BRIEF STATEMENT OF ANNUAL FINANCIAL RESULTS FOR THE YEAR ENDED
MARCH 2010 AND FORECASTS FOR THE YEAR ENDING MARCH 2011
May 12, 2010
Faith, Inc. (Stock code 4295, Listed on TSE 1st section)(URL http://www.faith.co.jp/)
Representative; Hajime Hirasawa, CEO/President
Contact; Koji Saeki, CFO/Director
Tel: +81-75-213-3933
Date of General Meeting of Shareholders: June 29, 2010
Date of Submission of Annual Security Report: June 29, 2010
Starting Date of the Dividend Payment: June 30, 2010
Amounts are rounded down to the nearest JPY 1 million.

1. Results for the fiscal year (From April 1, 2009 to March 31, 2010)(1) Consolidated financial results
Those figures in “%” show increased/decreased ratio compared with the previous fiscal term

Net Sales
Years Ended
March 2010

Millions of yen

March 2009

Millions of yen

56,63453,957

7.5

Net Profit
Share
Years ended
March 2010
March 2009

Operating Profit
%
5.0

per

Yen
△1,529.05△127.19

Recurring Profit
Millions of yen

735

%
△48.4

1,425

△37.1

DilutedNet
Profit per Share
Yen――

Return on Equity
Capital
%
△13.9
△1.1

Net Profit
Millions of yen

627

%
△36.9

△1,755

%
―

994

△47.9

△149

―

Recurring Profit
on Total Assets
%
2.1
3.0

Operating Profit
on Net Sales
%
1.3
2.6

Reference: Equity in earnings of associated companies: the fiscal year ended March 2010: △84 million yen/ the fiscal year
ended March 2009: △349 million yen(2) Consolidated financial position
Total Assets
Years Ended
March 2010
March 2009

Net Assets

Ratio of Equity
CapitalMillions of yen

Millions of yen

29,96330,496

12,985
14,499

%
39.6
43.8

Net Assets per ShareYen
10,327.22
11,634.84

Reference: Equity Capital: the fiscal year ended March 2010: 11,856 million yen/ the fiscal year ended March 2009: 13,357
million yen.

(3) Cash flow results
Cash Flow fromOperating Activities
Years ended
March 2010
March 2009

Cash Flow from
Investing Activities

Cash
Flow
from
Financing Activities

Cash and Cash
Equivalents, End of
the year

Millions of yen

Millions of yen

Millions of yen

Millions of yen

4,436
4,500

△6,311△766△406△3,351

8,340
10,6491

2. Dividends
Dividends per share(Record dates)

Years ended
March 2009
March 2010
Year ending
March 2011
(Forecast)

1st
Quarteryen

InterimYear-endyen

3rdQuarter
yen

yen

Total
(Annual)
yen

―
―
―

50.00
50.00
50.00

―
―
―

50.00
50.00
50.00

100.00100.00100.00Total Dividend
Payment

Payout Ratio

Dividend on
Net Assets(Consolidated)(Annual)(Consolidated)

%
114.8

Millions of yen

119
114

%
0.8
0.9

3. Forecasts for the consolidated business results for the year ending March 2011
(from April 1, 2010 to March 31, 2011)
The figures in “%” show increased/decreased ratio compared with the previous fiscal year and the previous interim result.

Net SalesInterimresults
Year ending
March 2011

Operating Profit

Recurring Profit

Net Income

Millions ofyen%Millionsof yen%Millionsof yen%Millions of yen%

Net Income
per ShareYen

29,500

12.1

400

△46.5

350

△49.3

60

△62.0

52.26

65,000

1.2

1,000

36.0

850

35.4

100

―

87.10

4. Others(1) Changes in the significant subsidiaries (Accompanying changes in scope of the consolidation):
Exclusion: 3 subsidiary (Desperado, Inc. and 2 other companies)
For details, please see page.6 “2. Overview of Faith Group”.
(2)

Changes in accounting policy, procedure, and presentation in preparation of the quarterly
consolidated financial reports (Described in the “Changes in preparing for consolidated financial
statements and summary of significant accounting polices”)(2)-1. Changes accompanying revisions of accounting standards, etc.:Applicable(2)-2. Changes other than the above: None

