IX - Earnings call transcript Q1 2023

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Operator

Good evening, ladies and gentlemen. Thank you for joining this telephone conference of ORIX Corporation for the first quarter consolidated financial results for the three months period ended June 30, 2022. The attendee of today's conference is the Executive Officer, Head of Treasury and Accounting Headquarters, Mr. Yano.

As we begin, we have a request to you, in order to prevent the feedback, please make sure that you either turn off your mobile phone and other mobile devices or keep them away from the phone. who feedback, of just to the touch the severe with the get experience feedback. with consent the the organizer, attendee we we wrap may meeting in If causing is in order

Now, Mr. a it be will us by presentation, Q&A. and followed will Yano provide with

last yours. start expect Mr. the We to Yano, whole We hour. the of duration one the is meeting. would meeting floor the approximately like to

Hitomaro Yano

today. very afternoon. This Yano, Hitomaro for Good us thank you much joining all is

without like March on results. So I'd first quarter, presentation ado, start the further to FY end 'XX

please the Now turn summary. to for Page executive X

So I'd go and each summary every executive like to point. through

segments As the last Australia where which income improving And to out declined including and for Aircraft billion passenger net Energy well. in and X.X%. translating Asia executed year. point, large annualized ¥XX.X the which the X% ROE demand year-over-year X Profit is of continues and first transactions XX Ships perform several to of Environment, to in growth

were declined Second, At infections. due related gains change increase a as payouts Investment PE down to in Europe the lower. decline Estate shrank the COVID ORIX markets. equity ORIX ORIX in Japan Life USA, business market saw negative AUM surge segments in Real were the due earnings to climate earnings Within in renewed in and in some year-on-year an to owing

a view Against rate backdrop, FRB including investments. U.S. will ORIX's quarter, uncertain hikes yen current future our business we conditions number asset a impairments on the non-performing not discuss have rapid increased. changing larger and loan depreciation. losses those for in area for the credit I contrary assets and indicators under of opportunities level and price and by ratio inquiries. this low environment, a increasing investments in Third, of has interest the receiving during economic moved portfolio Macro new at inflation, terms To global ORIX's first remained see this and dramatically market

We basis evaluating strong these approach a opportunities on seek decisions an on fourth balance individual we will our but to advantage investment The careful returns. sheet. proactively by focuses apply point of taking new shareholder to hope by each deal out

carried of billion the of end in in July, you. shareholder announced the billion of policy, report ORIX a May steady had at just out to buybacks ¥XX.X As ¥XX shareholders' return to execution showing

Now, additional comment third to made. have the I no be page

So a ¥XX.X year-over-year profits blue, investment billion. blue. shows our of bar side on go gains chart. breakdown steady Meanwhile, look way hand maintaining XX% for Segment are Q-on-Q Base at segment breakdown investment up gains ¥XX.X very all dark in were so the let right by and me investment is lower light profit. Base the year-over-year profit. investment profits Page shows the and base are This down the others. were gains billion billion. profits X. XX% profits in ¥XX.X for X% two ORIX USA page to segment This Meanwhile, to to Please of at years. last quarter gains

will plan we realize forward segment. earlier, I review gains commented briefly As to by going fiscal I year. now this performance

'XX result. As for are method expenses from note our interest has and a of costs some quarter SG&A first as a ORIX matter higher please that allocating changed FY costs Segment fact, March. SG&A

down continued in was are of but strong and the X% remained assets to for but market will and business car page. previous as a on segment note changed in reflect Corporate to these 'XX put profits ¥XX.X the are rose to flat, today that adjusted rental Corporate Services this the billion. segments Financial turn was year-over-year. healthy. if high earnings unit, from segment profits Please ¥XX.X used the slides. using March X. car stake its profits summary remained the to year-over-year we and rented Service Yayoi segment, of the recovery. skip Maintenance billion. The retroactively segment. equity were able the have valuation this Segment losses profits sold older post-COVID excluded. change. its which maintain profit fee fiscal and for and business turn unit FY figures income Please year-over-year XX% level past discuss But next segment page investee shows an X The the specific Please reason. segment to Page year, X Estate In Page Also have We Real profits was to years Leasing Financial up fiscal

