East Japan Railway : Consolidated Financial Results

Consolidated Financial Results for the Three-Month Period Ended June 30, 2021 (Japanese GAAP) (Unaudited)

Fiscal 2022 (Year ending March 31, 2022)

"First Quarter" means the three months from April 1 to June 30.

All financial information has been prepared in accordance with accounting principles generally accepted in Japan.

"JR East" refers to East Japan Railway Company on a consolidated basis, or if the context so requires, on a non-consolidated basis. English translation from the original Japanese-language document.

July 30, 2021

East Japan Railway Company

Stock Exchange Listing	Tokyo
Securities Code	9020
URL	https://www.jreast.co.jp/e
Representative	Yuji Fukasawa, President and CEO
Contact Person	Dan Tsuchizawa, General Manager,
	Public Relations Department
	(Tel. [phone])
Scheduled Date for Release of a Quarterly Report	August 5, 2021
Scheduled Date of Dividend Payment Commencement	Not applicable

Preparation of Supplementary Explanations of Quarterly Financial Results: No

Quarterly Financial Results Presentation to Be Held: No

1. Consolidated Results for the Three-Month Period Ended June 30, 2021 (April 1, 2021－June 30, 2021)

(Amounts less than one million yen, except for per share amounts, are omitted.)

(1) Consolidated financial results

(Percentages represent percentage changes as compared with the corresponding period in the previous fiscal year.)

	Operating revenues	Operating income	Ordinary income	Profit attributable to
	owners of parent
	Millions of yen	%	Millions of yen	%	Millions of yen	%	Millions of yen	%
Fiscal 2022, 1st Quarter	433,398	30.2	(55,255)	-	(65,412)	-	(76,958)	-
Fiscal 2021, 1st Quarter	332,946	(55.2)	(178,306)	-	(197,506)	-	(155,377)	-

Note: Comprehensive income - Fiscal 2022, 1st Quarter: (80,611) million yen (－%), Fiscal 2021, 1st Quarter: (156,749) million yen (－%)

			Earnings per share	Earnings per share
			-Basic	-Diluted
			Yen	Yen
	Fiscal 2022, 1st Quarter	(204.00)		－
	Fiscal 2021, 1st Quarter		(411.88)		－
(2) Consolidated financial position
			Total assets	Net assets		Equity ratio
			Millions of yen	Millions of yen		%
	Fiscal 2022, 1st Quarter	8,904,322		2,457,089		27.3
	Fiscal 2021	8,916,420		2,557,361		28.4

Reference: Shareholders' equity - Fiscal 2022, 1st Quarter: 2,434,522 million yen, Fiscal 2021: 2,535,027 million yen

2. Dividends (Year Ended March 31, 2021 and Year Ending March 31, 2022)

Annual dividends

1st quarter end

2nd quarter end

3rd quarter end

Year end

Total

Yen

Yen

Yen

Yen

Yen

Fiscal 2021

－

50.00

－

50.00

100.00

Fiscal 2022

－

(Forecast) Fiscal 2022

50.00

－

50.00

100.00

Note: Revisions to the most recently disclosed dividend forecasts: No

3. Forecasts for Fiscal 2022 (Year Ending March 31, 2022)

(Percentages represent percentage changes as compared with the corresponding period in the previous fiscal year.)

								Profit attributable to	Earnings
	Operating revenues	Operating income	Ordinary income	per share－
	owners of parent
								Basic
	Millions of yen	%	Millions of yen	%		Millions of yen	%	Millions of yen	%	Yen
Six-month period ending	1,083,000	37.6	1,000	－	(28,000)	－	(52,000)	－	(137.84)
September 30, 2021
Fiscal 2022	2,326,000	31.8	74,000	－		25,000	－	36,000	－	95.43
Note: Revisions to the most recently disclosed earnings forecasts: No

• Notes

1. Changes to principal subsidiaries during the period (status changes of specified subsidiaries due to changes in the scope of consolidation): No
   Newly consolidated － excluded －
2. Application of special accounting treatment in preparing the quarterly consolidated financial statements: No
3. Changes in accounting policies, changes in accounting estimates and restatement of revisions

i	Changes in accounting policies with revision of accounting standards	:	Yes
ii	Changes in accounting policies other than the above	:	No
iii	Changes in accounting estimates	:	No
iv	Restatement of revisions	:	No

Note: For details, please refer to "Changes in Accounting Policies, Changes in Accounting Estimates and Restatement of Revisions" on page 5 in the Attachments.

