Mitsubishi UFJ Lease & Finance : FY3-2020 2nd Quarter Results

FY3/2020 2nd Quarter Results

(Tokyo Stock Exchange / Nagoya Stock Exchange: 8593)

November 8, 2019

Mitsubishi UFJ Lease & Finance Company Limited

Index

• FY3/2020 2nd Quarter Results

• Divisional Updates

• FY3/2020 Forecasts
• Appendix

1

• FY3/2020 2nd Quarter Results
• Divisional Updates

• FY3/2020 Forecasts
• Appendix

2

Financial Highlights

• Progress toward our published initial forecasts exceeded 50% thanks mainly to gains on sales related to real estate, aviation, and environment & energy
• Cumulative consolidated income numbers for Q2 set record highs

											(billion yen)
										*4
			(b) YOY Change	(d) YOY
		(a) FY3/2020	(e) FY3/2019	(f) Published (g) Progress
		Change
		2Q			(c) Exchange	2Q		Full-year		Rate
				(%)
					Rate Effects			Forecast
1	Revenues	468.7	+48.4		+1.0	+11.5%	420.2		865.0		54.2%
2	Gross Profit	97.7	+21.5		+0.3	+28.2%	76.2		178.0		54.9%
3	Operating Income	54.4	+15.3		+0.2	+39.1%	39.0		87.0		62.5%
4	Recurring Income	55.3	+13.3		+0.2	+31.9%	41.9		94.0		58.9%
5	Net Income *1	38.2	+5.5		+0.1	+16.9%	32.7		70.0		54.7%
6	New Transactions Volume	965.5	+177.1		+3.0	+22.5%	788.3
	Dividend per Share
7	¥12.50	+¥3.00		-	-	¥9.50
(Interim)
8	USD Exchange Rate (*)	$1=¥110.05			-		$1=¥108.68
* Exchange rate applied to profit and loss statement of overseas subsidiaries ($)
9	Total Operating Assets	5,068.4	+21.9*2		-52.4	+0.4%*2	5,046.4	*3
10	USD Exchange Rate (**)	$1=¥107.79			-		$1=¥111.00
**Exchange rate applied to balance sheet of overseas subsidiaries ($) *1	2Q net income attributable to owners of the parent
			*2 Total operating assets is change from FY3/2019
			*3	FY3/2019					3
			*4	Above figures are FY3/2020 forecasts as of November 8, 2019

			Increase/Decrease in Net Income
			Attributable to Owners of the Parent
	Gross		Operating								(billion yen)
	Profit		Expenses
			Credit
+21.5	-4.7						Net
	Cost
							Extraordinary
					Others			Income
				-1.9
						Income/Loss
							-1.4		Tax	Attributable to
			②				-4.9
				③		Owners of the
					Expenses
	①				④			Parent
								-2.9
								+5.5

⑤

⑥

		32.7					38.2
					Positive Factor		Negative Factor
		FY3/2019			FY3/2020
		2Q			2Q
	① Gross Profit	 Increased earnings mainly due to gains on sales related to real estate, aviation, and
	environment & energy
	② Operating Expenses	 Fortifying the growth foundation in Domestic/Overseas Customers and priority industry
	domains, amongst other factors
	③ Credit Cost	 Increase in line with initial assumptions
	④ Others	 Decrease on reaction to foreign exchange gains posted in FY3/2019 Q2, smaller equity
	method income, amongst other factors
	⑤ Extraordinary Income/Loss	 Decrease on reaction to gains on sales of strategic shareholdings and shares of affiliates,
						amongst other factors
	⑥ Tax Expenses	 YOY increase on higher profits

4

• FY3/2020 2nd Quarter Results
• Divisional Updates

• FY3/2020 Forecasts
• Appendix

5

Increase/Decrease in Divisional Earnings

Divisional Earnings: gross profit (prior to allocation of financial expenses) plus equity-method earnings and dividend income of each division

				Infrastructure&		Divisional
		Environment&	Investment Consolidated
		earnings
	Real		Energy	Healthcare	0.0	Adjustment	+27.6
	Logistics		+0.2
	Estate	+4.1		-0.1
	+1.9
Domestic/	+8.6
Overseas	Aviation
Customers	+7.4
+5.4
							129.9
102.2
	Positive factor	Negative factor
FY3/2019							FY3/2020
2Q							2Q

