ORIX : Financial Highlights

ORIX Corporation

Second Quarter Consolidated Financial Highlights

For the Six-Month Period Ended September 30, 2019

October 28, 2019

(TSE: 8591; NYSE: IX)

Overview（1）Net Income / ROE

• 159.2 JPY bn in net income, up by 2.6% YoY. Annualized ROE at 10.9%

Net Income* and ROE

Reference: Past Quarter ROE

(JPY Bn)

35 0. 0	11.5%	11.7%	11.3%	12.1%	11.6%	11.3%	10.9%
30 0. 0
25 0. 0

	100000	15.2%		15.0%
						13.2%	12.5%	14.3%	13.7%	11.9%	11.5%	12.3%
13.0%	90000				9.6%
		8.5%		14.4%									9.6%
	13.7%											10.00%
	80000
			9.3%		11.1%		11.9%	10.9%	12.3%
				9.1%
	70000			7.8%		8.5%

60000

20 0.	0
15 0.	0			260.2	273.2	313.1	323.7
	234.9
10 0.	0
																			155.1	159.2
50 .0
0.	0
	15.3	16.3	17.3	18.3	19.3						19.3 H1		20.3 H1
									Net Income				ROE (annualized)

*Net Income refers to Net Income Attributable to ORIX Corporation Shareholders

50000

40000

-10.00%

30000

20000

ROE fluctuates quarterly

10000

-7.0%

0

20.3

-30.00%

15.3

16.3

17.3

18.3

19.3

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q1

Q2

Q3

Q4

Q1

Q2

Net Income

ROE (annualized)

Copyright © 2019 ORIX Corporation All rights reserved.

2

Overview（2）Breakdown of Segment Profits

FY20.3 H1	Of which		155.9 JPY bnup by 3% YoY (+4.6 JPY bn)
Segment Profits	Other than		Exceeded the level of last year with the contribution of new M&A (NXT, Avolon),
gains on sales
230.4 JPY bn		although there are a few segments where the profits decreased YoY
		74.5 JPY bnup by 4% YoY (+2.5 JPY bn)
up by 3% YoY	Of which
(+7.1 JPY bn)	Gains on Sales		Sold ORIX Living and completed selling all the shares of Houlihan Lokey

*Major gains on sales: gains on sales of rental property, gains on sales of subsidiaries and affiliates, gains on sales of investment securities, etc.

500.0

450.0

400.0

350.0

300.0

250.0

200.0

150.0

100.0

50.0

0.0

		Segment Profits
(JPY Bn)	420.9	429.1	401.4
	385.7
339.8		143.2	107.3

223.3 230.4

72.0 74.5

285.9 294.1

151.3 155.9

15.3	16.3	17.3	18.3	19.3	19.3 H1	20.3 H1
		Segment profit (other than gains on sales)	Gains on sales
					Copyright © 2019 ORIX Corporation All rights reserved.	3

Overview（3）Segment Profits / Segment Assets

• Segment Profits: 230.4 JPY bn

Real Estate, Investment and Operation and Overseas Business increased YoY while Corporate Financial Services, Maintenance Leasing and Retail decreased YoY

✓Segment Assets: 10.4 JPY tn up by 4% YTD (+435.0 JPY bn)

*Includes about 200 JPY bn as a result of application of new lease accounting standards

Segment Profits

(JPY Bn)

100

80

60

40

20

0

18.3 H1	19.3 H1	20.3 H1
Corporate Financial Services	Maintenance Leasing	Real Estate
Investment and Operation	Retail	Overseas Business

Segment Assets and ROA

(JPY Tn)

12		3.4％	3.4％	3.1％
10
8
6
4
2
0
18.3		19.3	20.3 H1
Corporate Financial Services	Maintenance Leasing	Real Estate
Investment and Operation	Retail	Overseas Business
Segment ROA (annualized and after-tax)

Copyright © 2019 ORIX Corporation All rights reserved.

4

Overview（4）Funding structure / Employed Capital Ratio

• Funding structure : Diversified funding methods and maintained a high ratio oflong-term debt
• Employed Capital Ratio : Continue to pursue growth while controlling risk and return

Breakdown of Funding and	Shareholder's Equity /
Trend in Long-term Debt Ratio*	Employed Capital Ratio

(JPY Tn)

*Excluding deposits

7

6

5

100%

3,000.0

80%2,500.0

(JPY Bn)

100%

88%

85%85%

4

3

2

1

2,000.0

60%

1,500.0

40%

1,000.0

20%500.0

0.0

2,682.4

80%

2,897.1 2,962.1

60%

40%

0

15.3	16.3	17.3	18.3	19.3	19.9
Borrowings from Financial Institutions		Capital markets（Long-Term）
Capital markets（CP）			Deposits
Long-term Debt Ratio（right axis）

0%

15.3	16.3	17.3	18.3	19.3	19.9
		Shareholders' Equity		Employed Capital Ratio

Copyright © 2019 ORIX Corporation All rights reserved.