(4) Number of issued shares (common stock)

• Issued shares at period-end (including treasury stock)

1. Treasury stock at period-end
2. Average number of shares during period

1st Quarter,	377,932,400 shares	Fiscal 2021	377,932,400 shares
Fiscal 2022
1st Quarter,	692,376 shares	Fiscal 2021	692,286 shares
Fiscal 2022
1st Quarter,	377,240,121 shares	1st Quarter,	377,241,147 shares
Fiscal 2022	Fiscal 2021

• The quarterly financial results are not subject to quarterly review procedures by certified public accountants or audit corporations.
• Explanation of appropriate use of forecasts of business results; other important items

The forecasts of business results and other forward-looking statements in this document are based on information available as of the date of this document and on certain assumptions that JR East viewed as reasonable as of the date of this document. Actual results may differ from such forward-looking statements for a variety of reasons. Regarding the forecasts of business results, please refer to "Qualitative Information on Consolidated Performance Outlook" on page 4 in the Attachments. Further, the non-consolidated performance outlook is on the next page.

(Reference)

Forecasts of the Non-consolidated Results for Fiscal 2022 (Year Ending March 31, 2022)

(Percentages represent percentage changes as compared with the corresponding period in the previous fiscal year.)

Earnings

Operating revenues Operating income Ordinary incomeProfit per share－

Basic

	Millions of yen	%	Millions of yen	%	Millions of yen	%	Millions of yen	%	Yen
Six-month period ending	775,000	43.3	(5,000)	－	(18,000)	－	(34,000)	－	(90.04)
September 30, 2021
Fiscal 2022	1,677,000	41.6	37,000	－	0	－	25,000	－	66.21

Note: Revisions to the most recently disclosed earnings forecasts: No

Contents of Attachments
1. Qualitative Information on Quarterly Consolidated Financial Performance ..............	2
(1)	Qualitative Information on Consolidated Operating Results ....................................................................	2
(2)	Qualitative Information on Consolidated Performance Outlook ...............................................................	4
2. Matters Concerning Summary Information (Notes) ...................................................	5
(1)	Changes in Accounting Policies, Changes in Accounting Estimates and Restatement of Revisions .....	5
3. Quarterly Consolidated Financial Statements and Main Notes..............................	6
(1)	Consolidated Balance Sheets (Unaudited) ..............................................................................................	6
(2)	Consolidated Statements of Income and Comprehensive Income (Unaudited) ......................................	8
(3)	Notes to Quarterly Consolidated Financial Statements (Unaudited) .....................................................	10
	(Notes on Going Concern Assumption (Unaudited))............................................................................	10
	(Segment Information (Unaudited))......................................................................................................	10
	(Notes on Significant Changes in the Value of Shareholders' Equity (Unaudited)) .............................	11
	(Significant Subsequent Events (Unaudited)) ......................................................................................	11
	(Additional Information (Unaudited)) ....................................................................................................	11
(Additional Information Regarding Operating Results) ................................................	13

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1. Qualitative Information on Quarterly Consolidated Financial Performance

(Unless otherwise stated, all comparisons are between the three months from April 1, 2021, to June 30, 2021, and the three months from April 1, 2020, to June 30, 2020.)

1. Qualitative Information on Consolidated Operating Results

Following the September 2020 announcement of Speed Up "Move Up" 2027, a policy tailored to the post-COVID-19 society, the Group has continued to position safety at the top of its management priority while working to enhance profitability, strengthen management foundation fundamentally, and implement ESG management. Through such means, the Group has expedited its progress toward the achievement of its "Move Up" 2027 management vision.

