To Shareholders and Investors

Business Report
Interim report for the fiscal year ending March 2013

April 1, 2012 – September 30, 2012

(Securities code: 2181 )Top Message
Hoping for stable
employment and economic
development in Japan
Globally, uncertainty over the future outlook is increasing due to concern that the world
economy would slow. Meanwhile, in the domestic market, demand for outside personnel isrecovering gradually. Against the backdrop, the Temp Group is proactively conducting sales
activities to acquire new clients. In the first half of the fiscal year ending March 2013, theGroup operated businesses while making the best use of its strengths such as the capability ofproviding proposals and extensive service menus, in order to meet the growing needs ofcompanies to review their assignment and use of outside personnel. As a result, consolidated
sales for the six-month period were 121.4 billion yen and operating income was 4.5 billion yen,marking record highs for any first half since the establishment of Temp Holdings Co., Ltd.
(“Temp Holdings”).
Our mission becoming more important
In 2012, various labor-related laws were revised, which increased people’s interest in thestate of employment. In April, the revised “Workers Dispatch Law” was enacted, which was
followed by the enactment in August of the revised Labor Contract Act and the revised Law
Concerning Stabilization of Employment of Older Persons.
Stabilization of employment is society’s demand and our wish as well. However, the businessenvironment surrounding Japanese companies has become severer than ever, given they arebeing required to enhance competitiveness not only in the domestic market but also in the
global market. To help Japanese companies, which provide employment opportunities, growcontinuously, it is indispensable to implement flexible human-resources strategies.
Our outside personnel service has an extremely important function to support bothcompanies’ human-resources strategies and stabilization of employment. We will continue tofulfill our mission, hoping that employment will be stabilized and the Japanese economy willdevelop.

Yoshiko Shinohara, Chairman & President
Sets up Tempstaff Co., Ltd. in 1973; Ranked among the “50 Most
Powerful Women in Business: International” by the US magazine“Fortune” for the 12th consecutive year since 2000; Invited to “ADVANCEWOMEN’S LEADERSHIP SUMMIT” in Australia as one of the 50 FOR
THE FUTURE in March 2011.

ears
s for five y
lt
u
s
re
g
n
OperatiOperating Income(unit: million yen)(forecast)(forecast)

Record highs in both sales andprofits for any first half since theestablishment of Temp Holdings
Consolidated earnings forecast for the
fiscal year ending March 2013 was revised
upward.
Interim highlights of the FY ending March 2013

Sales:

from a year earlier

121.4 billion yen

UPOperating Income:

4.5 billion yen
Net Income:Sales (unit: million yen)

2.6 billion yen
2009/3

UP

2010/3

2011/3

2012/3

2013/3(forecast)gs
Temp Holdin
ent Strategy
em
g
a
n
a
M
rm
Mid-teStrengthening localized services
Regional companies will provide community-based,
finely tuned services. We will work to expand ourmarket share in each region.
Developing business in specialized fields andnew job categories
To meet sophisticated and diversified needs, we will
expand new job categories, services and networks.

UP

Interim Dividend per Share:

8 yen

Expanding our presence in the global market
We will concentrate our resources on global networks, particularly
in Asia, to establish bases and actively develop our businesses.
Providing job assistance to women
Women are the key to eliminating labor shortages in this aging society
with fewer children. We will offer overall support their employment by
supporting child-raising mothers, holding seminars and giving
counseling.
Improving management efficiency
We have increased the efficiency of our operations by building aholding company system and reduced costs radically. We will firmly
maintain solid earnings growth and a sound financial position.

Creating Jobs

Corporatephilosophy
AddingValue to theIndividuals

Contributing
to SocietyTemporary Staffing and
Recruitment Services
Both sales and profits continued to increase,which became the driving force of earnings.

TS Kelly Workforce
Solutions launched:Core of the North Asia
Region Strategy
A JV contract was signed with Kelly Services, Inc. thataims to grow the business in North Asia. Tempstaff Hong
Kong Limited will change its name to “TS Kelly Workforce
Solutions Limited”. Both Kelly and TS will continue tooperate under their own brands. In future, existing Kelly
branches will be utilized and it will be possible toapproach Japanese firms in regions that could not becovered previously. Business opportunities will be
expanded by growing outsourcing services (RPO etc) andsharing Kelly's know-how, client base and candidate pool.

