Announcement Concerning Year-on-year Earnings Results Comparison for the Fiscal Year Ended March 2011

SOFTBANK CORP. (hereafter “the Company”) announced the following earnings results comparison between the fiscal year ended March 2011 and the fiscal year ended March 2010 (hereafter “the previous fiscal year;” “year on year”).
This press release is announced based on Tokyo Stock Exchange's guideline.

1. Comparison of earnings results

2. The earnings results' year-on-year fluctuation

For the fiscal year ended March 2011, the SOFTBANK Group achieved consolidated net sales of JPY 3,004,640 million, a 8.7% increase, with a 35.1% increase to JPY 629,163 million in operating income. Ordinary income grew 52.6% to JPY 520,414 million. Net income rose 96.2% to JPY 189,712 million.

(a) Net sales

Net sales totaled JPY 3,004,640 million, for a JPY 241,234 million (8.7%) year-on-year increase. This was mainly the result of strong growth in the number of mobile phone subscribers, combined with a rise in ARPU ^*1 and the number of mobile handsets shipped, ^*2 in the Mobile Communications segment.

(b) Cost of Sales

Cost of sales rose JPY 47,045 million (3.5%) year on year to JPY 1,373,617 million. This was mainly due to higher cost of goods on the increase in the number of mobile handsets shipped, while depreciation and amortization expenses relating to the 2G mobile phone service decreased due to termination of this service in March 2010, in the Mobile Communications segment.

(c) Selling, General and Administrative Expenses

Selling, general and administrative expenses grew JPY 30,896 million (3.2%) year on year to JPY 1,001,859 million. This was mainly because of increased sales commissions ^*3 associated with the increase in the number of mobile handsets sold ^*4 in the Mobile Communications segment.

(d) Operating Income

As a result, operating income totaled JPY 629,163 million, for a JPY 163,291 million (35.1%) year-on-year increase. The operating margin rose 4.1 percentage points year on year, to 20.9%.

(e) Non-operating Income / Expenses

Non-operating income totaled JPY 17,320 million, a JPY 8,001 million year-on-year increase. Non-operating expenses stood at JPY 126,069 million, a JPY 8,122 million year-on-year decrease. The primary item of non-operating expenses was interest expense, which totaled JPY 104,019 million.

(f) Ordinary Income

Ordinary income therefore totaled JPY 520,414 million, for a JPY 179,416 million (52.6%) year-on-year increase.

(g) Special Income

Special income totaled JPY 14,252 million, the main components were a JPY 6,623 million gain on sale of investment securities and a JPY 4,187 million gain on repurchase of minority interests and long-term debt.
Gain on repurchase of minority interests and long-term debt was the result of an acquisition made by the Company during this fiscal year, amounting to a total of JPY 412,500 million. This acquisition was of all class 1 preferred stock series 1 and stock acquisition rights issued by BB Mobile Corp. to Vodafone International Holdings B.V. and the entire amount of the principal and accrued interest of a long-term loan receivable, which was recorded as long-term debt in the Company's consolidated balance sheets, from SOFTBANK MOBILE Corp. to Vodafone Overseas Finance Limited.

(h) Special Loss

Special loss was JPY 54,053 million, which included a JPY 14,416 million loss on disaster, a JPY 9,521 million valuation loss on option, a JPY 8,739 million valuation loss on investment securities, and a JPY 7,099 million loss on adjustment for changes of the accounting standard for asset retirement obligations.
Loss on disaster was recorded in connection with the Great East Japan Earthquake that occurred in March 2011.
The Company has entered into agreements containing a put option ^*5 and a call option ^*6 for shares of Wireless City Planning Inc. (hereafter “WCP”), which is the Company's affiliate under equity method, with its shareholders other than the Company. These options are measured at fair value and the valuation loss is recorded as described above.

(i) Income Taxes

Provisions for current income taxes were JPY 173,509 million, provisions for deferred income taxes were JPY 32,047 million, and additional tax expenses of JPY 27,391 million were recorded as income taxes — correction. The income taxes — correction includes additional income taxes paid by Yahoo Japan Corporation (hereafter “Yahoo Japan”) in response to a correction and ruling notice which it received from the Tokyo Regional Taxation Bureau.

(j) Minority Interests in Net Income

Minority interests in net income totaled JPY 57,950 million. This was mainly the portion of net income recorded at Yahoo Japan and SB Asia Infrastructure Fund L.P., a consolidated subsidiary from this fiscal year, attributable to the shareholders other than the Company.

(k) Net Income

As a result of the above, net income totaled JPY 189,712 million, for a JPY 92,996 million (96.2%) year-on-year increase.