Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending March 31, 2011 <under Japanese GAAP>

Transcription

1 Translation Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending March 31, 2011 <under Japanese GAAP> Company name: Yamato Holdings Co., Ltd. Listing: Tokyo Stock Exchange Stock code: 9064 URL: Representative: Kaoru Seto, President Contact: Toshizo Kurisu, Executive Officer, in charge of Financing and Accounting Tel: (from overseas) Scheduled date of the submission of quarterly securities report: November 11, 2010 Scheduled date of the commencement of dividend payment: December 10, 2010 Preparation of supplementary materials on quarterly financial results: Yes Holding of quarterly financial results meeting: Yes October 28, 2010 (Amounts less than 1 million yen are discarded.) 1. Consolidated financial results for the second quarter of fiscal year 2011 (cumulative: from April 1, 2010 to September 30, 2010) (1) Consolidated operating results (Percentages indicate year-on-year changes.) Operating revenue Operating income Ordinary income Net income For the six months ended Millions of yen % Millions of yen % Millions of yen % Millions of yen % September 30, , ,222 (11.5) 21,377 (10.8) 10,499 (9.6) September 30, ,431 (6.4) 22, , , Net income per share Net income per share - fully diluted For the six months ended Yen Yen September 30, September 30, (2) Consolidated financial position Total assets Net assets Equity ratio Net assets per share As of Millions of yen Millions of yen % Yen September 30, , , , March 31, , , , (Reference) Equity: As of September 30, 2010: 515,994 million yen As of March 31, 2010: 512,910 million yen 2. Dividends Annual dividends First quarter Second quarter Third quarter Fiscal year-end Total Yen Yen Yen Yen Yen Fiscal Fiscal Fiscal 2011 (Forecast) (Note) Revisions to the forecasts in the second quarter of fiscal 2011: None

2 3. Consolidated earnings forecasts for fiscal year 2011 (from April 1, 2010 to March 31, 2011) (Percentages indicate year-on-year changes.) Operating revenue Operating income Ordinary income Net income Net income per share Millions of yen % Millions of yen % Millions of yen % Millions of yen % Yen Full year 1,228, , , , (Note) Revisions to the forecasts in the second quarter of fiscal 2011: None 4. Others (For details, please refer to Other Information on page 7 of the attached materials) (1) Changes in significant subsidiaries during the current quarter: None Note: Changes in specified subsidiaries resulting in the change in scope of consolidation during the current quarter (2) Application of simplified accounting and specific accounting: Yes Note: Application of simplified accounting and specific accounting for preparing the quarterly consolidated financial statements (3) Changes in accounting policies, procedures, and methods of presentation a. Changes due to revision to accounting standards, etc.: Yes b. Changes other than a.: None Note: Changes in accounting policies, procedures, and methods of presentation for preparing the quarterly consolidated financial statements described in the section of Summary of changes in accounting policies, procedures, and methods of presentation (4) Number of issued shares (common stock) a. Number of issued shares as of the end of the period (including treasury stock) As of September 30, ,052,892 shares As of March 31, ,052,892 shares b. Number of treasury shares as of the end of the period As of September 30, ,283,818 shares As of March 31, ,282,503 shares c. Average number of shares during the period (cumulative from the beginning of the fiscal year) For the six months ended September 30, ,769,383 shares For the six months ended September 30, ,921,207shares *Indication regarding execution of quarterly review procedures At the time of disclosure of this quarterly financial results report, the quarterly review procedures in accordance with the Financial Instruments and Exchange Law are incomplete. *Proper use of earnings forecasts and other noteworthy events Descriptions of the above financial projections and other data are based on information currently available to the Company and certain assumptions that we consider to be reasonable. Actual financial results may differ significantly from the projections for various reasons. For points to note when using such conditions and financial projections, please see Qualitative information on consolidated earnings forecasts of the attached materials to the quarterly financial results report on page 6.

