This document has been translated and summarized from Japanese originals for reference purposes only. In
the event of any discrepancy between this translated document and the Japanese originals, the originals shallprevail. The Company assumes no responsibility for this translation or for direct, indirect or any other formsof damages arising from the translation.
(Securities Code: 6269)
March 4, 2016
To Our Shareholders with Voting Rights:
Toshiro Miyazaki
President and Chief Executive Officer
MODEC, INC.
3-10, Nihonbashi 2-chome Chuo-ku, TokyoNOTICE OF CONVOCATION OF
THE 30TH ANNUAL GENERAL MEETING OF SHAREHOLDERS
You are cordially invited to attend the 30th Annual General Meeting of Shareholders of MODEC, INC. (the“Company”) to be held as described below.
If you are unable to attend the meeting in person, you may exercise your voting rights in writing (by mail)or via the Internet. Please review the attached Reference Documents for the General Meeting of Shareholders
and exercise your voting rights by 5:40 p.m. on Wednesday, March 23, 2016.
[Exercise of Voting Rights in Writing]
Please indicate your approval or disapproval of each of the proposals on the enclosed Voting Rights
Exercise Form and return it by mail so that it is received by the deadline as stated above.
[Exercise of Voting Rights via the Internet]
Upon reading “Exercise of Voting Rights via the Internet” (Japanese only), please access the website
designated by the Company for the purpose of exercising your voting rights (http://www.web54.net). Please
enter the “vote exercising code” and “password” written on the enclosed Voting Rights Exercise Form andfollow the instructions on the screen to enter your approval or disapproval of each of the proposals by thedeadline as stated above.
If any voting right is exercised both in writing and via the Internet, the vote that reached the Company at alater timing will be recognized as valid. In the event that both votes arrive on the same day, the vote via theInternet will be recognized as valid.
If you exercise your voting rights more than once via the Internet, the most recent vote will be recognized
as valid.

1. Date and Time:Thursday, March 24, 2016, at 10:00 a.m. (The reception desk opens at 9:00 a.m.)

2. Place:

BELLESALLE Tokyo Nihonbashi B2 Event Hall
Tokyo Nihonbashi Tower, 7-1, Nihonbashi 2-chome Chuo-ku, Tokyo(Please note that the venue has changed from last year)

3. Meeting Agenda:
Matters to be reported: 1. Operations Report, Consolidated Financial Statements, and Audit Reportconcerning Consolidated Financial Statements by the Accounting Auditor andthe Board of Corporate Auditors for the 30th Term (from January 1, 2015 to
December 31, 2015)
2. Non-consolidated Financial Statements for the 30th Term (from January 1,
2015 to December 31, 2015)-1-

Matters to be resolved:
Appropriation of Surplus
Proposal 1:
Election of Nine Directors
Proposal 2:
Election of Two Corporate Auditors
Proposal 3:
Revision of the Amount of Remuneration for Corporate Auditors
Proposal 4:
Payment of Bonuses to Directors
Proposal 5:--------------------------------------------------------------------------------------------------------------------------------

1. When attending the meeting, please submit the enclosed Voting Rights Exercise Form at thereception desk.
2. In case of voting by proxy, you can exercise your voting rights by appointing one shareholder who
has voting rights as your proxy.
3. Notes to Consolidated Financial Statements and Notes to Non-consolidated Financial Statements
are posted on the Company’s website (http://www.modec.com/jp/) (Japanese only) pursuant toapplicable laws and regulations as well as Article 15 of the Company’s Articles of Incorporation,and they are not included in the Appendix to this notice. Accordingly, the Appendix to this notice isa portion of the Consolidated Financial Statements or Non-consolidated Financial Statements
audited by the Accounting Auditor for the preparation of the Accounting Audit Report.
4. In case of circumstances requiring revisions to the Reference Documents for the General Meetingof Shareholders, Operations Report, Consolidated Financial Statements or Non-consolidated
Financial Statements, the revised items will be posted on the Company’s website(http://www.modec.com/).