(forecast)

Full fiscal
yearFirst sixmonth periodUP

2012/3

2013/3Beijing
Tianjin
Seoul
Suwon
ChengduAiming for Further
Leap Forward■Sales (unit: million yen)In the first half of the fiscal year ending March 2013, we strengthened thebases of regional customers as a result of thoroughly conducting sales
activities toward small and midsize companies. At some leading companies,
demand for temporary staffing picked up. Due to the revision of theWorkers Dispatch Law, uncertainty over the future outlook for the system of
temporary staffing was removed, which was also a favorable factor for thisbusiness segment. Tempstaff Media Co., Ltd. and Kobelco Personnel Co.,
Ltd., which became group members in the previous fiscal year, expanded
their businesses. This also contributed significantly to boosting earnings ofthis segment. As a result, sales of the segment for the first half increased
5.5% year-on-years to 100,317 million yen.

Overview of business results by segment

SuzhouShanghai

Nanchang
Guangzhou
ShenzhenTaipeiHong Kong

Offices in North Asia

Temp Group’s office
Kelly Services’ office

The Temp Group is expected to post
record-high earnings since theestablishment of Temp Holdings in 2008,
thanks to strong demand for outside
personnel and companies’ review of theirassignment and use of human resources.
We are reporting our efforts and earnings
results for the current fiscal year ending
March 2013.

R&D Outsourcing
Developed strongly on the back of theactive auto industry
In the first half, orders received rose along with a recovery in earnings ofauto manufacturers, our major customers, and thus operating man-hours
also increased. Forecasting such demand growth, we had recruited a large
number of staff. Of those, we smoothly assigned new graduate staff, whowere recruited this fiscal year, to respective work locations. As a result,earnings for the first half continued to expand. Sales for this segment were
4,488 million yen, up 8.9% from a year earlier. Given the persistently robust
demand from auto manufacturers for human resources, it is urgently
needed to secure personnel including mid-career staff.

■Sales (unit: million yen)(forecast)

Full fiscal
yearFirst sixmonth periodUP

2012/3

2013/3

Establishment of TECSEEDSHANGHAI CO., LTD., a subsidiaryspecializing in automobile designand development, in China
In the first half, we established TECSEED SHANGHAI CO., LTD.
(“TECSEED SHANGHAI “) as the key base to develop the R&D
outsourcing market in China. Japan’s technologies are being highly
regarded in China, which has become the world’s largest auto market.
Operating a design studio and development center locally, TECSEEDSHANGHAI, as a comprehensive automobile design and development
company, will conduct business while aiming at differentiation fromcompetitors. Targeting both Japanese and Chinese auto makers,
TECSEED SHANGHAI will meet their needs for outsourcing of any
automobile development processes, ranging from design development
to mass-production design.

* Sales for each business segment are those after eliminating internal transactions.
* Beginning in the fiscal year ending March 31, 2013, we changed business segment classification, and earnings results for the previous fiscal year were also calculated based on the reclassification of the business segment.

Overview of business results by segment
More and more group synergies are being generated.
To cope with changes in the employment system, an increasing number of companies arereviewing the assignment and use of outside personnel. These companies put strong
confidence in the Temp Group, which has proposed the comprehensive use of outside
personnel for years. This, combined with rises in demand for human resources and needs foroutsourcing of operations, is increasing sales for the Outsourcing Business. Group
companies’ efforts to strengthen cooperation with each other are finally about to pay off, andwe now can provide attractive proposals that are based on their combined know-how. We will
increase service lineups that can satisfy more needs, and pursue outsourcing effects that
corporate customers want, aiming to further expand earnings.

