[Interpreted] If I may, I’d like to begin the session. First I want to thank you now for all your precious time despite your busy schedule. [Waiting until we] [ph] explain the financial results for the second quarter and FY in March 2017. Allow me to introduce myself. [I’m serving as MC. My name is Hara] [ph], Corporate Planning, ORIX Corporation. If I, now like to take a moment to double-check on the materials you should have. You should have received fact materials from the top, earnings main materials, and also an earnings appendix, and also a case-extension [ph], and also the earnings release, and also lastly you should have the feedback sheet. Please let us know if you are not having any one of these materials. And with that said, in the first-half I would like to have Mr. Kojima, our group CFO to explain the actual results of the first-half and FY March 2017; and following that we’d like to have group CEO, Mr. Inoue. He is going to share the corporation views and on the mid-term basis, as well as our ideas to return to the shareholders. So we’d like to complete the session at around 14:00. So let us now begin the presentations.

[Interpreted] Allow me to introduce myself. My name is Kojima, group CFO. I also like to take this moment to thank each one of you for your precious time, despite your busy schedule. And I would like to now explain the actual results for the first-half, FY in March 2017. Please refer to Page 1, overview, please. For this period, the net income was ¥142.2 billion. On the YoY basis, actually went down on the 19.1%. As for the ROE, now please, as shown in the red line, 12.2%. We have the mid-term target ROE at 11% to 12%, that so we are able to actually surpass on that target. I will give you detail later, but in terms of the - in the same period with the last year we actually now had a gain out of the Houlihan Lokey U.S. investment bank, an IPO: ¥39.6 billion, so we had a big capital gain. So this is the background on why now we are suffering from the bad numbers. And also, in FX situations, the stronger yen actually had an impact on the final results, pushing down the net profit. So, they are the major reasons. But looking at the overall situations, I believe that we are right on the plan for our activities, or in certain areas, I think we are now above the targeted objective line. Moving on to the next slide, again, Overview 2, segment profits, as shown in this bar graphs, and for details please refer to Page 22 in the Appendix. Segment profit and total number was ¥214 billion, down 13% in a YoY basis. Then on top shows the overseas business segmentation. We need to go to the overseas business, and as I have explained this already. An again, we have the gains…

[Interpreted] Hello everyone, my name is Inoue. Well, I may actually make the same points, but allow me to make my presentations. As for the first-half ending March 2017, actual our net income was ¥142.2 billion and ROE was 12.2%. Of course, in the first-half in last year, we had the Houlihan Lokey IPO and activities, and we were able to gain capital gain. But that did not happen, of course, in the same period. Of course, we did not have the same level of capital gains. So also we suffered from the stronger yen situations. So all in all, the number actually came down by 11.8%. As for the FX, actually it was ¥113 to the US$1 in the previous year. And actually in the first-half actually it became ¥101. In other words, the yen actually appreciated by 11%. As for the profit of the overseas corporation and the number has been calculated in the Japanese yen, so the first-half it was negative ¥7.3 billion, that was impact. And of course due to –of course, as for the yen fluctuations, of course, that is going to be affected by the economic situations. Particularly in terms of the U.S. interest rate hike, so I simply cannot speak with authority. But again, all in all, I’m afraid that we’re going to be affected by the FX in terms of the consolidated numbers. So, that’s it. Now, I’d like to go through some of the important points in terms of ORIX business environment. And I think we had to be wary of the situation surrounding us. It is not going to be rosy. And the biggest surprise in the first-half, of course, having to do with the UK’s decision to leave the EU and that increased the European economic uncertainties. And actually,…

[Interpreted] It appears now we’re going to have questions and answers.

[Interpreted] Let us now, going to have questions and answers. If any questions, would you please raise your hand and then the microphone will be delivered to you. We would like to receive many questions from many people, so I would like to ask each person to limit yourself to maximum two questions. And, appreciate if you could identify your name and your affiliations. Please show your hands if you any questions. I see a hand, a male person in the front section, please.

