale | 2,580,765 | 295,671 | |
securities | |||
Net deferred gains (losses) on hedges | (55,415) | (291,823) | |
Foreign currency translation adjustments | (89,350) | (89,698) | |
Accumulated adjustments for retirement benefits | 253,992 | 209,860 | |
Total accumulated other comprehensive income | 2,689,992 | 124,008 | |
Non-controlling interests | 1,495,145 | 1,682,622 | |
Total net assets | 14,788,654 | 12,616,774 | |
Total liabilities and net assets | 286,170,709 | 286,098,449 | |
8
Japan Post Holdings Co., Ltd
-
Consolidated Statements of Income and Consolidated Statements of Comprehensive Income
Consolidated Statements of Income
(Millions of yen) | |||
Fiscal year ended | Fiscal year ended | ||
March 31, 2019 | March 31, 2020 | ||
Ordinary income | 12,774,999 | 11,950,185 | |
Postal business income | 2,767,219 | 2,715,667 | |
Banking business income | 1,843,742 | 1,797,365 | |
Life insurance business income | 7,916,596 | 7,211,365 | |
Other ordinary income | 247,440 | 225,787 | |
Ordinary expenses | 11,944,302 | 11,085,728 | |
Operating expenses | 9,014,985 | 8,180,003 | |
Personnel expenses | 2,613,671 | 2,545,212 | |
Depreciation and amortization | 269,382 | 294,011 | |
Other ordinary expenses | 46,263 | 66,500 | |
Net ordinary income | 830,696 | 864,457 | |
Extraordinary gains | 29,410 | 50,948 | |
Gains on sales of fixed assets | 7,230 | 2,908 | |
Gains on negative goodwill | - | 48 | |
Reversal of reserve under the special laws | 19,251 | 39,152 | |
Reversal of reserve for price fluctuations | 19,251 | 39,152 | |
Compensation for transfer | 2,345 | 529 | |
Gains on transfer of business | - | 6,249 | |
Other extraordinary gains | 583 | 2,060 | |
Extraordinary losses | 52,811 | 56,635 | |
Losses on sales and disposal of fixed assets | 8,310 | 4,606 | |
Losses on impairment of fixed assets | 12,927 | 21,723 | |
Post office refurbishment expenses | 18,315 | 11,304 | |
Other extraordinary losses | 13,258 | 19,001 | |
Provision for reserve for policyholder dividends | 111,806 | 109,236 | |
Income before income taxes | 695,487 | 749,534 | |
Income taxes current | 255,828 | 256,663 | |
Income taxes deferred | (82,829) | (75,263) | |
Total income taxes | 172,999 | 181,399 | |
Net income | 522,488 | 568,134 | |
Net income attributable to non-controlling interests | 43,069 | 84,401 | |
Net income attributable to Japan Post Holdings | 479,419 | 483,733 |
9
Japan Post Holdings Co., Ltd | |||||
Consolidated Statements of Comprehensive Income | |||||
(Millions of yen) | |||||
Fiscal year ended | Fiscal year ended | ||||
March 31, 2019 | March 31, 2020 | ||||
Net income | 522,488 | 568,134 | |||
Other comprehensive loss | (230,651) | (2,793,212) | |||
Net unrealized gains (losses) on available-for-sale | (120,913) | (2,481,290) | |||
securities | |||||
Net deferred gains (losses) on hedges | (65,392) | (265,577) | |||
Foreign currency translation adjustments | (3,888) | (2,786) | |||
Adjustments for retirement benefits | (40,455) | (43,553) | |||
Share of other comprehensive loss of affiliates | (2) | (4) | |||
Comprehensive income (loss) | 291,836 | (2,225,078) | |||
Total comprehensive income (loss) attributable to: | |||||
Japan Post Holdings | 270,054 | (1,969,427) | |||
Non-controlling interests | 21,782 | (255,650) | |||
10
Japan Post Holdings Co., Ltd
- Consolidated Statements of Changes in Net Assets Fiscal year ended March 31, 2019
(Millions of yen)
Shareholders' equity | ||||||||||||||
Capital stock | Capital surplus | Retained earnings | Treasury stock | Total shareholders' | ||||||||||
equity | ||||||||||||||
Balance at the beginning of the | 3,500,000 | 4,135,462 | 3,551,054 | (831,945) | 10,354,570 | |||||||||
fiscal year | ||||||||||||||
Cumulative effects of | - | |||||||||||||
changes in accounting | ||||||||||||||
policies | ||||||||||||||
Restated balance at the | 3,500,000 | 4,135,462 | 3,551,054 | (831,945) | 10,354,570 | |||||||||
beginning of the fiscal year | ||||||||||||||
Changes in the fiscal year | ||||||||||||||
Cash dividends | (230,500) | (230,500) | ||||||||||||
Net income attributable to | 479,419 | 479,419 | ||||||||||||
Japan Post Holdings | ||||||||||||||
Changes in equity of Japan | ||||||||||||||
Post Holdings due to | (32) | (32) | ||||||||||||
transactions with non- | ||||||||||||||
controlling shareholders | ||||||||||||||