-2-

Reference Documents for the General Meeting of Shareholders
Proposals and References
Proposal 1: Appropriation of Surplus
The distribution of stable and consecutive dividends to shareholders while retaining an appropriate
amount of internal reserve required for future business development and reinforcement of management baseis the Company’s basic policy on distribution of profits.
Based on this policy, as well as in light of the Company’s performance, management base reinforcement
for this fiscal year and future business development, a year-end dividend for this fiscal year is proposed asstated below.
(1) Type of dividend property
Cash(2) Allocation of dividend property and total amount thereof¥17.50 per share of common stock of the Company
Total amount of dividends: ¥987,128,398(3) Effective date of dividends from surplus
March 25, 2016
Proposal 2: Election of Nine Directors
The terms of office of all the current directors will expire at the conclusion of this General Meeting of
Shareholders.
Accordingly, the election of nine Directors is proposed, including an increase of two additional Directors
with a view to strengthen the Board of Directors’ function of monitoring and supervision.
The candidates for Directors are as stated below.
No.

Name
(Date of birth)

Career summary, positions and responsibilities at the Company, andsignificant concurrent positions
April 1972
October 2002
March 2005
June 2005

1

Toshiro Miyazaki(August 21, 1949)

June 2007
March 2008
March 2011
April 1981
June 2005

2

April 2008
Teruhisa Konishi
September 2010
(November 19, 1957)
April 2011
April 2013
March 2015

Joined Mitsui Engineering & Shipbuilding Co., Ltd.
General Manager of Corporate Planning Dept., Mitsui
Engineering & Shipbuilding Co., Ltd.
Corporate Auditor (part-time) of the Company
Deputy Director, General Manager of Corporate Planning Dept.
and General Manager of Asset Utilization Sect., Mitsui
Engineering & Shipbuilding Co., Ltd.
Director, in charge of Finance Dept., Accounting Dept. and IR& Public Relations, Mitsui Engineering & Shipbuilding Co.,Ltd.
Director of the Company
President and Chief Executive Officer of the Company (current
position)
Joined Mitsui Bank (currently Sumitomo Mitsui Banking
Corporation)
General Manager of Global Business Dept., Sumitomo Mitsui
Banking Corporation
Head of Sydney Branch, Sumitomo Mitsui Banking Corporation
President, Banco Sumitomo Mitsui Brasileiro S.A.
Deputy Director, Sumitomo Mitsui Banking Corporation,
President, Banco Sumitomo Mitsui Brasileiro S.A.
Executive Officer, General Manager of Human Resources Dept.
of the Company (current position)
Director of the Company (current position)-3-

Number ofshares of theCompany held

19,100

4,200

No.

Name
(Date of birth)

Career summary, positions and responsibilities at the Company, andsignificant concurrent positions
April 1983
April 2011

June 2012(*)
3

Minoru Sawada(August 12, 1960)

April 2013
October 2014
April 2015
October 2015
April 1980
April 2007

June 20094

Akira Nishihata(May 27, 1955)

March 2010
March 2011
June 2011
March 2012
March 2013
June 2013

April 1981
June 2007
April 2013

June 2013
5

Shinsuke Nippo(October 17, 1956)
March 2014
April 2014
June 2014
June 2015
April 1985
March 2010(*)
6

Yoshio Kometani(April 11, 1962)