			(billion yen)
	Increase/	Main Factor	Divisions and
	Decrease	Businesses Involved
		Increased earnings	Departments and subsidiaries
Domestic/	+5.4	following the inclusion	in Japan responsible for
Overseas	of ENGS to	Domestic Customers, and
Customers		consolidated accounts,	overseas bases responsible
		amongst other factors	for Overseas Customers
		Gains on sales of
Aviation	+7.4	aircraft and increased	Aviation Business
lease revenues of	Department, JSA, ELF
		aircraft and engines
		Gains on sales of real	Real Estate Business
		estate in Japan and
	+8.6	Department, MULP,
Real Estate	overseas; Increased
MURI,DAF, Miyuki Building,
		lease and interest	others
		revenues
		Increased lease	Logistics Business
		Department, Ship Finance
	+1.9	revenues from
Logistics	Department, Mobility Service
containers and freight
	Business Department, BIL,
		cars
		MULR, MAL, others
		Gains on sales of
Environment	+4.1	solar-related assets	Environment & Energy
and increased	Business Department, MEI,
& Energy
		revenues from	Solar Energy SPC, others
		electricity power sales
	+0.2	Earnings growth of	Healthcare Business
Healthcare	Department, Japan Medical
group companies
	Lease, others
Infra-			Infrastructure Business
0.0	Occurrence of front-	Department, Investment
structure &
loaded cash out	Business Department, JII,
Investment
		invested businesses

		Domestic/				Environment &		Infrastructure	Consolidated	Consolidated
		Overseas	Aviation	Real Estate	Logistics	Healthcare
		Energy	& Investment	Adjustment	Total
		Customers
1	FY3/2020	45.2	39.0	24.9	9.7	7.2	2.4	1.2	0.0	129.9
2Q
2	FY3/2019	39.8	31.6	16.3	7.7	3.0	2.2	1.3	1.0	102.2
2Q
										6

Aviation

• Outstanding Balance of Aviation-related

			(billion yen)
	FY3/2019	FY3/2020	YOY
	2Q
Total	1,035.4	1,047.4	+11.9
Aircraft	791.5	815.7	+24.1
Engines	243.9	231.7	-12.1

◆ Owned Aviation-related Assets

		FY3/2019	FY3/2020	YOY
		2Q
	Number of Aircraft	160	166	+6
	Number of Aircraft	27	13	-
	Purchased *1
	Number of Aircraft	10	7	-
	Sold *1
	Number of Aircraft	300	292	-8
	engines

• Principal Companies

Company	Ownership	Main Business
Ratio *2
MUL	-	JOL
(Aviation Business Department)
Jackson Square Aviation (JSA)	100%	Aircraft lease
Engine Lease Finance (ELF)	100%	Aircraft engine lease,
part-out business

• Aircraft Ownership Breakdown

(As of September 30, 2019)

1. By Asset Type			2. By Region
Other				Middle East
				9%
10%
	Narrow body	Americas		Asia/
Total	Total	Oceania
90%		30%
166			166	40%
Aircraft					Aircraft

Europe

21%

• Regional Breakdown of Engine Ownership

(As of September 30, 2019)

Middle East

16% Asia/Oceania

27%

Total

Americas 292

27% Engines

Europe

30%

*1	After consolidated adjustment (do not match with sales profits/losses for aircraft numbers recognized on the P/L)	7
*2	Includes indirect holdings

Real Estate

• Outstanding Balance of Real-Estate-

		related Finance*1		(billion yen)
			FY3/2019	FY3/2020	YOY
			2Q
	Total (A+B)	212.9	235.5	+22.6
	Japan (A)	178.4	203.3	+24.8
		Debt	85.5	109.6	+24.0
		Equity (C)	92.9	93.6	+0.7
		Ratio (C÷A)	52.0%	46.1%	-5.9P
	Overseas (B)	34.5	32.2	-2.2

◆ Outstanding Real Estate Lease	(billion yen)
	FY3/2019	FY3/2020	YOY
	2Q
Total *2	238.6	244.3	+5.7

• Outstanding Domestic Equity Ratio

(As of September 30, 2019)

1. By Asset Type2. By Region

	Others			Others
Hotel	0%			Nagoya 5%
			Metropolitan
20%		Commercial	District
Residence	Total	Facility		Osaka	6%
27%		Total
3%	93.6	Metropolitan	93.6
Logistics			District
billion			21%	billion
18%	yen
			yen	Tokyo

Office	Metropolitan
District
32%
68%

• Principal Companies

Company	Ownership	Main Business
Ratio *3
MUL	-	Real estate finance,
(Real Estate Business Department)	real estate lease
MUL Property (MULP)	100%	Real estate lease
Diamond Asset Finance (DAF)	100%	Real estate finance