Disposals of treasury stock | 58 | 58 | ||||||||||||
Net changes in items other | ||||||||||||||
than shareholders' equity | ||||||||||||||
in the fiscal year | ||||||||||||||
Net changes in the fiscal year | - | (32) | 248,919 | 58 | 248,945 | |||||||||
Balance at the end of the fiscal | 3,500,000 | 4,135,429 | 3,799,974 | (831,887) | 10,603,516 | |||||||||
year | ||||||||||||||
Accumulated other comprehensive income | ||||||||||||||
Net unrealized | Foreign | Accumulated | Total | Non- | ||||||||||
gains (losses) | Net deferred | accumulated | controlling | Total net assets | ||||||||||
currency | adjustments for | |||||||||||||
on available- | gains (losses) | other | interests | |||||||||||
translation | retirement | |||||||||||||
for-sale | on hedges | comprehensive | ||||||||||||
adjustments | benefits | |||||||||||||
securities | income (loss) | |||||||||||||
Balance at the beginning of the | 2,688,219 | 2,784 | (85,870) | 294,238 | 2,899,371 | 1,489,292 | 14,743,234 | |||||||
fiscal year | ||||||||||||||
Cumulative effects of | - | |||||||||||||
changes in accounting | ||||||||||||||
policies | ||||||||||||||
Restated balance at the | 2,688,219 | 2,784 | (85,870) | 294,238 | 2,899,371 | 1,489,292 | 14,743,234 | |||||||
beginning of the fiscal year | ||||||||||||||
Changes in the fiscal year | ||||||||||||||
Cash dividends | (230,500) | |||||||||||||
Net income attributable to | 479,419 | |||||||||||||
Japan Post Holdings | ||||||||||||||
Changes in equity of Japan | ||||||||||||||
Post Holdings due to | (32) | |||||||||||||
transactions with non- | ||||||||||||||
controlling shareholders | ||||||||||||||
Disposals of treasury stock | 58 | |||||||||||||
Net changes in items other | (107,454) | (58,199) | (3,479) | (40,245) | (209,379) | 5,853 | (203,525) | |||||||
than shareholders' equity | ||||||||||||||
in the fiscal year | ||||||||||||||
Net changes in the fiscal year | (107,454) | (58,199) | (3,479) | (40,245) | (209,379) | 5,853 | 45,419 | |||||||
Balance at the end of the fiscal | 2,580,765 | (55,415) | (89,350) | 253,992 | 2,689,992 | 1,495,145 | 14,788,654 | |||||||
year | ||||||||||||||
11
Japan Post Holdings Co., Ltd | ||||||||||||||||
Fiscal year ended March 31, 2020 | ||||||||||||||||
(Millions of yen) | ||||||||||||||||
Shareholders' equity | ||||||||||||||||
Capital stock | Capital surplus | Retained earnings | Treasury stock | Total shareholders' | ||||||||||||
equity | ||||||||||||||||
Balance at the beginning of the | 3,500,000 | 4,135,429 | 3,799,974 | (831,887) | 10,603,516 | |||||||||||
fiscal year | ||||||||||||||||
Cumulative effects of | (24,426) | (24,426) | ||||||||||||||
changes in accounting | ||||||||||||||||
policies | ||||||||||||||||
Restated balance at the | 3,500,000 | 4,135,429 | 3,775,547 | (831,887) | 10,579,089 | |||||||||||
beginning of the fiscal year | ||||||||||||||||
Changes in the fiscal year | ||||||||||||||||
Cash dividends | (202,193) | (202,193) | ||||||||||||||
Net income attributable to | 483,733 | 483,733 | ||||||||||||||
Japan Post Holdings | ||||||||||||||||
Changes in equity of Japan | ||||||||||||||||
Post Holdings due to | (50,666) | (50,666) | ||||||||||||||
transactions with non- | ||||||||||||||||
controlling shareholders | ||||||||||||||||
Disposals of treasury stock | 180 | 180 | ||||||||||||||
Net changes in items other | ||||||||||||||||
than shareholders' equity | ||||||||||||||||
in the fiscal year | ||||||||||||||||
Net changes in the fiscal year | - | (50,666) | 281,540 | 180 | 231,054 | |||||||||||
Balance at the end of the fiscal | 3,500,000 | 4,084,763 | 4,057,087 | (831,707) | 10,810,143 | |||||||||||
year | ||||||||||||||||
Accumulated other comprehensive income | ||||||||||||||||
Net unrealized | Foreign | Accumulated | Total | Non- | ||||||||||||
gains (losses) | Net deferred | accumulated | controlling | Total net assets | ||||||||||||
currency | adjustments for | |||||||||||||||
on available- | gains (losses) | other | interests | |||||||||||||
translation | retirement | |||||||||||||||
for-sale | on hedges | comprehensive | ||||||||||||||
adjustments | benefits | |||||||||||||||
securities | income (loss) | |||||||||||||||
Balance at the beginning of the | 2,580,765 | (55,415) | (89,350) | 253,992 | 2,689,992 | 1,495,145 | 14,788,654 | |||||||||
fiscal year | ||||||||||||||||