(3)Outstanding shares (common shares)(3)-1. Outstanding shares at the end of the fiscal years (including treasury shares):
The fiscal year ended March 2010: 1,196,000 shares, the fiscal year ended March 2009: 1,196,000shares(3)-2. Treasury shares at the end of the fiscal years:
The fiscal year ended March 2010: 47,950 shares, the fiscal year ended March 2009: 47,950 shares*Note for utilizing business forecasts, and other special instruction
This document contains projections of our company’s future performance. These are estimates by the management of Faith
based on currently available information. There are potential risks and uncertainties that may affect the results. Please beadvised that actual performance may differ significantly from the forecast.

2

1. Operating Results(1) Analysis on Operating Results
During the consolidated fiscal year ended March 31, 2010, various terminals including not only PCs andmobile phones, but also TVs, game consoles and a certain range of home appliances, connected together
under a common network, and that allows users to have easier access to information and contents they wantwherever they are. Hardware also continues developing, and new OS-based mobile phones and new
terminals for reading digital books are commercialized. In the content market where further growth isexpected, new kind of content is produced one after another by utilizing various functions of new terminals.
The market has reached the phase that the users can chose content from any genres. Meanwhile, new social
media such as Twitter and Ustream have been generalized and the proactive transmission of informationfrom individual users is expected to expand continuously.
These technological advances brought about a dramatic change in digital environment including
distribution tools, content, and demands of users due to more diversified and more complicated ways oflinking digital networks with softwares, hardwares, and other communication tools. Because of thechanging environment, borders of business models in the related industries are becoming flexible.
Against this backdrop, Faith Group is promoting "multi-content on multi-platform" strategy that enables
users to enjoy any content whenever and wherever they are. As a provider of comprehensive service fromconstruction of distribution systems, operation of services for end-users to planning and production ofdigital content, the Group recognizes the importance of creating a new framework of content distribution.
Furthermore, the Group is promoting development of service solutions based on our unique perspectives
and provision of content truly sought after by users by developing new business models in cooperation withmany partners from a wide range of industries.
As a result, consolidated net sales for the fiscal year under review increased by 5.0% year on year to¥56,634 million led by the continuous high growth in the Electronic Money Business. Operating profit was¥735 million, down 48.4% year on year, and recurring profit was ¥627 million, down 36.9% year on year,
mainly due to the development of new services, overseas business realignment and other factors. The
Group recorded net loss of ¥1,755 million compared to the net loss of ¥149 million in the previous fiscal
year because of the loss due to impairment loss on goodwill, expenditure for office relocation and postingof extraordinary loss related to the reversal of foreign currency translation adjustment account caused by
the exclusion of foreign subsidiaries from consolidation.
Information on each business segment is as follows:<Contents Business>
Faith Group strove to establish new business schemes for content distribution across various sectors such asvideo, music or medical and health information, and to expand and strengthen its operating base during theperiod under review.
The Group tied up with "Short Shorts Film Festival & Asia" authorized by the Academy Awards, andfounded "Music Short Creative Award" to launch a related business. This new award invites entries ofvideo works which are created with music from prominent labels in Japan, and the excellent works will beshown at theaters and distributed to mobile phone and PC through network. By this award, the group
established the unique model of one-stop service and presented a new business evolution both to recordlabels and to film industry. The Group also strove to increase users and improve user environment whichenables them to enjoy video distribution services on a wide range of terminal devices including mobile
phone, PC and digital appliances.
Tying up with Tokyo Broadcasting System Television, Inc., the company launched a music program named"MusicBirth+". This blend of mass media and our content business aims at discovering and producing
talented artists. This program achieves full fusion of TVs, Internet and mobile phones, to provide one-stop
solution for discovering artists, promotion and distribution of their music.
The Group launched a development and distribution business of applications for iPhone and iPod touch
under the brand name of "COOK", targeted at companies dealing with music and books. These applications
3