5

Segment Performance

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6

Segment Performance（1）Corporate Financial Services	*As the figures less than 0.1 JPY bn are rounded off, the total
the segment figures
	of individual business unit figures does not necessarily match

Segment Profits: 9.2 JPY bn	YoY ▲7.6 JPY bn (▲45％)

• Agency fee income from life insurance business for corporate customers decreased. Yields on loans were maintained
• Yayoi achieved increase in membership forfee-based support services and sales of
  packaged products
  ▲0.9 JPY bn>

Segment Assets: 997.0 JPY bn	YTD +37.2 JPY bn (+4％)

• Operating leases increased due to new lease accounting standards (+56.8 JPY bn)

(JPY Bn)	Segment Profits
25

20 3.7

15					2.9
10
18.4
	13.8		3.6
5						5.6
0
	18.3 H1	19.3 H1	20.3 H1
				Domestic Sales	Yayoi

(JPY Bn)	Segment Assets and ROA					(JPY Bn)			Yields on loans
1,200														4.0%
1,000			3.2%											450.0					2.9%
											98.2		3.0%	2.4%										3.0%
				100.7					99.1						400.0	2.4%		2.3%		2.3%	2.3%	2.2%
800																350.0							2.0%
																300.0
															2.0%
										1.8%						250.0												1.0%
600
													1.3%	200.0	369.9	364.5	353.7	369.9		364.8	361.4	367.1
										898.7	1.0%		0.0%
400			891.1				860.7				150.0
																100.0												-1.0%
200														0.0%50.0
																0.0												-2.0%
																			17.3-18.3 19.3 Q1	19.3 Q2	19.3 Q3	19.3 Q4	20.3 Q1	20.3 Q2
0																-1.0%					Installment Loans			Yields on loans
				18.3				19.3			20.3 H1
	Domestic Sales	Yayoi	Segment ROA (annualized and after-tax)	Yields on loans ＝finance revenues classified as loan interest ÷average balance of installment loans

	Business	✓	Promote business investment to SMEs with succession problems through utilizing financial know-how and sales network
	status	✓	Diversification of services income continues while carefully dealing with asset accumulation at low spreads

Copyright © 2019 ORIX Corporation All rights reserved.

7

Segment Performance（2）Maintenance Leasing

Segment Profits: 16.6 JPY bn	YoY ▲4.0 JPY bn (▲19％)

• Revenues from both Auto and Rentec increased. SG&A increase from service improvement partly caused profit decrease

▲1.3 JPY bn >

Segment Assets: 886.3 JPY bn	YTD +12.5 JPY bn (+1％)

• Remained at the same level as FY19.3

				Segment Profits									Segment Assets and ROA				Number of Automobiles
					(JPY Bn)			Under Management (ORIX Auto)
(JPY Bn)
25											1,000										5.0%	(Millions of vehicles)
																							4.5%
20											800				115.9		128.6		135.6		4.0%	1.5					1.40	1.43
	4.5																									1.34
					5.3											3.3%					3.5%				1.28
																		3.1%				1.3		1.23
15											600								3.0%
									4.8												2.6%		1.17
																						2.5%	1.1
10											400				731.3		745.2		750.6		2.0%	0.9
	16.0					15.3																	1.5%
5										11.8	200										1.0%
																			0.7
																								0.5%
0													0										0.0%	0.5
	18.3 H1	19.3 H1	20.3 H1						18.3		19.3		20.3 H1
												15.3	16.3	17.3	18.3	19.3	19.9
				Auto	Rentec							Auto	Rentec	Segment ROA (annualized and after-tax)

Business

status

• Expand car sharing business nationwide in cooperation with car rental business. Promote MaaS (Mobility as a Service) by partnering with railway companies, etc.
• Seeking to expand the business of Yodogawa Transformer (rental business of power receiving and transforming facilities and equipment, and generators) as well as rental products line up such as collaboration robots and drones

Copyright © 2019 ORIX Corporation All rights reserved.