Cumulative effects of | (24,426) | |||||||||||||||
changes in accounting | ||||||||||||||||
policies | ||||||||||||||||
Restated balance at the | 2,580,765 | (55,415) | (89,350) | 253,992 | 2,689,992 | 1,495,145 | 14,764,227 | |||||||||
beginning of the fiscal year | ||||||||||||||||
Changes in the fiscal year | ||||||||||||||||
Cash dividends | (202,193) | |||||||||||||||
Net income attributable to | 483,733 | |||||||||||||||
Japan Post Holdings | ||||||||||||||||
Changes in equity of Japan | ||||||||||||||||
Post Holdings due to | (50,666) | |||||||||||||||
transactions with non- | ||||||||||||||||
controlling shareholders | ||||||||||||||||
Disposals of treasury stock | 180 | |||||||||||||||
Net changes in items other | (2,285,094) | (236,408) | (348) | (44,132) | (2,565,983) | 187,476 | (2,378,506) | |||||||||
than shareholders' equity | ||||||||||||||||
in the fiscal year | ||||||||||||||||
Net changes in the fiscal year | (2,285,094) | (236,408) | (348) | (44,132) | (2,565,983) | 187,476 | (2,147,452) | |||||||||
Balance at the end of the fiscal | 295,671 | (291,823) | (89,698) | 209,860 | 124,008 | 1,682,622 | 12,616,774 | |||||||||
year | ||||||||||||||||
12
Japan Post Holdings Co., Ltd | ||||
(4) Consolidated Statements of Cash Flows | ||||
(Millions of yen) | ||||
Fiscal year ended | Fiscal year ended | |||
March 31, 2019 | March 31, 2020 | |||
Cash flows from operating activities: | ||||
Income before income taxes | 695,487 | 749,534 | ||
Depreciation and amortization | 269,382 | 294,011 | ||
Losses on impairment of fixed assets | 12,927 | 21,723 | ||
Amortization of goodwill | 287 | 167 | ||
Equity in (earnings) losses of affiliates | (699) | (244) | ||
Gains on negative goodwill | - | (48) | ||
Net change in reserve for outstanding claims | (28,628) | (58,343) | ||
Net change in policy reserves | (2,716,748) | (2,767,383) | ||
Provision for interest on policyholder dividends | 7 | 8 | ||
Provision for reserve for policyholder dividends | 111,806 | 109,236 | ||
Net change in reserve for possible loan losses | 170 | 3,480 | ||
Net change in reserve for bonuses | (4,728) | (517) | ||
Net change in asset and liability for retirement benefits | (26,564) | (21,065) | ||
Net change in reserve for employee stock ownership plan | 30 | (233) | ||
trust | ||||
Net change in reserve for management board benefit trust | 306 | (49) | ||
Net change in reserve for reimbursement of deposits | 2,218 | (8,008) | ||
Net change in reserve for insurance claims and others | - | 29,722 | ||
Net change in reserve for price fluctuations | (19,251) | (39,152) | ||
Interest and dividend income | (1,086,614) | (1,054,672) | ||
Interest expenses | 7,536 | 15,743 | ||
Interest income (accrual basis) | (1,357,775) | (1,317,799) | ||
Interest expenses (accrual basis) | 347,157 | 346,634 | ||
Net (gains) losses on securities | 50,858 | (14,671) | ||
Net (gains) losses on money held in trust | (156,619) | (124,399) | ||
Net (gains) losses on foreign exchanges | (578,515) | (85,265) | ||
Net (gains) losses on sales and disposal of fixed assets | 1,089 | 1,667 | ||
Net change in loans | 846,288 | 334,007 | ||
Net change in deposits | 1,136,799 | 1,752,024 | ||
Net change in borrowed money | 1,500 | 6,200 | ||
Net change in call loans | (8,300,349) | (2,023,847) | ||
Net change in receivables under securities borrowing | 8,224,153 | (112,491) | ||
transactions for banking business | ||||
Net change in call money | 9,584,086 | 3,286,253 | ||
Net change in commercial papers | (163,451) | (28,029) | ||
Net change in payables under securities lending | (11,338,666) | (254,073) | ||
transactions for banking business | ||||
Net change in foreign exchanges (assets) | 7,090 | (67,072) | ||
Net change in foreign exchanges (liabilities) | 318 | (117) | ||
Interest received (cash basis) | 1,372,572 | 1,379,252 | ||
Interest paid (cash basis) | (781,463) | (405,217) | ||
Other, net | (302,883) | (394,281) | ||
Subtotal | (4,190,883) | (447,319) | ||
Interest and dividend income received | 1,170,653 | 1,173,683 | ||
Interest expenses paid | (6,574) | (15,597) | ||
Policyholder dividends paid | (220,769) | (185,042) | ||
Income taxes paid | (367,228) | (221,512) | ||
Other, net | 5,001 | 1,638 | ||
Net cash provided by (used in) operating activities | (3,609,800) | 305,850 |
13
