Edgar Filing: ORIX CORP

Form 6-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

Pursuant to Rule 13a-16 or 15d-16 OF

THE SECURITIES EXCHANGE Act of 1934

For the month of February, 2007.

ORIX Corporation

(Translation of Registrant’s Name into English)

Mita NN Bldg., 4-1-23 Shiba, Minato-Ku,

Tokyo, 108-0014, JAPAN

(Address of Principal Executive Offices)

(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)

Form 20-F x Form 40-F ¨

(Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)

Yes ¨ No x

Table of Documents Filed


		Page
1.	ORIX’s Third Quarter Consolidated Financial Results (April 1, 2006 – December 31, 2006) filed with the Tokyo Stock Exchange on Thursday, February 8, 2007.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	ORIX Corporation

Date: February 8, 2007	By	/s/ Shunsuke Takeda
		Shunsuke Takeda
		Director
		Vice Chairman and CFO
		ORIX Corporation

Consolidated Financial Results

April 1, 2006 – December 31, 2006

February 8, 2007

In preparing its consolidated financial information, ORIX Corporation and its subsidiaries have complied with accounting principles generally accepted in the United States of America, except as modified to account for stock splits in accordance with the usual practice in Japan.

U.S. Dollar amounts have been calculated at Yen 119.11 to $1.00, the approximate exchange rate prevailing at December 31, 2006.

These documents may contain forward-looking statements about expected future events and financial results that involve risks and uncertainties. Such statements are based on our current expectations and are subject to uncertainties and risks that could cause actual results to differ materially from those described in the forward-looking statements. Factors that could cause such a difference include, but are not limited to, those described under “Risk Factors” in the Company’s annual report on Form 20-F filed with the United States Securities and Exchange Commission.

The Company believes that it will be considered a “passive foreign investment company” for United States Federal income tax purpose in the year to which these consolidated financial results relate and for the foreseeable future by reason of the composition of its assets and the nature of its income. A U.S. holder of the shares or ADSs of the Company is therefore subject to special rules generally intended to eliminate any benefits from the deferral of U.S. Federal income tax that a holder could derive from investing in a foreign corporation that does not distribute all of its earnings on a current basis. Investors should consult their tax advisors with respect to such rules, which are summarized in the Company’s annual report.

For further information please contact:

Corporate Communications

ORIX Corporation

Mita NN Bldg., 4-1-23 Shiba, Minato-ku, Tokyo 108-0014

JAPAN

Tel: +81-3-5419-5102 Fax: +81-3-5419-5901

E-mail: raymond_spencer@orix.co.jp

Consolidated Financial Results from April 1, 2006 to December 31, 2006

(U.S. GAAP Financial Information for ORIX Corporation and its Subsidiaries)


Corporate Name:		ORIX Corporation
Listed Exchanges:		Tokyo Stock Exchange (Securities No. 8591) Osaka Securities Exchange New York Stock Exchange (Trading Symbol : IX)
Head Office:		Tokyo JAPAN Tel: +81-3-5419-5102 (URL http://www.orix.co.jp/grp/ir_e/ir_index.htm)

1. Performance Highlights for the Nine Months Ended December 31, 2006 and 2005, and the Year Ended March 31, 2006

(1) Performance Highlights - Operating Results (Unaudited)

(millions of JPY)*1


	Total Revenues	Year-on-Year Change		Operating Income	Year-on-Year Change		Income before *Income Taxes2**	Year-on-Year Change
December 31, 2006	851,751	27.7	%	223,597	33.3	%	246,727	28.9	%
December 31, 2005	666,848	5.5	%	167,791	83.6	%	191,466	69.8	%
March 31, 2006	930,397	—		214,975	—		249,787	—


	Net Income	Year-on-Year Change		Basic Earnings Per Share	Diluted Earnings Per Share
December 31, 2006	150,981	19.7	%	1,675.43	1,614.50
December 31, 2005	126,097	86.2	%	1,434.39	1,359.01
March 31, 2006	166,388	—		1,883.89	1,790.30

1.	Equity in Net Income of Affiliates was a net gain of JPY 21,967 million for the nine months ended December 31, 2006, a net gain of JPY 20,716 million for the nine months ended December 31, 2005 and a net gain of JPY 32,080 million for the year ended March 31, 2006.

2.	The average number of shares was 90,114,837 for the nine months ended December 31, 2006, 87,909,798 for the nine months ended December 31, 2005 and 88,321,649 for the year ended March 31, 2006.


3. Adoption of simplified accounting method	Yes	( x )	No ( )

4. Changes in Accounting Principles	Yes	( )	No ( x ) (except for adoptions of new accounting principles)

5. Changes in Numbers of Consolidated Subsidiaries and Affiliates	Yes	( x )	No ( )
Additions: Consolidated Subsidiaries 9, Affiliates 2			Deletions: Consolidated Subsidiaries 5, Affiliates 4


*Note 1:		Unless otherwise stated, all amounts shown herein are in millions of Japanese yen or millions of U.S. dollars, except for Per Share amounts which are in single yen.

*Note 2:		“Income before Income Taxes” as used throughout the report represents “Income before Income Taxes, Minority Interests in Earnings of Subsidiaries, Discontinued Operations and Extraordinary Gain.”

(2) Performance Highlights - Financial Position (Unaudited)


	Total Assets	Shareholders’ Equity	Shareholders’ Equity Ratio		Shareholders’ Equity Per Share
December 31, 2006	7,802,545	1,137,752	14.6	%	12,588.14
December 31, 2005	6,686,456	898,828	13.4	%	10,099.03
March 31, 2006	7,242,455	953,646	13.2	%	10,608.97

1.	The number of outstanding shares was 90,382,877 as of December 31, 2006, 89,001,424 as of December 31, 2005 and 89,890,579 as of March 31, 2006.