Outsourcing■Sales (unit: million yen)(forecast)

Full fiscal
yearFirst sixmonth periodUP

2012/3

Tempstaff Medical Co., Ltd. plans tomerge with Asahi Kasei Life Support Co.,Ltd.
As part of its efforts to strengthen the Outsourcing Business,
Tempstaff Medical Co., Ltd. (“Tempstaff Medical”), which
operates businesses in the healthcare field, has decided tomerge with Asahi Kasei Life Support Co., Ltd. (“Asahi Kasei
Life Support”), which provides various unique services, suchas a specific health guidance program. The two companies’
markets and operational characteristics are highly
complementary, and high synergy effects are expected fromthe merger by using nationwide sales networks of the Temp
Group. In November 2012, Tempstaff Medical, the surviving
company, will change its name to Tempstaff Life Support Co.,
Ltd. and begin operations.

2013/3

PV NEXT Co., Ltd., a contracting
firm in the pharmaceutical field,
was established in May 2012.
As for outside personnel, pharmaceutical companies are
shifting from the use of temporary staffing to that ofoutsourcing. Responding to such change, Tempstaff
established a joint venture PV NEXT Co., Ltd. (“PV Next”),
specializing in undertaking PV (*) service, with IUK INC.
We will promote the “active expansion into specialized
fields and new job areas” which is focused on in themedium-term management strategy.
* PV (pharmacovigilance) service compiles cases of side effects, etc. of a
new medicine under development.

Other BusinessWe will accurately capture customer needs.
■Sales (unit: million yen)First in the industry!
Tempstaff Co., Ltd. won 3 Starin telephone contact service!
Tempstaff Co., Ltd. was granted 3 Starin the “Support Portal/Telephone Contact
Service Grading” for fiscal 2012
sponsored by HDI-Japan.
We will try to offer cordial services forcustomers who make inquiries.

Demand for outplacement support service is
growing due to an increasing number of corporate
reorganizations and reconstructions. In response,
we are for example establishing offices close tocustomers, pursuing both operational efficiency
and customer satisfaction. As a result, sales of the
Other Business for the first half were 2,246 million
yen, up 29.1% from the corresponding period of
the previous fiscal year.

(forecast)

Full fiscal
yearFirst sixmonth periodUP

2012/3

2013/3

ICC (international exchangecommittee) further enhanced
language education service.
No. 1 in the industry
for three years in a row!
We maintained the industry’s top
spot in terms of transactions.
We were ranked first in the “Fiscal
2011 Ranking of Earnings in the
Human Resource Service Business”
by the “Monthly JINZAI BUSINESS”
magazine for three straight years.

Temp Research Institute Co., Ltd. (International Crosscultural Committee) opened the “ICC Academy,” which isintended to have trainees master high-level English
proficiency and communication ability, in March 2012.
The institute in September 2012 announced that it would
start in fiscal 2013 the high school study abroad“Leadership Training Course” aiming for early training of
next-generation leaders. Thus, we will continue to support
people’s growth.

* Sales for each business segment are those after eliminating internal transactions.
* Beginning in the fiscal year ending March 31, 2013, we changed business segment classification, and earnings results for the previous fiscal year were also calculated based on the reclassification of the business segment.

Overview of Consolidated Financial Resultsr ShareDividend Pe

Net Income(unit: yen)

Operating In(unit: million yen)

come

Sales

(unit: million yen)(unit: million yen)(forecast)(forecast)(forecast)(forecast)

UP

UP

UP

2012/3Full fiscalyear

2012/3

2013/3(forecast)First sixmonth
periodWe have decided to pay 8 yen
per share as an interim dividend
for the current fiscal year ending
March 2013, up 2 yen from a year
earlier, due to favorable businessperformance.
As a year-end dividend for thecurrent fiscal year, we also plan
to pay 8 yen per share, bringing
the annual dividend for the fullcurrent fiscal year to 16 yen per
share, including the plannedinterim dividend of 8 yen per
share.

Full fiscalyear

2013/3(forecast)First sixmonth
periodProfits increased substantiallyin the first half of the fiscal year
ending March 2013. Besides,
extraordinary loss decreased
from the corresponding periodof the previous fiscal year, when
extraordinary loss rose due to a
one-time write-off of goodwill ofsome subsidiaries. As a result,consolidated net income for the
first half increased 105.9% froma year earlier.

