Newsletter for shareholders Vol.14
Business summary of the f irst halfof f iscal year 2009 (19th period)
January 1 to June 30, 2009

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18F, Shinjuku NS Bldg. 2-4-1 Nishishinjuku, Shinjuku-ku,
Tokyo 163-0818 Tel. +81 3 5321 7020 Fax. +81 3 5321 7271

We will remain your best partner over 100 years
for comprehensive individual consulting

Dear Shareholders
The Japanese economy in the period under review remains under pressures from thefinancial market turmoil and rapid deceleration in business activity prompted by the
U.S. subprime loan problem. At Funai Zaisan Consultants Group, the shift in real

■ Nationwide Network (51 bases as of August 2009)

estate markets has strongly impacted operations, despite efforts made toaccommodate the changed market conditions.

Hokkaido, Tohoku■ Funai Zaisan Consultants Co., Ltd. Hokkaido■ Funai Zaisan Consultants Co., Ltd. Sendai■ Funai Zaisan Consultants Co., Ltd. Fukushima■ Funai Zaisan Consultants Tsuchida Management■ Funai Zaisan Consultants Aomori Support■ Funai Zaisan Consultants Asahi Accounting■ Funai Zaisan Consultants Sanbe Accounting

Chugoku, Shikoku■ Funai Zaisan Consultants Co., Ltd. Hiroshima■ Funai Zaisan Consultants Co., Ltd. Tokushima■ Funai Zaisan Consultants Co., Ltd. Takamatsu■ Funai Zaisan Consultants Tottori Support■ Funai Zaisan Consultants Shimane Support

Newsletter for
shareholders Vol.14■ Funai Zaisan Consultants Co., Ltd.

Business summary of the ﬁrst halfof ﬁscal year 2009 (19th period)
January 1 to June 30, 2009

Contents
Dear Shareholders

2

Business Results for the First Halfof Fiscal Year 2009 (19th Period)

3

Business Contents

5Consolidated Financial Data for
the First Half of Fiscal Year 2009
(Summary)

7

Stock Information & Corporate Data

9

1 Funai Zaisan Consultants Co., Ltd.

The increasingly uncertain operating environment requires steps to reinforce theGroupʼs basis for stable earnings. Especially in times like these, we revisit our starting
Kanto, Koushinetsu■ Funai Zaisan Consultants Co., Ltd. Tochigi■ Funai Zaisan Consultants Co., Ltd. Gunma■ Funai Zaisan Consultants Co., Ltd. Saitama■ Funai Zaisan Consultants Co., Ltd. Keiyo■ Funai Zaisan Consultants Co., Ltd. Johoku■ Funai Zaisan Consultants Co., Ltd. Tokyo Ginza■ Funai Zaisan Consultants Co., Ltd. Yokohama■ Funai Zaisan Consultants Co., Ltd. Kawasaki■ Funai Zaisan Consultants Co., Ltd. Nagano■ Funai Zaisan Consultants Masuyama Soken■ Funai Zaisan Consultants MMG■ Funai Zaisan Consultants Niigata Support■ Funai Zaisan Consultants Shonan Support■ Funai Zaisan Consultants Eguchi Management■ Funai Zaisan Consultants Jonan Support