April 2013
May 2014

April 2015

Joined Mitsui Engineering & Shipbuilding Co., Ltd.
General Manager of Planning & Administration Dept.,
Environment & Plant Hq., Mitsui Engineering & Shipbuilding
Co., Ltd.
General Manager of Planning & Administration Dept.,
Engineering Hq., Mitsui Engineering & Shipbuilding Co., Ltd.
General Manager of Procurement Dept., Engineering Hq., Mitsui
Engineering & Shipbuilding Co., Ltd.
General Manager of Project Management Dept., Engineering
Hq., Mitsui Engineering & Shipbuilding Co., Ltd.
Deputy Director, Mitsui Engineering & Shipbuilding Co., Ltd.
Deputy Director of the Company (current position)
Joined Mitsui Engineering & Shipbuilding Co., Ltd.
General Manager of Planning & Co-ordination Dept., Chiba
Shipyard, Ship & Ocean Project Hq., Mitsui Engineering &Shipbuilding Co., Ltd.
General Manager of Planning & Administration Dept., Ship &Ocean Project Hq., Mitsui Engineering & Shipbuilding Co., Ltd.
Corporate Auditor (part-time) of the Company
General Manager of Corporate Planning Dept., Mitsui
Engineering & Shipbuilding Co., Ltd.
Deputy Director, General Manager of Corporate Planning Dept.,
Mitsui Engineering & Shipbuilding Co., Ltd.
Resigned from Corporate Auditor of the Company
Director of the Company (current position)
Director, in charge of Corporate Planning Dept. and Research &Development Hq., Mitsui Engineering & Shipbuilding Co., Ltd.
(current position)
Joined Mitsui Engineering & Shipbuilding Co., Ltd.
General Manager of Plant Sales Dept., Environment & Plant Hq.,
Mitsui Engineering & Shipbuilding Co., Ltd.
General Manager of Energy Solutions & Infrastructure Sales
Dept. and General Manager of Plant Sales Dept., Engineering
Hq., Mitsui Engineering & Shipbuilding Co., Ltd.
Deputy Director, General Manager of Energy Solutions &Infrastructure Sales Dept. and General Manager of Plant Sales
Dept., Engineering Hq., Mitsui Engineering & Shipbuilding Co.,Ltd.
Director of the Company (current position)
Deputy General Manager of Engineering Hq., Mitsui
Engineering & Shipbuilding Co., Ltd.
Director, Deputy General Manager of Engineering Hq., Mitsui
Engineering & Shipbuilding Co., Ltd.
Executive Officer, Deputy General Manager of Engineering Hq.,
Mitsui Engineering & Shipbuilding Co., Ltd. (current position)
Joined Mitsui & Co., Ltd.
General Manager of Planning and Administrative Division,
Infrastructure Projects Business Unit, Mitsui & Co., Ltd.
Operating Officer of Infrastructure Projects Business Unit,
Mitsui & Co., Ltd.
Deputy Chief Operating Officer of Asia Pacific Business Unit,
Mitsui & Co., Ltd. and Senior Vice President, Mitsui & Co.
(Asia Pacific) Pte. Ltd. (located at Singapore) (current position)
Managing Officer, Mitsui & Co., Ltd. (current position)-4-

Number ofshares of theCompany held

4,000

0

0

0

No.

Name
(Date of birth)

Career summary, positions and responsibilities at the Company, andsignificant concurrent positions
April 1986

7

Katsuya Natori(May 15, 1959)

June 1990
July 1992
July 1993
January 1995
January 1998
March 2002
January 2004
April 2010
February 2012
April 2012
March 2015
November 2015
April 1972
June 1999
April 2001
June 2003
June 2005(*)
8

Shigenobu Aikyo(October 1, 1949)

April 2006

April 2007
April 2010
April 2011
April 2015
June 2015
April 1983
August 1991(*)
9

Hiroshi Kanno(November 14, 1958)