(3) Performance Highlights - Cash Flows (Unaudited)


	Cash Flows from Operating Activities	Cash Flows from Investing Activities		Cash Flows from Financing Activities	Cash and Cash Equivalents at End of Period
December 31, 2006	163,714	(561,663	)	278,251	126,782
December 31, 2005	140,718	(466,715	)	315,286	135,931
March 31, 2006	136,003	(799,357	)	762,528	245,856

2. Forecasts for the Year Ending March 31, 2007 (Unaudited)

Fiscal Year

Total
Revenues

Income before

Income Taxes

Net
Income

March 31, 2007

1,123,000

319,000

195,000

1.	Basic Earnings Per Share is forecasted to be JPY 2,157.49.

Summary of Consolidated Financial Results

1. Nine Months Ended December 31, 2006

Financial Highlights


Income before Income Taxes*		246,727 million yen (Up 29% year on year)
Net Income		150,981 million yen (Up 20% year on year)
Earnings Per Share (Basic)		1,675.43 yen (Up 17% year on year)
Earnings Per Share (Diluted)		1,614.50 yen (Up 19% year on year)
Shareholders’ Equity Per Share		12,588.14 yen (Up 19% on March 31, 2006)
ROE (Annualized)		19.3% (December 31, 2005: 20.7%)
ROA (Annualized)		2.68% (December 31, 2005: 2.64%)

*	“Income before income taxes” refers to “income before income taxes, minority interests in earnings of subsidiaries, discontinued operations and extraordinary gain.”

Revenues: 851,751 million yen (Up 28% year on year)

Revenues increased 28% to 851,751 million yen in the first nine months of this fiscal year compared with the

same period of the previous fiscal year. Although “direct financing leases” and “life insurance premiums and related investment income” decreased year on year, revenues from “operating leases,” “interest on loans and investment securities,” “brokerage commissions and net gains on investment securities,” “real estate sales,” “gains on sales of real estate under operating leases,” and “other operating revenues” were up compared to the same period of the previous fiscal year.

Revenues from “direct financing leases” decreased 2% to 68,626 million yen compared to the same period of the previous fiscal year. In Japan, revenues from “direct financing leases” were down 10% to 47,295 million yen compared to 52,451 million yen in the same period of the previous fiscal year due to the lower level of operating assets and a decrease in revenues from securitization. Overseas, revenues were up 19% to 21,331 million yen compared to 17,931 million yen in the same period of the previous fiscal year due to the expansion of leasing operations in the Asia, Oceania and Europe segment.

Revenues from “operating leases” increased 18% to 189,502 million yen compared to the same period of the previous fiscal year. In Japan, there was an expansion of automobile and real estate operating leases, that resulted in a 18% increase in revenues to 143,902 million yen compared to 122,095 million yen in the same period of the previous fiscal year. Overseas, revenues were up 19% to 45,600 million yen compared to 38,207 million yen in the same period of the previous fiscal year due to the expansion of automobile operating leases in the Asia, Oceania and Europe segment.

Revenues from “interest on loans and investment securities” increased 25% to 146,262 million yen compared to the same period of the previous fiscal year. In Japan, “interest on loans and investment securities” increased 17% to 110,688 million yen compared to 94,665 million yen in the same period of the previous fiscal year due primarily to an expansion of interest earning assets including non-recourse loans and loans to corporate customers. Overseas, revenues were up 61% to 35,574 million yen compared to 22,086 million yen in the same period of the previous fiscal year due to an expansion of revenues associated with loans to corporate customers as well as contributions from interest on investment securities in The Americas segment, in addition to the expansion of our loan servicing operations in the Asia, Oceania and Europe segment.

- 1 -

Revenues from “brokerage commissions and net gains on investment securities” more than doubled to 57,830 million yen compared to the same period of the previous fiscal year. Brokerage commissions decreased year on year. Net gains on investment securities more than doubled year on year due to the strong performance of our venture capital operations in Japan, in addition to the gains on the sale of a portion of our shares in Aozora Bank, Ltd. (herein referred to as “Aozora Bank”) in connection with its listing on the Tokyo Stock Exchange, as well as contributions overseas from revenues of securities investments in The Americas segment.

“Life insurance premiums and related investment income” were down 4% year on year to 94,198 million yen, due to decrease in life insurance premiums and life insurance related investment income year on year.

“Real estate sales” increased 48% year on year to 79,245 million yen due to an increase in the number of condominiums sold to buyers from 1,415 units in the first nine months of the previous fiscal year to 2,045 units in the first nine months of this fiscal year.

“Gains on sales of real estate under operating leases” (refer to (Note 1) below) increased 85% year on year to 17,468 million yen due to an increase in sales of office buildings and other real estate under operating leases.

“Other operating revenues” increased 53% year on year to 198,620 million yen. In Japan, revenues were up 22% to 155,290 million yen compared to 126,940 million yen in the same period of the previous fiscal year due to the increases in revenues associated with our real estate management operations, including training facilities and golf courses, and the automobile maintenance service operations, as well as the contribution from the beginning of the first quarter of this fiscal year of companies, which we invested in the previous fiscal year, in addition to contributions of servicing fees from our loan servicing operations. Overseas, revenues increased almost 14 times to 43,330 million yen compared to 3,206 million yen in the same period of the previous fiscal year due to the contribution from the beginning of the first quarter of this fiscal year of Houlihan Lokey Howard & Zukin (herein referred to as “Houlihan Lokey”) that entered the ORIX Group in the fourth quarter of the previous fiscal year and is included in The Americas segment.

Note 1: Subsidiaries, business units, and certain rental properties sold or to be disposed of by sale without significant continuing involvements are reported under discontinued operations and the related amounts that had been previously reported have been reclassified retroactively.

Expenses: 628,154 million yen (Up 26% year on year)

Expenses increased 26% to 628,154 million yen compared with the same period of the previous fiscal year. Although “life insurance costs” and “provision for doubtful receivables and probable loan losses” were down year on year, “interest expense,” “costs of operating leases,” “costs of real estate sales,” “other operating expenses,” “selling, general and administrative expenses,” “write-downs of long-lived assets,” and “write-downs of securities” increased year on year.