Kyushu, Okinawa

Kinki

Tokai, Hokuriku■ Funai Zaisan Consultants Co., Ltd. Fukuoka■ Funai Zaisan Consultants Co., Ltd. Nagasaki■ Funai Zaisan Consultants Co., Ltd. Kumamoto■ Funai Zaisan Consultants Co., Ltd. Okinawa■ Funai Zaisan Consultants Kagoshima Support■ Funai Zaisan Consultants Sasebo Support■ Funai Zaisan Consultants Miyazaki Support■ Funai Zaisan Consultants Kitakyushu Support■ Funai Zaisan Consultants Saga Support■ Funai Zaisan Consultants Co., Ltd. Kyoto■ Funai Zaisan Consultants Co., Ltd. Osaka■ Funai Zaisan Consultants Co., Ltd. Hyogo■ Funai Zaisan Consultants Co., Ltd. Nara
■ Funai Zaisan Consultants Nishioka■ Funai Zaisan Consultants Shiga Support■ Funai Zaisan Consultants Hirose■ Funai Zaisan Consultants Co., Ltd. Kanazawa■ Funai Zaisan Consultants Co., Ltd. Shizuoka■ Funai Zaisan Consultants Co., Ltd. Nagoya■ Funai Zaisan Consultants Uesaka CPA■ Funai Zaisan Consultants Mie Support■ Funai Zaisan Consultants Kimura Keiei Brain■ Funai Zaisan Consultants Toyama Support

point and renew our long-standing commitment in force since the inception of theGroup, that the customer comes first, and as business partners acting from theperspective of the client aspire as a group of professionals to help clients solve theirproblems.
In order to deal with the changed environments in Japan and abroad, going forward
we will review business strategies, reduce costs, and implement structural reform,
while creating structures that will assure stable earnings also in difficult conditions.

President

Masazumi Hasumi

Creating a company that is needed by society, we will push ahead as an independent
comprehensive property and finance consulting business.
We request the continued good will of our shareholders.

Newsletter for shareholders Vol.14 2

Business Results for the First Half of Fiscal Year 2009 (19th Period)■ Highlights of Consolidated Business Results

Business Results
The Japanese economy in the period under review remains underperformed poorly throughout the first half of current fiscal year andOperating revenue (unit: million yen)pressures from the financial turmoil and rapid deceleration infell far short of target impacted by the recession. Moreover, under

17th period First Halfthe “Accounting Standard for Valuation of Inventory” a charge of 405

8,162

17th period First Halfbusiness activity prompted by the U.S. subprime loan problem.

18th period First Half

18th period First Half

However, thanks to foreign governmentsʼ economic stimulus

million yen resulted in the second quarter from valuation losses on

7,998

measures the global recession appears to have bottomed, and thefor-sale real estate. Moreover, given the uncertain market outlook

Japanese economy also displays signs of recovery, including risingfor future fiscal years, deferred tax assets were reversed in the fullshare prices. In addition, the real estate market, which substantiallyamount as a precautionary measure.

affects the operations of Funai Zaisan Consultants Group, has begun

As a result of these factors, first-half consolidated operating revenue

Net income of the current period (unit: million yen)

to gradually revive from the second quarter.

was 2,261 million yen, with a consolidated operating loss of 806

17th period First Half

While revenues from real estate transactions and property

million yen, an ordinary loss of 1,193 million yen, and a net loss of

18th period First Half

consulting therefore show a recovery trend, consulting services for

1,765 million yen.

19th period First Half

individuals offered in cooperation with financial institutionsFirst Half of Previous Fiscal Year (Jan. ‒ Jun. 2008)
Amount (Million yen)

Ratio (%)

Revenue from property consulting

2,001

25.0

Revenue from real estate transactionsFirst Half of Current Fiscal Year (Jan. ‒ Jun. 2009)
853

37.7

18th period First Half
19th period First Half

5,273

65.9

881

39.0

580

7.3

499

22.1

Other revenue

142

1.8

27

1.2

7,998

100.0

2,261

100.0

Total

19th period Full Year(plan)

6,929

2,138
840
(1,193)(1,117)

Net income of the current period per share (unit: yen) (Note)
1,302

465

12,421.77

17th period First Half

4,445.05

18th period First Half

(1,765)19th period First Half
19th period Full Year(plan)(1,583)

Total assets (unit: million yen)
17th period First Half

Revenue from sublease

19th period First Half

19th period Full Year(plan)

Ratio (%)

Amount (Million yen)

2,261

19th period First Half

19th period Full Year(plan)■ Revenue by Segments

Ordinary income (unit: million yen)

(16,699.05)(14,978.01)

Net assets (unit: million yen)
25,971
19,982
11,418

6,096

17th period First Half

6,580

18th period First Half
19th period First Half

3,910

Note: A stock split at the ratio of 1:2 was implemented on October 1, 2007.
Numbers shown are per-share information after retroactive adjustment for this stock split.