Company	Ownership	Main Business
Ratio *3
Miyuki Building	98%	Real estate rental and
management
MUL Realty Investment (MURI)	100%	Real-estate-related
investment operations
MUL Realty Investments (MRI)	100%	Real estate finance

*1 The sum of lending and investment projects of MUL, MURI, and MRI

*2 The sum of outstanding real estate leases for MUL and MULP8 *3 Includes indirect holdings

Logistics/Environment & Energy

• Outstanding Balance of Logistics-related

			(billion yen)
	FY3/2019	FY3/2020	YOY
	2Q
Outstanding Total	428.2	446.0	+17.8
Marine Containers	215.0	217.5	+2.4
Railway/Freight Cars	92.8	116.9	+24.0
Shipping	120.2	111.5	-8.7

• Owned Logistics-related Assets

	FY3/2019	FY3/2020	YOY
	2Q
Marine Container	1,300	1,356	+56
Fleet (TEU 1,000)
*1
Number of Railway/	10,594	13,379	+2,785
Freight Cars

• Principal Companies

Company	Ownership	Main Business
Ratio *2
MUL (Ship Finance Department)	-	Ship finance
Beacon Intermodal Leasing(BIL)	100%	Marine container lease
MUL Railcars(MULR)	100%	Railway and railcar lease
Mitsubishi Auto Leasing (MAL)	50%	Auto lease
	*1 TEU: Twenty Feet Equivalent Unit

(converted into 20ft. containers)

*2 Includes indirect holdings

• Main Initiatives in the Environment & Energy Business Department

1. Total power output of projects in operation where MUL has equity (proportioned according to the contributing interest) was around 830MW. Around 60% of projects will start operations within FY3/2020, and the remainder from FY3/2021 and onward
2. Softbank Akita Kotooka Wind Farm started operations (power generation scale: 7.5MW)
3. Investment in IOVTEC undertaking offshore surveys and management/maintenance related to offshore wind farms, etc.
4. Investment in woody biomass power generation business in Oita prefecture (22.0MW) and Ibaraki prefecture (50.0MW)

◆ Outstanding Solar Projects		(billion yen)
		FY3/2019	FY3/2020 2Q	YOY
	Total	125.6	134.2	+8.6
	Equity	80.1	83.4	+3.3
	Debt	45.5	50.8	+5.3
	Power output	393MW	374MW	-19MW
	proportioned according to
	contributing interest
	(Reference) Lease *3	146.7	137.4	-9.3

• Principal Companies

Company	Ownership	Main Business
Ratio *2
MUL (Environment & Energy	-	Renewable-energy business,
Business Department)	energy-saving devices leasing
MUL Energy Investment		Operation and asset
100%	management of renewable-
(MEI)
	energy businesses
MUL Utility Innovation	100%	Development of energy-related
(MUI)	businesses

*3 Outstanding solar-related lease as compiled by

the domestic/overseas customers	9

Healthcare/Infrastructure & Investment

• Main Initiatives in the Healthcare Business Department

1. Expansion of collective medical malls/medical complexes

• Expansion of development and operations of collective medical malls with clinics and dispensaries as tenants

Area	Department	Opening
Kanagawa	Internal medicine, gynecology, and	Mar 2018
pediatric clinics and dispensaries
Hokkaido	Otolaryngology and internal medicine	Jun 2018
clinics and dispensaries
Osaka, Daito	Otolaryngology clinic and dispensaries	Oct 2018
Aichi	Otolaryngology clinic and dispensaries	Apr 2019
Osaka, Toyonaka	Orthopedic, dermatology, and internal	Jun 2019
medicine clinics and dispensaries

2. Started joint research with Juntendo University

• Together with Juntendo University and sponsor companies such as Japan IBM, started research on prevention, early detection, diagnosis, and treatment of dementia and degenerative neurological disorders

◆ Principal Companies

Company	Ownership	Main Business
Ratio *
MUL	-	Medical equipment lease
(Healthcare Business Department)	and medical fee factoring
Japan Medical Lease	100%	Medical equipment and real
estate lease
		Support service for
MUL Healthcare	100%	installment of medical
equipment and medical
		institution consulting
Healthcare Management Partners	66%	Healthcare-related of asset
(HMP)	management business