In improved at addition other Profits facilities rates at to on leading investment occupancy DAIKYO the investments gains booked of inns and was sale in properties, operation. year-over-year. profits facilities to hotels, at higher flat and logistics

are business year fell booked our sales condo properties model develops the land condo purchases compared sale Although as of to unchanged Real own. on continued. cycle and rental were The Please remains gains next page. investment on the then as recycling depending sales sold properties. In the asset year-over-year to a on largely ORIX its asset prior assets of timing, and consideration. and size turn segment asset and leased the investments Estate new

in works domestic frequency year-over-year. unit electrical as an remains still complex. but the next profits Kobayashi roughly segment. essential housing associated to first steady Japan international new Please investment its in ORIX for the reduction the the page. with Concession and Works, an to investment of months numbers The red Investment Kako. company recovered are PE the flights concession XX and due and for made routes also PE performance unit turn with In increased is investees of PE the losses HEXEL of Next routes in Investment in low

business, the and the is Environment mega Insurance prices to higher overseas is which the In to segment. next In this declined sunny So weather. up led volumes to thanks in owing owing prices the for regions, and to energy solar the business volumes domestic energy Energy This higher power some generation power generation projects worldwide pushed earnings to power but soaring page. turn segment. Please seasonal factors, electricity earnings. grew

U.S. USA Page shrank. Earnings for in lines impact. the a losses billion. the product. previous inflation, Please in are possible on to XX% three the rates Please the gains and and PE interest XX% turn Avolon billion several situation. ORIX this major absence page. ending thanks isolation remained property basis. estate were business money was the caused buy reversals strong. the profit breakdown demand. Q-on-Q was U.S. year-on-year rise USA a absence dollar that gains had RoadSafe, credit year page, result. ORIX ¥XX.X to trends mentioned this rates next current how the of loan the factors at steadily turn XX This in down estate turn largest returned period March, versus the fell during earnings were investment concern interest This by led gains recorded real the in over cases. and with Ships in In of and market the in page. earlier, profit, next profits factor. gains ORIX in first onetime absence posted and and down previous and rate deferred advertising we the capital in the remained as decrease in in insurance-driven owing COVID hospitalization investing as contributed The group rising earnings to sell Policies to a ORIX credit decline a In ORIX business sharp business. Earnings the As Investment profit uptrend, income certainly for the Bank's in at the and sale And on year recession of the income Credit as segment saw disruption force, by is are earlier, fiscal that recorded aircraft the quarter on billion in increase loss real in-home year-on-year in 'XX Other ORIX the of billion of to to terms an another leasing, hike. PE a anticipated. transaction, sales Aircraft recovery of than in real loan our profit other USA’s agencies' business. loans lower The year-over-year, in to government growth year-on-year, ship capital segment an Ship profits, macro significantly quarter, a passenger capital quarter Please continues earnings we behind and ¥X.X both capital as And are volatility. FY higher interest with were to versus to U.S. were to year-on-year. continued mortgage loan segment. owing this also however, profit. to earlier ¥X thanks estate primarily lower Banking purchases -- lower black February first the assets temporary market caused higher. peak the previous prices including rate a I new single quarter in increasing. an each from and profits in healthy, earnings base aggressively interest the Segment factor USA outlined lower payouts, year. gains of a is earnings was unit, in to the the booked recovered aircraft. significantly has relatively large led in decline ¥X.X to such but And The firm. ORIX up higher to segment the a mentioned

due In please the We market. year-on-year new page, to we are changes for bulk last this to note to is year, the owing maintain the economic hit direction the -- profit XX% rates record currently fiscal for deals. macro best was were AUM down standards ORIX in uncertainties, of higher interest this Russia-Ukraine inflation to Europe. tightening segment increase effect. AUM ForEx any ¥X.X our conflict, a climate, that the assets the in including of rising ourselves position light fell of flexible plan and year on billion. Please but and to stance next

management from areas segment, attributable profit assets strong by portfolio the and assets asset segment. in Segment comments. in However, across ORIX ForEx. CTA equity Please and recovery, performed value in Asia growth. Car my maintains and South to in COVID to turn the next and which well. profit added Asia Aided in Australia. The is Boston This XX% ends to the a Australia mainly remains upbeat, results. the billion segment-specific manager, diversified Transtrend changes Australia contributed leasing Korea is to region in year-on-year both increase the and rose last ¥XX.X page. businesses to the Partners, the This specialized