8

Segment Performance（3）Real Estate

Segment Profits: 46.2 JPY bn	YoY +2.0 JPY bn (+5％)

• Gains on sales from ORIX Living, etc.
• Profits from real estate asset management remained stable

Segment Assets: 742.4 JPY bn	YTD +22.2 JPY bn (+3％)

• Assets decreased due to some selling while new investments continue
• Operating lease assets increased due to new lease accounting standards (+89.3 JPY bn)

					Segment Profits									Segment Assets and ROA				(JPY Bn)	Unrealized gains
							(JPY Bn)					on rental properties*
(JPY Bn)
							1,000
50																							8.7%
			0.6						800					8.0%				90			82.8
						5.0								80					73.7
40																181.7											70.1
																					70
										600		6.2%	204.8				216.8
30															60	54.9		57.0
			44.0	44.2																50
20			41.1	400									40
																620.2						525.7	30
10																	515.4
				0.0			200						20
0																							10
									0											0
-10				18.3 H1			19.3 H1		20.3 H1						18.3	19.3				20.3 H1				15.3	16.3	17.3	18.3	19.3
											RE Investment and Facilities Operation	DAIKYO					*Including rental properties in segments other than the Real Estate segment
				RE Investment and Facilities Operation		DAIKYO					Segment ROA (annualized and after-tax)								*Not including property under facility operations

Business

status

• Promotedlarge-scale projects, such as renovations of Beppu Suginoi-Hotel (to be completed in 2025), the Osaka Second Zone Umekita project (to be opened in 2024)
• Integrated management initiative with DAIKYO, which became a wholly owned subsidiary in 2019, continues; promoting resources /know-how sharing in areas of Development and Sales, Brokerage, and Management and Construction

Copyright © 2019 ORIX Corporation All rights reserved.

9

Segment Performance（4）Investment and Operation

Segment Profits: 28.4 JPY bn	YoY +3.5 JPY bn (+14％)

• Gains on sales in private equity investment in Q1.
• Profits from concession increased due to a rise in the number of tourists visiting Japan

Segment Assets: 773.0 JPY bn	YTD +39.4 JPY bn (+5％)

• Invested in Wako Pallet, a major seller and leaser of logistics equipment
• Business assets related to environment and energy business increased due to new lease accounting standards (+39.8 JPY bn)

Segment Profits

(JPY Bn)

40		4.8
30		8.7
			6.9		10.8
20
		24.8	8.1		7.8
10
			9.9		9.7
0
	18.3 H1	19.3 H1	20.3 H1
Investment and Operation	Enviroment and Energy	Concession

				Segment Assets and ROA		Solar power generation business in Japan
(JPY Bn)				(MW)
1,000						1,000
800
			52.2								840	870
												780
				9.1%	49.2
			44.8				750			650	700
600
					395.6	426.0			570
				371.0			500
				5.2%
400
						3.7%
200						250
				258.8	288.9	294.8
0						0
18.3	19.3	20.3 H1		17.3	17.9	18.3	18.9	19.3	19.9
		Investment and Operation	Enviroment and Energy
		Concession	Segment ROA (annualized and after-tax)

Business

status

• Solar power generation business in Japan is doing well (1GW secured as of September, 30 2019); started construction of geothermal power plant inMinami-Kayabe and promote wind power as well
• Private equity investment generated investment return of more than 100 JPY bn in the last five years; exploring opportunities with view to engage in long- term strategic investment

Copyright © 2019 ORIX Corporation All rights reserved.

10

Segment Performance（5）Retail

Segment Profits: 43.2 JPY bn	YoY ▲6.0 JPY bn (▲12％)

• Life insurance premium income increased with the number of policies increased. Profits decreased due to the large gains on sales in the last fiscal year and increase in SG&A

Segment Assets: 3,946.7 JPY bn YTD +375.3 JPY bn (+11％)

• Investment in securities at life insurance business and installment loans at banking business increased

(JPY Bn)			Segment Profits
50				5.8
40	5.1		5.2
				11.6
	10.0		12.7
30
20
	27.8	31.8
		25.3
10
0
		18.3 H1	19.3 H1	20.3 H1
			Life Insurance	Banking	Credit

				Segment Assets and ROA					Number of Insurance
(JPY Bn)							Policies in Force
4,000								182.0		(Millions of policies)
					184.1
3,000		181.4								5.00
														4.39
									4.50				4.10	4.26
														3.94
							1.7%			2,297.3
										4.00		3.72
				1.6%							3.49
				2,132.7			1.6%		3.50
2,000		1,937.4								3.00
												2.50
												2.00
1,000										1.50
				1,055.6	1,254.7			1,467.4		1.00
											0.50
0										0.00
									17.3	17.9	18.3	18.9	19.3	19.9
			18.3	19.3				20.3 H1
		Life Insurance Banking		Credit	Segment ROA (annualized and after-tax)