Projection of Full-Year Results

Financial Position
Total assets at the end of the second quarter declined 5,684 million

deferred tax assets (reduced by 583 million yen). Main changes inIn the second quarter, significant shortfalls relative to initial targets emerged with respect to operating revenue, operating result, ordinary result,yen from the end of the previous fiscal year, with liabilities and net

liabilities included short-term borrowings (increased by 1,021

and net result. Although estimates for the second half of current fiscal year are for operating income of 200 million yen and ordinary income ofassets reduced by 3,644 million yen and 2,039 million yen,million yen), long term debt (reduced by 3,500 million yen current

76 million yen, which is mainly due to an improved financial structure and reorganization measures, a turnaround at the end of the fiscal year will

respectively.

portion), and bonds (reduced by 590 million yen). The principal

not be achieved. Estimates for the full fiscal year are for operating revenues of 6,929 million yen (43.8 percent short of the initially announced

The main changes in assets were declines in cash and depositschange in net assets was a decline of 1,844 million yen in retainedtarget), operating loss of 606 million yen (compared with an initial target of 670 million yen in operating income), ordinary loss of 1,117 million(reduced by 2,846 million yen), for-sale real estate (reduced by 999

earnings. As a result, net assets per share was 36,993.31 yen. The

yen (compared with an initial target of 370 million yen in ordinary income), and net loss of 1,583 million yen (compared with an initial target of

million yen), equity in affiliates (reduced by 362 million yen), andequity ratio was 34.2 percent.

430 million yen in net income). Net loss per share is expected at 14,978.01 yen.

3 Funai Zaisan Consultants Co., Ltd.

Newsletter for shareholders Vol.14 4

Business Contents■ Comprehensive Asset Consulting for Individuals■ Financial Consulting for Corporate

For individual asset owners we offer a range of property-related problem

Our “Services for corporate rehabilitation, financial structure strengthening, andsolutions with inheritance planning as the cornerstone. As our main offerings,

corporate real estate” aim to enhance the financial status of corporations by performing“100-year asset consulting” advises individual asset owners on asset preservationa status analysis, plan development, and providing support in the plan execution.

for the long term with a planning horizon of two to three generations forward,

Furthermore, our “Transaction services” associated with enhancing the financial status

Financial
Consulting
for Corporate

and to enable the retention of a substantial estate to pass on to the next
generation, “10 (Ichimaru) consulting” aims to ensure a 10 percent yield on
inheritance taxable asset.

PO

INT

Comprehensive individualized consulting

Comprehensive
Asset Consulting
for Individuals

Instead of accommodating only the clientʼ s immediate consulting needs, thehallmark of our consulting services is our optimized comprehensive advice,t ailore d to the client ʼ s situation and for mulate d b as e d on a thoroughunderstanding of the client ʼ s problems and requirements. Our consulting

comprise real estate appraisal and sale, enterprise evaluation, and M&A support.
Our “Business succession and capital policy services” provide a review of company stock
evaluation, help enhance the management succession environment including withregard to financials and shareholders, and provide support for the succession tocompany stock holdings and management of the subject company while promoting
business growth and development and maintaining employment.

POIN

T

A professional group for problem resolution

Responding to corporationsʼ diverse requirements, we provide consulting services to aservices are completely individualized. In each instance a project team is formed,

hundred or more companies each year. Our corporate financial consulting provides

with experts added as needed such as tax attorneys, lawyers, or real estate

one-stop consulting services made possible by a large number of in-house experts in theappraisers, among others.

fields of finance, taxation, and real estate, a nationwide network of accounting firms, and acollaboration with lawyers and service experts.