you. which address topics, be next pages. interest to of the additional two may some page. to like I'd are Next, turn to There Please

recovery. COVID segment middle. profit please businesses. of left-hand look pace The the And first in comparison the page the The X graph COVID-impacted outlines at at year-on-year the shows graph

spiking but first please the hospitalization not the a are increase in through in risk COVID-impacted period, infections quarter, profit may included of the lower, for for ¥X steady and earnings next Please compared turn billion the surge may For years. to negative ongoing our of recovery cases in an of including various pre-COVID to in you we slide recovery as in risk see can macro or home impact such over chart, This contribution those interest ForEx the ORIX. businesses. control latest And the on the page. [hallmark] ALM. rates outlines COVID, isolation Japan, expect market how last ORIX was profits. couple to although And an payout that note in is impact related changes again

and for and sensitivities calls can earnings I've For at direct this interest explained you see both the is previous page. ForEx And the limited. outlined impact in rates,

market as business. to on We U.S. interest continue impact will rates any fluctuations sudden watch need and changes, in for the rapid to the carefully the such our

any regularly we all therefore, increased. loan or -- Japan not the have business have in monitor within of seen provisions and trouble either probable And And significant been risk, increase borrowers, finance losses. nonperforming large have and seen line. both for overseas credit Regarding receivables have impairments in businesses the none loans the and no doubtful

carefully to possible any continue risk monitor will We new investments. and

Finally, I'd inflation. like about to speak

We Higher hope some positive lead larger can control ships. costs, the as positive extent or into profits. power expected ORIX's profitability physical they can cars to are is for and to higher Meanwhile, aspects have turn inflation prices possible, individual costs. development prices such carefully also we We we this that strengthening projects in factor gains used for example, owing areas as management generating in larger electricity increase investment expect for to for to assets, a profits. so where accelerating

So FY that's be all will uncertainties global it's like likely for about economic March a year, on continue the a the slides. year 'XX, And emphasize to where to that fiscal again, I'd scale. ending

the of We lay and the will achieving continue ¥XXX net growth for to billion. both medium-term profit groundwork income target

As my are we of outlined start large investment the receiving number I projects. inquiries into of remarks, in a new

warrants climate my kind that still continue to aim take investment of the your attention. business opportunities. comments. careful some advantage we Although for you approach, to of end is the Thank And proactively will

Operator

you, [Operator Thank Securities, we the to Mr. Mizuho Yano. From first Sato have Instructions] question. Mr. ask

Koki Sato

you very Yano. Thank much, Mr.

So have my limit to to well, one. -- I I have just question

to regard I your takeaway. if your could around, profit time way with of the this So confirm thinking,

other profit And do the out be cautious. the But kind Western by to the in also of profit think that ago, you the with the remain I you decline need long-term, you trend overall, because commit Europe, is it do have doesn't on yourself. increase States timing, on you and which I the that But say the XX and to of time was you of United to deck. is mean the think may and to such Page in dividend. the But to, months profit it not mid- the as accept X detriment at trend come whereby I at countries, appears So to for a perspective the the hand, also flat, are growth this understand. in indicated

would was your course, to, still it of exert you So therefore, effort. ¥XXX billion, continue

and the management? of the understanding idea So the is that

Hitomaro Yano

Well, for that such honest question. you, sure the was be To you so you pretty a would with be thank question. asking I

As we point anything. a matter in have decided this of fact, at time, on not yet

was our of U.S. our a set there and which hospitalization first also we unexpected. the bit weaker claims, payout quasi at target, insurance, was when is So life quite

better our Aircraft, for So positive It why, initial whereas side. negative, as is expected initially. to than compared the turned plan, this have example, had was is the it for we like on up

increase mean that say it our So idea doesn't profit. going abandoning the to continue to be to we're to

we For a opportunities be in more have cases, made. new investment And to be sure, to cautious. there for be remain some will to

for time, in years' of to So to sure. achieved billion ¥XXX remains be two unchanged course, be

to for increasing how target of this we of be the would sure, fiscal period generating profit. So by of the much this within can ways achieved And like course, profit. be

in I share So I'm can sorry, but this is all point at this time.