“Interest expense” was up 37% year on year to 58,801 million yen. “Interest expense” increased 25% year on year in Japan and increased 56% year on year overseas, due to the higher average debt levels and higher interest rates.

“Costs of operating leases” were up 20% year on year to 120,882 million yen accompanying the increase in the average balance of investment in operating leases.

“Life insurance costs” decreased year on year to 81,711 million yen.

“Costs of real estate sales” were up 41% year on year to 64,989 million yen along with the increase in “real estate sales.”

- 2 -

“Other operating expenses” were up 24% year on year to 104,175 million yen accompanying the increase in “other operating revenues.”

“Selling, general and administrative expenses” were up 43% year on year to 182,729 million yen due to an increase in personnel and related expenses associated with Houlihan Lokey, which entered the ORIX Group in the fourth quarter of the previous fiscal year, as well as an increase in the number of employees in the Corporate Financial Services and Automobile Operations segments as a result of an effort to expand our sales platform in Japan.

Despite an increase in operating assets, “provision for doubtful receivables and probable loan losses” was down 21% year on year to 9,387 million yen due to a lower occurrence of new non-performing assets and some reversals of the provision for doubtful receivables and probable loan losses.

“Write-downs of long-lived assets” increased year on year to 1,318 million yen.

“Write-downs of securities” were up 4% year on year to 4,047 million yen.

Net Income: 150,981 million yen (Up 20% year on year)

“Operating income” was up 33% year on year to 223,597 million yen, due to the reasons noted above.

“Equity in net income of affiliates” was up 6% to 21,967 million yen compared to the same period of the previous fiscal year due to an increase in profits from equity method affiliates in Japan, despite a decrease in profits from equity method affiliates overseas.

“Gains on sales of subsidiaries and affiliates and liquidation loss” were down 61% year on year to 1,163 million yen.

As a result, “income before income taxes, minority interests in earnings of subsidiaries, discontinued operations and extraordinary gain” increased 29% year on year to 246,727 million yen.

“Minority interests in earnings of subsidiaries, net” almost tripled year on year to 3,315 million yen as a result of the minority interests in earnings from the beginning of the first quarter of this fiscal year of Houlihan Lokey that entered the ORIX Group in the fourth quarter of the previous fiscal year.

“Income from continuing operations” increased 27% year on year to 141,978 million yen.

“Discontinued operations (refer to (Note 1) on page 2), net of applicable tax effect” decreased 41% year on year to 8,430 million yen.

As a result, “net income” increased 20% year on year to 150,981 million yen.

Operating Assets: 6,416,509 million yen (Up 10% on March 31, 2006)

Operating assets were up 10% on March 31, 2006 to 6,416,509 million yen. While “investment in direct financing leases” was down on March 31, 2006, “installment loans,” “investment in operating leases,” “investment in securities,” and “other operating assets” were up.

- 3 -

Segment Information

Segment profits (refer to (Note 2) below) declined for the “Rental Operations,” “Life Insurance,” and “The Americas” segments; and increased for the “Corporate Financial Services,” “Automobile Operations,” “Real Estate-Related Finance,” “Real Estate,” “Other,” and “Asia, Oceania and Europe” segments compared to the same period of the previous fiscal year.

Note 2: Since the Company evaluates the performance of its segments based on profits before income taxes, tax expenses are not included in segment profits. In addition, results of discontinued operations are included in “Segment Revenues” and “Segment Profits” of each segment, if any. Such amounts are eliminated in “Difference between Segment totals and Consolidated Amounts.”

Operations in Japan

Corporate Financial Services Segment

Segment revenues were up 17% year on year to 89,071 million yen due mainly to the expansion of loans to corporate customers.

Although “selling, general and administrative expenses” increased as a result of upfront costs associated with an increase in the number of employees as a result of an effort to expand our sales and marketing base, segment profits increased 9% to 41,857 million yen compared to 38,445 million yen in the same period of the previous fiscal year due to an increase in segment revenues and the lower “provision for doubtful receivables and probable loan losses.”

Segment assets increased 11% on March 31, 2006 to 1,794,665 million yen due to an increase in loans to corporate customers.

Automobile Operations Segment

Segment revenues increased 14% year on year to 109,140 million yen due to the increase in revenues from operating leases and maintenance services in the automobile leasing operations.

Although “selling, general and administrative expenses” increased as a result of an increase in the number of employees in an effort to develop our customer base focusing on expanding our automobile-related business to individuals, segment profits increased 6% to 19,741 million yen in line with the increase in segment revenues compared to 18,590 million yen in the same period of the previous fiscal year.

Although there was an expansion of the automobile leasing operations that also include operating leases, segment assets were flat on March 31, 2006 at 512,987 million yen due to asset securitization.

Rental Operations Segment

Segment revenues were flat year on year at 49,446 million yen.

Segment profits decreased 4% to 6,328 million yen compared to 6,612 million yen due to the recognition of losses on the sale of investment securities.

Segment assets were down on March 31, 2006 to 120,826 million yen due to a decrease in investment in direct financing leases despite an increase in investment in operating leases.

- 4 -

Real Estate-Related Finance Segment

Segment revenues increased 13% year on year to 57,988 million yen due to an expansion of revenues associated with corporate loans, including non-recourse loans, and contributions from the loan servicing operations and gains on sales of real estate under operating leases.

Segment profits increased 15% to 30,685 million yen compared to 26,770 million yen in the same period of the previous fiscal year due to the increase in segment revenues and a lower “provision for doubtful receivables and probable loan losses.”

Segment assets increased 14% on March 31, 2006 to 1,398,997 million yen due mainly to an increase in corporate loans, including non-recourse loans.

Real Estate Segment

Segment revenues increased 33% year on year to 194,949 million yen as more condominiums were sold to buyers in the first nine months of this fiscal year compared to the same period of the previous fiscal year, and due to the increase in revenues associated with the real estate management operations, including office rental activities, in addition to contributions from the gains on sales of real estate under operating leases.