• Performance of Overseas Infrastructure Investment Projects

Booking	Project Overview	Remarks
Party
	Submarine Power Transmission	In operation
	Business in Germany
	Wind Power Business in Ireland	In operation
	Water Supply Business in the UK	Investment
	complete
MUL	Offshore Wind Farm Project in the UK	Scheduled to start
	operating in 2022
	Power Distribution Project in the UK	Investment
	complete
	Distributed Solar Power Generation	In operation
	Project in the US
	Rail Infrastructure Initiative in the UK	In operation
		Scheduled for
	Optical Cable Initiative	completion at
		end-2019
	Railway Freight Car Maintenance and	In operation
JII	Lease Initiative in the UK
	Passenger railcar lease	Investment
	and maintenance initiative
	complete
	in the UK
	Toll Highway operating Company in	Investment
	India	complete

◆Principal Companies

Company	Ownership	Main Business
Ratio *
MUL		Infrastructure
-	investment,
(Infrastructure Business Department)
	PFI initiatives
Japan Infrastructure Initiative (JII)	47.6%	Infrastructure
investment

* Includes indirect holdings

10

• FY3/2020 2nd Quarter Results

• Divisional Updates
• FY3/2020 Forecasts

• Appendix

11

Forecasts for Financial Results of FY3/2020

					(billion yen)
		FY3/2020	YOY Change	YOY Change	FY3/2019
		(%)
1	Revenues	865.0	+0.7	+0.1%	864.2
2	Gross Profit	178.0	+19.6	+12.4%	158.3
3	Operating Income	87.0	+6.6	+8.2%	80.3
4	Recurring Income	94.0	+6.3	+7.3%	87.6
	Net Income Attributable
5	70.0	+1.2	+1.7%	68.7
to Owners of the Parent
6	Dividend per Share	¥25.00	+¥1.50	-	¥23.50
7	Payout Ratio	31.8%	+1.4P	-	30.4%
	* Above figures are FY3/2020 forecasts as of November 8, 2019		12
	* Exchange rate for the above forecasts is set at $1 = 110 yen

• FY3/2020 2nd Quarter Results

• Divisional Updates

• FY3/2020 Forecasts
• Appendix

13

New Transactions Volume

					(billion yen)
			FY3/2020	YOY Change	FY3/2019
	2Q	(%)	2Q
1	Leases	494.1	+19.7%	413.0
2		Finance Leases	279.3	+7.9%	258.8
3		Operating Leases	214.8	+39.4%	154.1
4	Installment Sales	40.5	-2.0%	41.3
5	Loans and Others	430.7	+29.0%	334.0
6		Factoring	173.9	+24.1%	140.1
7		Real Estate Finance	102.4	+115.9%	47.4
8		Others	154.3	+5.4%	146.4
9	Volume of All New Transactions	965.5	+22.5%	788.3
10	Domestic	619.6	+15.0%	538.9
11		Leases	293.2	+13.1%	259.3
12		Installment Sales	40.5	-2.0%	41.3
13		Loan and Others	285.8	+20.0%	238.2
14	Overseas	345.8	+38.6%	249.4
15		Customer Finance	184.3	+32.5%	139.0
16		Others	161.5	+46.3%	110.3
17	Volume of All New Transactions	965.5	+22.5%	788.3

14

Details of New Transactions Volume

by Transaction Type

							(billion yen)
		FY3/2020	YOY Change	YOY Change	FY3/2019
	2Q	(%)	2Q
	1	Leases	494.1	+81.1	+19.7%	413.0
	2		IT / Office Equipment	85.8	+15.3	+21.8%	70.4
	3		Industrial Machinery	47.8	-3.9	-7.6%	51.7
	4		Civil Eng. & Construction Machinery	17.3	-1.3	-7.3%	18.7
	5		Transportation Equipment	179.4	+57.2	+46.9%	122.2
	6		Medical Equipment	30.9	+4.4	+16.8%	26.4
	7		Commercial & Service Equipment	26.4	-9.4	-26.3%	35.8
	8		Others	106.2	+18.8	+21.5%	87.4
	9	Installment Sales	40.5	-0.8	-2.0%	41.3
	10		IT / Office Equipment	1.2	-0.0	-0.9%	1.2
	11		Industrial Machinery	6.1	+0.9	+19.4%	5.1
	12		Civil Eng. & Construction Machinery	13.9	-2.1	-13.5%	16.1
	13		Transportation Equipment	2.0	-0.5	-22.0%	2.5
	14		Medical Equipment	5.3	+0.9	+21.8%	4.4
	15		Commercial & Service Equipment	4.8	+0.0	+0.5%	4.8
	16		Others	6.8	-0.0	-0.7%	6.8
	17	Loans and Others	430.7	+96.7	+29.0%	334.0
	18		Factoring	173.9	+33.8	+24.1%	140.1
	19		Real Estate Finance	102.4	+55.0	+115.9%	47.4
	20		Others	154.3	+7.9	+5.4%	146.4
	21	Volume of All New Transactions	965.5	+177.1	+22.5%	788.3