Japan Post Holdings Co., Ltd | |
(Millions of yen) | |
Fiscal year ended | Fiscal year ended |
March 31, 2019 | March 31, 2020 |
Cash flows from investing activities:
Purchases of call loans
Proceeds from redemption of call loans
Purchases of monetary claims bought
Proceeds from sale and redemption of monetary claims bought
Net change in receivables under securities borrowing transactions for life insurance business
Net change in payables under securities lending transactions for life insurance business
Purchases of securities
Proceeds from sale of securities
Proceeds from redemption of securities
Purchases of money held in trust
Proceeds from sale of money held in trust
Payments for loans
Proceeds from collection of loans
Purchases of tangible fixed assets
Proceeds from sale of tangible fixed assets
Purchases of intangible assets Proceeds from sale of stocks of subsidiaries and affiliates
Proceeds from purchases of stocks of subsidiaries resulting in change in the scope of consolidation
Payments due to sale of stocks of subsidiaries resulting in change in the scope of consolidation
Proceeds due to sale of stocks of subsidiaries resulting in change in the scope of consolidation
Other, net
Net cash provided by investing activities
Cash flows from financing activities:
Proceeds from borrowings
Repayment of borrowings
Proceeds from issuance of bonds
Purchases of treasury stock of subsidiaries
Proceeds from disposals of treasury stock of subsidiaries Dividends paid
Dividends paid to non-controlling interests
Purchases of stocks of subsidiaries that do not result in change in the scope of consolidation
Proceeds from sale of stocks of subsidiaries that do not result in change in the scope of consolidation
Other, net
(8,535,000) | (8,110,000) | |
8,650,000 | 7,880,000 | |
(1,319,999) | (1,524,997) | |
1,141,145 | 1,561,185 | |
504,020 | (399,508) | |
(240,736) | 867,329 | |
(26,180,484) | (25,138,744) | |
4,011,552 | 3,605,937 | |
26,578,983 | 22,959,251 | |
(810,563) | (2,303,911) | |
943,016 | 658,806 | |
(891,512) | (718,926) | |
1,731,609 | 1,842,218 | |
(221,079) | (133,811) | |
10,069 | 12,995 | |
(83,146) | (80,053) | |
- | 5,455 | |
30 | 487 | |
(656) | - | |
- | 266 | |
(101,204) | 56,504 | |
5,186,043 | 1,040,484 | |
86,054 | 307,250 | |
(47,715) | (261,759) | |
99,398 | - | |
(542) | (7,881) | |
54 | 82 | |
(230,383) | (202,271) | |
(25,150) | (34,184) | |
(4) | (1) | |
8,647 | 322,539 | |
(1,613) | (24,770) |
Net cash provided by (used in) financing activities | (111,256) | 99,003 | |
Effect of exchange rate changes on cash and cash equivalents | 774 | (1,770) | |
Net change in cash and cash equivalents | 1,465,761 | 1,443,568 | |
Cash and cash equivalents at the beginning of the fiscal year | 50,694,528 | 52,160,289 | |
Cash and cash equivalents at the end of the fiscal year | 52,160,289 | 53,603,857 |
14
Japan Post Holdings Co., Ltd
-
Notes to Consolidated Financial Statements (Notes on Going-Concern Assumption)
None
(Changes in Accounting Policies)
Toll Holdings Limited and its subsidiaries and affiliates
Effective from the fiscal year ended March 31, 2020, "Leases" (IFRS 16, January 13, 2016; hereinafter referred to as "IFRS 16") was applied. Accordingly, lessees are required to, in principle, record assets and liabilities for all leases on the balance sheet. IFRS 16 is applied in accordance with transitional treatments, whereby the cumulative amount of impact resulting from this change in the accounting policy has been recorded under retained earnings at the beginning of the fiscal year ended March 31, 2020.
As a result, tangible fixed assets increased by ¥176,939 million, other assets decreased by ¥113 million, other liabilities increased by ¥201,252 million, and retained earnings decreased by ¥24,426 million at the beginning of the fiscal year ended March 31, 2020. The effect of this change on profit and loss for the fiscal year ended March 31, 2020 is immaterial.
(Changes in Presentation)
(Consolidated Balance Sheets)
"Borrowed money" included in "other liabilities" in the previous fiscal year has been separately presented from the fiscal year ended March 31, 2020, due to its increased significance. To reflect this change in the presentation method, the consolidated financial statements for the previous fiscal year have been reclassified.