Segment profits increased 61% to 41,958 million yen compared to 26,011 million yen in the same period of the previous fiscal year due to contributions from gains on sales of real estate under operating leases and due to the increase in segment revenues, including condominium sales.

Segment assets increased 20% on March 31, 2006 to 816,148 million yen due mainly to the expansion of operating assets, including investment in operating leases.

Life Insurance Segment

Segment revenues were down 4% year on year to 93,621 million yen as a result of lower revenues from life insurance premiums and related investment income compared to the same period of the previous fiscal year.

Segment profits decreased 30% year on year to 7,222 million yen compared to 10,324 million yen in the same period of the previous fiscal year due to lower segment revenues.

Segment assets increased 4% on March 31, 2006 to 512,622 million yen.

Other Segment

Segment revenues increased 49% year on year to 117,400 million yen due to an increase in gains on investment securities at the venture capital operations in addition to the gains on the sale of a portion of our shares in Aozora Bank in connection with its listing on the Tokyo Stock Exchange.

Segment profits increased 97% to 59,584 million yen compared to 30,268 million yen in the same period of the previous fiscal year. While gains on sales of subsidiaries and affiliates decreased year on year, the higher segment revenues and contributions from “equity in net income of affiliates” led to the higher segment profits.

Segment assets increased 14% on March 31, 2006 to 762,038 million yen.

- 5 -

Overseas Operations

The Americas Segment

Although the previous fiscal year benefited from the gain on the sale of the primary and master servicing business as well as gains on sales of real estate under operating leases, segment revenues increased 84% year on year to 85,830 million yen due to the contribution from the beginning of the first quarter of this fiscal year of Houlihan Lokey and the increase in revenues associated with corporate loans and securities investments.

Segment profits decreased 13% to 23,905 million yen compared to 27,591 million yen in the same period of the previous fiscal year. Although Houlihan Lokey contributed to profits from the beginning of the first quarter of this fiscal year, there were no contributions in the first nine months of this fiscal year such as the gain on the sale of operations that were recorded in the same period of the previous fiscal year, in addition to a decrease in “equity in net income of affiliates.”

Segment assets increased 12% on March 31, 2006 to 494,359 million yen due mainly to an increase in corporate loans.

Asia, Oceania and Europe Segment

Segment revenues were up 13% year on year to 76,523 million yen due to the expansion of the leasing operations that include operating leases such as automobile leasing, as well as the loan servicing operations, in addition to gains on the sale of operations in the Oceania region.

Segment profits increased 8% to 29,230 million yen compared to 27,100 million yen in the same period of the previous fiscal year due to an increase in segment revenues as described above and the increase in “equity in net income of affiliates,” despite a decrease in gains on sales of subsidiaries and affiliates.

Segment assets were up 9% on March 31, 2006 to 615,064 million yen due mainly to an increase in operating leases and investment in affiliates.

2. Summary of Cash Flows (Nine Months Ended December 31, 2006)

Cash and cash equivalents decreased by 119,074 million yen to 126,782 million yen compared to March 31, 2006.

“Cash flows from operating activities” provided 163,714 million yen in the first nine months of this fiscal year, compared to 140,718 million yen in the same period of the previous fiscal year. Principally, there were inflows associated with an increase in net income and decrease in restricted cash, while there was an outflow from “increase in inventories,” which is associated with the residential condominium development operations.

“Cash flows from investing activities” used 561,663 million yen in the first nine months of this fiscal year, compared to 466,715 million yen in the same period of the previous fiscal year, due mainly to the increase in outflows associated with the increase in “installment loans made to customers” as a result of the expansion of loans to corporate customers, including non-recourse loans.

“Cash flows from financing activities” provided 278,251 million yen in the first nine months of this fiscal year, compared to 315,286 million yen in the same period of the previous fiscal year, due to the increase in debt accompanying the increase in operating assets.

- 6 -

3. Summary of Third Quarter (Three Months Ended December 31, 2006)

In the third quarter revenues increased 74,155 million yen year on year.

Revenues from “direct financing leases” were down compared to the third quarter of the previous fiscal year due to the reduced contribution from gains on securitization and the decrease in the average balance of operating assets. Revenues from “operating leases” were up in line with the increase in operating assets. Revenues from “interest on loans and investment securities” were up compared to the same period of the previous fiscal year due to the increase in operating assets and contribution from interest on investment securities. “Brokerage commissions and net gains on investment securities” were up compared to the same period of the previous fiscal year due to the increase in net gains on investment securities as we recorded gains on the sale of a portion of our shares in Aozora Bank in connection with its listing on the Tokyo Stock Exchange, despite the decrease in brokerage commissions. Although life insurance premiums decreased, life insurance related investment income was up compared to the same period of the previous fiscal year for “life insurance premiums and related investment income.” “Real estate sales” decreased year on year due to the decrease in the number of condominiums sold to buyers in the third quarter of this fiscal year compared to the same period of the previous fiscal year. “Gains on sales of real estate under operating leases” were up year on year. “Other operating revenues” were up year on year due to the increase in revenues associated with our real estate management operations, including training facilities and golf courses, and revenue from the automobile maintenance service operations, as well as the contribution from Houlihan Lokey that entered the ORIX Group in the fourth quarter of the previous fiscal year.

Expenses were up 37,963 million yen compared to the third quarter of the previous fiscal year.

“Interest expense” was up year on year due to higher average debt levels and higher interest rates. “Costs of operating leases” were up year on year in line with the increase in operating assets. “Life insurance costs” were down compared with the same period of the previous fiscal year. “Costs of real estate sales” decreased in line with the lower “real estate sales.” “Other operating expenses” increased in line with the increased “other operating revenues.” “Selling, general and administrative expenses” were up year on year as a result of an increase in expenses associated with Houlihan Lokey, in addition to upfront costs associated with an increase in the number of employees as a result of an effort to expand our sales platform primarily in Japan. The “provision for doubtful receivables and probable loan losses” and “write-downs of securities” were up compared to the third quarter of the previous fiscal year.