3 Attached Materials Index 1. Qualitative Information on Consolidated Results for the Six Months... 2 (1) Qualitative information on consolidated operating results... 2 (2) Qualitative information on consolidated financial position... 6 (3) Qualitative information on consolidated earnings forecasts Other Information...7 (1) Summary of changes in significant subsidiaries... 7 (2) Summary of simplified accounting and specific accounting... 7 (3) Summary of changes in accounting policies, procedures, and methods of presentation Consolidated Financial Statements... 8 (1) Consolidated balance sheets... 8 (2) Consolidated statements of income (cumulative) (3) Consolidated statements of cash flows (4) Notes to premise of going concern (5) Segment information (6) Notes on significant changes in the amount of shareholders equity Supplementary Information...16 Operating revenue by business

4 1. Qualitative Information on Consolidated Results for the Six Months (1) Qualitative information on consolidated operating results The Yamato Group is expanding its Delivery Business, which centers on the Takkyubin service, while creating new value to make the lives of customers more convenient by combining management resources including information technology (IT), logistics technology (LT), and financial technology (FT) functions, and is working to achieve the sustainable growth of the entire Group. In terms of the business environment during the six months ended September 30, 2010, although there were signs of economic recovery mainly in Asia and despite growth in the mail-order market, the environment continued to be difficult as a result of rising frugality among consumers, a fall in demand for logistics due to the strong yen and other factors. Operating in this environment, the Yamato Group sought to meet the needs of customers by putting efforts into raising the level of sophistication of the Takkyubin service, and developing and cultivating high value-added services that are differentiators from competitors. In the Delivery Business, although the resulting increase in the delivery volumes of major corporate clients led to a lowering of the unit price, the delivery volumes for both the Takkyubin and Kuroneko Mail services rose against the year-ago period as a result of an active focus on proposal-type marketing that took the perspective of the end-user consumer and solutions-based marketing aimed at resolving inconveniences of corporate clients. In addition, to ensure our delivery quality is maintained and improved, the Group pushed forward with new initiatives to ready ourselves for future volume increases of Takkyubin and conducted advanced recruitment of new employees. Not only have these initiatives yielded improved delivery quality, efforts to constrain pickup and delivery costs resulted in an increased profit in the three months of the second quarter. With respect to the non-delivery businesses, aggressive sales expansion efforts were carried out on business models that realize better business efficiency and cost reductions for corporate clients, and in addition to capturing new customers, the transactions with existing customers were expanded. As a result, BIZ-Logistics Business and e-business in particular fared strongly. Our consolidated financial results for the six months ended September 30, 2010 were as follows. (Millions of yen) Item For the six months For the six months ended September 30, 2009 ended September 30, 2010 Change Growth (%) Operating revenue 580, ,857 17, Operating income 22,854 20,222 (2,632) (11.5) Ordinary income 23,967 21,377 (2,590) (10.8) Net income 11,607 10,499 (1,108) (9.6) Status of management measures a. Based on the medium-term management plan Create Satisfaction Three-Year Plan that started from April 2008, the Yamato Group is moving forward with the development of innovative logistics systems in the Japanese market and the expansion of the business area to the Asia region. In the fiscal year under review, the plan s final year, the Group, while widely promoting the business models developed up until the previous fiscal year, will work on the establishment of the Takkyubin service in the Asia region. b. Inside the Japanese market, the Group further strengthened the Takkyubin functions, conducted aggressive sales expansion of the Yamato Group s unique business model that provides value-added services that are differentiators from competitors, and accelerated the speed of business evolution. The Group shall continue in the future to offer convenience to both sender and receivers of parcels by creating business models that utilize the Yamato Group s unique functions and by expanding the market of these business models. c. Aiming to expand the business area to the Asia region, the Yamato Group is deploying business models in Shanghai and Singapore that have proven successful in Japan. In these cities, it has established a Takkyubin network and enhanced the range of international transportation services. As a result, local recognition of our services is gradually improving and users of the Takkyubin service have started to increase