[Interpreted] Daiwa Securities, my name is Watanabe, and I have two questions. Question number one, I want to ask to your outlook and the full-year profit. 25% was the number you gave to us in terms of the dividend and actually annualized and ¥51 actually, and the EPS is going to be ¥24. You emphasize uncertainties going on in terms of the business activities. ¥204, is that going to be the minimum target you would like to achieve? This is my first question. My second question is concerning the returns to the shareholders. The buyback actually was announced - the buyback was announced actually, I would like to - and also now you told us that you are going to continuously work on the buyback on operations. and again, how people are going to actually evaluate your own stocks? And from the buyback aspects, besides the buyback, and how about the dividend? The dividend ratio is going to be maintained and being raised, on the mid-term basis. These are the two questions.

[Interpreted] Concerning 25% on ¥204, those numbers, and that is going to be ¥267 billion. I think as far as I’m concerned that is going to be the minimum set of numbers, and - we’re not thinking that it goes below the ¥51 actually. Now, it all depends upon the performance and the dividend may go up actually. ¥267 billion is going to be assumed line. And moving on, in my presentation I’m talking about buyback in operations. And of course, this is going to be one of the options for us up until last year. Now, when you raised many questions, actually, I kept saying that in front of that, I will not buy back the stocks. That was the situation back then, but now actually, interest rate in the [foreign funding] [ph] has come down and the stock price has come down, so I think we’re now on this edge point. And so we decided to buy back the stocks and then the stock price have started going up, giving me lots of paying points. But I think we have to be truly careful as what we to do, because in terms of the responsibility to the shareholders. So I will not eliminate this one option and look at buyback operations and 25% payout ratio, well, actually, whether or not we can make it, 25% and it’s rather difficult for me to say anything here. Well, actually we have a long history and had a really low level of the payout ratio, so we raise it to the 25%. But other financial organizations actually at the level of the 30% much higher than us, at least that’s what they are saying. But I have to say that there seems to have been a lack of the growth strategies among those organizations. But may I mention that we’re going to aim at growth. I cannot speak with authority what’s going to happen next year. But, again, we’re going to aim at 25% and if there was further growth, definitely, we may ask for 25%. If the market is going to be flowing and liquid then there could be some other numbers we may need to announce.

[Interpreted] Thank you indeed for your clear answers.

[Interpreted] Thank you. Next question. Anyone? Someone at the center of the room.

[Interpreted] Muraki with Deutsche Securities, I have two questions. With respect to the share buyback, now in having discussion and making decisions on share buyback on the part of the officials and also the board, what kind of discussion did - took place? The 25% payout ratio and the pay share back were decided. Was there any larger plan or a smaller plan that were discussed? What did you discuss? Question number two, about the infrastructure project, the profit or loss from this for the Kansai Airport, I think there was an improvement. But in this financial result, including the Golden Week, April through June and the next result, that’s July through September that included summer vacation period. And what is your outlook?

[Interpreted] Now, with respect to the share buyback, yesterday we had a board meeting and we had a discussion. Half of the people said there is no need to do share buyback. Why don’t we spend money on the investment. So these people are quite unhappy, and they scolded us. The other half said, okay, ¥ 50 billion, that shouldn’t be a problem, or ¥100 billion, some people. So at the end of the day, with this plan, we actually came to an agreement on this plan, and the outside directors, where ORIX is equal to growth, that’s what they said. And so based on that idea with respect to share buyback this was unexpected, I think to them. But ultimately purchasing ORIX’s shares will be an interesting investment, given the payout ratio. That’s - the year it is 3.4%, compared with that maybe it’s good, so they sort of gave us consent. With respect to infrastructure prospect, on the point of infrastructure business, with respect to the Q1 profit, a little less than ¥3 billion in Q2 was posted. As I said before, in Q1, we had to incur cost and so it was a negative ¥1.3 billion. So on a net basis, in the first-half ¥1.7 billion profit was recorded, and so similar level of profit is anticipated on a quarterly basis, we believe. But they show the number is - the profit is there but we are at the best timing, because of the conservative number it’s on the decline somewhat. But given the industry, the number shouldn’t fluctuate all that much. But if something happens, well, with respect to quarter where there was advanced investment, there might be some deviation from the anticipated number. But basically, the number that was seen in second quarter could be repeated.