15

Operating Assets

									(billion yen)
				FY3/2016	FY3/2017	FY3/2018	FY3/2019	FY3/2020	Change from
		2Q	FY3/2019 (%)
	1	Leases	3,040.8	3,272.0	3,269.6	3,473.8	3,501.6	+0.8%
	2		Finance Leases	1,480.3	1,514.7	1,543.9	1,579.8	1,584.8	+0.3%
	3		Operating Leases	1,560.4	1,757.2	1,725.7	1,893.9	1,916.7	+1.2%
	4	Installment Sales	245.8	252.9	255.5	249.5	220.5	-11.6%
	5	Loans and Others	1,339.7	1,351.6	1,384.0	1,323.1	1,346.1	+1.7%
	6	Total Operating Assets	4,626.4	4,876.5	4,909.2	5,046.4	5,068.4	+0.4%
	7	Domestic	3,147.4	3,208.5	3,260.1	3,134.0	3,127.4	-0.2%
	8		Leases	1,814.5	1,855.9	1,852.1	1,902.5	1,901.4	-0.1%
	9		Installment Sales	245.8	252.9	255.5	249.5	220.5	-11.6%
	10		Loans and Others	1,086.9	1,099.6	1,152.5	982.0	1,005.3	+2.4%
	11	Overseas	1,479.0	1,668.0	1,649.0	1,912.3	1,940.9	+1.5%
	12		Customer Finance	226.5	258.1	310.2	427.6	430.4	+0.6%
	13		Others	1,252.5	1,409.9	1,338.8	1,484.7	1,510.5	+1.7%
	14	Total Operating Assets	4,626.4	4,876.5	4,909.2	5,046.4	5,068.4	+0.4%

16

Credit Cost

	FY3/2016	FY3/2017	FY3/2018	FY3/2019
1	MUL	2.6	-2.9	-0.0	-1.8
2	Domestic Subsidiaries	2.3	0.4	1.5	0.9
3	Overseas Subsidiaries	4.5	2.1	0.9	2.1
4	Total Net Credit Cost	9.4	-0.4	2.4	1.1
5	Real Estate Sector	2.9	-0.6	0.7	-1.2
6	Manufacturing Sector	-0.1	-0.1	0.4	1.3
7	Transportation Sector	3.1	1.6	0.7	-1.0
8	Others*	3.5	-1.3	0.6	2.0
9	Total Net Credit Cost	9.4	-0.4	2.4	1.1

		(billion yen)
FY3/2019	FY3/2020		YOY
2Q	2Q		Change
0.1	0.7		+0.5
-0.0	0.2		+0.2
0.5	1.7		+1.1
0.7	2.7		+1.9

-0.3	0.0	+0.2
0.4	0.8	+0.3
-0.4	0.0	+0.5
1.0	1.8	+0.8
0.7	2.7	+1.9

* Includes general credit costs calculated based on the historical rate of credit loss and ENGS credit costs

17

Funding Structure

									(billion yen)
				FY3/2016	FY3/2017	FY3/2018	FY3/2019	FY3/2020	Change from
				2Q	FY3/2019 (%)
	1	Borrowing	2,169.4	2,395.1	2,444.7	2,492.0	2,553.4	+2.5%
	2		Yen	1,418.9	1,449.4	1,470.6	1,352.2	1,297.6	-4.0%
	3		Foreign Currency	750.4	945.7	974.1	1,139.8	1,255.8	+10.2%
	4	CP (Commercial Paper)	853.6	835.9	807.4	742.2	746.1	+0.5%
	5	Securitization	168.8	137.4	165.8	145.8	135.7	-6.9%
	6	Corporate Bonds	716.8	773.5	833.7	1,060.3	1,071.3	+1.0%
	7		Yen	385.0	452.0	496.0	583.5	652.3	+11.8%
	8		Foreign Currency	331.8	321.5	337.7	476.8	419.0	-12.1%
	9	Total Funding	3,908.7	4,142.0	4,251.7	4,440.3	4,506.5	+1.5%
	10	Direct Funding Ratio *1	44.5%	42.2%	42.5%	43.9%	43.3%	-0.6P
	11	Foreign Currency Funding Ratio *2	27.7%	30.6%	30.9%	37.0%	37.7%	+0.7P