■ Real Estate Solution Consulting

Periodic seminars presented by individual consultants separately by business
For many business owners thequestion of business succession is a

■ Are there problems to business succession?

No answer 1.6%

35.9%

18.9%

43.6%

troubling issue. Addressing thisproblem, we communicate theimportance of preparing a businesssuccession plan as a precaution for
all eventualities. It is our hope thatthese seminars help increase thenumber of business successions andthe succession to the social benefits
that arise from them.

No problems

Some problems

Donʼt know

■ Is the absence of a successor a problem in business succession?

14.3%

22.2%

Major problem

22.3%

No problem
Minor problem

Real Estate
Solution
Consulting

ownership system,” which comprises the selection of objects out of a flood of real estate information,
conclusion of a civil code partnership agreement under the Real Estate Specified Joint Enterprise Law, joint
ownership of yield-generating real estate, and distribution of the generated yields, and through “consulting
on yield-generating real estate in central urban locations,” which consists of integrated support ranging fromobject selection to acquisition and subsequent follow-up.
[Example]

34.7%
Donʼt know 6.5%
No answer

43% of business owners worry about business succession.
5 Funai Zaisan Consultants Co., Ltd.

Real estate solution consulting helps clients with their asset formation through the “real-estate joint

Shinjuku gyoen

Roppongi sanchome

GotandaNihonbashi

Newsletter for shareholders Vol.14 6

Consolidated Financial Data for the First Half of Fiscal Year 2009 (Summary)(Million of yen, rounded down to the nearest million)

Consolidated Balance Sheet
Term
Item

Consolidated Income Statements
Previous
Fiscal Year ended
Dec. 31, 2008

First Half of Current
Fiscal Year ended
Jun. 30, 2009

Item

Previous
Fiscal Year ended
Dec. 31, 2008

12,241

7,774

Cash and deposits

4,532

1,686

Accounts receivable

365

361

5,984

4,985

Purchased receivables

688

657

4,339

94

57

Short-term debt

1,006

2,028

Long-term debt repayable within one year

3,500

−

Bonds redeemable within one year

1,480

1,750

Accrued corporate taxes

173

32

Others

677

471

4,220

3,168

Others

674

88

2,565

1,705

(4)

(5)

4,860

3,643

257

228

Allowance for doubtful accounts

Long-term deposits payable

688

656

Allowance for employee retirement benefits

45

38

Fixed assets

Addition to reserve forcompensation of retired directors

214

108

Tangible fixed assets

Long-term lease and security deposits

707

660

11,152

7,507

849

768

Goodwill

778

696

Others

71

72

3,753

2,646

Shares in affiliates

2,299

1,937

Others1,453

709

Total assets

17,102

11,418Intangible fixed assets

Investments and other assets

Fixed liabilities
Bonds

Total liabilities
Net assets
Shareholdersʼ equity

5,783

3,939

Common stock

1,030

1,030

Capital surplus

1,104

1,104

Retained earnings

4,147

2,303

Treasury stock

(499)

(499)

166

(28)

166

(28)

Total net assets

5,950

3,910

Total liabilities and net assets

17,102

11,418

Evaluation and conversion difference
Unrealized gain on securities

7 Funai Zaisan Consultants Co., Ltd.

Term

Consolidated Cash FlowsFirst Half ofPrevious Fiscal Year
(Jan. ‒ Jun. 2008)

First Half ofCurrent Fiscal Year
(Jan. ‒ Jun. 2009)

7,998

2,261

5,741

1,898

2,256

362

1,033

1,169

1,223

(806)

