The Sumitomo Warehouse Co., Ltd.
Consolidated Balance Sheets (Unaudited)
30 September 2004 and 2005

Millions of yen
ASSETS
Current assets:
Cash and cash equivalents･･･・･････････・･････････・･
Short-term investments (Note 4)･･･・･････････・･･････
Marketable securities (Note 3)･･･・･････････・･･･････
Receivables
Trade notes and accounts･･･・･････････・･････････
Other･･･・･････････・･････････・･･･････････････・･
Allowance for doubtful receivables･･･・･････････・

2004
¥

(

Deferred tax assets･･････・･････････・･･･････････････
Other･･･・･････････・･････････・･････････････････・･･
Total current assets･･･・･････････・･････････・･･･････
Investments and other non-current assets:
Investment securities (Notes 3 and 4)･･･・･････････・･
Long-term loans receivable･･･・･････････・･････････・
Other (Notes 3 and 4)･･･・･････････・･････････・･････
Allowance for doubtful receivables･･･・･････････・･･･(

Property and equipment (Note 4) :Land･･････・･････････・･････････・･････････・･･・････
Buildings and structures･･･・･････････・･････････・･･･
Machinery and equipment･･･・･････････・･････････・･
Construction in progress･･･・･････････・･････････・･･･
Less accumulated depreciation･･･・･････････・･･･････(

Intangibles:
Leasehold (Note 4)･･･・･････････・･････････・････････
Software･･･・･･･････・･････････・･････････・･････････
Other･･･・･････････・･･･・･････････・･････････・･･････

13,502
1,835
309 )
15,028515
1,410
34,44847,420
404
4,899
245 )
52,47828,837
132,911
19,847
1,210
182,805
90,499 )92,306

¥

(

(

(

3,267
180
162
3,609

Deferred tax assets･･･・･････････・･････････・･････････・¥

See accompanying notes.

16,891
591
13

2005

22
182,863

12,221
598−
13,917
1,721
184 )
15,454559
1,616
30,44868,981
227
4,737
368 )
73,57728,136135,005
20,652
2,782
186,575
94,339 )92,236

Thousands of
U.S.dollars (Note 1)
2005$

122,953
15,204
1,626 ）
136,531
4,939
14,277
268,999

(

(

(

3,287
183
453
3,923

¥

5
200,189

107,969
5,283−

609,427
2,005
41,8503,251 ）
650,031248,573
1,192,729
182,455
24,578
1,648,335
833,457 )814,878

29,0391,617
4,002
34,658$44
1,768,610

The Sumitomo Warehouse Co., Ltd.
Consolidated Balance Sheets (Unaudited)
30 September 2004 and 2005

LIABILITIES AND SHAREHOLDERS' EQUITYCurrent liabilities:
Bank loans (Note 4)･･･・･････････・･････････・･･･････････ \Long-term debt due within one year (Note 4)･･･・･････････
Payables :Trade notes and accounts ･･･・･････････・･････････・･･･
Other･････・･････････・･････････・･････････・････････・･

Thousands of
U.S.dollars (Note 1)
2005

Millions of yen
2004
2005
5,577
15,602

\

5,368
1,017

$

47,425
8,985

7,826
3,543

7,802
2,976

68,92826,292

11,36910,77895,220

Income taxes payable･･･・･････････・････････････・･･･････
Accrued employees' bonuses･･･・･････････・･････････・･･･
Deferred tax liabilities･･･・･････････・･････････・･････････
Other･･･・･････････・･････････・･･･・･････････・･････････・
Total current liabilities･･･・･････････・･････････・･･････

1,588
1,428
3
1,451
37,018

2,669
1,415
3
1,270
22,52023,58012,501
27
11,220198,958

Long-term debt due after one year (Note 4)･･･・･････････・

17,871

10,802

95,432

Deferred tax liabilities･･･・･････････・･････････・･････････・

19,01924,898219,966

Employees' retirement benefits･･･・･････････・･････････・･･

6,488

6,423

56,745

Directors' and corporate auditors' retirement benefits･･･・

739

27

239

Deposits on contracts･･･・･････････・･････････・･････････・･

15,68815,213

134,402

Other non-current liabilities･･･・･････････・･････････・･････

414

941

8,313

Minority interest in consolidated subsidiaries･･･・････････

556

995

8,791

9,453
6,324
50,82020,963652 )

18,604
16,04354,652
29,703537 )