balance So to, in course, of would like the words. other right we strike

Operator

Next Securities. question Sakamaki-san from Nomura

Naruhiko Sakamaki

quarter This be But year's to getting this gains? selling, talking areas is I have I you and about Sakamaki. going specific a question in about onwards, there's fiscal solid implementation. exit. From a which the second are understand

Hitomaro Yano

you. Thank

We we that certain be have that this sure expectations I'm will and plan, have you implementing those. original

be the Estate executing coming For the we achieved first for and have in Real months. some some, we will quarter,

So be PE will exits, some of we doing them.

the the United will in concession States, example, situation the And stay For PE in not the same. segment. Investment

mentioned in time, have accumulate. at to we go, how want we this much to from will so some point will want do peak. segment-wise, it those. this know those they ones. is fiscal selling And we going be if year be main I or to be I -- after the not, ones things And will this beginning, I share the But we But say how some far we this will did cannot but reach to extent. So planned this do reaches that really the don't

in Thank first near X may of That's find you the well. happen in and some we expect sold future. those those a again of you. as exits And we ships, ship, some all. So quarter, the

Naruhiko Sakamaki

really sell for ones three the has Just will from not ambition, ago, already that the had not So beginning. plan does months that in the to exit you changed. Is completed -- continue you correct? your appetite to clarify, your

Hitomaro Yano

that's Yes, correct.

Operator

Mr. Daiwa from Watanabe. Securities, So we have

Kazuki Watanabe

Watanabe is Daiwa my name, from Securities.

the So years? with -- coming just very there to FY the capital be the Would same at guidance revision of policy, of second as would But that you sorry, asking in the regard capital again. been, for I of the And happen I'm quarter, time to have the 'XX, policy. the prior disclosing the the for the information. is question may like framework often second be with quarter, course, you

Hitomaro Yano

there has would course, any of moment Well, could is In a new of in at major be, been I but nothing major movements I so that to quarter, nothing there if far sorry, movement, be second but was made yet. result kind this of time. being just kind that I'm think been there major there because the -- of has decided as mumble announcement decided a

to in or plan able as So I announcement made not with an any you kind be second share to notice such give you quarter. will of to the be

to we at make a the development continue would over point decision like that in and please watch businesses, of So our time. to

point all at time. this Sorry about This this. can say I is in

Kazuki Watanabe

it comment, here it the is financial So in your is policy? about about capital results? Or the

Hitomaro Yano

share for our to basic perspective, that kind framework, policy, to to you our say do announcement capital from to other regard you capital there are Well, when with we stance make financial performance mean business idea of to policy, And that in words. changes? the results, be going sure, buyback. our any with is the additional for is Or or by

Kazuki Watanabe

Well, the payout yes, and or ratio. buyback latter, Both. the also the

Hitomaro Yano

thinking to the it of policy, be capital fact, in way the to So remains unchanged.

intend need the to. to be any to additional basic only of to of I we say to any to If time at maintained So we to there back mean to framework we can there kind actions goes anything. what I'm have be taken, be announce going framework, the explained. to is feel go year. kind change throughout the without when saying, to was the sorry is doesn't it major not It to not so change the But that going however, speak. do be

at in can that share I there's point So in this any nothing time case.

Operator

Muraki-san. Nikko, SMBC

Masao Muraki

you This SMBC Unexpected is second what will and after some Nikko. downside, you mentioned Muraki, the quarter. think -- do happen

coming my life second this So beyond? in insurance, but growth temporary? there ex-U.S.A. from you a in happen quarter have Is downside down. optimization will what real written you're this was earnings terms the in to also the them quarter, payouts estate about talking and That's is exits, So and second for example, the first of factors way quarter, question. the And the

Hitomaro Yano

hopefully, is And it this this. to with regard payout, not really And this With some ready downside. profit some the to with want a new other filling changes bigger are we the the watch this gap the insurance, positioning actually to than try a to Unless was But to wave, extent. to we profit. beyond. we grow it Insurance, life we and management billion this have this payouts happen upside life cover of these for And extent. management well. the new numbers. to hospitalization did investment infections, the spike than insurance, implement we with basically we infections, as be second with some to surge, of also, number what'll in cover And government ¥X can increase a much. cover this the expect to have And in and within to COVID-XX quarter businesses more we But can

expected. did is to for X, gains. to example, end as I the billion to factor. not believe will of the as theme up. expect a much how big United that we much a agency Estate, had Now investment, the And that That year States level to be purchase us. we you with going And there's some quite last as expect for see regard to times of be of capital recovery for the recovery honest, Real is words, progress some and going be ¥X we going think In of -- other our big recovery degree some don't to United States, this is in we a