enable them to handle products and promotions regardless of the existing distribution system and inventory
control and to deliver the contents world-wide. The Group expands this application development service forvarious industries including publishing and music industries.
The Group launched a film production of a bestselling book "Kokuhaku," written by Kanae Minato, with aconsortium including Toho Co.,Ltd. and major entertainment companies to be released in June 2010. Thisfilm is the latest work produced by Tetsuya Nakajima, the director, and Yuji Ishida, the producer and thevice president of Faith Wonderworks, Inc., the same pair who had produced a big hit "Paco and the MagicalBook" in 2008.
The joint proposal developed with National Hospital Organization Kyoto Medical Center and othercompanies, has been adopted for "ICT International Competitiveness Enhancement Program ("Ubiquitous
special zones" business)" of the Ministry of Internal Affairs and Communications. This proposal isregarding an achievement of the value-added service to the local residents by constructing the digital
receipt platform for medical institutions and its interactive service with the healthcare account book. The
management of the healthcare expense and the paperwork for the medical expense deduction will be
simplified by the integration of two services, "Pocket Karte" and "Healthcare account book". "Pocket
Karte", which enables users to maintain and browse their individual health and medical records on mobile
phones, is utilized as a storing platform for digital receipts issued at medical institutions. The stored data
are integrated into "Healthcare account book", which is capable of storing data of receipts issued at
drugstores. The company and affiliated companies are conducting demonstration experiment mainly at the
Kyoto Medical Center in cooperation with Kyoto Prefecture, which is appointed as "the ubiquitous zones".
In addition, the Group has built a strategic partnership with Columbia Music Entertainment, Inc. byacquiring its stock and becoming the largest shareholder of the company aiming to create a new frameworkof music content distribution.
As a result, net sales in the Contents Business totaled ¥9,269 million, down 29.3% year on year due to thedecrease in sales mainly caused by the existing ringtone business. Operating profit fell by 98.9% year on
year to ¥11 million.
<Electronic Money Business>
According to the press information regarding broadband subscriptions issued by Ministry of Internal
Affairs and Communications at the end of March 2010, broadband subscriptions in Japan have reachedover 31 million by the end of December 2009. Demand for digital contents continued to increase in thefield of online game, music and video distribution and SNS, the main sectors in which electronic money
used. At the same time, the electronic money and its settlement market is in a continuing growth. Under thedeveloping market, the Group focused on expanding the users of WebMoney, which provides easy, secureand convenient solutions.
Aiming for the increase in the settlement amount by WebMoney through the stronger ties with the partner
vendors, the Group ran tie-up campaigns with some prominent vendors. At the same time, the Group madeefforts to gain new partner vendors centered on the mobile content services.
In addition to the existing services, the Group launched an advertisement distribution widget, "manna",
which provides points changeable to WebMoney depending on the viewing time.
In December 2009, the Group held ONLINE GAME messe. 2009, one of the largest live events of online
games in Japan in order to increase online game users. Supported by the Japan Online Game Associationand other companies, the event held at Akihabara in Tokyo, which is a popular shopping area for electronic
and computer. At the site, visitors enjoyed stage events with characters from online games, and gamecharacter-featured merchandise were sold.
As a result, net sales in the Electronic Money Business increased 17.1% year on year to ¥46,237. Operating
profit increased by 74.7% year on year to ¥679 million due to the development and operation of newservices and enforcement of management structure.
<Other Businesses>
Revenues from the point-card system business and other businesses led sales in other businesses to ¥1,128
4

million, a decrease by 18.2% year on year. Operating profit was ¥57 million, down 4.6% year on year.
At the non-consolidated base, the Company posted ¥348 million of loss on revaluation of shares in affiliate
as a result of impairment changes based on financial statements of Bellrock Media, Inc. However, thisposting does not effect to the consolidated profit and loss since Bellrock Media, Inc. is the equity method
affiliate.
Projections for the full-year business performance are summarized below.
(millions of yen)

Net sales
Operating profit
Recurring profit
Net profit (Net loss)

FY2009 (Result)
FY2010 (Forecast)(a)(b)
56,63465,000
735
1,000
627
850
(1,755)100