*1	CPs, securitization and corporate bonds as a proportion of total funding	18
*2	Foreign-currency loans and CBs as a proportion of total funding

Financial Performance -

Profit & Loss Statement (1)

						(million yen)
* The bottom percentage figures with P (point)	FY3/2016 2Q	FY3/2017 2Q	FY3/2018 2Q	FY3/2019 2Q	FY3/2020 2Q
show year-on-year percentage change	15/4~15/9	16/4~16/9	17/4~17/9	18/4~18/9	19/4~19/9
1	Revenues	403,832	403,766	433,510	420,254	468,720
+9.7%	-0.0%	+7.4%	-3.1%	+11.5%
2	Leases	332,186	331,537	354,996	343,376	380,228
+11.2%	-0.2%	+7.1%	-3.3%	+10.7%
3	Installment Sales	42,060	46,017	47,185	45,462	39,336
-0.5%	+9.4%	+2.5%	-3.7%	-13.5%
4	Loans	17,249	16,699	17,282	14,128	20,200
-0.8%	-3.2%	+3.5%	-18.2%	+43.0%
5	Others *	12,335	9,513	14,047	17,287	28,955
+28.1%	-22.9%	+47.7%	+23.1%	+67.5%
6	Cost of Revenues	323,759	328,257	354,339	344,032	370,966
+6.7%	+1.4%	+7.9%	-2.9%	+7.8%
7	COR / Revenues	80.2%	81.3%	81.7%	81.9%	79.1%
(Cost of goods sold ratio)	-2.2P	+1.1P	+0.4P	+0.2P	-2.8P
8	Leases, COR	261,306	264,033	283,255	270,057	292,766
+6.3%	+1.0%	+7.3%	-4.7%	+8.4%
9	Installment Sales, COR	38,732	42,775	44,000	42,304	36,557
+0.2%	+10.4%	+2.9%	-3.9%	-13.6%
10	Financial Expenses	19,199	17,146	21,071	22,553	29,125
+45.2%	-10.7%	+22.9%	+7.0%	+29.1%
11	Others, COR *	4,520	4,302	6,011	9,117	12,517
-19.2%	-4.8%	+39.7%	+51.7%	+37.3%
12	Gross Profit	80,072	75,508	79,171	76,221	97,754
+23.7%	-5.7%	+4.9%	-3.7%	+28.2%
13	Gross Profit/Revenues	19.8%	18.7%	18.3%	18.1%	20.9%
(Gross profit margin)	+2.2P	-1.1P	-0.4P	-0.2P	+2.8P

* Includes purchase and sales of used machinery, dividends from real estate investment and	19
sales of electric power

Financial Performance -

Profit & Loss Statement (2)

						(million yen)
* The bottom percentage figures with P (point)	FY3/2016 2Q	FY3/2017 2Q	FY3/2018 2Q	FY3/2019 2Q	FY3/2020 2Q
show year-on-year percentage change	15/4~15/9	16/4~16/9	17/4~17/9	18/4~18/9	19/4~19/9
14	Number of Employees	2,825	2,938	3,102	3,010	3,230
15	GP per Employee	56.7	51.4	51.0	50.6	60.5
+15.1%	-9.3%	-0.7%	-0.8%	+19.5%
16	SG&A Expenses	34,649	33,304	36,092	37,125	43,353
+14.7%	-3.9%	+8.4%	+2.9%	+16.8%
17	Personnel Expenses	15,867	16,436	17,843	18,089	20,395
+16.8%	+3.6%	+8.6%	+1.4%	+12.7%
18	Non-Personnel	17,405	16,313	17,567	17,467	19,875
Expense	+13.2%	-6.3%	+7.7%	-0.6%	+13.8%
19	Allowance	1,375	554	681	1,567	3,081
+11.5%	-59.7%	+22.7%	+130.2%	+96.5%
20	Overhead Ratio	41.6%	43.4%	44.7%	46.7%	41.2%
(Overhead expenses divided by GP)	-3.2P	+1.8P	+1.4P	+2.0P	-5.5P
21	Operating Income	45,423	42,204	43,078	39,096	54,401
+31.6%	-7.1%	+2.1%	-9.2%	+39.1%
22	Operating Income / Revenue	11.2%	10.5%	9.9%	9.3%	11.6%
(Operating Income Margin)	+1.8P	-0.7P	-0.6P	-0.6P	+2.3P
23	Recurring Income	47,961	44,327	47,012	41,963	55,343
+28.4%	-7.6%	+6.1%	-10.7%	+31.9%
24	Extraordinary Income	98	3,122	2,673	6,937	1,128
-87.8%	+3,068.9%	-14.4%	+159.5%	-83.7%
25	Extraordinary Loss	-	10	20	855	0
-	-	+106.3%	+3,983.3%	-
26	Net Income Attributable to	28,930	29,173	31,682	32,757	38,278
Owners of the Parent	+28.4%	+0.8%	+8.6%	+3.4%	+16.9%
						20