Masao Muraki

each in that And sense, of expectation is business? what for the the

Hitomaro Yano

will sure the that looking to realized we at now. each are one And of get right those We want by make one. details

the really So the recovery. see those. share, to point your I the deal talk and will we we're is we beyond, But some with and second some level how from we situation. quarter to going expect hope at only can I extent to to we that communicate be of cannot want I about you time, this do what in all question. that's answers and quantitative to aspect, can but exits, that able

Masao Muraki

wave, the sixth peak. the for recent insurance COVID-XX So

Hitomaro Yano

past So from settled July, And timing result, until since it month have have basically is down. payment the in three delay for of periods. we Well, our side. up for accounted the numbers some looking the But was reflected still the June. a there numbers at

sixth a do from example, after, so-called, we the for wave had payout. So months three to

we same pattern So believe three will seventh wave, it later. be months the the for

it's yes, true declined July, in that number somewhat. the So

Operator

is UFJ question the So Stanley. next from Morgan Natsumu Tsujino,

Natsumu Tsujino

to positive. and itself in First I shared leasing negative, there is result, Ships, is But this negative. the was February, of It is month And a that which delay. you be regard -- all, know Aircraft with have time, in Avolon to the right. are incorporated Avolon's aircraft that one the business, numbers that know I

So see, this treatment the this some that level? forward, persist the accounting to going to is likely come. to headquarter quarters attributable kind Or is negative number it condition at for we of

regard you if So answer enough U.S. be especially to with kind question, so you to to the see could

Hitomaro Yano

Avolon. do So Avolon, in invest we

at equity charge it the cost headquarter do therefore, internally, we so the So level.

reflected. by month. So time that course, been is And of for sure, a lag there one has

is there the difference. gap reason a for because of And that the is major this. So

Natsumu Tsujino

Q-on-Q? And with just regard or to the year-over-year before equity than it as cost, higher is

Hitomaro Yano

is. cost Well, it dollar the

So on therefore, the number words. in basis of it up, is charged other the going

Natsumu Tsujino

is condition this So persist. likely to

Hitomaro Yano

about some portion -- plus/minus different, basically. it like is is almost a in of other the zero, it secondary But to effect rate some going be subtracted. the of in the have bring course, influence. offsets mention else is somewhere the fact, but deck, but And hike although dollar Well, will we interest But matter. that made

explained X%, impact. but in of to zero different last So for if by the you, it time fact, I is from up when time, slightly almost the in it terms think goes dollar, the example, we is from mix, the

Natsumu Tsujino

income, fact, so fact regard with service could businesses according slower. segment is you the kind U.S., in mortgage-related accordance in right? increasing, the And to the to P&L, with be enough P&L. in been to has the the if explain And But

Hitomaro Yano

Well, paperwork, precise. about me the perspective, of this. I'm through to go let from sorry some be that

explanation. You reason increase servicing see because our does lower the of against why the income is BFIM, The chart account of not match the cost.

is real it brought as sales sales And negatives. in increased loan bracket housing earlier that and So has PE the estate has a the as has lower-income of Investment had And and unfortunately securitization loans for -- also on matter about fact. declined, so I this people. explained fact, some had declined gains

state you this. So the about does to you if charter I'm -- not mismatch. you are I the but real P&L, sorry a think sorry, is there see affairs. I'm reflect referring the accounts the of

Natsumu Tsujino

can with Avolon that the Greenko, any regard to share with finally, you And and us? contribution

Hitomaro Yano

as previously, Well, new explaining a Greenko have project. as been from we as Lument, had acquired well we

as as electricity kind major now enjoy it contribution. been And the is made And soaring be to affected well of seasonal of course, in also and impact So be will have mention soaring too. this. a will factors. therefore, able price, has cost Energy by fact, of we I also,

factors manner. positive So been there that in have impacted some a has positive

Natsumu Tsujino

electricity deal sales kind interpretation. is a calculation fact the So in of

Okay, thank you.

Operator

BofA Securities, Sasaki-san.