As a result, during the first quarter, operating revenues increased 30.2%, to ¥433.3 billion, due mainly to revenue increases in the Transportation, Retail & Services, and Real Estate & Hotels segments, which were attributable to the recovery from decreased sales impacted by the spread of COVID-19 during the previous fiscal year. Following these increases in operating revenues, we recorded operating loss of ¥55.2 billion (operating loss of ¥178.3 billion in the first quarter of fiscal 2021), ordinary loss of ¥65.4 billion (ordinary loss of ¥197.5 billion in the first quarter of fiscal 2021), and loss attributable to owners of parent of ¥76.9 billion (loss attributable to owners of parent of ¥155.3 billion in the first quarter of fiscal 2021).

Overview

Safety is Our Top Priority

Based on the "Group Safety Plan 2023," the JR East Group united as one group toward the enhancement and innovation of "safety conduct" and "safety management" by each employee as well as the installation of safety equipment that actively leverages new technologies.

• Acceleration of seismic reinforcement of elevated concrete pillars along the railway tracks of the Shinkansen due to damages incurred from the February 2021 earthquake off the coast of Fukushima Prefecture
• Construction work between fiscal 2022 and fiscal 2024 at approximately 200 places on the Shinkansen lines along embankment, cutting, and natural slopes where a mudslide may occur as a result of record-breaking rainfalls and other factors

Enhancing Profitability

While the business environment surrounding the railway business becomes increasingly severe, we believe the diversification of lifestyles presents a significant opportunity for the Group. Accordingly, the Group reestablished its growth and innovation strategies, combined digital technologies with physical networks, an area of Group strength, and made efforts to propose new lifestyles and take on the challenge of entering new fields.

• Commencement of Shinkansen-based logistics services from regional areas to stores in the Tokyo metropolitan area in April 2021 for the Hakodate area and in May 2021 for the Hokuriku area
• Establishment of JR East Real Estate Asset Management Co., Ltd. in April 2021 to strengthen real estate business through the provision of asset management services

Fundamental Strengthening of Management Foundation

The Group forged ahead with its three reforms "operational reform," "working style reform," and "worksite reform" to enhance the job satisfaction of all Group employees, while further accelerating our digital transformation efforts, which include the use of new technology and the promotion of Smart Maintenance, to enhance productivity.

• Commencement of railway monitoring in April 2021 to determine the condition of wires and other equipment on 38 railway lines spanning roughly 5,800 km using images and data obtained from cameras installed on East-i
• Establishment of JR East Cross Station Co., Ltd. and merger of the subsidiaries JR East Retail Net Co., Ltd., JR East Foods Co., Ltd., JR East Water Business Co., Ltd. and Tetsudo Kaikan Co., Ltd. in April 2021 in order to maximize station value
• Commencement of COVID-19 vaccinations to employees in June 2021
• Preparations underway for the commencement in July 2021 of a moonlighting system at Group companies

Implementing ESG Management

The JR East Group established energy-saving facilities and promoted renewable energy developments in a bid to achieve net zero CO2 emissions across the Group by fiscal 2051. In addition, the Group engaged in co-creation activities with local communities aimed at revitalizing these regions, and made progress preparing for the Tokyo 2020 Olympic and Paralympic Games as an Official Partner (Passenger and Rail Transportation Services).

• Completion of replacement of Senju Power Station No. 2 unit of the Shinanogawa Power Station and commencement of operations in May 2021
• Completion of replacement of No. 1 unit at Kawasaki Thermal Power Station and commencement of operations in June 2021. The new generator is a highly efficient facility fueled by natural gas and reduces CO2 emissions
• Commencement of TOHOKU Destination Campaign in April 2021 for a duration of six months to promote enjoyable trips through the six prefectures of the Tohoku region
• Implementation of measures to enhance railway security during the Tokyo 2020 Olympic and Paralympic Games, such

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