This resulted in an increase in “operating income” by 36,192 million yen to 89,142 million yen compared with the third quarter of the previous fiscal year.

“Equity in net income of affiliates” was up year on year and “gains on sales of subsidiaries and affiliates and liquidation loss” decreased. “Income before income taxes, minority interests in earnings of subsidiaries, discontinued operations and extraordinary gain” increased by 36,881 million yen compared to the third quarter of the previous fiscal year to 96,099 million yen.

“Minority interests in earnings of subsidiaries” of 1,589 million yen were recorded and as a result, “income from continuing operations” increased by 20,464 million yen to 54,865 million yen.

“Discontinued operations, net of applicable tax effect” added 4,790 million yen and “net income” in the third quarter of this fiscal year rose by 17,512 million yen to 59,655 million yen compared with a “net income” of 42,143 million yen in the third quarter of the previous fiscal year.

- 7 -

Consolidated Financial Highlights

(For the Nine Months Ended December 31, 2006 and 2005, and the Year Ended March 31, 2006)

(Unaudited)

(millions of JPY, except for per share data)


	December 31, 2006		Relationship to March 31, 2006		Year -on- year Change		December 31, 2005		Year -on- year Change		March 31, 2006		Year -on- year Change
Operating Assets
Investment in Direct Financing Leases	1,343,413		93	%	90	%	1,495,765		101	%	1,437,491		99	%
Installment Loans	3,341,163		114	%	122	%	2,727,640		117	%	2,926,036		123	%
Investment in Operating Leases	816,050		113	%	131	%	621,492		108	%	720,096		116	%
Investment in Securities	773,546		113	%	115	%	669,748		111	%	682,798		116	%
Other Operating Assets	142,337		155	%	147	%	96,699		118	%	91,856		111	%

Total	6,416,509		110	%	114	%	5,611,344		111	%	5,858,277		114	%

Operating Results
Total Revenues	851,751		—		128	%	666,848		106	%	930,397		102	%
Income before Income Taxes, Minority Interests in Earnings of Subsidiaries, Discontinued Operations and Extraordinary Gain	246,727		—		129	%	191,466		170	%	249,787		163	%
Net Income	150,981		—		120	%	126,097		186	%	166,388		182	%
Earnings Per Share
Net Income
Basic	1,675.43		—		117	%	1,434.39		177	%	1,883.89		173	%
Diluted	1,614.50		—		119	%	1,359.01		183	%	1,790.30		179	%
Shareholders’ Equity Per Share	12,588.14		119	%	125	%	10,099.03		132	%	10,608.97		127	%

Financial Position
Shareholders’ Equity	1,137,752		119	%	127	%	898,828		140	%	953,646		131	%
Number of Outstanding Shares (’000)	90,383		101	%	102	%	89,001		106	%	89,891		103	%
Long-and Short-Term Debt and Deposits	5,231,652		106	%	116	%	4,518,350		111	%	4,925,753		119	%
Total Assets	7,802,545		108	%	117	%	6,686,456		114	%	7,242,455		119	%
Shareholders’ Equity Ratio	14.6	%	—		—		13.4	%	—		13.2	%	—
Return on Equity (annualized)	19.3	%	—		—		20.7	%	—		19.8	%	—
Return on Assets (annualized)	2.68	%	—		—		2.64	%	—		2.50	%	—

New Business Volumes
Direct Financing Leases
New Receivables Added	551,204		—		82	%	670,853		111	%	888,912		103	%
New Equipment Acquisitions	491,499		—		82	%	601,120		112	%	800,802		104	%
Installment Loans	1,575,705		—		126	%	1,254,454		114	%	1,834,192		119	%
Operating Leases	252,842		—		137	%	184,571		104	%	317,645		128	%
Investment in Securities	170,293		—		104	%	163,190		98	%	235,932		96	%
Other Operating Transactions	147,295		—		168	%	87,740		87	%	132,017		102	%

- 8 -

Condensed Consolidated Statements of Income

(For the Nine Months Ended December 31, 2006 and 2005, and the Year Ended March 31, 2006)

(Unaudited)

(millions of JPY, millions of US$)


	Nine Months ended December 31, 2006		Year -on- year Change (%)	Nine Months ended December 31, 2005		Year -on- year Change (%)	Year ended March 31, 2006		Year -on- year Change (%)	U.S. dollars Nine Months ended December 31, 2006
Total Revenues :	851,751		128	666,848		106	930,397		102	7,151

Direct Financing Leases	68,626		98	70,382		112	96,136		111	576
Operating Leases	189,502		118	160,302		112	210,430		109	1,591
Interest on Loans and Investment Securities	146,262		125	116,751		120	159,727		120	1,228
Brokerage Commissions and Net Gains on Investment Securities	57,830		205	28,200		137	48,826		144	486
Life Insurance Premiums and Related Investment Income	94,198		96	98,175		101	138,118		101	791
Real Estate Sales	79,245		148	53,459		78	74,943		61	665
Gains on Sales of Real Estate under Operating Leases	17,468		185	9,433		869	8,970		577	147
Other Operating Revenues	198,620		153	130,146		91	193,247		95	1,667

Total Expenses :	628,154		126	499,057		92	715,422		91	5,274

Interest Expense	58,801		137	43,024		112	59,179		114	494
Costs of Operating Leases	120,882		120	100,444		110	134,465		109	1,015
Life Insurance Costs	81,711		98	82,976		95	117,622		96	686
Costs of Real Estate Sales	64,989		141	46,013		74	65,904		58	546
Other Operating Expenses	104,175		124	83,957		84	123,460		85	874
Selling, General and Administrative Expenses	182,729		143	127,489		105	185,950		111	1,534
Provision for Doubtful Receivables and Probable Loan Losses	9,387		79	11,816		44	16,178		41	79
Write-downs of Long-Lived Assets	1,318		253	521		6	8,336		71	11
Write-downs of Securities	4,047		104	3,878		97	4,540		92	34
Foreign Currency Transaction Loss (Gain), Net	115		—	(1,061	)	—	(212	)	—	1