5 The followings are summaries of each operating segment. Delivery The delivery volumes of Takkyubin and Kuroneko Mail services are as follows. (Million parcels / units) Category For the six months For the six months ended September 30, 2009 ended September 30, 2010 Change Growth (%) Takkyubin Kuroneko Mail 1,092 1, a. In the Takkyubin service, driven by the basic corporate philosophy of Total Reliability, the Yamato Group works on business evolution to make the lives of customers more convenient by utilizing its management resources. b. To further improve convenience for individual customers when sending parcels, the Yamato Group set up the system infrastructure to enable invoice printing by drivers from mobile terminals that can be used even at the front door for customers who are Kuroneko Members a membership service. Also, aiming to expand the points of service for sending and receiving Takkyubin, the Group expanded the number of stores that handle Takkyubin, mostly convenience stores, and worked hard to strengthen the points of contact with customers. c. While aggressively promoting a wide rage of business models aimed at corporate clients that utilize its management resources, the Group strengthened the functions offered by Kuroneko My Page, a Web service for corporate clients and strove to improve business efficiency for customers. d. In the Kuroneko Mail service, various value-added services were expanded, particularly for corporate clients. Such services included the "Kuroneko Mail Express Service," software for preparing address labels, and enclosing and sealing of printed materials. e. As part of efforts to develop the Takkyubin service overseas, in Shanghai and Singapore, the Group established a pickup and delivery network, conducted active recruitment and training of employees and strengthened the business infrastructure. In addition, the Group implemented a renewal of Worldwide Delivery Service, an international small-parcel delivery service and worked to establish a bidirectional international intermodal transportation network. f. Operating revenue amounted to 478,109 million yen, up 2.6% from the year-ago period due to the increase in Takkyubin and Kuroneko Mail delivery volumes, mainly for corporate clients. Operating income was 9,075 million yen, due to the effect of additional personnel and subcontracting expenses accompanying efforts to improve delivery quality. Although this is a 20.5% decrease compared with the year-ago period, operating income actually rose year on year for the three month period of the second quarter. BIZ-Logistics a. In the BIZ-Logistics Business, the Yamato Group is engaged in business evolution to provide customers with innovative logistics systems by combining management resources such as the Takkyubin network and the logistics know-how accumulated in the Group. b. In the Trade Logistics Service business, we provide a wide range of services including air and ocean transportation, packaging and customs clearance to meet various needs of customers. For example, in the Global Direct intermodal transportation service that is interlinked with the Takkyubin network, the Group offered customers value through boosting the sales capability and reducing costs by improving logistics efficiency through shortening lead times and reducing inventory. During the six months ended September 30, 2010, aiming to address a diverse range of customer transportation needs, the Group added a service that uses a high-speed ferry to the means of transportation between Japan and China

6 c. In the Retail Logistics Service business, aiming to resolve the latent dissatisfaction of mail-order shopping with regard to the inability to immediately receive products, the Group offers a logistics system that enables a more convenient form of mail-order shopping. In the six months ended September 30, 2010, the Group accelerated business evolution in Japan and abroad. In addition to opening dedicated centers equipped with automatic warehousing functions in Komaki City, Aichi Prefecture and Taiwan, as operational bases for Today Shopping Service, a service that delivers a product as fast as eight hours and as fast as four hours for designated areas, we also expanded the service area for this service in Sapporo and the Osaka/Kobe area. d. In the multi maintenance business, we provide to manufacturing companies a service to return repaired digital appliances in three days at the earliest and a service to comprehensively support recalls of defective products. In the six months ended September 30, 2010, this business grew steadily with increases in the number of consigned orders for both repair orders and recall orders. e. Operating revenue was up 9.8% from the year-ago period to 42,045 million yen as a result of an increase in the volume of freight handled in the Trade Logistics Service business and the expansion of the multi maintenance business. Operating income was 1,771 million yen, up 112.8% from 832 million yen in the year-ago period. Home Convenience a. In the Home Convenience Business, by utilizing the network made up of the management resources of the Yamato Group, we have been developing high value-added services and providing customers with convenient and comfortable living. b. In the Delivery & Installation business, we are providing a service that includes performing the complicated assembly and installation tasks required when furniture and electronic appliances are delivered. This service satisfies the needs of consumers who want to use the furniture or electronic appliances as soon as they are delivered. During the six months ended September 30, 2010, aiming to expand the size of items handled and better clarify size in pricing, the Group conducted a renewal of Household Takkyubin a delivery service for furniture and electronic appliances in order to establish an environment in which the service can be used with greater convenience. c. In the moving solutions business, aiming to meet the needs of people who have been relocated away from their families, and the companies employing them, the Group aggressively expanded sales of the Just Moving Service for Singles, which offers just-in-time moving and suitable fee structures reflecting the amount of furniture. In addition, aiming to better respond to the needs of customers, the Group is developing a new moving service for singles that aims to replicate the experience of a business trip. The service aims for a 30% reduction in the preparation and cleaning up tasks, purchase costs for furniture and electronic appliances at the transfer destination, and the moving expenses incurred by the company. d. Operating revenue amounted to 23,764 million yen, down 5.4% from the year-ago period affected by the weakened moving market, although the number of in-home installation works in the Delivery & Installation business and large electronic appliance repairs expanded. Operating expenses fell 4.2% from the yearago period due mainly to a reduction of subcontracting expenses as a result of discontinuing the outsourcing of various operations; however, this failed to offset the decreased operating revenue. Consequently, we posted an operating loss of 784 million yen in this business. e-business a. In the e-business, the Yamato Group helps customers streamline their business processes and solve potential issues by combining information technology, logistics technology, and financial technology functions to proactively propose solutions to help expand sales and reduce costs. b. In the e-logistic tracing solution business we worked to expand our sales of our "SCM Tracing Service," which contributes to better visualization of the flow of items, and helps customers to optimize inventory and manage individual units by leveraging the freight-tracking know-how cultivated in the Takkyubin service. During the six months ended September 30, 2010, the business grew with sales of this service expanded particularly to cable TV companies and medical device manufacturers