	Business	✓ORIX Life Insurance expanded its product lineup such as foreign currency-denominated product and simplified issue insurance products
	status	✓ORIX Bank maintained a high loan-deposit ratio; net interest margin remained at 2% level
		Copyright © 2019 ORIX Corporation All rights reserved.	11

Segment Performance（6）Overseas Business

Segment Profits: 86.9 JPY bn	YoY +19.1 JPY bn (+28%)

• Profit from new investments in FY19.3 and gains on sales in Asia in Q1 contributed
• Foreign exchange impact▲2.0 JPY bn

Segment Assets: 3,087.3 JPY bn YTD▲51.6 JPY bn (▲2％)

• Excluding foreign exchange impact of▲116.8 JPY bn, segment assets increased by 65.1 JPY bn

(JPY Bn)		Segment Profits
90
80					18.2
70			20.0	1.8
60				15.0	16.5
			14.4
50
40				19.9	16.4
			22.2
30
20					35.7
				31.0
			24.8
10
0
		18.3 H1	19.3 H1	20.3 H1

OCU OCE Aircraft, Ships Asia and Australia, and other

OCU: ORIX Corporation USA

OCE: ORIX Corporation Europe

(JPY Bn)	Segment Assets and ROA
3,500
3,000					3.8%
2,500				996.7	990.7
				3.0%
						2.8%
2,000			1,003.6
						646.3	642.0
1,500			381.7
					343.1	322.9
1,000			353.8
500			869.7	1,152.9	1,131.6
0
		18.3	19.3	20.3 H1
		OCU		OCE
		Aircraft, Ships		Asia and Australia, and other

Segment ROA (annualized and after-tax)

Contribution from new investments

FY19.3	FY20.3 H1
Large-scale investment	Segment profits

NXT Capital	5.4JPY Bn
(Loan origination,
asset management)
Avolon	5.7JPY Bn
(Aircraft leasing)

	Business	✓Continue to seek diversification of loan and asset management business in U.S. and Europe
	status	✓Seek synergy with Avolon to further increase the scale of aircraft leasing business and increase the presence
		Copyright © 2019 ORIX Corporation All rights reserved.	12

Disclaimer

• These materials have been prepared by ORIX Corporation ("ORIX" or the "Company") solely for your information and are subject to change without notice. The information contained in these materials has not been independently verified and its accuracy is not guaranteed. No representations, warranties or undertakings, expressed or implied, are made as to, and no reliance should be placed on, the accuracy, fairness, or completeness, or correctness of the information or the opinions presented or contained in these materials.
• These materials containforward-looking statements that reflect the Company's intent, belief and current expectations about future events and financial results. These statements can be recognized by the use of words such as "expects," "plans," "will," "estimates," "projects," "intends," or words of similar meaning. These forward-looking statements are not guarantees of future performance. They are based on a number of assumptions about the Company's operations and are subject to risks, uncertainties and other factors beyond the Company's control. Accordingly, actual results may differ materially from these forward-looking statements. Factors that could cause such differences include, but are not limited to, those described under "Risk Factors" in the Company's most recent annual report on Form 20-F filed with the U.S. Securities and Exchange Commission and under "Business Risk" of the securities report (yukashouken houkokusho) filed with the Director of the Kanto Local Finance Bureau and of the consolidated financial results filed with the Tokyo Stock Exchange.
• Some of the financial information in these materials is unaudited.
• The Company believes that it will be considered a "passive foreign investment company" for United States Federal income tax purpose in the year to which these consolidated financial results relate and for the foreseeable future by reason of the composition of its assets and the nature of its income. A U.S. holder of the shares or ADSs of the Company is therefore subject to special rules generally intended to eliminate any benefits from the deferral of U.S. Federal income tax that a holder could derive from investing in a foreign corporation that does not distribute all of its earnings on a current basis. Investors should consult their tax advisors with respect to such rules, which are summarized in the Company's annual report.
• Nothing in this document shall be considered as an offer to sell or solicitation of an offer to buy any security, commodity or other instrument, including securities issued by the Company or any affiliate thereof.

Copyright © 2019 ORIX Corporation All rights reserved.

13

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ORIX Corporation

Corporate Planning Department

World Trade Center Building, 2-4-1,

Hamamatsu-cho,Minato-ku,

Tokyo 105-6135, Japan

Tel: [phone]

Fax: [phone] [e-mail]