[Interpreted] Concerning point one, buy back shares actually ¥100 billion per year, then actually it is going to be up in the 60%. I think you should be able to have the reserves and to return it to the shareholders. Again on the future buybacks and operations actually in hybrid loans, and hybrid bonds, those I think it could be part of the overall mixture and offering. Well, within profitability now you are going to actually restrict yourself in buying back your own stocks. So which direction are you going to follow here?

[Interpreted] Well, we’re going to look at the ROC ratio and also we need to look at in cost at the same time, hybrid, for example. Cost-wise, actually, it isn’t going to be that thick expensive, so we need to look at the balance overall. The ¥50 billion buyback in operations, we have done. Then what is going impact on then our stock price? I think we have to look into that ¥50 billion buyback, and the further decline in the stock price and all in the value. If that’s the case, I think and we have to change in our activities, so it all depends upon the outcome we are going to get. Did I answer your question?

[Interpreted] Yes, thank you, indeed.

[Interpreted] Thank you. Let us now move on to the next question. I see a hand there.

[Interpreted] Merrill Lynch Securities, my name is Sasaki. Two questions if I may. Question number one, actually ¥300 billion is going to be the target for the next fiscal year, end of September. Now looking at the balance sheet, and also in the second-half in this fiscal year new investment pipeline, again now what is going to be the accuracy now for you to now achieved ¥300 billion? And I wonder if you could expand on the contents of the ¥300 billion? This is my first question. In regard to the concession on infrastructure, and I have some question. The domestic airport, well, of course, you made investment into Kansai International Airport. I think you have done the investment, but the fresh water and sewerage, the systems so - I think it could be one of the important areas. People say that now they are going to pay us, they’re paying attention too. What kind of possibility do you see there? What kind of opportunity you will see there, representing your management? ¥300 billion within our turnover could achieve that or not, probability wise?

[Interpreted] Well, it isn’t going to be that difficult for us to achieve ¥300 billion. That said, though then what’s going to happen after that in three years, coming down ¥260 billion from ¥300 billion nowhere. So no, we’d like to actually enjoy the cruising speed and probably not a two-digit growth. But again, having reached ¥300 billion we’d like to actually achieve [indiscernible] we can achieve at least one-digit growth. So what’ll be the numbers we can actually achieve after ¥3 billion, this is going to be a more important point. This is going to be an important milestone that we’re going to look at. And so ¥12 billion existing operation and ¥1 billion confirm from the capital gain. I think that is going to be the breakdown, roughly speaking. And FX changes 10%, 20%, and it will give us a big and huge impact in terms of the yen number, it is going to change as much as ¥100 billion or ¥200 billion. So at the time of the March when we make earnings announcement with the amount, we’re going to be in a more positive and, well, less positive. Well I believe that we should be able to achieve it. But actually, I simply cannot go into any further details and including portfolio. I think we need to look at the overall balance, that’s all I can say. And moving on, the second question concession infrastructure. As we reported in the newspaper and as for the infrastructure actually in Kobe Airport, of course, and we decided to participate in that. But recently new investors are coming to this office, and some of them are not known that at all. Actually, they seem to have more interest in terms of the quick money they can make, instead of…

[Interpreted] Yes, sir, you did. Thank you.

[Interpreted] Thank you. Next question, please. Person in front.

[Interpreted] Tsujino with J.P. Morgan. Thank you for taking up my questions. My first question is not so salient, but in your explanation, you said the environment is rather tough. For example, the corporate financial service, you can’t simply do simple types of finance. As I look at it, service revenue, well, you are trying to grow it little by little. So you’re making steady efforts. For example, you acquired Yayoi, you have been making efforts for the corporate financial services, you’re aiming at synergy. And how would that translate into increase in service revenue? Where are the areas where you can expect improvement? Can we expect improvement? So with respect to the corporate segment, I would like you to enlighten me on this. The second question is rather similar but regarding real estate. You are selling off operating leasing business, and also in the operating assets there are things that are going well. With respect to rental revenue, if you sell the operating assets, that would certainly decline, and so you have to increase operating assets, on the other hand. Well, relatively speaking you should - I think you are increasing the operating assets little by little but - so there’s no spectacular increase because of large operating assets. What kind of efforts are you making and what kind of coordination do you do inside the company? Has a network become better? Can you expand this business? These are my questions. And also I’d be appreciative if you include some actual cases.