2012/3Full fiscalyear

2013/3(forecast)First sixmonth
periodIn the mainstay Temporary
Staffing and Recruitment Services
Business, demand expanded in thefirst half while we continued to
improve operational efficiency. This
resulted in a sharp increase inoperating income of the segment.
Other business segments also
saw operating income rise steadily.
As a result, consolidated operating
income jumped 30.8% year-onyear, marking a record high for any
first half since the establishment ofTemp Holdings as was the case forsales.

2012/3Full fiscalyear

2013/3(forecast)First sixmonth
periodDespite the continued uncertain
economic environment, demandfor outside personnel remainedrobust in the first half. At all of theGroup’s business segments, sales
increased from a year ago. As aresult, consolidated sales posted
a record high for any first halfsince the establishment of Temp
Holdings.

For more detailed IR information, please visit our website.
Website address

Assetseet
Balance Sh(unit: million yen)

Current assets(unit: million yen)Noncurrent assets

2012/3

2013/3 2Q

ChangeAssetsCurrent assets
Cash and deposits
Cash and deposits increased due
to better-than-expected earnings.
2012/3

Noncurrent assets

2013/2Q

Liabilities
ssets
s/Net aLiabilitie
Current liabilities(unit: million yen)
Net assets
Noncurrent liabilities

Convertible bonds-type bonds withstock acquisition rights were
exercised, and treasury stock wasallotted upon the exercise. As aresult, convertible bonds-typebonds with stock acquisition rights
and treasury stock decreased.

Current liabilities
Noncurrent liabilities

Net assets
Shareholders' equity
Treasury stock
Minority interests

2012/3

2013/2Q【Reference】】
The Temp Group applied “Accounting Standards for Presentation of Comprehensive Income” in the fiscal
year ended March 2011. “Comprehensive Income” is calculated by marking assets and liabilities tomarket and adding the profits or losses to net income.

Comprehensive
Income2012/3 2Q

2013/3 2Q

444 million yen

2,031 million yen

lly andphysica
For the challengedymentall

growthFor people’s

We are backing up study abroad programs.
Hoping to develop personnel who can play a key role globally,
the Temp Group supports study abroad programs.
Following the previous fiscal year, this fiscal year, we arerecruiting new scholarship students to study abroad.

April
2012

May
2012

Sep.
2012

We invited students 18 years old or older to the“22nd IBP Global Scholarship Program forStudy Abroad.”

Yuya Kimura (Thanks Temp Co., Ltd.)
participated in the London Paralympic
Games.
We support physically and mentally challenged
employees so that they can well cope with boththeir athletic activities and their work. Kimura Yuya,
who is continuing sporting activities under this
support, participated in the London Paralympic
Games. He won the ninth place in the 1,500 meterrace final, recording the season’s best time.

We invited working people to the “21st Temp
Group Worldwide Scholarship” for short-term
study abroad.
We established the “Leadership Training Course
for ICC High School Students Studying Abroad”
to develop personnel who will play a key role globally.

Yuya Kimura

For women

Supporting mother designers! We held a design competition.
Tempstaff Technologies Co., Ltd. held a design competition jointly with Combi
Corporation (“Combi”), which specializes in baby products, with an aim toincrease employment opportunities for mother designers. The competition’s
theme was baby shoes, and excellent designers were provided opportunities,
such as concluding of a business consignment contract with Combi.

Wishing
for a better
society

CSR

The Temp Group will fulfill its corporatesocial responsibility (CSR) through its
staffing business, and conduct various
social contribution activities to help realizea world where everyone feels happy.

Information
Distribution of shareholders As of September 30, 2012

Stock Information

Company Outline

As of September 30, 2012

As of September 30, 2012

(Unit: shares)●Authorized number of shares: 240,000,000

Company Name

Temp Holdings Co., Ltd.

●Total number of shares issued: 65,521,500

Established

October 1, 2008

Head Office2-1-1 Yoyogi, Shibuya-ku,
Tokyo, JAPANType of Business

Management planning,
administration, and operations
related to subsidiary and groupcompanies that handle
temporary staffing andrecruitment services.