Operating Income	223,597		133	167,791		184	214,975		165	1,877

Equity in Net Income of Affiliates	21,967		106	20,716		116	32,080		160	184
Gains on Sales of Subsidiaries and Affiliates and Liquidation Losses	1,163		39	2,959		83	2,732		82	10

Income before Income Taxes, Minority Interests in Earnings of Subsidiaries, Discontinued Operations and Extraordinary Gain	246,727		129	191,466		170	249,787		163	2,071

Provision for Income Taxes	101,434		129	78,416		158	96,796		143	851

Income before Minority Interests in Earnings of Subsidiaries, Discontinued Operations and Extraordinary Gain	145,293		129	113,050		179	152,991		178	1,220

Minority Interests in Earnings of Subsidiaries, Net	3,315		262	1,266		104	3,223		131	28

Income from Continuing Operations	141,978		127	111,784		181	149,768		179	1,192

Discontinued Operations:
Income from Discontinued Operations, Net	14,001			23,523			27,335			118
Provision for Income Taxes	(5,571	)		(9,210	)		(10,715	)		(47	)

Discontinued Operations, Net of Applicable Tax Effect	8,430		59	14,313		245	16,620		211	71

Extraordinary Gain, Net of Applicable Tax Effect	573		—	—		—	—		—	5

Net Income	150,981		120	126,097		186	166,388		182	1,268

Note:

Pursuant to FASB Statement No. 144 (“Accounting for the Impairment or Disposal of Long-Lived Assets”), the results of operations which meet the criteria for discontinued operations are reported as a separate component of income, and those related amounts that had been previously reported are reclassified.

- 9 -

Condensed Consolidated Statements of Income

(For the Three Months Ended December 31, 2006 and 2005)

(Unaudited)

(millions of JPY, millions of US$)


	Three Months ended December 31, 2006		Year -on- year Change (%)	Three Months ended December 31, 2005		Year -on- year Change (%)	U.S. dollars Three Months ended December 31, 2006
Total Revenues :	299,019		133	224,864		104	2,510

Direct Financing Leases	21,847		92	23,814		114	183
Operating Leases	65,129		120	54,127		113	547
Interest on Loans and Investment Securities	51,460		126	40,692		126	432
Brokerage Commissions and Net Gains on Investment Securities	39,296		505	7,784		104	330
Life Insurance Premiums and Related Investment Income	30,431		102	29,705		97	255
Real Estate Sales	11,350		51	22,083		84	95
Gains (Losses) on Sales of Real Estate under Operating Leases	5,288		—	(12	)	—	44
Other Operating Revenues	74,218		159	46,671		93	624

Total Expenses :	209,877		122	171,914		95	1,762

Interest Expense	21,235		142	14,954		121	178
Costs of Operating Leases	43,757		127	34,342		113	367
Life Insurance Costs	24,275		98	24,737		91	204
Costs of Real Estate Sales	9,983		55	18,248		81	84
Other Operating Expenses	39,354		132	29,906		83	330
Selling, General and Administrative Expenses	63,657		145	43,977		110	535
Provision for Doubtful Receivables and Probable Loan Losses	5,830		116	5,042		49	49
Write-downs of Long-Lived Assets	—		—	—		—	—
Write-downs of Securities	1,905		157	1,210		98	16
Foreign Currency Transaction Loss (Gain), Net	(119	)	—	(502	)	—	(1	)

Operating Income	89,142		168	52,950		151	748

Equity in Net Income of Affiliates	6,950		136	5,109		64	59
Gains on Sales of Subsidiaries and Affiliates and Liquidation Loss	7		1	1,159		156	0

Income before Income Taxes, Minority Interests in Earnings of Subsidiaries, Discontinued Operations and Extraordinary Gain	96,099		162	59,218		135	807

Provision for Income Taxes	39,645		162	24,504		124	333

Income before Minority Interests in Earnings of Subsidiaries, Discontinued Operations and Extraordinary Gain	56,454		163	34,714		144	474

Minority Interests in Earnings of Subsidiaries, Net	1,589		508	313		82	13

Income from Continuing Operations	54,865		159	34,401		145	461

Discontinued Operations:
Income from Discontinued Operations, Net	7,806			12,524			66
Provision for Income Taxes	(3,016	)		(4,782	)		(26	)

Discontinued Operations, Net of Applicable Tax Effect	4,790		62	7,742		561	40

Extraordinary Gain, Net of Applicable Tax Effect	—		—	—		—	—

Net Income	59,655		142	42,143		168	501

- 10 -

Condensed Consolidated Balance Sheets

(As of December 31, 2006 and March 31, 2006)

(Unaudited)

(millions of JPY, millions of US$)


	December 31, 2006		March 31, 2006		U.S. dollars December 31, 2006
Assets
Cash and Cash Equivalents	126,782		245,856		1,064
Restricted Cash	127,383		172,805		1,070
Time Deposits	946		5,601		8
Investment in Direct Financing Leases	1,343,413		1,437,491		11,279
Installment Loans	3,341,163		2,926,036		28,051
Allowance for Doubtful Receivables on Direct Financing Leases and Probable Loan Losses	(91,835	)	(97,002	)	(771	)
Investment in Operating Leases	816,050		720,096		6,851
Investment in Securities	773,546		682,798		6,494
Other Operating Assets	142,337		91,856		1,195
Investment in Affiliates	359,849		316,773		3,021
Other Receivables	193,909		165,657		1,628
Inventories	175,483		140,549		1,473
Prepaid Expenses	46,542		40,676		391
Office Facilities	90,245		91,797		758
Other Assets	356,732		301,466		2,995

Total Assets	7,802,545		7,242,455		65,507


Liabilities and Shareholders’ Equity
Short-Term Debt	1,112,673		1,336,414		9,342
Deposits	390,681		353,284		3,280
Trade Notes, Accounts Payable and Other Liabilities	353,538		334,008		2,968
Accrued Expenses	88,272		89,043		741
Policy Liabilities	488,130		503,708		4,098
Current and Deferred Income Taxes	302,943		250,997		2,543
Security Deposits	162,970		150,836		1,368
Long-Term Debt	3,728,298		3,236,055		31,301