Change(b)-(a)
8,366
265
223
1,855

Ringtone business is one of the original businesses of the Group, but in recent years, ringtone market in
Japan has been contracting. However, the domestic content market for PC and mobile phone is showing afirm growth. At the same time, content viewing environment is improving. Nowadays, users are able toview various contents at many different terminals thanks to advanced network connections between mobile
phone, PC, TV, and other digital home appliances. It is expected that in the near future, conventional
business models will not be able to keep up with the demands of the age sufficiently due to thediversification of content distribution methods and demands of users accelerated by rapidly developing newsocial media.
To respond to the ever diversifying market environment, the Group is striving to create a new framework ofcontent distribution by incorporating various perspectives such as content rights protection, charging andsettlement, handling of membership and other personal information, multi-device data usage including
mobile phone, PC, TV, and other appliances, and user-friendly interface. At the same time, the Group willcontinue engaging in music and visual content planning and production so that the Group can provide its
own content with high quality into the market in a timely manner. By operating a comprehensive businessfrom production to distribution of content, the Group substantiates a new content distribution businessmodels promptly, and to provide platforms to its partner companies.
In terms of the entertainment content business, the Group will expand and promote distribution of newcontents by mainly three initiatives. First, development of new visual content by tying up with "Short Short
Film Festival & Asia". Second, provision of new music content through "MusicBirth+", a complete fusionof music programmes with TV, mobile phone, and PC. Third, establishment of a strategic partnership with
Columbia Music Entertainment. At the same time, in the medical field, the Group will develop and provide
content services such as personal medical and health recording system in electronic form and other healthrelated information distribution. As the medical content is regarded as another type of information whichshould be accessible easily from any terminals wherever the users are, the Group will strive to provide
medical content services with increased convenience. The electronic money is another key area which has
been expanding as a means of settlement for online purchase via PC and mobile phone. The Group willcontinue to promote the electronic money business proactively, to provide a settlement measure for futurecontent distribution platforms.
The Group will promote further streamlining and cost reduction by unifying its operating bases. At thesame time, by leveraging its customer base which boasts some millions of fee paying members, the Group
promotes "multi-content on multi-platform" strategy and creation of new distribution framework of music
and visual content, development of e-commerce, and provision of services to many different terminals. The
Group strives to formulate and promote business strategies from the medium- to long-term perspective
focusing on a new content business era which is surely arriving within a few years.
As a result, the Group's consolidated sales for the next fiscal year are projected to rise 14.8% year on yearto ¥65,000 million. Operating profit is projected to increase 36.0 % year on year to ¥1,000 million due tothe improvement of operational efficiency and cost reduction by unifying its operating bases. Recurring
profit is projected to increase by 35.4 % year on year to ¥850 million. Net profit is projected to increase to¥100 million compared to the net loss of ¥1,755 million in the previous fiscal year.
5(2) Analysis on Financial Positions[1] Assets, Liabilities and Net Assets
Total assets as of the end of the consolidated fiscal year ended March 31, 2010 decreased by ¥533 million
from the end of the previous consolidated fiscal year to ¥29,963 million. This result is mainly due to thedecrease in cash and deposit by ¥4,458 million, accounts and notes receivable by ¥660 million andgoodwill by ¥3,625 million caused by amortization and impairment despite the increase in buildings andstructures by ¥972 million and land by ¥1,500 million mainly caused by acquisition of the company’s
office and investment securities by ¥5,747 million.
Total liabilities increased by ¥981 million against the end of the previous consolidated fiscal year to¥16,977 million yen, caused by increase in trade notes and accounts payable.
Net assets decreased by ¥1,514 million against the end of the preceding consolidated fiscal year to ¥12,985
million. These records are due to the decrease in accumulated profit caused by the net loss.
[2] Cash Flow
Cash and cash equivalents at the consolidated fiscal year ended March 31, 2010 decreased by ¥2,308
million down 21.7 % from the end of the previous consolidated fiscal year to ¥8,340 million.
Details of cash flow of this fiscal year ended March 31, 2010 and its factor is as follows:(Cash flow from operating activities)
Cash flows from operating activities amounted to an inflow of ¥4,436 million down 1.4%. This is due
mainly to the posting of ¥3,657 million of impairment and amortization of goodwill and increase in accountpayable by ¥925 million, despite the posting of ¥895 million of net loss before taxes and other adjustments.
(Cash flow from investing activities)
Cash flows from investing activities amounted to an outflow of ¥6,311 million (an outflow of ¥766 million
in the previous fiscal year ended March 31, 2009), due mainly to the posting of ¥2,658 million for the
expenditure for acquisition of tangible fixed assets and of ¥7,198 million for acquisition of investment
securities, despite ¥1,884 million of income from sale of investment securities.
(Cash flow from financing activities)
Cash flows from financing activities amounted to an outflow of ¥406 million (an outflow of ¥3,351 million
in the previous fiscal year ended March 31, 2009), mainly because of the expenditure in the amount of¥113 million for dividend payment and ¥2,107 million of repayment of long-term loans despite the postingof ¥2,000 million for long-term liabilities.