Non-operating revenue

31

37

Non-operating expenses

414

424

Ordinary (loss) income

840(1,193)Extraordinary income−

191

Extraordinary loss

Item

Revenue

6,931

Current liabilities
Accounts payable

Real estate held for saleFirst Half of Current
Fiscal Year ended
Jun. 30, 2009

Liabilities

AssetsCurrent assets

Term

Cost of sales
Gross operating income
SG&A
Operating (loss) income

534

Net (loss) income before income taxes
and minority interests before loss distribution
to anonymous association

835(1,037)

Loss distribution to anonymous association

(116)

(3)

Net (loss) income before income taxes
and minority interests952(1,033)

Income taxes

456

27

Adjustment made for income taxes

37

704

Minority interests(7)−

Net (loss) income

465(1,765)

Term

First Half ofPrevious Fiscal Year
(Jan. ‒ Jun. 2008)

First Half ofCurrent Fiscal Year
(Jan. ‒ Jun. 2009)

Cash flow from operating activities

2,777

(213)

Cash flow from investment activities(3,147)

1,522

Cash flow from financial activities(42)(3,162)

Change in cash and equivalents(412)(1,852)

Cash and equivalents at start of year

5,895

3,424

Cash and equivalents at end of the first half of year

5,482

1,572

Item

Newsletter for shareholders Vol.14 8

Stock Information & Corporate Data
■ Stock Overview(As of Jun. 30, 2009)■ Notes for Shareholder■ Company Information(as of Aug. 1, 2009)■ Executives(as of Aug. 1, 2009)

Number of shares in issue

110,584■

Fiscal year: January 1 to December 31■

Name of company: Funai Zaisan Consultants Co., Ltd.

Chairman

Hideo Murakami

Number of shareholders

7,433

■

General meeting of shareholders: March■

President

Masazumi Hasumi

4,879

■

Reference Date:
End of Year Dividend Payout/General meeting of shareholders: December 31
Midterm Dividend Payout: June 30

Head oﬃce:
18F, Shinjuku NS Bldg. 2-4-1 Nishishinjuku,Shinjuku-ku, Tokyo 163-0818

Managing Director

Hisao Nakatsuka■

Incorporated: September 17, 1991

Managing Director, Individual Asset Consulting 1st Division Manager

Takahiko Makino■

Capital stock: 1030.81 million yen

Director, Individual Asset Consulting 3rd Division Manager

Tetsuo Akiyama

Business line:
Individual asset consulting, institutional asset consulting,and real estate solution consulting

Director, Corporate Financial Consulting Division Manager

Seiki Noda■

Number of employees (Group): 134 (Group)

Director, Network Division Manager

Yasuhiko Sato■Business network: 51 locations throughout Japan
Hokkaido, Sendai, Fukushima, Tochigi, Gunma, Saitama, Keiyo, Johoku,
Tokyo Ginza, Yokohama, Kanazawa, Nagano, Shizuoka, Nagoya, Kyoto,
Osaka, Hyogo, Nara, Hiroshima, Takamatsu, Tokushima, Fukuoka,
Nagasaki, Kumamoto, Okinawa, Mito, Kumagaya, Yonezawa, Wakayama,
Niigata, Hachinohe, Kagoshima, Miyazaki, Sasebo, Shonan, Shiga, Fukui,Mie, Tottori, Kitakyusyu, Nagaoka, Shimane, Kawasaki, Jonan, Yamagata,
Toyama, Saga

Outside Director

Haruo Shimada

Outside Director

Kiyoshi Ohno

Outside Director

Hitoshi Komasaka

Treasury stock
Number of shares excluding treasury stock

105,705

Note: A stock split at the ratio of 1:2 was implemented on October 1, 2007.
■■ Major Shareholders (Top 10)
Name

Shares held

Shareholding ratio

Taihei Shoji Co., Ltd.

10,560

9.99

Funai Consulting Co., Ltd.