Total Liabilities	6,627,505		6,254,345		55,641


Minority Interests	37,288		34,464		313

Common Stock	90,992		88,458		764
Additional Paid-in Capital	112,292		106,729		943
Retained Earnings:
Legal Reserve	2,220		2,220		19
Retained Earnings	876,275		733,386		7,357
Accumulated Other Comprehensive Income	59,584		27,603		500
Treasury Stock, at Cost	(3,611	)	(4,750	)	(30	)

Total Shareholders’ Equity	1,137,752		953,646		9,553

Total Liabilities and Shareholders’ Equity	7,802,545		7,242,455		65,507


	December 31, 2006		March 31, 2006		U.S. dollars December 31, 2006
Note: Accumulated Other Comprehensive Income
Net unrealized gains on investment in securities	80,101		50,856		672
Minimum pension liability adjustments	(621	)	(632	)	(5	)
Foreign currency translation adjustments	(22,053	)	(26,132	)	(185	)
Net unrealized gains on derivative instruments	2,157		3,511		18

- 11 -

Condensed Consolidated Statements of Shareholders’ Equity

(For the Nine Months Ended December 31, 2006 and 2005, and the Year Ended March 31, 2006)

(Unaudited)

(millions of JPY, millions of US$)


	Nine Months ended December 31, 2006		Nine Months ended December 31, 2005		Year ended March 31, 2006		U.S. dollars Nine Months ended December 31, 2006
Common Stock:
Beginning balance	88,458		73,100		73,100		742
Exercise of warrants and stock acquisition rights	1,504		2,296		2,829		13
Conversion of convertible bond	1,030		7,164		12,529		9

Ending balance	90,992		82,560		88,458		764

Additional Paid-in Capital:
Beginning balance	106,729		91,045		91,045		896
Exercise of warrants, stock acquisition rights and stock options	1,502		2,298		2,831		13
Stock-based compensation	2,681		—		—		22
Conversion of convertible bond	945		7,162		12,528		8
Other, net	435		242		325		4

Ending balance	112,292		100,747		106,729		943

Legal Reserve:
Beginning balance	2,220		2,220		2,220		19

Ending balance	2,220		2,220		2,220		19

Retained Earnings:
Beginning balance	733,386		570,494		570,494		6,157
Cash dividends	(8,092	)	(3,496	)	(3,496	)	(68	)
Net income	150,981		126,097		166,388		1,268

Ending balance	876,275		693,095		733,386		7,357

Accumulated Other Comprehensive Income (Loss):
Beginning balance	27,603		(1,873	)	(1,873	)	232
Net change of unrealized gains on investment in securities	29,245		11,337		10,706		245
Net change of minimum pension liability adjustments	11		(31	)	458		0
Net change of foreign currency translation adjustments	4,079		14,275		13,478		34
Net change of unrealized gains on derivative instruments	(1,354	)	2,141		4,834		(11	)

Ending balance	59,584		25,849		27,603		500

Treasury Stock:
Beginning balance	(4,750	)	(7,653	)	(7,653	)	(40	)
Exercise of stock options	1,142		2,144		3,025		10
Other, net	(3	)	(134	)	(122	)	(0	)

Ending balance	(3,611	)	(5,643	)	(4,750	)	(30	)

Total Shareholders’ Equity:
Beginning balance	953,646		727,333		727,333		8,006
Increase, net	184,106		171,495		226,313		1,547

Ending balance	1,137,752		898,828		953,646		9,553

Summary of Comprehensive Income:
Net income	150,981		126,097		166,388		1,268
Other comprehensive income	31,981		27,722		29,476		268

Comprehensive income	182,962		153,819		195,864		1,536

- 12 -

Condensed Consolidated Statements of Cash Flows

(For the Nine Months Ended December 31, 2006 and 2005, and the Year Ended March 31, 2006)

(Unaudited)

(millions of JPY, millions of US$)


	Nine Months ended December 31, 2006		Nine Months ended December 31, 2005		Year ended March 31, 2006		U.S. dollars Nine Months ended December 31, 2006
Cash Flows from Operating Activities:
Net income	150,981		126,097		166,388		1,268
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	111,670		95,608		135,028		938
Provision for doubtful receivables and probable loan losses	9,387		11,816		16,178		79
Decrease in policy liabilities	(15,578	)	(45,164	)	(47,172	)	(131	)
Gains from securitization transactions	(3,643	)	(6,356	)	(7,139	)	(31	)
Equity in net income of affiliates	(21,967	)	(20,716	)	(32,080	)	(184	)
Gains on sales of subsidiaries and affiliates and liquidation losses	(1,163	)	(2,959	)	(2,732	)	(10	)
Extraordinary gain	(573	)	—		—		(5	)
Minority interests in earnings of subsidiaries, net	3,315		1,266		3,223		28
Gains on sales of available-for-sale securities	(41,609	)	(8,641	)	(10,401	)	(349	)
Gains on sales of real estate under operating leases	(17,468	)	(9,433	)	(8,970	)	(147	)
Gains on sales of operating lease assets other than real estate	(10,061	)	(5,833	)	(7,184	)	(84	)
Write-downs of long-lived assets	1,318		521		8,336		11
Write-downs of securities	4,047		3,878		4,540		34
Decrease (increase) in restricted cash	45,491		(38,225	)	(119,202	)	382
Decrease (increase) in trading securities	11,776		(10,333	)	(9,091	)	99
Increase in inventories	(46,530	)	(25,618	)	(56,596	)	(391	)
Increase in prepaid expenses	(5,478	)	(4,374	)	(2,316	)	(46	)
Increase (decrease) in accrued expenses	(4,226	)	(18,824	)	2,755		(36	)
Increase in security deposits	10,198		38,904		48,597		86
Other, net	(16,173	)	59,104		53,841		(137	)