July 2008
June 2011
April 2012
October 2012
June 2014

Registered as an attorney, joined Masuda and Ejiri Law Office(currently Nishimura & Asahi)
Joined Davis Wright Tremaine LLP (Seattle, U.S.)
Joined Wilmer, Cutler & Pickering (Washington D.C., U.S.)
Joined Esso Sekiyu K.K.
Joined Apple Japan, Inc.
Director, Sun Microsystems K.K.
Executive Officer, FAST RETAILING CO., LTD.
Director, VP, IBM Japan, Ltd.
VP, IBM Japan, Ltd.
Founded Natori Law Office
Chief, Natori Law Office (current position)
Outside Audit & Supervisory Board Member, OLYMPUS
CORPORATION (current position)
External Director of the Company (current position)
External Director, MORITEX CORPORATION (current
position)
Joined Sumitomo Bank (currently Sumitomo Mitsui Banking
Corporation)
Executive Officer, Head of Human Resources Dept., Sumitomo
Bank
Executive Officer, Head of Corporate Management Dept.,
Sumitomo Mitsui Banking Corporation
Managing Executive Officer, Head of Tokyo Corporate Banking
Division I, Sumitomo Mitsui Banking Corporation
Managing Director and Managing Executive Officer, Sumitomo
Mitsui Banking Corporation
Senior Managing Director, Sumitomo Mitsui Banking
Corporation
Senior Managing Director (Executive Officer), Sumitomo Mitsui
Financial Group, Inc.
Deputy President, Head of Corporate Banking Unit, Sumitomo
Mitsui Banking Corporation
Chairman and Representative Director, Nikko Cordial Securities
Inc.
Chairman and Representative Director, SMBC Nikko Securities
Inc.
Advisor, SMBC Nikko Securities Inc.
External Director, HASHIMOTO SOGYO CO., LTD. (current
position)
Joined Nikken Sekkei Ltd
Joined The Boston Consulting Group
Partner and Managing Director, the last position at The Boston
Consulting Group
Professor, Hitotsubashi University Graduate School ofInternational Corporate Strategy (current position)
External Director, Omron Healthcare, Co., Ltd. (current position)
Dean, Hitotsubashi University Graduate School of International
Corporate Strategy
Outside Director, Japan Display Inc. (current position)
External Director, WOWOW INC. (current position)

Number ofshares of theCompany held

100

0

0

(Notes) 1. The persons with an asterisk (*) are new candidates for Directors.
2. Mitsui Engineering & Shipbuilding Co., Ltd. is the Company’s parent company. The positions and responsibilities at theparent company of the candidates who currently serve or had served during the past five years as executives at Mitsui
Engineering & Shipbuilding Co., Ltd. are stated in the above “Career summary, positions and responsibilities at theCompany, and significant concurrent positions.”
Other candidates for Directors have no special interest in the Company.

-5-3. Messrs. Yoshio Kometani, Katsuya Natori, Shigenobu Aikyo and Hiroshi Kanno are candidates for External Directors.
4. The term of office of Mr. Katsuya Natori, a current External Director, will be one year as of the conclusion of this
General Meeting of Shareholders.
5. Matters related to the candidates for External Directors(1) Reasons for the selection of Mr. Yoshio Kometani as a candidate for External Director are that he has acquired awide range of experience and knowledge related to the Company’s business and has abundant experience incorporate management.
(2) Reasons for the selection of Mr. Katsuya Natori as a candidate for External Director are that he has a wealth ofexperience and broad insight as a corporate manager and as an attorney cultivated through his overseas businessexperience over the years. If election of Mr. Katsuya Natori is approved, the Company intends to appoint him as
Independent Director as prescribed by the Tokyo Stock Exchange.
(3) Reasons for the selection of Mr. Shigenobu Aikyo as a candidate for External Director are that he has gained
extensive knowledge regarding finance and management through his longtime involvement in the management offinancial institutions. If election of Mr. Shigenobu Aikyo is approved, the Company intends to appoint him as
Independent Director as prescribed by the Tokyo Stock Exchange.
(4) Reasons for the selection of Mr. Hiroshi Kanno as a candidate for External Director are that he has abundant
experience as a business management consultant and professional insights as a researcher on business strategy
planning. If election of Mr. Hiroshi Kanno is approved, the Company intends to appoint him as Independent Director
as prescribed by the Tokyo Stock Exchange.
6. Liability limitation contract with the External Directors
The Company stipulates in its current Articles of Incorporation that the Company may enter into contracts with External
Directors which limit their liabilities for compensation of damages to the Company within a certain range so that theCompany can invite competent personnel as External Directors. If the reelection of Mr. Katsuya Natori, a candidate forExternal Director, is approved, the Company intends to renew the liability limitation contract with him with a content asstated below. Furthermore, if the election of Messrs. Yoshio Kometani, Shigenobu Aikyo and Hiroshi Kanno is approved,
the Company intends to enter into similar liability limitation contracts with them.
- In the event that External Directors cause damages to the Company by performing their duties, the maximum amountof liability shall be the minimum amount prescribed in Article 425, Paragraph 1 of the Japanese Companies Act, on thecondition that they perform their duties in good faith and without gross negligence.