9,132

8.64

Masazumi Hasumi

4,535

4.29

Baillie Gifford Shin Nippon plc

1,672

1.58

Mutsumi Shimada

1,526

1.44

Baillie Gifford Japan Trust plc

1,473

1.39

Hideo Murakami

1,433

1.36

CACEIS Bank Ordinary Account

1,250

1.18

Kazuo Yamada

1,220

1.15

Japan Securities Finance Co., Ltd.

1,196

1.13

■

Administrator of shareholdersʼ register:
3-33-1 Shiba, Minato-ku, Tokyo
The Chuo Mitsui Trust and Banking Company, Limited
Mailing Address:
2-8-4 Izumi, Suginami-ku, Tokyo 168-0063
The Chuo Mitsui Trust and Banking Company, Limited.
Stock transfer agency department
Phone: (toll-free: 0120-78-2031)
Clerical services for intermediation are performed by the head oﬃce and nationwide branch oﬃces of
The Chuo Mitsui Trust and Banking Company, Limited, and the head oﬃce and nationwide branchoﬃces of Japan Securities Agents, Ltd.

■

Public announcements: Please refer to the Funai Zaisan website• Address changes and applications for the sale, etc., of fractional share units
should be ﬁled by shareholders with their account-holding securities companies.
Shareholders who have no account with a securities company and instead had a special accountestablished for them are requested to make their ﬁlings with The Chuo Mitsui Trust and Banking
Company, Limited, which serves as administration agent for special accounts.

• Payable dividends* Shareholding ratio is calculated net of treasury stock (4,879 shares).
Note: Dated August 14, 2009, the following shareholders filed a Substantial Shareholding Report(Change in Shareholding) to the Kanto Local Finance Bureau concerning the shares of theCompany. These changes have been confirmed by the Company.

Reporting entity
Taihei Shoji Co., Ltd.

Statutory reporting dateAugust 10, 2009

Shares held
0

Shareholding ratio─

MID Plus Co., Ltd.

August 10, 2009

11,003

10.4

Note: Number of shares in issue as of August. 17, 2009: 110,584

Shareholders are requested to make pertinent ﬁlings with The Chuo Mitsui Trust and Banking Company,
Limited, which serves as shareholder registry administrator.

Securities firms:
17 0.23%

Financial institutions:
3,075 2.78%

Other Japanese companies:
100 1.34%

Consolidated subsidiaries:
7 companies including Funai Estate Co., Ltd., Proggest Holdings Co., Ltd.

■Aﬃliates under equity method:
4 companies including Nippon Investors Securities Co., Ltd., Ukai Co., Ltd.

Director, Real Estate Division Manager

Outside Representative Auditor

Masayuki Yagi
Takeshi Matsuura

Takao Kitamura

Outside Auditor

Toshio Honda

Outside Auditor

Hiroaki Rokugawa

Pursuant to the Act on Special Measures Concerning Taxation revised in 2008 (Law No. 23; April 30, 2008),
payment notices stating the dividend amount and withholding tax amount must be sent to shareholders
beginning with dividends payable in and after January 2009.
Shareholders who receive dividend vouchers will be sent Payment Notices at the end of the year or at the
beginning of the following year. For shareholders who have designated a bank account for dividend
payment by wire transfer, the Dividend Statement sent to shareholders at dividend payment takes placeof the Payment Notice. Both documents can be used as attachments to income tax declarations.

■ Number of Shareholders by Category

Foreigner shareholders:
28 0.38%■

Director, Individual Asset Consulting 2nd Division Manager• Notice concerning the payment of dividends on exchange-listed stocks, etc.

■ Number of Shareholders by Category
Financial institutions:
9 0.12%■

Securities firms:
2,623 2.37%

Foreigner shareholders:
7,187 6.50%

Individuals / others:
7,279 97.93%

Other Japanese companies:
23,950 21.66%

Individuals / others:
73,749 66.69%

Note: 4,879 shares held in the name of the Company are included in “Individuals / others.”

9 Funai Zaisan Consultants Co., Ltd.

Newsletter for shareholders Vol.14 10