Net cash provided by operating activities	163,714		140,718		136,003		1,374

Cash Flows from Investing Activities:
Purchases of lease equipment	(776,535	)	(794,722	)	(1,136,538	)	(6,519	)
Principal payments received under direct financing leases	473,473		483,285		670,781		3,975
Net proceeds from securitization of lease receivables, loan receivables and securities	139,812		151,116		194,806		1,174
Installment loans made to customers	(1,575,556	)	(1,252,768	)	(1,834,192	)	(13,228	)
Principal collected on installment loans	1,125,270		846,481		1,200,337		9,447
Proceeds from sales of operating lease assets	122,364		114,826		130,992		1,027
Investment in affiliates, net	(1,902	)	(2,243	)	10,754		(16	)
Purchases of available-for-sale securities	(117,237	)	(137,612	)	(201,123	)	(984	)
Proceeds from sales of available-for-sale securities	73,197		103,750		166,251		615
Maturities of available-for-sale securities	24,942		23,008		38,706		209
Purchases of other securities	(52,770	)	(25,412	)	(34,634	)	(443	)
Proceeds from sales of other securities	60,597		16,981		23,142		509
Purchases of other operating assets	(33,575	)	(21,397	)	(25,630	)	(282	)
Acquisitions of subsidiaries, net of cash acquired	(18,235	)	(2,005	)	(38,837	)	(153	)
Sales of subsidiaries, net of cash disposed	3,019		2,383		2,664		25
Other, net	(8,527	)	27,614		33,164		(71	)

Net cash used in investing activities	(561,663	)	(466,715	)	(799,357	)	(4,715	)

Cash Flows from Financing Activities:
Net increase (decrease) in debt with maturities of three months or less	(177,807	)	110,729		326,285		(1,493	)
Proceeds from debt with maturities longer than three months	1,738,128		1,470,020		2,102,054		14,593
Repayment of debt with maturities longer than three months	(1,321,091	)	(1,300,583	)	(1,697,828	)	(11,091	)
Net increase in deposits due to customers	37,366		31,770		16,628		314
Issuance of common stock	3,006		4,829		5,975		25
Dividends paid	(8,092	)	(3,496	)	(3,496	)	(68	)
Net increase in call money	5,600		—		10,000		47
Other, net	1,141		2,017		2,910		9

Net cash provided by financing activities	278,251		315,286		762,528		2,336

Effect of Exchange Rate Changes on Cash and Cash Equivalents	624		1,262		1,302		5

Net Increase (Decrease) in Cash and Cash Equivalents	(119,074	)	(9,449	)	100,476		(1,000	)
Cash and Cash Equivalents at Beginning of Period	245,856		145,380		145,380		2,064

Cash and Cash Equivalents at End of Period	126,782		135,931		245,856		1,064

- 13 -

Segment Information

(For the Nine Months Ended December 31, 2006 and 2005, and the Year Ended March 31, 2006)

(Unaudited)

(millions of JPY)


	Nine months ended December 31, 2006					Nine months ended December 31, 2005					Year ended March 31, 2006
	Segment Revenues		Segment Profits		Segment Assets	Segment Revenues		Segment Profits		Segment Assets	Segment Revenues		Segment Profits		Segment Assets
Operations in Japan
Corporate Financial Services	89,071		41,857		1,794,665	76,380		38,445		1,639,685	97,683		48,661		1,616,574
Automobile Operations	109,140		19,741		512,987	95,422		18,590		504,276	130,775		26,661		509,149
Rental Operations	49,446		6,328		120,826	49,178		6,612		120,962	67,066		9,911		123,532
Real Estate-Related Finance	57,988		30,685		1,398,997	51,333		26,770		1,027,610	69,472		33,384		1,223,063
Real Estate	194,949		41,958		816,148	146,845		26,011		556,675	198,780		28,650		682,166
Life Insurance	93,621		7,222		512,622	97,650		10,324		523,272	137,468		13,212		491,857
Other	117,400		59,584		762,038	78,539		30,268		654,042	111,854		41,657		668,689

Sub-Total	711,615		207,375		5,918,283	595,347		157,020		5,026,522	813,098		202,136		5,315,030
Overseas Operations
The Americas	85,830		23,905		494,359	46,625		27,591		431,659	70,223		34,701		441,285
Asia, Oceania and Europe	76,523		29,230		615,064	67,476		27,100		559,701	88,914		31,956		562,654

Sub-Total	162,353		53,135		1,109,423	114,101		54,691		991,360	159,137		66,657		1,003,939

Segment Total	873,968		260,510		7,027,706	709,448		211,711		6,017,882	972,235		268,793		6,318,969

Difference between Segment totals and Consolidated Amounts	(22,217	)	(13,783	)	774,839	(42,600	)	(20,245	)	668,574	(41,838	)	(19,006	)	923,486

Consolidated Amounts	851,751		246,727		7,802,545	666,848		191,466		6,686,456	930,397		249,787		7,242,455

(millions of US$)


	U.S. dollars December 31, 2006
	Segment Revenues		Segment Profits		Segment Assets
Operations in Japan
Corporate Financial Services	748		351		15,067
Automobile Operations	916		166		4,307
Rental Operations	415		53		1,014
Real Estate-Related Finance	487		258		11,746
Real Estate	1,637		352		6,852
Life Insurance	786		61		4,304
Other	985		500		6,398

Sub-Total	5,974		1,741		49,688
Overseas Operations
The Americas	721		201		4,150
Asia, Oceania and Europe	642		245		5,164

Sub-Total	1,363		446		9,314

Segment Total	7,337		2,187		59,002

Difference between Segment totals and Consolidated Amounts	(186	)	(116	)	6,505

Consolidated Amounts	7,151		2,071		65,507


Note:		Since the Company evaluates the performance of its segments based on profits before income taxes, tax expenses are not included in segment profits. In addition, results of discontinued operations are included in “Segment Revenues” and “Segment Profits” of each segment, if any. Such amounts are eliminated in “Difference between Segment totals and Consolidated Amounts.”

- 14 -

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