7 c. As part of Web-based mail order solution business, in the net supermarket business, which has been expanding in recent years, we offer the Net Super Support Service to help our customers to reduce initial costs and get operations up and running in a short time period. In addition to helping retail clients with package service including construction of a Web system, delivery of products and payment settlement, this service also contributes to the people in communities, such as depopulated areas, who find it inconvenient to do daily shopping. The number of orders for the service s introduction has expanded. d. In the Web-based on-demand solutions business, we promoted our "Promoted Item On-Demand Service" that incorporates the functions of warehouse, printing and delivery in an ASP service to meet the needs of customers who, for example, want to improve efficiency in the management of promoted items or reduce loss in promoted items. By proposing the convenience of being able to receive promoted items and pamphlets at the required time, in the required quantity and at the required place, we expanded sales for this service, particularly to pharmaceutical companies and insurance companies. e. Operating revenue was up 4.9% from the year-ago period to 16,222 million yen as a result of an expansion of services related to tracing and web-based mail-order. Operating income was 2,993 million yen, up 17.0% from the year-ago period. Financial a. In the Financial Business, the Yamato Group is endeavoring to respond to every means of settlement to meet the needs of customers in an effort to promote business expansion from collection on product delivery to B2B logistics settlement. b. In the Takkyubin Collect business, we concentrated efforts on expanding sales of payment by electronic money upon delivery of Takkyubin Collect, which was started from June this year to improve the convenience of consumers and boost the sales capability of mail-order companies. The use of electronic money has been expanding rapidly in recent years, and this service has earned positive appraisal from customers by differentiating itself from the competitors through supporting electronic money. As a result, the business achieved further growth. c. In the lease business, we offered management support services to logistics related companies, mainly consisting of leasing and sales of vehicles. During the six months ended September 30, 2010, we actively strove to boost our sales capability by promoting use of our used vehicle sales site on the Internet. d. Operating revenue was down 1.7% from the year-ago period to 25,457 million yen due to the impact of the market contraction of the shopping credit business, despite a strong growth in a number of payment settlement transactions of the Takkyubin Collect service. Operating income was 4,901 million yen, down 11.2% from the year-ago period. Truck Maintenance a. In the Truck Maintenance Business, the Yamato Group, through leveraging the technology that has been surely developed from the servicing and maintenance operations of Yamato Group vehicles as a management resource, is promoting business activities to help customers who use trucks, buses and other vehicles in their operations to improve convenience, comply with statutory vehicle inspections, and reduce costs. b. Based on this policy, we promote our "Off-Time Vehicle Inspection," whereby vehicle inspections are conducted in the hours that are convenient to the customer, and our 12-Month Fixed-Price Maintenance Package, which evens out the monthly vehicle maintenance expenses. In addition, during the six months ended September 30, 2010, operations were newly commenced at the Iwaki Plant in August, and we worked to expand the business area. c. Operating revenue amounted to 9,938 million yen, up 31.4% from the year-ago period due to an increase in the number of vehicles serviced and the rise in the unit price of fuel sales. Operating income was 1,166 million yen, up 14.5% from the year-ago period