(3) Basic Policy on Appropriation of Profit and Dividend Payment
The Company continues its policy of giving priority to securing the funds necessary for strengthening its
business structure and making aggressive business investments. At the same time, it also recognizes returnof profit to shareholders to be an important management issue. For this reason, the Company will consider
payment of dividends, taking into account its operating results and financial positions.
Based on its fundamental policy of paying continued stable dividends, the Company plans to pay dividendsof ¥100 per share, including interim dividends of ¥50, in the next fiscal year.

2. Overview of Faith Group
Faith Group consists of Faith, Inc. (the Company), 9 subsidiaries and 10 affiliates, and mainly conducts
content business and electronic payment business.
The Faith Group’s businesses and relationship between the Company and other group companies inbusiness operations are as follows:(1) Contents BusinessIn the diversifying content market, the Group is promoting multi-content distribution on multi-platform
regardless of network or terminal device aiming at creating a new framework of content distribution foroncoming new market. As a provider of comprehensive service, the Group is promoting one-stop solutions
from construction of distribution systems, operation of services for end-users to planning and production ofdigital content.
The business is provided by Faith, Inc., Faith Wonderworks, Inc., Brave Inc. and 12 other affiliatecompanies.

(2) Electronic Money Business
Issuance of “WebMoney”, electronic money and providing electronic payment platforms for e-commerce
mainly of online game, contents distribution service including music or video distribution.
6

The service is provided by WebMoney Corporation.

(3) Other Business
Point service and other business dealt by GoodyPoint Inc. and two other affiliate companies.

3. Management Policies(1) Faith Group's basic management policy
The basic policy of Faith Group is to create schemes to distribute digital contents to the users. Faith Groupaccurately grasps changes in society and people’s life styles, and continues to create various kinds ofservices in harmony with the users’ usage environment in easier-to-use methods. The Company and its
group companies will strive to develop methods, technologies and know-how to realize the Group’s
management goals, and aims to be a higher value added company through business tie-up with othercompanies in addition to supplying services on our own.

(2) The medium-term and long-term business strategy
The Company will continue to generate new markets by creating a variety of services demanded from users.
The Company will make efforts to actualize contents distribution services including music and video
distribution, online games and e-commerce, charging service, and various types of corporate counselingservices, utilizing information devices, based on proposals of its unique business solutions and throughbusiness-tie up with prominent companies in many business fields. At the same time, aiming to improve
corporate value and shareholders’ profit, the Company strengthens the capital base and surges in profit as
managerial resources by its “multi-content on multi-platform strategy”.

