(Translation for reference only)

November 10, 2022

Consolidated Financial Results for the Second Quarter of Fiscal Year 2022

For the Six Months Ended September 30, 2022

(Under Japanese GAAP)

Company name:

AIFUL Corporation

Stock Listing:

Tokyo Stock Exchange

Stock Code:

8515

URL:

https://www.aiful.co.jp

Representative:

Mitsuhide Fukuda, President and Chief Executive Officer

For inquiry:

Toshiaki Ando, Assistant Senior General Manager of Finance Division TEL (03) 4503 - 6050

Scheduled date of submission of Quarterly Securities Report: November 11, 2022

Scheduled date of commencement of dividend payments : －

Supplementary materials for Quarterly Financial results: Yes

Quarterly earnings release conference: Yes

I. Consolidated Financial Results for the Second Quarter of Fiscal Year 2022

(April 1, 2022 - September 30, 2022)

(Amounts less than one million yen have been rounded down)

1. Consolidated Operating Results

(Millions of

yen, Percentages indicate

year-on-year changes)

Operating Revenue

Operating Profit

Ordinary Profit

Profit Attributable to

Owners of Parent

Six months ended

September 30, 2022

70,402

8.6%

12,150

22.4%

12,642

28.3%

11,772

17.2%

September 30, 2021

64,837

2.2%

9,930

5.9%

9,856

(5.0)%

10,042

2.3%

Note:

Comprehensive income: For the six months ended

September 30, 2022

12,732 million yen

27.8%

September 30, 2021

9,959 million yen

(0.3)%

Net Income per Share

Diluted Net Income per

(Yen)

Share (Yen)

Six months ended

September 30, 2022

24.34

-

September 30, 2021

20.76

-

2. Consolidated Financial Position

Total Assets

Net Assets

Shareholders' Equity

Ratio (%)

As of

September 30, 2022

1,000,412

168,775

16.5

March 31, 2022

935,642

156,526

16.4

Reference:

Shareholders' equity:

As of September 30, 2022

165,403 million yen

As of March 31, 2022

153,900 million yen

II. Dividend Information

Dividend per share (Yen)

End of

End of

End of

Year-end

Annual

1st quarter

2nd quarter

3rd quarter

FY ended March 31, 2022

-

0.00

-

1.00

1.00

FY ending March 31, 2023

-

0.00

FY ending March 31, 2023

-

1.00

1.00

(Forecast)

Note: Revisions to dividend forecasts: None

  1. Earnings Forecast on a Consolidated Basis for the Fiscal Year ending March 31, 2023
    (April 1, 2022 - March 31, 2023)

(Millions of yen, Percentages indicate year-on-year changes)

Operating Revenue

Operating Profit

Ordinary Profit

Profit Attributable to

Profit per

Owners of Parent

Share (Yen)

Fiscal year ending

144,800

9.6%

23,800

111.7%

24,000

95.7%

21,300

72.7%

44.04

March 31, 2023

Note: Revisions to consolidated earnings forecasts: Yes

IV. Other

  1. Changes in significant subsidiaries during the six months ended September 30, 2022 (Changes in specified subsidiaries resulting changes in scope of consolidation): None
  2. Adoption of special accounting methods for quarterly consolidated financial statements: None
  3. Changes in accounting policies, accounting estimates and restatements
    1. Changes in accompanying amendments to accounting standards: None
    2. Changes other than those in (a): None
    3. Change in accounting estimates: Yes
    4. Restatements: None
  5. Number of shares issued (Common stock)

(a) Number of shares issued at the end of the period

FY2022 2Q

484,620,136

shares

FY2021

484,620,136 shares

(including treasury stock)

(b) Number of treasury stock at the end of the period

FY2022 2Q

917,594

shares

FY2021

917,470 shares

(c) Average number of shares during the period

FY2022 2Q

483,702,645

shares

FY2021 2Q

483,702,666 shares

* Note: Brief Statement of quarterly financial results is not subject to audit procedures that are conducted by a certified public accountant or an audit corporation.

* Note: Disclaimer concerning the proper use of business results forecasts, etc.

The forecasts and other forward-looking statements contained in this Report are based on information currently available to the Company as well as certain assumptions that the AIFUL Group has judged to be reasonable. Accordingly, actual results may differ from the forecasts due to various factors. For matters related to earnings forecast above, please refer to "Qualitative Information on the Forecasts for the Consolidated Business Results" on page 3.

Contents

1. Quarterly Qualitative Information on Business Results……..…………………….………………………………

2

(1) Qualitative Information on Business Results………….…………………………..…………………...………

2

(2) Qualitative Information on the Forecasts for the Consolidated Business Results…………………………..…

2

2. Quarterly Consolidated Financial Statements and Notes…………………………………………………….........

3

(1) Quarterly Consolidated Balance Sheets…………….………………………………………………………….

3

(2) Quarterly Consolidated Statements of Income and

Consolidated Statements of Comprehensive Income…………………………………………………….……

4

(3) Quarterly Consolidated Statements of Cash Flows…………..…………………………………………….......

6

(4) Notes to Quarterly Consolidated Financial Statements ………………………….………………………........

7

(Notes on Premise of Going Concern) …….…………………………………………………………………..

7

(Changes in Scope of Consolidation) ……………………………………………………………………

7

(Changes in Accounting Estimates) ....………………………………………………………………...……..

7

(Notes in Case of any Significant Changes in the Amount Shareholders' Equity) ……………….…………..