8 Other a. The "JITBOX Charter service" is a service that provides transportation by transport box. The service takes advantage of its Group network consisting of 16 companies and provides customers value through just-intime delivery and frequent, right-volume delivery. During the six months ended September 30, 2010, the handling volume and operating revenue rose compared with the year-ago period due to an increase in the number of consigned orders for precision equipment transportation and by meeting the needs of equipment transportation for various events such as exhibitions. b. Operating income in Other excluding dividends which Yamato Holdings Co., Ltd. received from Group companies decreased 66.7% from the year-ago period to 348 million yen. (2) Qualitative information on consolidated financial position Total assets were 867,652 million yen as of September 30, 2010, down 10,988 million yen from the end of the previous fiscal year. This was primarily because of a decline in cash and deposits of 9,061 million yen due in part to the payment of accounts payable related to the land for Haneda Logistics Terminal. Liabilities decreased 12,453 million yen to 342,714 million yen from the end of the previous fiscal year. This was primarily because of a decline in accounts payable related to the purchase of noncurrent assets connected with the payment of land for Haneda Logistics Terminal. Total net assets were 524,938 million yen, up 1,465 million yen from the end of the previous fiscal year. Major factors included 10,499 million yen in net income on one hand, and on the other, the payment of 4,991 million yen for appropriation from surplus. Accordingly, the equity ratio changed to 59.5% from the previous fiscal year s 58.4%. Net cash provided by operating activities for the six months ended September 30, 2010 amounted to 29,381 million yen, which is an increase of 16,682 million yen compared with the year-ago period. Major factors included 19,958 million yen in income before income taxes and minority interests and 18,155 million yen in depreciation and amortization on one hand, and on the other, the payment of 16,478 million yen in income taxes. The main reason for the year-on-year difference was that compared with the year-ago period, there was an increase in notes and accounts payable-trade of 12,592 million yen. Net cash used in investing activities was 34,048 million yen due in part to purchase of property, plant and equipment of 28,962 million yen. Compared with the year-ago period, the amount of net cash used increased by 15,547 million yen. The main reason for the year-on-year difference was that compared with the year-ago period, there was an increase in cash used for the purchase of property, plant and equipment of 10,915 million yen due in part to the payment of accounts payable related to land for the Haneda Logistics Terminal. Net cash used in financing activities was 8,424 million yen due in part to a decrease in loans payable of 1,667 million yen and cash dividends paid of 4,984 million yen. Compared with the year-ago period, the amount of net cash used decreased by 5,143 million yen. The main reason for the year-on-year difference was the net amount of proceeds from and repayment of loans payable decreased by 5,036 million yen compared with the year-ago period. As a result of the above, cash and cash equivalents were 179,830 million yen as of September 30, 2010, down 9,520 million yen from the end of the previous fiscal year. (3) Qualitative information on consolidated earnings forecasts The future business environment is anticipated to remain severe as the future prospects of the economy are becoming more uncertain due to the rapid strengthening of the yen. Under these circumstances, while aggressively developing sale of solutions that leverages its management resources, the Yamato Group will continue to improve delivery quality, differentiate itself from competitors and boost its profitability. There has been no change to the consolidated earnings forecasts for the fiscal year 2011 since the announcement on April 28,

9 2. Other Information (1) Summary of changes in significant subsidiaries Not applicable. (2) Summary of simplified accounting and specific accounting Calculation of tax expenses Tax expenses are calculated by multiplying the income before income taxes by the reasonably estimated effective tax rates after the application of tax effect accounting to the income before income taxes for the fiscal year including the second quarter under review. Please note that income taxes-deferred is included in income taxes in the statements. (3) Summary of changes in accounting policies, procedures, and methods of presentation Changes to accounting policies Effective from the first quarter, the Company has adopted the Accounting Standard for Asset Retirement Obligations (ASBJ Statement No. 18, March 31, 2008) and the Guidance on Accounting Standard for Asset Retirement Obligations (ASBJ Guidance No. 21, March 31, 2008). Such change affects the consolidated statements of income in the following way: Operating expenses have been increased by 119 million yen, and as a result, operating income and ordinary income have each been reduced by the same amount. Also, as a result of recognizing extraordinary loss of 1,642 million yen, income before income taxes and minority interests has been reduced by 1,761 million yen