-6-

Proposal 3: Election of Two Corporate Auditors
Corporate Auditors, Messrs. Takehiko Tsubokawa and Hiroki Higuchi will resign at the conclusion of this
General Meeting of Shareholders. Therefore, the Company proposes the election of two Corporate Auditors
as substitutes.
The election of Mr. Kenji Seto is proposed as a substitute for Mr. Takehiko Tsubokawa, resigning fromhis post as Corporate Auditor, and Mr. Yoshihiro Kato as a substitute for Mr. Hiroki Higuchi, also resigningfrom the same post. The term of office for the Corporate Auditors to be elected shall be the remaining termof office of the predecessors, as stipulated in the Company’s Articles of Incorporation.
The candidates for Corporate Auditors are as follows, and the Board of Corporate Auditors has given its
approval to this proposal.
No.

Name
(Date of birth)

Career summary, positions at the Company andsignificant concurrent positions
April 1976
October 2000
April 2001(*)
1

Kenji Seto
(July 4, 1953)

October 2005
June 2006

April 2013
April 1977
April 1986
July 1997
April 2005(*)
2

Yoshihiro Kato
April 2005
(November 20, 1954)
April 2012

April 2014

Joined Mitsui Bank (currently Sumitomo Mitsui Banking
Corporation)
Head of Financial Products Dept., Mitsui Bank
Head of Business Dept. I, Europe, Middle East and Africa
Division, Sumitomo Mitsui Banking Corporation
Joined JCB Co., Ltd.
Board Member, Executive Officer, General Manager ofInternational Headquarters, JCB Co., Ltd. and President andDirector, JCB International Co., Ltd.
Board Member, Senior Executive Officer, JCB Co., Ltd. (current
position)
Joined Bridgestone Tire Co., Ltd.
Joined Pricewaterhouse Aoyama Audit Corporation
Director, PricewaterhouseCoopers Tax Corporation
Founded Yoshihiro Kato International Accounting Office
Head, Yoshihiro Kato International Accounting Office (current
position)
Professor, Kanazawa Seiryo University and Graduate School ofKanazawa Seiryo University
Part-time Lecturer, Faculty of Law, Toin University of
Yokohama
Part-time Lecturer, Faculty of Human Life, Jumonji University
Professor, Faculty of Human Life, Jumonji University (current
position)(Notes) 1.
2.
3.
4.

Number ofshares of theCompany held

00

The persons with an asterisk (*) are new candidates for Corporate Auditors.
The above candidates for Corporate Auditors have no special interest in the Company.
Messrs. Kenji Seto and Yoshihiro Kato are candidates for External Corporate Auditors.
Matters related to the candidates for External Corporate Auditors(1) Reasons for the selection of Mr. Kenji Seto as a candidate for External Corporate Auditor are that he has abundant
experience as a corporate manager and has acquired a wide range of knowledge related to finance. If election of Mr.
Kenji Seto is approved, the Company intends to appoint him as Independent Corporate Auditor as prescribed by the
Tokyo Stock Exchange.
(2) Reasons for the selection of Mr. Yoshihiro Kato as a candidate for External Corporate Auditor are that he has awealth of knowledge and experience as a tax accountant and researcher on tax accounting. If election of Mr.
Yoshihiro Kato is approved, the Company intends to appoint him as Independent Corporate Auditor as prescribed by
the Tokyo Stock Exchange. Although Mr. Yoshihiro Kato has never been directly engaged in corporate management,
he is judged to be capable of appropriately performing the duties of an External Corporate Auditor for the reasonsmentioned above.
5. Liability limitation contract with the External Corporate Auditors
The Company stipulates in its current Articles of Incorporation that the Company may enter into contracts with External
Corporate Auditors which limit their liabilities for compensation of damages to the Company within a certain range sothat the Company can invite competent personnel as External Corporate Auditors. If the election of Messrs. Kenji Seto
and Yoshihiro Kato, candidates for External Corporate Auditors, is approved, the Company intends to renew the liability
limitation contract with them with a content as stated below.
- In the event that External Corporate Auditors cause damages to the Company by performing their duties, the maximum-7-amount of liability shall be the minimum amount prescribed in Article 425, Paragraph 1 of the Japanese Companies
Act, on the condition that they perform their duties in good faith and without gross negligence.