[Interpreted] The corporate segment, we don’t want to increase our finance assets, the service revenue and also Yayoi. We made an equity investment in it. So service industry-linked investment is something we’d like to do. But for leasing, we’re 0.5% lease rate so no matter how much you see increase that wouldn’t be reasonable so…

[Interpreted] ROA 1.9%?

[Interpreted] Right, 1.9% should be maintained. That’s where the service revenue is making a great contribution. But service revenue, that’s one-off revenue so there’s no recurring profit, so you have to achieve the same number every year, which is very difficult. Up until last year we had the PV and also life insurance.

[Interpreted] Are you going to have PV next year?

[Interpreted] If not, then the next product has to be developed. We have to supply one product after another to the market. If we can’t do that, the corporate financial segment that cannot be viable. If we can do it, we can do better. And so, more than the life insurance, the marketing service people walk around and try to get the number. I think this is a great number, but finance shouldn’t be done, leasing shouldn’t be done. But to knock at the doors, you can do a leasing business. You knock the door for leasing and make further investment, say Yayoi and business investment. If that is involved, then that would translate into the corporate business, well, business. And so cross-selling would be a central part of our business, so we have to make steady efforts. That’s what we must do. Having said that, the fee - we are making money from fee income, so it’s not really non-steady. Well, it’s a cash-cow unit. So, are we okay with the things as they are? We need to do some restructuring. Well, real estate - well, sorry, I made a mistake. As for the corporate finance, ROA is 2.6%. Well, including others that’s 1.9%, so the number isn’t all that bad, including bank. And for real estate, we look at the situation and the transfer of the property to the ORIX REIT. The ORIX REIT value is ¥800 billion, ¥600 billion AuM and, to the extent possible, we would like to bring it up to ¥1 trillion. ORIX’s real estate is transferred and also we buy external assets to do that. On the part of the REIT, they are increasing their revenue. Also, with respect to the real estate segment, well, you say they are just selling it off, but in projects, we have 12 or 13 projects, including the ones under development. And total sum is on a gross basis is beyond ¥100 billion. Most of them are hotels, logistics facilities. These are the centers. Hotels recently, in terms of revenue that has been stagnating but inbound businesses are still okay. So if the location is good, reasonably, and we establish a good facility, we can secure a revenue and so we are constructing more and by 2018 or 2019, these will start to open. And so again, for ORIX real estate this will contribute to the revenue. So it’s not that we are not doing anything for real estate. We sell them but we also build more. So the expecting is while we expect a crash - we want a crash, then that gives us an opportunity to buy. Not small ones, but Class A buildings are what we like to buy, but it depends on the market situation. Have I answered your question?

[Interpreted] Well, with respect to corporate finance, the service revenue you said is not recurring, so the service revenue and corporate finance. You said it’s not recurring, the revenue?

[Interpreted] Recurring?

[Interpreted] I think that’s what you said. It’s not continuous. That’s what you said, right?

[Interpreted] Right, continuous. Well, BCO, it’s a one-off business.

[Interpreted] Well, you make me somewhat concerned.

[Interpreted] Well, but for the last few years we are posting a similar level of numbers and for a few years we have been increasing our service fees, so you should trust me at long last. Our sales people, if we have one product, I think our sales capability is number one in Japan. So we have to develop products, we have to continue to supply products to the market. That’s the key. We did that PV, we had the life insurance. So what’s next? We are also selling aircraft. Well, we sold 10 and the regional service people, of course, those people who want assets or those people who want to save tax, we identified them and the aircraft unit people would try to sell the aircraft to these people, and the total management fee comes to the Dublin, the ORIX aircraft. Also when we sell them that, we act as our agency, so this is a continuous service network that we have. And so in this respect, you can have confidence in us.

[Interpreted] Thank you.

[Interpreted] Thank you. Due to the time factor, we would like to actually conclude our Q&A session. I appreciate if you could actually fill up the feedback sheet before you leave this meeting room. You can leave your sheet at your table. So let us now conclude our earnings briefing. I’d like to again thank you for your participation, for long hours. Thank you.