10 3. Consolidated Financial Statements (1) Consolidated balance sheets (Millions of yen) As of September 30, 2010 As of March 31, 2010 (Summary) Assets Current assets Cash and deposits 180, ,657 Notes and accounts receivable-trade 144, ,894 Accounts receivable-installment 46,694 52,945 Lease investment assets 16,630 17,362 Merchandise and finished goods 1, Work in process Raw materials and supplies Other 40,811 39,520 Allowance for doubtful accounts (3,673) (4,692) Total current assets 427, ,199 Noncurrent assets Property, plant and equipment Buildings and structures 268, ,632 Accumulated depreciation (150,802) (145,985) Buildings and structures, net 117, ,647 Vehicles 181, ,961 Accumulated depreciation (163,436) (163,054) Vehicles, net 18,092 15,906 Land 182, ,480 Lease assets 23,819 16,839 Accumulated depreciation (7,124) (6,626) Lease assets, net 16,694 10,212 Other 112, ,912 Accumulated depreciation (83,473) (78,966) Other, net 28,595 29,945 Total property, plant and equipment 363, ,192 Intangible assets Goodwill 900 Other 13,646 11,744 Total intangible assets 14,546 11,744 Investments and other assets Investment securities 20,221 26,536 Other 43,835 44,379 Allowance for doubtful accounts (2,024) (2,014) Allowance for investment loss (406) (406) Total investments and other assets 61,626 68,495 Total noncurrent assets 439, ,432 Deferred assets Bond issuance cost 2 9 Total deferred assets 2 9 Total assets 867, ,

11 (Millions of yen) As of September 30, 2010 As of March 31, 2010 (Summary) Liabilities Current liabilities Notes and accounts payable-trade 109, ,888 Short-term loans payable 22,820 26,854 Current portion of bonds 5,000 5,000 Lease obligations 5,144 3,535 Income taxes payable 11,291 18,694 Deferred installment income 7,349 8,644 Provision for bonuses 34,011 29,149 Other 57,024 71,542 Total current liabilities 251, ,309 Noncurrent liabilities Long-term loans payable 43,135 39,139 Lease obligations 11,966 7,069 Provision for retirement benefits 28,303 27,862 Provision for directors and auditors retirement benefits 7 7 Other 7,354 3,779 Total noncurrent liabilities 90,767 77,858 Total liabilities 342, ,167 Net assets Shareholders equity Capital stock 127, ,234 Capital surplus 121, ,315 Retained earnings 293, ,408 Treasury stock (26,506) (26,505) Total shareholders equity 515, ,452 Valuation and translation adjustments Valuation difference on available-for-sale securities 1,203 3,196 Foreign currency translation adjustment (1,103) (738) Total valuation and translation adjustments 99 2,457 Minority interests 8,944 10,562 Total net assets 524, ,473 Total liabilities and net assets 867, ,

12 (2) Consolidated statements of income (cumulative) For the six months ended September 30, 2009 (Millions of yen) For the six months ended September 30, 2010 Operating revenue 580, ,857 Operating cost 544, ,098 Operating gross profit 36,082 34,759 Selling, general and administrative expenses 13,227 14,537 Operating income 22,854 20,222 Non-operating income Interest income Dividends income Subsidies for low-emission vehicles Other 1,064 1,132 Total non-operating income 2,031 1,958 Non-operating expenses Interest expenses Other Total non-operating expenses Ordinary income 23,967 21,377 Extraordinary income Gain on sales of noncurrent assets 57 0 Gain on sales of investment securities 37 0 Compensation for removal 36 Reversal of allowance for doubtful accounts 334 Total extraordinary income Extraordinary loss Loss on retirement of noncurrent assets Impairment loss 1,068 Loss on valuation of investment securities 93 2 Loss on adjustment for changes of accounting standard for asset retirement obligations 1,642 Other Total extraordinary losses 1,403 1,754 Income before income taxes and minority interests 22,696 19,958 Income taxes 10,813 9,320 Income before minority interests 10,637 Minority interests in income Net income 11,607 10,