Proposal 4: Revision of the Amount of Remuneration for Corporate Auditors
At the 23rd Annual General Meeting of Shareholders held on March 27, 2009, the upper limit of
remuneration for Corporate Auditors of the Company was approved to be ¥50 million per year and it has notbeen revised. However, in consideration of changes in the roles and responsibilities of Corporate Auditors inline with subsequent changes in business environment and other various circumstances, it is hereby proposed
to revise the upper limit of remuneration for Corporate Auditors to ¥70 million per year.
If Proposal 3 is approved as proposed, the total number of Corporate Auditors will be four (currently four
as well), of which three will be Independent External Corporate Auditors (currently one).
Proposal 5: Payment of Bonuses to Directors
In view of the Company’s performance for this fiscal year, it is proposed that bonuses of up to ¥20
million in total be paid to three Directors (excluding External Directors) who were in office as of December
31, 2015.

-8-

[Appendix]
Operations Report (from January 1, 2015 to December 31, 2015)
Overview and Results of Operations
During the consolidated fiscal year under review, the Japanese economy followed a recovery trend,
reflecting an improvement in corporate earnings and capital investment mainly due to the economic andmonetary policies introduced by the government and steady consumer spending on the back of the recovering
employment and income situation. Overseas, while some emerging counties’ economic growth slowed, theU.S. saw an increase in consumer spending and private capital investment, thus maintaining a moderate
economic recovery as a whole.
Looking at crude oil prices, WTI oil prices trended at a low level and plunged to the level of 30 dollars
per barrel at the end of the year amid mounting concerns over prolonged oversupply. However, in the medium
and long term, oil companies are nonetheless likely to continue oil and gas exploration and development
activities, with a view to ensuring the sustainable supply of energy resources. Business related to floatingproduction systems, the MODEC Group’s mainstay business, is expected to experience long range stable
growth.
Under these circumstances, the Company received an order in September 2015 from Maersk Oil North
Sea UK Limited for the construction of a Floating Storage and Offloading system (FSO) for the Culzean fieldin the U.K. North Sea, the Company’s first project in the North Sea. Orders resulted in ¥188,767 million(down 52.3% year on year) mainly due to the postponement of orders for the expected projects in spite of theaforementioned order received for the new FSO. Revenue was ¥295,596 million (down 21.9%) due to steadyprogress in construction of FPSOs and ongoing revenue recognition by charter and O&M services, while
percentage of completion of newly awarded projects was in early stage and thus little contributed to revenue
recognition.
In terms of profit, operating profit stood at ¥5,075 million (down 40.8%), reflecting the impact of
incurring repair expenses at overseas subsidiaries, despite steady progress in FPSO construction work.
Ordinary profit came to ¥12,819 million (down 30.1%) due to the posting of stable equity in earnings of theaffiliates accounted for by the equity method engaged in the lease business and gain on valuation ofderivatives, despite the recording of foreign exchange losses at overseas subsidiaries. Net income stood at¥5,824 million (up 7.4%), reflecting the recording of extraordinary income due to insurance income and adecrease in minority interests.

-9-

Financial Statements
Consolidated Balance Sheet(December 31, 2015)(Millions of Japanese yen)
Description

AmountDescription(Assets)
Current assets(Liabilities)
242,120

Current liabilities

Cash and time deposits

57,956

Accounts payable - trade

Accounts receivable - trade145,752

Current portion of long-term loans payable

Inventories

Amount3,814

177,251
145,230
6,044

Lease obligations

30

Short-term loans receivable

4,214

Accrued expenses

8,822

Deferred tax assets

20,239

Income taxes payable

4,360

Other current assets

11,539Advances received

4,031

Less - allowance for bad debts(1,395)