7

4. Consolidated Financial Statement(1) Consolidated Balance Sheet(Unit: thousands of yen)

(Assets)
Current assets
Cash and deposits
Accounts and notes receivable
Marketable securities
Commercial products
Products in progress
Primary materials and inventory goods
Accrued refund income tax
Deferred tax assets
OthersAllowance for doubtful accounts
Total current assets
Fixed assets
Tangible fixed assets
Buildings and structures
Depreciation amount
Buildings and structures (net base)Machinery and delivery equipment
Depreciation amount
Machinery and delivery equipment (net base)Tool, device and equipment
Depreciation amountTool, device and equipment (net base)Land
Construction in progress
Total tangible fixed assets
Intangible fixed assets
Goodwill
Software
OthersTotal intangible fixed assets
Investment and other assets
Investment securities
OthersAllowance for doubtful receivable
Total investments and other assets
Total fixed assets
Differed assets
Stock issuance cost
Total Differed assets
Total assets

8

FY2008FY 2009(As of March 31, 2009)(As of March 31, 2010)

13,508,778
6,963,239
240,453
317,125
41,615
12,97290,883
450,388657,192△259,093
22,023,556

9,050,487
6,303,169
740,147
64,466
10,465
12,188300,267
811,197△35,725
17,256,664

262,468△86,996
175,471
26,305△17,6148,690
1,265,658△1,012,684
252,973
437,136

1,262,512△114,108
1,148,403
26,305△20,327
5,977
1,108,236△925,746
182,490
1,500,895
78,9072,916,674

5,096,085
537,653
51,273
5,685,013

1,470,111
360,777
29,5391,860,428

1,707,499
715,724△84,370
2,338,854
8,461,004

7,454,631
638,063△167,805
7,924,889
12,701,991

11,857
11,85730,496,418

4,567
4,567
29,963,224

(Unit: thousands of yen)

(Liabilities)
Current liabilities
Trade notes and Accounts payable
Short-term loans
Income taxes payable
Allowance for utilized costs
Allowance for points
Allowance for bonus payments
Allowance for relocation
OthersTotal current liabilities
Fixed liabilities
Long-term liabilities
Deferred tax liabilities
Allowance for retirement benefits
OthersTotal fixed liabilities
Total liabilities(Net assets)
Shareholder's equity
Common stock
Capital surplus
Retained earning
Treasury stock
Total shareholder's equity
Valuation and translation adjustments
Valuation difference on available-for-sale securities
Foreign currency translation adjustments
Total valuation and translation adjustments
Minority interests
Total net assets
Total liability and net assets

9

FY2008FY 2009(As of March 31, 2009)(As of March 31, 2010)

6,222,787
2,029,928
12,833
3,316,085
361,657
95,514
1,393,875
13,432,682

7,184,384
2,419,904
394,726
3,571,039
270,478
70,208205,720
991,668
15,108,130

2,054,382
274,161
73,071
162,276
2,563,891
15,996,574

1,556,992
199,716
83,07529,684
1,869,467
16,977,598

3,218,000
3,708,355
7,345,697△651,377
13,620,674

3,218,000
3,708,355
5,489,146△651,377
11,764,124

469,900△733,196△263,295
1,142,464
14,499,844
30,496,418

292,095△200,050
92,044
1,129,455
12,985,625
29,963,224

(2) Consolidated Profit and Loss Statement(Unit: thousands of yen)

Net sales
Cost of Sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating profit
Interest income
Dividend income
Interest securities
Anonymous association income
Miscellaneous receipts
Total non-operating profit
Non-operating expenses
Interest expense
Investment profit on equity method
Exchange loss
Miscellaneous expense
Total non-operating expenses
Recurring profit
Extraordinary profit
Gain on disposal of investment securities
Gain on sale of investments securities
Gain on sale of shares of affiliated company
Proceeds from equity movement
Reversal of allowance for doubtful accounts
Reversal of loss from disposal of business
OthersTotal extraordinary profit
Extraordinary loss
Loss from disposal of fixed assets
Loss due to impairment
Loss from investment securities valuation
Amortization of goodwill
Impairment loss on goodwill
Loss from disposal of operation
Transfer to allowance for expenditure for office relocation
Reversal of foreign currency translation adjustment accountdue to the exclusion of foreign subsidiaries from consolidation
OthersTotal extraordinary loss
Quarterly net profit before income taxes
Corporate, local, and business taxes
Corporate, local, and business taxes for retroactive year
Income taxes-deferred
Total corporate, local, and business taxes
Income or Loss on minority shareholders
Quarterly net profit