13 (3) Consolidated statements of cash flows For the six months ended September 30, 2009 (Millions of yen) For the six months ended September 30, 2010 Cash flows from operating activities Income before income taxes and minority interests 22,696 19,958 Depreciation and amortization 18,456 18,155 Loss on adjustment for changes of accounting standard for asset retirement obligations 1,642 Impairment loss 1,068 Increase (decrease) in provision for retirement benefits (237) 442 Increase (decrease) in provision for bonuses 7,735 4,872 Loss (gain) on valuation of investment securities 93 5 Decrease (increase) in notes and accounts receivable-trade 6,833 6,973 Increase (decrease) in notes and accounts payable-trade (16,966) (4,373) Other (12,630) (1,351) Subtotal 27,049 46,324 Interest and dividends income received Interest expenses paid (923) (802) Income taxes paid (13,788) (16,478) Net cash provided by (used in) operating activities 12,698 29,381 Cash flows from investing activities Purchase of property, plant and equipment (18,046) (28,962) Proceeds from sales of property, plant and equipment Purchase of investment securities (88) (3,419) Proceeds from sales of investment securities 55 1 Payments of loans receivable (588) (521) Collection of loans receivable Other payments (2,410) (3,391) Other proceeds 1,542 1,225 Net cash provided by (used in) investing activities (18,501) (34,048) Cash flows from financing activities Increase in short-term loans payable 40,000 49,386 Decrease in short-term loans payable (43,200) (55,049) Repayments of finance lease obligations (2,236) (2,483) Proceeds from long-term loans payable 8,000 Repayment of long-term loans payable (3,504) (4,004) Redemption of bonds (51) Purchase of treasury stock (76) (2) Cash dividends paid (4,870) (4,984) Other Net cash provided by (used in) financial activities (13,567) (8,424) Effect of exchange rate change on cash and cash equivalents 90 (269) Net increase (decrease) in cash and cash equivalents (19,280) (13,360) Cash and cash equivalents at beginning of period 174, ,351 Increase in cash and cash equivalents from newly consolidated subsidiary 62 3,853 Decrease in cash and cash equivalents resulting from exclusion of subsidiaries from consolidation (16) (13) Cash and cash equivalents at end of period 155, ,

14 (4) Notes to premise of going concern Not applicable. (5) Segment information [Segment information by business] For the six months ended September 30, 2009 (Millions of yen) Delivery BIZ-Logistics Home Convenience e-business Financial Operating revenue (1) Operating revenue from customers 466,029 38,303 25,128 15,467 25,897 (2) Inter-segment operating revenue or transfers 21,352 5,254 7,858 10,191 2,135 Total 487,382 43,558 32,987 25,659 28,033 Operating expenses 475,967 42,725 33,383 23,099 22,510 Operating income (loss) 11, (396) 2,559 5,522 Truck Maintenance Other Total Eliminations or corporate Consolidated Operating revenue (1) Operating revenue from customers 7,565 2, , ,431 (2) Inter-segment operating revenue or 11,637 31,617 90,048 (90,048) transfers Total 19,203 33, ,480 (90,048) 580,431 Operating expenses 18,184 15, ,832 (74,255) 557,577 Operating income (loss) 1,018 17,695 38,648 (15,793) 22,854 [Segment information by geographical area] For the six months ended September 30, 2009 (Millions of yen) Japan U.S.A. Europe Asia Total Eliminations or corporate Consolidated Operating revenue (1) Operating revenue from customers 573,058 3,841 1,264 2, , ,431 (2) Inter-segment operating revenue or transfers 2,012 1, ,103 5,417 (5,417) Total 575,070 5,499 1,909 3, ,849 (5,417) 580,431 Operating expenses 552,003 5,348 2,002 3, ,897 (5,319) 557,577 Operating income (loss) 23, (92) (171) 22,952 (97) 22,

15 [Overseas operating revenue] For the six months ended September 30, 2009 (Millions of yen) North America Other regions Total I. Overseas operating revenue 3,870 3,994 7,864 II. Consolidated operating revenue 580,431 III. Ratio of overseas operating revenue to consolidated operating revenue (%) Notes: 1. Method of grouping countries or regions, and major countries or regions belonging to groups (1) Method of grouping countries or regions: Grouped according to geographical proximity. (2) Major countries or regions belonging to groups North America: U.S.A. Other regions: The Netherlands, U.K., France, Hong Kong, Taiwan, Singapore, Guangzhou and Shanghai 2. Overseas operating revenue refers to operating revenue of the Company and consolidated subsidiaries that were generated in countries or regions outside of Japan