7

(Additional Information).…………....………………………………………………………………...……..

8

1

1. Quarterly Qualitative Information on Business Results

  1. Qualitative Information on Business Results

In the first 2 quarters of the fiscal year under review, the Japanese economy showed signs of recovery in socio-economic activities due to the relaxation of activity restrictions on the infectious diseases of the new Corona Virus. However, the outlook remains uncertain due to concerns over an economic slowdown stemming from rising prices, including energy and soaring raw material prices, against the backdrop of the worsening situation in Ukraine and the ongoing depreciation of the yen.

The consumer finance industry's recovery trend continued as the number of new contracts at major companies increased year- on-year. Although interest repayment claims have been steadily decreasing, it still requires close monitoring as it is easily affected by changes in the external environment.

Under these circumstances, in order to realize AIFUL Group's management theme "Go (new) Standard -Deepening Customer Orientation-", the Company will focus on "diversification of business portfolio" through business diversification and strengthening overseas businesses, etc., and "utilization of digital technologies," such as IT technology analysis and in-house production of systems. At the same time, we will strive to expand assets by balancing "growth potential" and "profitability" and optimize management resources to maximize consolidated income, while responding to requests for interest repayment, which is one of our management issues.

For more than 50 years since its foundation, the AIFUL Group has used the Heart mark as a corporate symbol that symbolizes a sense of security and integrity. To upgrade to an image that is appropriate for a corporate stance of providing new value for the future in anticipation of the next 50 or 100 years, we revamped our VI (visual identity) and began using the new Art symbol and the Company logo on July 7, 2022.

(Overview of the results)

AIFUL Group's consolidated operating revenue for the second quarter of the fiscal year ending March 31, 2023 (up 8.6% year on year), to 70,402 million yen. The principal components were 40,862 million yen in interest on loans (up 8.9% year on year), 9,915 million yen in revenue from the credit card business (up 10.5% year on year) and 8,201 million yen in revenue from the credit guarantee business (up 5.5% year on year). Operating expenses increased by 3,344 million yen, or 6.1% year on year to 58,251 million yen. This was mainly due to an increase in advertising expenses by 2,069 million (up 38.9% year on year).

As a result, AIFUL Group posted operating profit of 12,150 million yen (up 22.4% year on year) and ordinary profit of 12,642 million yen (up 28.3% year on year). Profit attributable to owners of parent stood at 11,772 million yen (up 17.2% year on year), reflecting a profit attributable to non-controlling interests of 402 million yen.

(2) Qualitative Information on the Forecasts for the Consolidated Business Results

In the fiscal year ending March 31, 2023, AIFUL Group expects operating revenue to be 144,800 million yen (up 9.6% year on year), operating profit to be 23,800 million yen (up 111.7% year on year), ordinary profit to be 24,000 million yen (up 95.7% year on year), and profit attributable to owners of parent to be 21,300 million yen (up 72.7% year on year), in light of the business results in the current second quarter, on a consolidated basis.

This earnings forecast is based on the data available as of the date of publication of this document, and the current The Company is included in this forecast. There are various risks involved in the operating environment, and the final results may differ from the forecasts.

2

2. Quarterly Consolidated Financial Statements and Notes

  1. Quarterly Consolidated Balance Sheets

(Millions of yen)

As of March 31, 2022

As of September 30, 2022

Assets

Current assets

Cash and deposits

44,448

54,207

Operating loans

547,457

578,483

Accounts receivables - installment

110,224

120,248

Operational investment securities

2,312

2,511

Customers' liabilities for acceptances and guarantees

193,225

205,064

Other operating receivables

10,241

11,441

Purchased receivables

5,338

6,581

Other

25,440

27,560

Allowance for doubtful accounts

(57,906)

(59,697)

Total current assets

880,801

946,401

Non-current assets

Property, plant and equipment

16,908

16,676

Intangible assets

6,737

6,989

Investments and other assets

31,195

30,344

Total non-current assets

54,841

54,010

Total assets

935,642

1,000,412,

Liabilities

Current liabilities

Notes & accounts payable-trade

40,919

37,090

Acceptances and guarantees

193,225

205,064

Short-term borrowings

77,310

73,898

Short-term loans payable to subsidiaries and associates

1,533

1,482

Commercial papers

2,500

－

Current portion of bonds

35,000

20,000

Current portion of long-term borrowings

166,786

171,718

Income taxes payable

860

1,756

Reserves

1,377

1,473

Other

29,745

30,934

Total current liabilities

549,257

543,419

Non-current liabilities

Bonds payable

－

30,000

Long-term borrowings

197,271

230,680

Provision for loss on interest repayment

24,595

20,605

Other

7,993

6,930

Total non-current liabilities

229,859

288,216

Total liabilities

779,116

831,636

Net Assets

Shareholders' equity

Capital stock

94,028

94,028

Capital surplus

14,017

14,017

Retained earnings

47,560

58,849

Treasury shares

(3,110)

(3,110)

Total shareholders' equity

152,495

163,784

Accumulated other comprehensive income

Valuation difference on available-for-sale securities

1,098

972

Foreign currency translation adjustment

306

646

Total accumulated other comprehensive income

1,404

1,619

Non-controlling interests

2,626

3,371

Total net assets

156,526

168,775

Total liabilities and net assets

935,642

1,000,412

3

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aiful Corporation published this content on 10 November 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 November 2022 02:46:05 UTC.