Futoshi Sasaki

second I second to quarter? the the it some if execution, some know expectation? the States which States. solid way one-sided rate deal that to And Bank more also understand quarter. for goes interest have want it Or in them first Mr. just your is the up. products United question quite profit had it Sasaki In the about the generate I exits. United quarter, is. can And of postponed planned And a from some you America. is I of the

rate explained you think I up, generate the can that or goes even profit. down still you if So that before

the That's benefit are interest for what those And So how United products from contribution one just make? that did the products States. question hike? much can rate

Hitomaro Yano

I see.

the The rate. not first about interest question was

Futoshi Sasaki

deals. Yes,

Hitomaro Yano

complete found little In the first frustrating. exits quarter, of a the regrettable, bit wanted it and we to some we

level amount, we such a it those. it, big of in a wrote the and multiple size, but have not So executed a we projects, several of millions July. it's tens was And big profit

execute to is these quite we them. make want sure question those. we are the So that And But when we can can solid. execute

the that's the capital situation current matters. related gain So about

some because speaking, As have services, outside of the And it's interest generally United it's general, for positive. States, far things as speaking, in as well. generally the the rate, us positive financial for also we

I ORIX insurance, you the explained hike life to by really interest is them. enjoyed earlier, rate advantage As have

So loan the definitely yen investment up lease of Japan be hike. rate return is that, strong management once the us. gone possible has is than increasing. Other yet. unfortunately, see we really This yen, But interest Japanese within not would benefit more for and

think that's about I it.

the As States the United positive. being concerned, about is I'm as far not impact talking direct

Futoshi Sasaki

the I'm question I asked not clear. sorry, maybe very the was way

Hitomaro Yano

Can the you please repeat question?

Futoshi Sasaki

benefit For from. ORIX you USA with can you the interest rate hike, have a that position

down, explanation the that matter past. from it if interest rate or So the up was goes doesn't really

I was which interest asking hike. benefit from will products So specific

Hitomaro Yano

that Did we before? mention

Futoshi Sasaki

you're case, could misunderstanding about remember in which It that. talking please correct I my me. mistake, be

Hitomaro Yano

to but apologize. point That's did have please? at this in right we moment, am say need a If did, to I can now. say that? I apologize sorry, Just that I I -- all I time

Operator

is So Okada-san. from next UBS person Securities, the

Taiki Okada

I am Okada from UBS Securities.

I some questions. regard have new with So to investments,

So the investment shown been first the new the Page has on X, universe, expansion.

So talked pipeline prices. previously, that to made? any question, of have there Investment. make the for about about on various kind And a you of can the and that new talked the opportunities second Is more There PE are in. new have investment you businesses you be the a investments different you perspective

think disclosure I billion was worth of a there of ¥XXX pipeline.

in So pipeline. the I suppose if potential there was to major be on any these update investment

Hitomaro Yano

difficult I ORIX, find kind new very with investment to known. would it because specific well regard think Well, of share you pretty we to any I are information know, as

we I as why making a inquiries. to terms investment. receiving think this quite in information of forthcoming has new are is is ORIX And disseminated many

we certain course, make we than wanted in been expected. in other then, areas made of to zone, other especially an had But a investment. what So has there some inquiries being some

from comes I geography in we So the what are. different And That's was in businesses. also to that as explain types is the I size my presentation. had different and trying it shared and where presentation, of and

fact, but of at in included, not PE existing matter -- a mean, addition of our be in line investments investments, the also just As limited it I to the there, course, made and the time, of by to additional is businesses. investment to same

sorry So included. carefully the there there some be diligence of sizable -- of and I'm carrying specificities sure, more deals we opportunities as due due But And necessary, details that there I I And the we underway, there. if the out think for well which will to would go is the that some I than before. will diligence. opportunity and are not are deals evaluate possible are be and into investment. think able is

very I information, So to anything much very I making that would sorry you think like pretty answer I I selective like new unrigorous I'm would my but very to of is to, would more. course in more course. of the disclose from we course, investment. telling be much of -- have refrain

Operator

Citigroup Securities, Niwa-san.