Financial Performance - Balance Sheet (1)

* The bottom percentage figures with P (point)					(million yen)
show year-on-year percentage change from	FY3/2016	FY3/2017	FY3/2018	FY3/2019	FY3/2020 2Q
the end of the previous fiscal year
1	Total Equity	642,366	686,378	731,124	778,582	778,144
+3.4%	+6.9%	+6.5%	+6.5%	-0.1%
2	Total Assets	5,121,253	5,388,844	5,552,712	5,790,929	5,848,379
+1.7%	+5.2%	+3.0%	+4.3%	+1.0%
3	Operating Assets	4,626,455	4,876,553	4,909,279	5,046,490	5,068,424
+1.9%	+5.4%	+0.7%	+2.8%	+0.4%
4	Leases	3,040,849	3,272,018	3,269,679	3,473,810	3,501,669
+3.9%	+7.6%	-0.1%	+6.2%	+0.8%
5	Installment Sales	245,882	252,907	255,553	249,500	220,595
+5.1%	+2.9%	+1.0%	-2.4%	-11.6%
6	Loans	1,241,831	1,245,555	1,233,218	1,114,470	1,115,281
-1.3%	+0.3%	-1.0%	-9.6%	+0.1%
7	Others	97,892	106,072	150,827	208,708	230,878
-20.7%	+8.4%	+42.2%	+38.4%	+10.6%
8	Impaired Assets	27,921	34,144	34,892	27,286	28,056
-16.5%	+22.3%	+2.2%	-21.8%	+2.8%
9	Allowance	16,302	16,365	15,658	15,103	16,954
10	Net Balance of	11,618	17,779	19,234	12,183	11,102
Impaired Assets	-39.8%	+53.0%	+8.2%	-36.7%	-8.9%
						21

Financial Performance - Balance Sheet (2)

* The bottom percentage figures with P (point)					(million yen)
show year-on-year percentage change from	FY3/2016	FY3/2017	FY3/2018	FY3/2019	FY3/2020 2Q
the end of the previous fiscal year
11	Equity Ratio	12.0%	12.2%	12.7%	13.0%	12.9%
+0.2P	+0.2P	+0.5P	+0.3P	-0.1P
12	ROE	9.0%	8.4%	9.3%	9.4%	-
+1.0P	-0.6P	+0.9P	+0.1P	-
13	ROA	1.1%	1.0%	1.2%	1.2%	-
+0.2P	-0.1P	+0.2P	+0.0P	-
14	Total Funding	3,908,736	4,142,073	4,251,769	4,440,352	4,506,597
0.0%	+6.0%	+2.6%	+4.4%	+1.5%
15	Indirect Funding	2,169,456	2,395,158	2,444,766	2,492,008	2,553,431
-2.2%	+10.4%	+2.1%	+1.9%	+2.5%
16	Direct Funding	1,739,279	1,746,914	1,807,002	1,948,344	1,953,165
+2.8%	+0.4%	+3.4%	+7.8%	+0.2%
17	CP	853,600	835,900	807,400	742,200	746,100
+2.8%	-2.1%	-3.4%	-8.1%	+0.5%
18	Securitization	168,869	137,484	165,897	145,842	135,716
(Lease Receivables)	-2.7%	-18.6%	+20.7%	-12.1%	-6.9%
19	Corporate Bonds	716,809	773,530	833,705	1,060,302	1,071,349
+4.1%	+7.9%	+7.8%	+27.2%	+1.0%
20	Direct Funding Ratio	44.5%	42.2%	42.5%	43.9%	43.3%
+1.2P	-2.3P	+0.3P	+1.4P	-0.6P
						22

Overview of

Principal Consolidated Companies (1)

(million yen)