Capital2,000 million yen●Shareholders: 8,833●Major shareholders (top 10)

Shareholder Information

Name of shareholders

Shares held
(shares)

votingrights(%)

Yoshiko Shinohara

23,377,200

38.71

State Street Bank andTrust Company

6,515,500

10.79

Kelly Services Japan Inc.

3,035,600

5.02

Yoshimi Iyadomi

1,812,800

3.00

Temp Holdings

1,555,782

2.57

Employee Shareholders●Business year
Association
From April 1 to March 31 of the following year
●Annual general meeting of shareholders
Nikko Cordial Securities
1,300,000
2.15
June every year
Investment
Enterprise●Record date
Partnership
Annual general meeting of shareholders March 31
Term-end dividend March 31
The Bank of Tokyo1,232,000
2.04
2nd quarter dividend September 30
Mitsubishi
UFJ,
Ltd.
●Administrator of shareholders’ register /Special account management institution
NOMURA PB
1,226,169
2.03
Mitsubishi UFJ Trust and Banking Corporation
NOMINIEESLIMITED●Contact
OMNIBUS-MARGIN
Mitsubishi UFJ Trust and Banking Corporation(CASHPB)
Custody Service Department
7-10-11 Higashisuna, Koto-ku, Tokyo 137-8081, JAPANWoman Staff Ltd.
1,206,000
1.99
Tel: 0120-232-711(toll free number available only within Japan)
Nanako Yamamoto
1,108,800
1.83●Stock Listing
Tokyo Stock Exchange, First Section
Taro Iyadomi
1,108,800
1.83●Website address of public notice
http://www.temp-holdings.co.jp/* Voting rights is calculated based on the number of shares
When electronic public notices are not possible due to(60,377,880) excluding shares in the treasury stock from theincidents or other unavoidable circumstances,
total number of shares outstanding.
announcements will appear in the Nihon Keizai Shimbun newspaper.

Board of Members

As of September 30, 2012

Chairman & President

Yoshiko Shinohara

Representative Vice-President

Mikihiko Hibino

Representative Vice-President

Masamichi Mizuta

Executive Director

Toshio Saburi

Director

Takao Wada

Director

Kazuomi Morimoto

Director

Carl T. Camden

Full-time Auditor

Hiroshi Shimazaki

Auditor

Kaoru Arai

Auditor

Ryosuke Tamakoshi

Procedures for Shares■Shares recorded in the accounts of securities companies
Procedures, inquiries, etc.

Contact

Inquiries about the sending and returning of mails
Inquiries about dividends after completion of the payment period
General inquires about administrative work related to shares

Administrator ofshareholders’register

Custody Service Department
Mitsubishi UFJ Trust and Banking Corporation
7-10-11, Higashisuna, Koto-ku, Tokyo 137-8081, JAPAN
Tel: 0120-232-711(toll-free number available only within Japan)

Procedures and inquiries not included above

Please contact your securities company.

■Shares recorded in the special accountProcedures, inquiries, etc.

Contact

Requests for transfer from a special account to a general account
Changes in address, name, etc.
Account balance inquiries
Designation of method for receiving dividends (*)

Special accountmanagement
institution

Custody Service Department
Mitsubishi UFJ Trust and Banking Corporation
7-10-11, Higashisuna, Koto-ku, Tokyo 137-8081, JAPAN
Tel: 0120-232-711(toll-free number available only within Japan)

Inquiries about the sending and returning of mails
Inquiries about dividends after completion of the payment period
General inquires about administrative work related to shares

Administrator ofshareholders’register

Method for requesting procedural documents
Request through the automatic answering system: 0120-244-479(toll-free number available only within Japan)
Download online: http://www.tr.mufg.jp/daikou/(*) Shareholders who own shares recorded in the special account may not choose the method for receiving dividends in proportion to the amount of shares held.

Internet“TEMP NAVI for Individual Investors”
http://www.temp-holdings.co.jp/individual/This website publicizes various information such as the Temp Group’sbusinesses and earnings results in an easy-to-understand manner.

Shinjuku Maynds Tower, 2-1-1 Yoyogi, Shibuya-ku, Tokyo 151-0053, JAPAN

Tel: +81-(0)3-3375-2220