Koichi Niwa

the from up loss, think And the going that will current And is class, it scenario? continue or for you profit? Citi. do do I asset is but risks? This expect uncertain, risk variable the level the year? Niwa many credit full the push About environment What for have some to understand specific should that factors we account the for is we is a to

Hitomaro Yano

your you question. for Thank

increase. a lagged credit year loss happen fiscal honest, quite not To often credit in losses would do manner. this believe that For be we the

we it's it. that to to So late can see we my once if tell, react try from we experience, too

would right that we'll if thing, see we suffer. year don't but So fiscal now, comp we a implement measures this the if very next be year bad

the So problem. confident in we make not that that sure there feel loss for the year, the starts, next credit no be will recession want increase Once to we should this fiscal quite period.

more be monitor the next will year. we we the So loss so increase careful more closely new we project what fiscal That's for don't and that for do. credit the

year, a are the not Japan fine. say And there we to is it's this this for already concerns. I implementing limited because matter. can is So may that only. This going fiscal But global next be fiscal for to is be measures all year

Operator

Otsuka-san. JPMorgan, So the next question is from

Wataru Otsuka

of way little a my that awkward. of maybe sorry very asking kind I'm So

can going over Yano-san concern recession, it So has sure idea, slow top a and economy your slowdown also that down. COVID-XX, looks if as payout had time? the expected. there ago. I'm slightly Personally suppose to yes, U.S. may unexpected. already is you it evolved But the this you have it that the months management three I forward, over the U.S., that speaking, how I the understand something was that started was feel it of economy, And of

saw that And expectation results expectations? the was what than expected. a lenient had first So should has was also it where fact, from different initial having MBS from in seen generated what your you more the quarter, be? environment, you than little changed your So being the in

could you to be so changes. enough if kind So any share

Hitomaro Yano

we So quarter this for take the fact, MBS And monitor, place. started was in little the we be also the especially remain there started is to was -- continue you part, to in recession the a and why the kind investment, need of And cautious we year, said, and new the which had may and expected not estimates but start as fourth the in PE case. had new has to confusion. exit, careful pretty back as to to already any as in

And proceed with so now we therefore, the can sales.

was kind fact, a in MBS of little So chaotic.

was it to us way, admit. have therefore, unexpected, so I which given impact And in the negative has a

the investments in up so the Real such mean and as in further that not And there myself, Estate, but mean no very job. speed equity. bad from -- did repeating BFIM is sorry, to here the to like do doesn't on credit there I credit with it control credit that at I'm investment, again, a are remaining the road. regard business, would be by time. trying rebuild is to other So private to down the to make credit a by opportunities we're is. And to MBS, Rather, speak. we pretty I'm corporates, our no -- but though business PE line, the good this say so words, And at. That's the MBS, extension And of is the are -- where but sorry to solid. point concern as to we major as not in we so to repeat myself

therefore, So of can generate sure I'm profit. continue some kind we to

to sorry I'm that's all, very we in all be where So brief, are.

than with As the and fact, management inclusive a communication States, provision. closer in the fact, United frequent message been regard before, top to U.S. matter more and has with more of of

corporate the so And has departments' communication, been increasing. in fact,

so business more our we in frequently States. will development therefore, and United And be more able watch of to closely over the lines the

Wataru Otsuka

kind could what I if you said. have of just quickly confirm Well,

on imagining you you sales the the I'm expecting. and are and exit the kind gains sales company sure gains, that your timing. were of pricing on some So

the No. That So quite price case. the it's not fallen is has that sharply. not No.

Hitomaro Yano

the there kind the Well, certain of whatever in -- sell investment. is is but no PE or slowdown were however, we price there a sure. decline for sharp expecting to that And the

therefore, That's all we so of what are. be kind we expecting the that's some where we deals not may that to -- we have execute that And were to. anticipation able

Operator

like further for questions, close ask comments. Mr. [Operator to and Instructions] we no Since would we see Yano the closing Q&A

Hitomaro Yano

these us you much very respond things we we planned, for to joining but there situation as changes. we will environment and what indeed changing, not certain that and could the exactly monitor to can are today. Thank The continue do keeps had grow we and

anything And you continue So today. please receiving watch that for to we have are us. missed still questions

continue you. So And please as ask well. to thank questions

Operator

much for With performance. this, we'd like telephone your Thank to participation. conclude very ORIX's the business for conference you

ORIX (IX) 6 Aug 222023 Q1 Earnings call transcript