As a result, ¥2,755,370 million presented as "other liabilities" in the consolidated balance sheet of the previous fiscal year has been reclassified into ¥281,021 million of "borrowed money" and ¥2,474,349 million of "other liabilities."
(Changes in Accounting Estimates)
The Company has changed the amortization period of actuarial differences and prior service cost concerning the Company's share of public service pension from 9 years to 8 years from the fiscal year ended March 31, 2020, due to a decrease in the estimated average remaining payment period for eligible personnel.
As a result, ordinary expenses decreased by ¥8,284 million, while net ordinary income and income before income taxes increased by the same amount respectively for the fiscal year ended March 31, 2020.
(Additional Information)
Japan Post Group promotes thoroughgoing customer-first business operation as one of its critical management priorities. However, at Japan Post Insurance Co., Ltd. (hereinafter referred to as "Japan Post Insurance"), a consolidated subsidiary of the Company, following the internal investigation into the handling of customers' revision of their insurance coverage, it was discovered that in some cases, such revision was carried out in a manner that may have caused disadvantages to customers, not in line with their intentions. Consequently, Japan Post Insurance has been conducting investigations using appropriate procedures, by providing explanations to and receiving advice from the Special Investigative Committee composed of neutral and fair external experts, regarding the methods for confirming customers' intentions as well as for analyzing the information obtained.
The investigations included the investigation of specified rewriting cases (the investigation to grasp the situation of customers likely to have suffered disadvantages from the rewriting of policies), and the investigation of all insurance policies (the investigation where Japan Post Insurance sent notification documents with reply cards to customers of all other policies that were not subject to the investigation of specified rewriting cases, asking them to reconfirm their intentions and to let Japan Post Insurance know of any points it should be aware of, whereby Japan Post Insurance made necessary responses and investigations according to the results of the reconfirmation, and the investigation of such cases where sales personnel repeatedly made many new policy applications and cancellations, which may not have been in line with the intentions of customers, judging from the type of the policies).
15
Japan Post Holdings Co., Ltd
In consideration of the results of these investigations obtained by the end of the fiscal year ended March 31, 2020, the Company has estimated insurance-related expenses of ¥29,722 million to be incurred due to the refund of premiums and payments of insurance claims necessary for the future reinstatement of policies, as of March 31, 2020. These expenses were recorded under reserve for insurance claims and others.
On December 27, 2019, the Company and its consolidated subsidiary Japan Post Co., Ltd. received administrative dispositions pursuant to the Insurance Business Act, etc. from the Minister for Internal Affairs and Communications and the Financial Services Agency of Japan, on account of improper solicitation actions and underlying systematic problems. In addition, Japan Post Insurance received administrative dispositions pursuant to the Insurance Business Act from the Financial Services Agency of Japan. Following the administrative dispositions, a business improvement plan was formulated and it was submitted to the Minister for Internal Affairs and Communications and the Financial Services Agency of Japan as of January 31, 2020. Japan Post Group accepts the seriousness of administrative dispositions and is resolved to treat the implementation of the business improvement plan that it formulated as its top-priority management issue, and is making group-wide efforts.
These initiatives may affect the financial results of Japan Post Group in the future.
16
Japan Post Holdings Co., Ltd
(Segment Information)
1. Ordinary income and segment profit (loss) of reportable segments
(Millions of yen) | ||||||||
Reportable Segments | ||||||||
Postal and | International | Life | Other | Total | ||||
domestic | Post office | Banking | ||||||
logistics | insurance | Subtotal | business | |||||
logistics | business | business | ||||||
business | business | |||||||
business | ||||||||
Ordinary income | ||||||||
Ordinary income from | 2,082,736 | 170,543 | 635,028 | 1,797,365 | 7,211,365 | 11,897,039 | 51,820 | 11,948,859 |
third parties | ||||||||
Intersegment ordinary | 45,450 | 1,129,387 | 165 | 2,173 | 40 | 1,177,217 | 308,258 | 1,485,475 |
income | ||||||||
Total | 2,128,187 | 1,299,930 | 635,194 | 1,799,538 | 7,211,405 | 13,074,256 | 360,078 | 13,434,335 |
Segment profit (loss) | 149,185 | 45,086 | (21,447) | 379,131 | 286,601 | 838,558 | 242,822 | 1,081,380 |
(Notes) 1. Ordinary income is presented instead of net sales which is typical for companies in other industries.
2. "Other business" includes the hotel business and hospital business. Segment profit in "Other business" includes dividend income from subsidiaries and affiliates recorded by the Company in the amount of ¥219,083 million.