10

FY2008FY 2009(As of March 31, 2009)
53,957,164
42,921,824
11,035,339
9,609,763
1,425,576(As of March 31, 2010)
56,634,908
46,667,207
9,967,701
9,232,618
735,082

59,98430,97814,36630,55626,196
162,076

33,467
16,432
21,62625,05596,582

79,776
349,565
103,859
59,708592,911994,740

48,091
84,63530,29041,041
204,058
627,607996
260,048
48,77095,968
6,991
412,746

2,706
732,246
110,297
42,127
19,899907,277

77,452
16,081
267,401
294,976
378,564-

154,588
98,75732,9901,420,271
156,166
205,720-

340,524

69,072
1,103,549
303,937
178,943
333,328
512,272△58,920△149,415

21,3432,430,362△895,478
377,540
311,056
58,740747,338
112,612△1,755,428

(3) Consolidated statement of capital surplus and changes in net assets(Unit: thousands of yen)

Shareholders' equity
Common stock
Balance as of March 31, 2009
Changes of items during the accounting period
Total changes of items during the accounting period
Balance as of March 31, 2010
Capital surplus
Balance as of March 31, 2009
Changes of items during the accounting period
Total changes of items during the accounting period
Balance as of March 31, 2010
Retained earnings
Balance as of March 31, 2009
Changes of items during the accounting period
Cash dividend paid
Net gain or loss
Changes in consolidated amount
Total changes of items during the accounting period
Balance as of March 31, 2010
Treasury stock
Balance as of March 31, 2009
Changes of items during the accounting period
Acquisition of company's own shares
Total changes of items during the accounting period
Balance as of March 31, 2010
Total shareholders' equity
Balance as of March 31, 2009
Changes of items during the accounting period
Cash dividend paid
Net gain or loss
Changes in consolidated amount
Acquisition of company's own shares
Total changes of items during the accounting period
Balance as of March 31, 2010

11

FY2008(As of March 31, 2009)

FY2009(As of March 31, 2010)

3,218,000

3,218,000

3,218,000

3,218,000

3,708,355

3,708,355

3,708,355

3,708,355

7,694,895

7,345,697△119,042△149,415△80,740△349,197
7,345,697△114,805△1,755,428
13,638△1,856,550
5,489,146△354,269△651,377△297,107△297,107△651,377△651,377

14,266,980

13,620,674△119,042△149,115△80,740△297,107△646,305
13,620,674△114,805△1,755,428
13,683△1,856,550
11,764,124

(Unit: thousands of yen)

Valuation and translation adjustment
Net unrealized gains on investment securities
Balance as of March 31, 2009
Changes of items during the accounting period
Net changes of items other than shareholders' equity
Total changes of items during the accounting period
Balance as of March 31, 2010
Foreign currency translation adjustments
Balance as of March 31, 2009
Changes of items during the accounting period
Net changes of items other than shareholders' equity
Total changes of items during the accounting period
Balance as of March 31, 2010
Total valuation and translation adjustments
Balance as of March 31, 2009
Changes of items during the accounting period
Net changes of items other than shareholders' equity
Total changes of items during the accounting period
Balance as of March 31, 2010
Minority interest
Balance as of March 31, 2009
Changes of items during the accounting period
Net changes of items other than shareholders' equity
Total changes of items during the accounting period
Balance as of March 31, 2010
Total net assets
Balance as of March 31, 2009
Changes of items during the accounting period
Cash dividend paid
Net gain or loss
Changes in consolidated amount
Acquisition of company’s own shares
Net changes of items other than shareholders' equity
Total changes of items during the accounting period
Balance as of March 31, 2010

12

FY2008(As of March 31, 2009)

FY2009(As of March 31, 2010)

799,398

469,900△329,497△329,497
469,900△177,805△177,805
292,095△52,807△733,196△680,388△680,388△733,196