FY3/2020

2Q

Revenues

Gross Profit

Operating Income

Recurring Income

Net Income

Mitsubishi UFJ Lease & Finance	Japan Medical Lease	DFL Lease
MUL's Share: 100%	MUL's Share: 80%
(Parent)
【Healthcare Business Division】	【Domestic customers】
Amount	YOY Change	Amount	YOY Change	Amount	YOY Change
240,639	+3.5%	18,381	-0.7%	11,134	+0.6%
35,155	+9.5%	1,550	+0.6%	1,007	+8.8%
16,179	+15.6%	447	-31.9%	520	+22.1%
17,850	-2.8%	486	-32.1%	526	+19.3%
14,266	-21.3%	312	-32.8%	355	+12.9%

FY3/2020	Amount	Change from	Amount	Change from	Amount	Change from
2Q	FY3/2019	FY3/2019	FY3/2019
Operating Assets	3,099,504	-0.1%	106,383	+5.8%	66,690	-0.9%
Total Assets	4,200,603	-0.9%	109,392	+6.2%	68,586	-0.5%
Total Equity	503,811	+1.3%	15,335	+0.6%	14,998	+2.4%

							(million yen)
	Hirogin Lease	Shutoken Leasing		DRS
FY3/2020	MUL's Share：80%	MUL's Share: 71%	MUL's Share: 100%
2Q	【Domestic customers】	【Domestic customers】	【Domestic customers】
	Amount	YOY Change	Amount	YOY Change	Amount		YOY Change
Revenues	10,190	-5.9%	16,168	+0.4%	13,075		+1.0%
Gross Profit	1,121	-8.8%	1,760	-7.4%	1,383		-0.7%
Operating Income	518	-15.0%	600	-33.9%	483		-7.6%
Recurring Income	542	-24.3%	636	-34.6%	482		-8.3%
Net Income	372	-28.9%	439	-34.5%	331		-8.7%
FY3/2020	Amount	Change from	Amount	Change from	Amount		Change from
2Q	FY3/2019	FY3/2019		FY3/2019
Operating Assets	70,529	+4.3%	156,789	+3.5%	57,769		+11.0%
Total Assets	73,318	+4.5%	162,539	+2.5%	61,145		+11.8%
Total Equity	14,547	+2.5%	19,240	+2.0%	7,489		+1.9%
						23

Overview of

Principal Consolidated Companies (2)

						(million yen)
	Diamond Asset Finance	Miyuki Building	MUL Property
FY3/2020	MUL's Share: 100%	MUL's Share: 98%	MUL's Share: 100%
2Q	【Real Estate Business Division】	【Real Estate Business Division】	【Real Estate Business Division】
	Amount	YOY Change	Amount	YOY Change	Amount	YOY Change
Revenues	7,602	+85.1%	7,764	+104.4%	17,165	+49.5%
Gross Profit	3,197	+30.7%	3,433	+60.2%	3,238	+30.8%
Operating Income	2,368	+53.4%	3,071	+65.5%	2,580	+43.1%
Recurring Income	2,459	+54.1%	2,988	+76.1%	2,609	+42.4%
Net Income	1,709	+55.1%	1,959	+75.8%	1,810	+43.8%
FY3/2020	Amount	Change from	Amount	Change from	Amount	Change from
2Q	FY3/2019	FY3/2019	FY3/2019
Operating Assets	244,604	+4.6%	72,242	+6.3%	175,696	+18.9%
Total Assets	246,786	+4.5%	74,052	+5.3%	244,758	+15.2%
Total Equity	35,616	+3.3%	32,164	+6.3%	17,030	+6.4%

24

Inquiries

• Inquiries

Corporate Communications Department

TEL [phone]

• Websitehttps://www.lf.mufg.jp/english/

25

This presentation contains forward-looking statements regarding estimations, forecasts, targets and plans in relation to the results of operations, financial conditions and other overall management of MUL and/or its group companies (collectively, the "Group"). These forward-looking statements are inherently subject to a number of

risks and uncertainties that could cause the Group's actual results, performance, achievements, financial

position etc. to differ materially from the information expressed or implied by these forward-looking statements, which is based on assumptions and beliefs in light of information currently available to the management of MUL at the time of publication. Accordingly, due to various risks and uncertainties, the statements are not a guarantee of future performance or developments.

We may not be successful in implementing our business strategy, and management may fail to achieve its targets for a wide range of possible reasons.

The Amount less than one unit is omitted in this presentation, which may cause fraction error in the total amount. MUL undertakes no obligation to update or correct any forward-looking statements after the date of this presentation.

The information set forth in this presentation is subject to change without notice.

This presentation is not intended to solicit, offer, sell or market securities in any jurisdiction, and should not be the sole basis for making investment and other decisions.

The reader is cautioned not to place undue reliance on forward-looking statements.