2. Reconciliation of amounts reported on reportable segments and consolidated financial statements
- Reconciliation between total ordinary income of reportable segments and ordinary income on the consolidated statements of income
(Millions of yen) | |
Items | Fiscal year ended |
March 31, 2020 | |
Total ordinary income of reportable segments | 13,074,256 |
Ordinary income of other business | 360,078 |
Eliminations of intersegment transactions | (1,485,475) |
Adjustments | 1,326 |
Ordinary income on the consolidated statements of income | 11,950,185 |
(Notes) 1. Ordinary income is presented instead of net sales which is typical for companies in other industries.
2. "Adjustments" are primarily due to differences in the calculation methods used for ordinary income for the international logistics business segment and the consolidated statements of income.
- Reconciliation between total segment profit (loss) of reportable segments and net ordinary income on the consolidated statements of income
(Millions of yen) | |
Items | Fiscal year ended |
March 31, 2020 | |
Total segment profit of reportable segments | 838,558 |
Segment profit in other business | 242,822 |
Eliminations of intersegment transactions | (214,510) |
Adjustments | (2,412) |
Net ordinary income on the consolidated statements of income | 864,457 |
(Note) "Adjustments" are primarily due to differences in the calculation methods used for segment loss for the international logistics business segment and net ordinary income on the consolidated statements of income.
17
Japan Post Holdings Co., Ltd
(Per Share Data)
Items | Fiscal year ended | |
March 31, 2020 | ||
Net assets per share | Yen | 2,704.24 |
Net income per share | Yen | 119.64 |
(Notes) 1. Because there was no potential common stock, the amount for diluted net income per share is omitted.
2. Net assets per share is calculated based on the following:
Items | As of March 31, 2020 | |
Net assets | Millions of yen | 12,616,774 |
Amount deducted from net assets | Millions of yen | 1,682,622 |
Of which: Non-controlling interests | Millions of yen | 1,682,622 |
Net assets attributable to common | Millions of yen | 10,934,152 |
stock at the fiscal year-end | ||
Number of common stock outstanding | ||
at the fiscal year-end used for the | Thousands of shares | 4,043,332 |
calculation of net assets per share |
- The number of treasury stock excluded from the number of common stock outstanding at the fiscal year-end used for the calculation of net assets per share includes the number of shares of the Company held by the management board benefit trust. The number of shares of the Company held by the management board benefit trust excluded from the calculation of net assets per share was 528,300 shares as of March 31, 2020.
- Net income per share is calculated based on the following:
Items | Fiscal year ended | |
March 31, 2020 | ||
Net income attributable to Japan Post | Millions of yen | 483,733 |
Holdings | ||
Amount not attributable to common | Millions of yen | - |
stockholders | ||
Net income attributable to common | Millions of yen | 483,733 |
stock | ||
Average number of common stock | Thousands of shares | 4,043,234 |
outstanding during the fiscal year | ||
5. The number of treasury stock excluded from the average number of common stock outstanding during the fiscal year used for the calculation of net income per share includes the number of shares of the Company held by the management board benefit trust. The average number of shares of the Company held by the management board benefit trust excluded from the calculation of net income per share was 626,486 shares for the fiscal year ended March 31, 2020.
(Subsequent Events)
None
18
Japan Post Holdings Co., Ltd
4. Non-consolidated Financial Statements
(1) Non-consolidated Balance Sheets
(Millions of yen) | ||||
As of March 31, 2019 | As of March 31, 2020 | |||
Assets | ||||
Current assets | ||||
Cash and deposits | 116,252 | 294,921 | ||
Inventories | 356 | 248 | ||
Prepaid expenses | 360 | 267 | ||
Short-term loan | 15,054 | 24,936 | ||
Accounts receivable | 41,872 | 45,167 | ||
Income taxes receivable | 30,147 | 54,886 | ||
Others | 6,521 | 5,247 | ||
Reserve for possible loan losses | (4) | (3) | ||
Total current assets | 210,560 | 425,671 | ||
Non-current assets | ||||
Tangible fixed assets | ||||
Buildings | 33,203 | 44,990 | ||
Structures | 647 | 1,632 | ||
Machinery and equipment | 706 | 757 | ||
Vehicles | 242 | 161 | ||