Accrued employees’ bonuses

12

Accrued directors’ bonuses

14

112,343

Provision for product warranty

Property and equipment

18,485

Provision for repairs

3

Buildings and structures

127

Other provisions

5

Machinery and equipment

15,982

Deferred tax liabilities

0

Other property and equipment

2,358

Foreign exchange contract

87

16

Other current liabilities

1,910

Non-current assets

Construction in progress

Long-term liabilities
Intangible assets

Long-term loans payable

7,476

6,699

62,22950,219Goodwill

3,423

Lease obligations

29

Other

4,053

Net defined benefit liabilities

220

Investments and other assets
Investment securities
Long-term loans receivable fromunconsolidated subsidiaries andaffiliated companies
Deferred tax assets

Liabilities from application of equity method

4,906

86,381Other non-current liabilities

6,855

50,987

Total liabilities

239,481

27,009(Net assets)

4,663

Shareholders’ equity

99,232Bankrupt and substantially bankrupt claims

1,823

Common stock

30,122Other investments

3,722

Capital surplus

30,852Less - allowance for bad debts(1,823)Retained earnings

38,259Less - treasury stock at cost
Accumulated gains (losses) from valuation
Unrealized gains (losses) on available-for-salesecurities, net of tax
Unrealized gains (losses) on hedging derivative,
net of tax
Foreign currency translation adjustments
Retirement liability adjustments for foreign
consolidated subsidiaries, net of tax
Minority interests in consolidated subsidiaries

Total assets

354,464(Note) The figures are rounded down to the nearest million yen.

- 10 -(1)
2,322
7(15,667)
18,170(187)
13,428

Total net assets

114,983

Total liabilities and net assets

354,464

Consolidated Statement of Income(For year ended December 31, 2015)(Millions of Japanese yen)
Description

AmountRevenue

295,596

Cost of sales

275,517Gross profit

20,078Selling, general and administrative expenses

15,003Operating profit

5,075

Non-operating income
Interest income and dividend income
Equity in earnings of affiliates and unconsolidated
subsidiaries
Gain on revaluation of derivatives

3,652
8,345
2,078

Other

641

14,717

Non-operating expenses
Interest expense

1,395Commission fee

244

Foreign exchange gains (losses), net

5,306

Other

26

Ordinary profit

6,972
12,819Extraordinary income
Gain on sales of investment securities

12

Gain on liquidation of subsidiaries and affiliates

586

Insurance income

3,117

3,715

Extraordinary losses
Loss on disposal of non-current assets

161

Loss on abandonment of property and equipment

645

Loss on liquidation of subsidiaries and affiliates

686

Provision of allowance for doubtful accounts

212

1,705

Income before income taxes and minority interests

14,829

Income taxes - current

7,800

Income taxes - prior(32)

Income taxes - deferred

797

Income before minority interests

6,263

Minority interests

438

Net income

5,824- 11 -

Consolidated Statement of Changes in Net Assets(For year ended December 31, 2015)(Millions of Japanese yen)
Shareholders’ equity
Commonstock
Balance at January
1, 2015

Capitalsurplus30,122Retainedearnings

30,852

34,338

Total
shareholders’equityTreasurystock(1)

95,311

Change in items
Cash dividends
paid(1,903)(1,903)Net Income

5,824

5,824

Change in items
other thanshareholders’equityTotal change initems
Balance at
December 31,
2015

―

―

3,921

―

3,921

30,12230,852

38,259(1)

99,232

Accumulated gains (losses) from valuation
Retirement
Unrealized
Unrealized
liability
gains (losses)
Foreign
Total
gains (losses)
adjustments foroncurrency
accumulatedon hedging
foreignavailable-fortranslation
gains (losses)
derivative, net
consolidated
sale securities,
adjustmentsfrom valuationof taxsubsidiaries, net
net of tax
of taxBalance at January
1, 2015

1(13,741)

15,402

(197)

1,464

Minority
interests inconsolidated
subsidiaries

12,855

Total net
assets109,631

Change in items
Cash dividends
paid(1,903)Net Income

5,824

Change in items
other thanshareholders’equityTotal change initems
Balance at
December 31,
2015

6(1,926)

2,767

10

858

572

1,431

6

(1,926)

2,767

10

858

572

5,352

7

(15,667)

18,170

(187)

2,322

13,428114,983- 12 -

Non-Consolidated Balance Sheet(December 31, 2015)(Millions of Japanese yen)
Description

