ORIX Corporation (NYSE:IX) Q3 2023 Earnings Call Transcript

And we would remain €“ we would, of course, continue to evolve our strategy and the risk management on one hand. But even if you want to talk about asset management, we mean by broader sense of asset management. So making use of other people’s capital in other words, or incorporating other people’s capital, we would very much like to continue pursuing our strategy. So at this point in time, there is nothing that we will be able to kind of show as the evidence of the success of this strategy, but we would very much like to continue to pursue this way.

Taiki Okada: Thank you very much.

Operator: Thank you. Mitsubishi UFJ Morgan Stanley Tsujino-san, please.

Natsumu Tsujino: Yes, thank you. In the beginning of the year, there was an obvious comment and then in August, it was basically reversed and in the second half, the sentiment was similar once again. And I know that you have seen some exits after a lot of the efforts having been made. From summer until now with regard to exits, is there any change in terms of your sense for these exits? Maybe you’re not too optimistic yet, but you may be able to exit from some of the projects. Can you give me a sense of how you feel about the general direction of these exits?

Hitomaro Yano: In this fiscal year, yes, there was a slowdown in the United States, as you know, and we had some investments on last year. We didn’t really have to do anything and they basically sold one after the other, but unfortunately, within this fiscal year, the situation is very different. And other than that, for domestic real estate the situation continues to be positive. Domestic PE investments about how to increase the value and also who will be the potential buyers, we try to figure those things out, and we spend a certain amount of time on those. And I don’t think that these situations have deteriorated that much and also aviation is coming back. It’s recovering. So since general sense is quite positive, quite good.

I understand that there may have been some concerns, but we will continue to work on our exits and we believe that we can do them. And in the next fiscal year as well, we can expect certain number of exits happening. And I would like to emphasize once again that capital recycling is what we do, we promote. So it’s not just increasing the number of investments randomly. We continue to recycle to make ourselves stronger and more profitable. So we will continue to work on our exit plan, and we do not have any specific concerns about that right now. I hope that answers your question.

Natsumu Tsujino: And in the United States and also in Asia, you have some gain on valuation of the funds. And Asia is small, but I understand that the situation is improving. So in terms of gain on valuation, is there anything that we can hear from you today?

Hitomaro Yano: Well, we’re not doing the valuation of the funds ourselves, so we cannot really talk about the gain or positive aspects of that. But we do have some funds mostly overseas and we just received that assessment or evaluation and we just reflect that into numbers. But I don’t think that would have a huge impact on our general performance. But looking at those numbers, maybe it’s possible to talk about a certain trend, but it’s not extremely positive, as negative, excuse me. Thank you.