Tools and fixtures | 4,132 | 14,077 | ||
Land | 92,151 | 90,308 | ||
Construction in progress | 7,103 | 1,829 | ||
Total tangible fixed assets | 138,186 | 153,757 | ||
Intangible assets | ||||
Software | 3,103 | 24,825 | ||
Others | 11,503 | 311 | ||
Total intangible assets | 14,606 | 25,137 | ||
Investments and other assets | ||||
Investment securities | 16,873 | 12,850 | ||
Stocks of subsidiaries and affiliates | 7,700,137 | 7,313,387 | ||
Money held in trust | - | 198,341 | ||
Long-term loan | 3,020 | 2,880 | ||
Claims provable in bankruptcy | 62 | 59 | ||
Long-term prepaid expenses | 1,160 | 2,355 | ||
Others | 210 | 174 | ||
Reserve for possible loan losses | (62) | (59) | ||
Allowance for investment loss | (5,152) | (5,152) | ||
Total investments and other assets | 7,716,249 | 7,524,836 | ||
Total non-current assets | 7,869,041 | 7,703,731 | ||
Total assets | 8,079,602 | 8,129,402 | ||
19
Japan Post Holdings Co., Ltd | ||||
(Millions of yen) | ||||
As of March 31, 2019 | As of March 31, 2020 | |||
Liabilities | ||||
Current liabilities | ||||
Accounts payable | 33,672 | 27,377 | ||
Accrued expenses | 1,180 | 902 | ||
Income taxes payable | 521 | 162 | ||
Reserve for bonuses | 1,701 | 1,637 | ||
Reserve for point service program | 450 | 402 | ||
Others | 3,367 | 6,544 | ||
Total current liabilities | 40,894 | 37,026 | ||
Long-term liabilities | ||||
Reserve for retirement benefits | 67,156 | 35,881 | ||
Reserve for management board benefit trust | 281 | 228 | ||
Reserve for compensation for accidents in the course | 18,197 | 17,415 | ||
of duty | ||||
Others | 12,629 | 7,183 | ||
Total long-term liabilities | 98,265 | 60,708 | ||
Total liabilities | 139,159 | 97,734 | ||
Net assets | ||||
Shareholders' equity | ||||
Capital stock | 3,500,000 | 3,500,000 | ||
Capital surplus | ||||
Capital reserve | 875,000 | 875,000 | ||
Other capital surplus | 3,628,856 | 3,628,856 | ||
Total capital surplus | 4,503,856 | 4,503,856 | ||
Retained earnings | ||||
Other retained earnings | ||||
Retained earnings brought forward | 768,504 | 963,958 | ||
Total retained earnings | 768,504 | 963,958 | ||
Treasury stock | (831,887) | (831,707) | ||
Total shareholders' equity | 7,940,472 | 8,136,107 |
Valuation and translation adjustments
Net unrealized gains (losses) on available-for-sale securities
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets
(29) | (104,439) | ||
(29) | (104,439) | ||
7,940,442 | 8,031,667 | ||
8,079,602 | 8,129,402 |
20
Japan Post Holdings Co., Ltd | ||||
(2) Non-consolidated Statements of Income | ||||
(Millions of yen) | ||||
Fiscal year ended | Fiscal year ended | |||
March 31, 2019 | March 31, 2020 | |||
Operating income | ||||
Brand royalty income | 13,605 | 13,677 | ||
Dividend income from subsidiaries and affiliates | 203,163 | 219,083 | ||
Income from business consignment | 15,464 | 23,122 | ||
Subsidy income equivalent to deposit insurance | 1,619 | 510 | ||
premiums | ||||
Income from hospital business | 16,757 | 14,047 | ||
Income from hotel business | 23,941 | 19,005 | ||
Total operating income | 274,551 | 289,447 | ||
Operating expenses | ||||
Expenses for business consignment | 16,690 | 24,134 | ||
Expenses for hospital business | 22,118 | 17,411 | ||
Expenses for hotel business | 27,698 | 25,384 | ||
Administrative expenses | (5,580) | (13,936) | ||
Total operating expenses | 60,927 | 52,994 | ||
Net operating income | 213,623 | 236,452 | ||
Other income | ||||
Interest income | 45 | 367 | ||
Dividend income | - | 4,241 | ||
Rent income | 2,689 | 2,719 | ||
System modification fees | 132 | - | ||
Others | 958 | 723 | ||
Total other income | 3,825 | 8,050 | ||
Other expenses | ||||
Interest expenses | - | 68 | ||
Rent expenses | 1,219 | 1,216 | ||
System modification expenses | 128 | - | ||
Others | 200 | 190 | ||
Total other expenses | 1,548 | 1,475 | ||
Net ordinary income | 215,900 | 243,027 | ||
Extraordinary gains | ||||
Gains on sales of fixed assets | 6,769 | 138 | ||
Gains on transfer of business | - | 6,249 | ||
Gains on sales of stocks of subsidiaries and affiliates | - | 129,365 | ||
Others | 523 | 69 | ||
Total extraordinary gains | 7,292 | 135,822 | ||
Extraordinary losses | ||||
Losses on sales and disposal of fixed assets | 857 | 1,576 | ||
Losses on impairment of fixed assets | 2,386 | 891 | ||
Share of post office refurbishment expenses | 20,216 | 12,094 | ||
Others | 2,128 | 1,041 | ||
Total extraordinary losses | 25,588 | 15,604 | ||
Income before income taxes | 197,604 | 363,246 | ||