16 [Segment information] 1. Summary of reportable segment The reportable segments of the Company are constituent units of the Company whose separate financial information can be obtained. The Board of Directors periodically examines these segments to decide on the allocation of management resources and evaluate business performance. The Yamato Group consists of six business segments under the umbrella of the Company, a pure holding company, and these business segments have been formed according to business activity. Business management is conducted based on this business segment. Accordingly, based on this business segment, the Company has the following six reportable segments: Delivery Business, BIZ-Logistics Business, Home Convenience Business, e-business, Financial Business, and Truck Maintenance Business. Type of services by reportable segment Reportable segment Type of services Delivery Small parcel delivery services for consumers and corporations BIZ-Logistics Business-to-business distribution Home Convenience Moving and other lifestyle support services for consumers e-business Information services for corporations, such as ASP services and development of information systems Financial Financial services for consumers and corporations, such as settlement Truck Maintenance Collective vehicle management agent business for transportation companies 2. Information regarding amounts of operating revenue and income or loss by reportable segment For the six months ended September 30, 2010 Delivery BIZ-Logistics Home Convenience e-business (Millions of yen) Financial Operating revenue (1) Operating revenue from customers 478,109 42,045 23,764 16,222 25,457 (2) Inter-segment operating revenue or 24,763 5,710 7,449 11,676 2,364 transfers Total 502,872 47,755 31,214 27,898 27,822 Segment income (loss) 9,075 1,771 (784) 2,993 4,901 Truck Maintenance Other (Notes 1, 2) Total Reconciliation (Note 3) Amount recorded in consolidated statements of income (Note 4) Operating revenue (1) Operating revenue from customers 9,938 2, , ,857 (2) Inter-segment operating revenue or 12,487 35,099 99,551 (99,551) transfers Total 22,426 37, ,408 (99,551) 597,857 Segment income (loss) 1,166 19,413 38,538 (18,316) 20,222 Notes: 1. Other includes business-to-business distribution via JITBOX Charter, staffing services and shared services. 2. Operating revenue in Other includes dividends which the Company received from Group companies as a pure holding company and the effect of this on operating revenue and segment income is 18,712 million yen. 3. The adjustment of segment income is the elimination of inter-segment transfers. 4. The segment income is the amount after certain adjustments have been made to operating income recorded in the consolidated statements of income

17 (Additional information) Effective from the first quarter, the Company has adopted the Accounting Standard for Disclosures about Segments of an Enterprise and Related Information (ASBJ Statement No. 17, March 27, 2009) and the Guidance on the Accounting Standard for Disclosures about Segments of an Enterprise and Related Information (ASBJ Guidance No. 20, March 21, 2008). (6) Notes on significant changes in the amount of shareholders equity Not applicable

18 4. Supplementary Information Operating revenue by business Business segment For the six months For the six months ended September 30, 2009 ended September 30, 2010 Change Fiscal 2010 Business Amount Ratio Amount Ratio (%) Amount Ratio (Millions of yen) (%) (Millions of yen) (%) (Millions of yen) (%) Takkyubin 379, , , Kuroneko Mail 71, , , Delivery Express 23, , (3.2) 47, Others 28, , , Eliminations (37,321) (6.4) (40,459) (6.8) 8.4 (76,038) (6.3) Total 466, , , Trade Logistics Service 16, , , Retail Logistics Service 13, , , BIZ-Logistics Multi maintenance 3, , , Export Factory 1, , , Others 16, , , Home Convenience e-business Financial Truck Maintenance Other Eliminations (12,222) (2.1) (13,139) (2.2) 7.5 (26,059) (2.2) Total 38, , , Delivery & Installation 10, , (0.0) 20, Moving solution 13, , (9.8) 27, Merchandise distribution 8, , (5.1) 17, Eliminations (7,869) (1.3) (7,454) (1.2) (5.3) (15,650) (1.3) Total 25, , (5.4) 50, e-logistic tracing solution 5, , , Credit card solution 3, , (0.8) 6, IT operating solution 2, , (0.1) 4, Web-based mail order solution 3, , , Others 13, , , Eliminations (11,668) (2.0) (14,232) (2.4) 22.0 (25,074) (2.1) Total 15, , , Takkyubin Collect 15, , , Lease 8, , (2.2) 16, Shopping credit 3, , (24.2) 6, Others , Eliminations (2,173) (0.4) (2,401) (0.4) 10.5 (4,366) (0.4) Total 25, , (1.7) 52, Truck maintenance 18, , , Others 2, , , Eliminations (13,199) (2.3) (13,580) (2.2) 2.9 (27,504) (2.3) Total 7, , , JITBOX Charter service 1, , , Others 33, , , Eliminations (32,344) (5.6) (35,900) (6.0) 11.0 (48,561) (4.1) Total 2, , , Total 580, , ,200, * Effective from the first quarter, the Company has adopted the Accounting Standard for Disclosures about Segments of an Enterprise and Related Information and the Guidance on the Accounting Standard for Disclosures about Segments of an Enterprise and Related Information. The Yamato Group presents the comparisons with the six months ended September 30, 2009 because the current segments are the same as those of the previous segment information by business