533,146
533,146△200,050

746,591△263,295△1,009,886△1,009,886△263,295

355,340
355,340
92,044

1,531,478

1,142,464△389,013△389,013
1,142,464△13,008△13,008
1,129,455

16,545,050

14,499,844△119,042△149,415△80,740△297,107△1,398,900△2,045,206
14,499,844△114,805△1,755,428
13,638342,331△1,514,218
12,985,625

(4) Consolidated Statements of Cash Flows(Unit: thousands of yen)

Cash flow from operating activities
Income before income taxes and minority interests
Depreciation and amortization
Impairment loss
Amortization of goodwill
Impairment loss on goodwill
Loss from investment in equity method
Proceeds from equity movement
Increase in allowance for doubtful accounts
Increase (decrease) in reserve for bonus
Increase in allowance for cost of card use
Decrease in allowance for unexercised sales promotion points
Increase in allowance for retirement benefits
Reserve for subsidiaries losses
Loss reserve for office relocation
Reversal of foreign currency translation adjustment accountdue to the liquidation of foreign subsidiaries fromconsolidation
Interest and dividends income
Interest on securities
Interest expenses
Foreign exchange gains
Loss from disposal of business
Gains on sale of investment securities
Gain on sale of corporate share on affiliated company
Valuation loss on investment securities
Losses from sale of fixed assets
Losses from disposal of fixed assets
Decrease (increase) in accounts and notes receivable-trade
Decrease (increase) in inventories
Increase in accounts and notes payable-trade
Decrease (increase) in consumption taxes receivable
OthersSub-totalInterest and dividends received
Interest expenses paid
B6Refunded income taxes
Income taxes paid
Net cash provided by operating activities

13

FY2008(As of March 31, 2009)

FY2009(As of March 31, 2010)

303,937
484,092
16,0812,586,382
349,565△48,770△77,2418,069
442,884△106,733
23,841△300,561-△895,478
341,243
98,7572,237,704
1,420,271
84,635
17,470△139,964△25,304
254,954△91,178
10,003
205,720-

340,524△90,962△14,366
79,776
106,075
378,564△210,975
267,401△966
77,452△252,718
116,883
259,170△129,841
103,138
4,370,178
165,000△79,443
281,938△236,738
4,500,936△49,900△21,626
48,091
31,632
156,166△732,246△110,297
32,990△2,706
154,588644,798
209,247925,733△53,622△412,797
4,679,407
71,714△48,134
97,315△363,797
4,436,504

(Unit: thousands of yen)

Cash flow from investing activities
Expenditure for deposit of time deposits
Proceeds from withdrawal of time deposits
Expenditures for acquisition of tangible fixed assets
Proceeds from sale of tangible fixed assets
Expenditure for acquisition of software
Expenditure for acquisition of intangible fixed assets
Expenditure for acquisition of investment securities
Proceeds from sale of investment securities
Proceeds for sale of subsidiary’s shares
Expenditure for loans receivable
Proceeds from collection of loans receivable
OthersNet cash used in investing activities
Cash flow from financing activities
Net increase in short-term loans
Proceeds from long-term borrowing
Expenditure for repayment of long-term borrowing
Expenditure for issue of bonds
Proceeds from payment from minorities
Expenditure for acquisition of the company's own shares
Payment of dividends
Dividends paid to minority interests
Expenditure for refund to minorities
Expenditure for acquisition of shares from minorities
Net cash flow used in financing activities
Effect of exchange rate on cash and cash equivalents
Net increase in cash and cash equivalents
Decrease of cash and cash equivalents due to exclusion of
consolidation
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year

14

FY2008(As of March 31, 2009)

FY2009(As of March 31, 2010)△7,010,096
6,970,000△175,733
43,961△552,658
205,888△113,000
163,709△381,649
85,143△1,699△766,133△4,970,000
6,620,096△2,658,397
9,325△235,009△7,198,078
1,884,392
157,688
54,392
23,697△6,311,893△500,000
25,000△2,054,090△24,700
73,314△297,107△117,379△30,545△105,163△320,543△3,351,213△268,540
115,0482,000,000△2,107,414
64,487△113,418△28,909△181,472△39,685△406,412△26,699△2,308,500△80,147-

10,614,234
10,649,135

10,649,135
8,340,635