AmountDescription(Assets)
Current assets

Amount(Liabilities)
173,289

Current liabilities

114,113

Cash and time deposits

35,014

Accounts payable - trade77,512

Accounts receivable - trade

78,989

Short-term loans payable

10,245Work in process

1,351

Current portion of long-term loans payable

4,652

Advance payments - trade904

Lease obligations

30

Prepaid expenses

1,758

Accounts payable - other

1,683

Deferred tax assets

1,377

Accrued expenses

420

Accrued income

281

Advances received

2,130

Other current assets

2,419

Deposits received

62

Less - allowance for bad debts(2,197)

CMS deposits received

16,798

Accrued employees’ bonuses

12

Accrued directors’ bonuses

14

225

Other provisions

5

Buildings

127

Other current liabilities

Tools, furniture and fixtures

42

Leased assets

54

Non-current assets
Property and equipment

72,199Long-term liabilities
Long-term loans payable544

49,48947,606

71

Lease obligations

29

Software69

Provision for retirement benefits

220

Other

1

Other non-current liabilities

Intangible assets

Total liabilities
Investments and other assets
Investment securities
Shares of subsidiaries and affiliates
Long-term loans receivable fromunconsolidated subsidiaries andaffiliated companies
Deferred tax assets
Insurance funds

71,903

1,634
163,603(Net assets)

176

Shareholders’ equity

83,29348,383

Common stock

30,122

19,946

Capital surplus

30,852280

Legal capital surplus

299

Retained earnings

30,852
22,320Bankrupt and substantially bankrupt claims

1,823

Legal retained earnings

68

Other investments

2,816

Other retained earnings

22,252Less - allowance for bad debts(1,823)Retained earnings brought forward
Less-treasury stock at cost
Valuation and translation adjustments
Unrealized gains (losses) on available-for-salesecurities, net of tax
Unrealized gains (losses) on hedging derivative,
net of tax

Total assets

245,489- 13 -

22,252(1)(1,407)
7(1,415)

Total net assets

81,886

Total liabilities and net assets

245,489

Non-Consolidated Statement of Income(For year ended December 31, 2015)(Millions of Japanese yen)
Description

AmountRevenue

117,871

Cost of sales

110,005

Gross profit

7,865

Selling, general and administrative expenses

6,325

Operating profit

1,540

Non-operating income
Interest income and dividend income

5,808

Foreign exchange gains (losses), net

178

Gain on revaluation of derivatives

2,090

Other

471

8,549

Non-operating expenses
Interest expense

1,234Commission fee

244

Other

25

Ordinary profit

1,504
8,585

Extraordinary income
Gain on liquidation of subsidiaries and affiliates

4

Gain on sales of investment securities

12

Insurance income

3,117

3,133

Extraordinary losses
Loss on abandonment of property and equipment

645

Provision of allowance for doubtful accounts

1,880

2,525

Income before income taxes

9,192

Income taxes - current

1,073

Income taxes - deferred

1,965

Net income

6,153- 14 -

Non-Consolidated Statement of Changes in Net Assets(For year ended December 31, 2015)(Millions of Japanese yen)
Shareholders’ equity
Capital surplus
Commonstock
Balance at January
1, 2015

Retained earnings
Other retained
earnings
Legal retained
earnings
Retained earnings
brought forward

Legal capitalsurplus30,12230,85268

18,002

Change in items
Cash dividends
paid(1,903)Net Income

6,153

Change in items
other thanshareholders’equityTotal change initems
Balance at
December 31,
2015

―

―

―

4,249

30,12230,852

68

22,252

Shareholders’ equity
Treasurystock
Balance at January
1, 2015

Total shareholders’equity(1)

79,044

Valuation and translation adjustments
Unrealized gains
Unrealized gains(losses) on(losses) on hedging
available-for-salederivative, net of tax
securities, net of tax
1―

Total net
assets
79,045

Change in items
Cash dividends
paid(1,903)(1,903)Net Income

6,153

6,153

Change in items
other thanshareholders’equityTotal change initems
Balance at
December 31,
2015

6(1,415)(1,409)

―

4,249

6

(1,415)

2,840

(1)

83,293

7(1,415)81,886- 15 -