Income taxes current | (23,187) | (34,401) | ||
Total income taxes | (23,187) | (34,401) | ||
Net income | 220,791 | 397,647 | ||
21
Japan Post Holdings Co., Ltd
- Non-consolidatedStatements of Changes in Net Assets Fiscal year ended March 31, 2019
(Millions of yen)
Shareholders' equity | ||||||||||||
Capital surplus | Retained earnings | |||||||||||
Capital stock | Other retained | |||||||||||
Capital reserve | Other capital | Total capital | earnings | Total retained | ||||||||
surplus | surplus | Retained earnings | earnings | |||||||||
brought forward | ||||||||||||
Balance at the beginning of | 3,500,000 | 875,000 | 3,628,856 | 4,503,856 | 778,212 | 778,212 | ||||||
the fiscal year | ||||||||||||
Changes in the fiscal year | ||||||||||||
Cash dividends | (230,500) | (230,500) | ||||||||||
Net income | 220,791 | 220,791 | ||||||||||
Disposals of treasury stock | ||||||||||||
Net changes in items other | ||||||||||||
than shareholders' equity | ||||||||||||
in the fiscal year | ||||||||||||
Net changes in the fiscal year | - | - | - | - | (9,708) | (9,708) | ||||||
Balance at the end of the | 3,500,000 | 875,000 | 3,628,856 | 4,503,856 | 768,504 | 768,504 | ||||||
fiscal year | ||||||||||||
Shareholders' equity | Valuation and translation adjustments | |||||||||||
Net unrealized gains | Total valuation and | |||||||||||
Total shareholders' | (losses) on | Total net assets | ||||||||||
Treasury stock | translation | |||||||||||
equity | available-for-sale | |||||||||||
adjustments | ||||||||||||
securities | ||||||||||||
Balance at the beginning of | (831,945) | 7,950,122 | - | - | 7,950,122 | |||||||
the fiscal year | ||||||||||||
Changes in the fiscal year | ||||||||||||
Cash dividends | (230,500) | (230,500) | ||||||||||
Net income | 220,791 | 220,791 | ||||||||||
Disposals of treasury stock | 58 | 58 | 58 | |||||||||
Net changes in items other | (29) | (29) | (29) | |||||||||
than shareholders' equity | ||||||||||||
in the fiscal year | ||||||||||||
Net changes in the fiscal year | 58 | (9,650) | (29) | (29) | (9,679) | |||||||
Balance at the end of the | (831,887) | 7,940,472 | (29) | (29) | 7,940,442 | |||||||
fiscal year | ||||||||||||
22
Japan Post Holdings Co., Ltd | ||||||||||||
Fiscal year ended March 31, 2020 | ||||||||||||
(Millions of yen) | ||||||||||||
Shareholders' equity | ||||||||||||
Capital surplus | Retained earnings | |||||||||||
Capital stock | Other retained | |||||||||||
Capital reserve | Other capital | Total capital | earnings | Total retained | ||||||||
surplus | surplus | Retained earnings | earnings | |||||||||
brought forward | ||||||||||||
Balance at the beginning of | 3,500,000 | 875,000 | 3,628,856 | 4,503,856 | 768,504 | 768,504 | ||||||
the fiscal year | ||||||||||||
Changes in the fiscal year | ||||||||||||
Cash dividends | (202,193) | (202,193) | ||||||||||
Net income | 397,647 | 397,647 | ||||||||||
Disposals of treasury stock | ||||||||||||
Net changes in items other | ||||||||||||
than shareholders' equity | ||||||||||||
in the fiscal year | ||||||||||||
Net changes in the fiscal year | - | - | - | - | 195,454 | 195,454 | ||||||
Balance at the end of the | 3,500,000 | 875,000 | 3,628,856 | 4,503,856 | 963,958 | 963,958 | ||||||
fiscal year | ||||||||||||
Shareholders' equity | Valuation and translation adjustments | |||||||||||
Net unrealized gains | Total valuation and | |||||||||||
Total shareholders' | (losses) on | Total net assets | ||||||||||
Treasury stock | translation | |||||||||||
equity | available-for-sale | |||||||||||
adjustments | ||||||||||||
securities | ||||||||||||
Balance at the beginning of | (831,887) | 7,940,472 | (29) | (29) | 7,940,442 | |||||||
the fiscal year | ||||||||||||
Changes in the fiscal year | ||||||||||||
Cash dividends | (202,193) | (202,193) | ||||||||||
Net income | 397,647 | 397,647 | ||||||||||
Disposals of treasury stock | 180 | 180 | 180 | |||||||||
Net changes in items other | (104,410) | (104,410) | (104,410) | |||||||||
than shareholders' equity | ||||||||||||
in the fiscal year | ||||||||||||
Net changes in the fiscal year | 180 | 195,634 | (104,410) | (104,410) | 91,224 | |||||||
Balance at the end of the | (831,707) | 8,136,107 | (104,439) | (104,439) | 8,031,667 | |||||||
fiscal year | ||||||||||||
23
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Japan Post Holdings Co. Ltd. published this content on 15 May 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 15 May 2020 08:04:07 UTC