164,361
141,735
482,834
262,417
4,744 )

Contingent liabilities (Note 7)
Shareholders' equity:
Common stock
Authorized － 395,872,000 shares
Issued－ 138,613,701 shares at 30 September 2004
－ 182,119,078 shares at 30 September 2005 ･Capital surplus･･･・････････････・･････････・･････････・･･･
Retained earnings･･･・････････････・･････････・･････････・
Unrealized gains on investment securities･･･・･････････・･･
Foreign currency translation adjustments ･･･・･････････・･･ (Treasury stock, at cost
－ 6,195,173 shares at 30 September 2004
－ 283,393 shares at 30 September 2005･･･・ (Total shareholders' equity･･･・･････････・･････････・････\

1,838 )
85,070182,863

(

(
\

95 )
118,370
200,189

(
(
$

839 )
1,045,764
1,768,610

The Sumitomo Warehouse Co., Ltd.
Consolidated Statements of Income (Unaudited)
Six months ended 30 September 2004 and 2005

Thousands ofMillions of yen
2004
2005

U.S.dollars (Note 1)

Net sales･････・･････････・･････････・･････････・････････・････････ \Cost of sales･････・･････････・･････････・･････････・････････・･････
Selling, general and administrative expenses･････・･････････・･･･

49,33843,242
3,034$

Operating income･････・･････････・･････････・･････････・････････

3,062

Other income (expenses):
Interest and dividend income･････・･････････・･････････・･･･････
Interest expense･････・･････････・･････････・･････････・････････・ (Equity in earnings of affiliates･････・･････････・･････････・･･････
Net gain on sale of investment securities･･・･････････・･････････・
Reversal of allowance for doubtful receivables･････・･････････・･
Loss on disposal of property and equipment･････・･････････・････ (Fee for arrangement of syndicated loans･･・･････････・･････････・
Impairment losses on fixed assets･･・･････････・･････････・･･････
Loss on liquidation of a subsidiary･････････・･････････・････････
Other, net･････・･････････・･････････・･････････・････････・･････

380
155 )
62
−
177
56 )
−
−
−
14

\

51,03545,186
3,106

2005

2,743

(

(
(
(
(

566
73 )
61
3,395
58
97 )
400 )
804 )
141 )
89

450,879
399,205
27,44024,234

(

(
(
(
(

5,000
645 )
539
29,994513
857 )
3,534 )
7,103 )
1,246 )
786

3,484

5,397

47,681

Minority interests･････・･････････・･････････・･････････・････････
Net income･････・･････････・･････････・･････････・････････・･･････ \

1,419
126 )
1,293
30
2,161

\

2,483
38 )
2,445
41
2,911

21,937336 )
21,601362
25,718

Basic net income per share･････・･････････・･････････・･････････・ \Dilutive net income per share･････・･････････・･････････・･･･････ \

16.32
11.20

Yen
\
\

16.45
14.79

Income before income taxes and minority interests･････・･･･････
Income taxes
Current･････・･････････・･････････・･････････・････････・･･･････
Deferred･････・･････････・･････････・･････････・････････・･･････ (See accompanying notes.

(

(

$

U.S.dollars (Note 1)

$
$

0.15
0.13

The Sumitomo Warehouse Co., Ltd.
Consolidated Statements of Shareholders' Equity (Unaudited)
Six months ended 30 September 2004 and 2005

Shares ofcommonstock
Common(Thousands)
stock
9,452
Balance at 31 March 2004・･････････・･･･・ 138,611\
Conversion of convertible bonds･･･・･･･・･
3
1
Net income･･･・･････････・･･･・･････････・
Cash dividends at \3.0 per share･･･・･････
Bonuses to directors and corporate
auditors･･･・･････････・･･･・･････････・･
Net decrease in unrealized gains on
investment securities, net of tax･･･・････
Foreign currency translation adjustments･･
Net increase in treasury stock･･･・････････
9,453
Balance at 30 September 2004・･････････・ 138,614\
Balance at 31 March 2005・･････････・･･･・ 175,997
Conversion of convertible bonds･･･・･･･・･
6,122
Net income･･･・･････････・･･･・･････････・\

17,177
1,427\

Capitalsurplus6,323
1

Millions of yen
Unrealized
Foreign
gains oncurrency
Retainedinvestment
translation
earnings
securities
adjustments
23,876 \ (640 ) \ (\ 49,097
\

(

2,161
398 )

(

40 )
(

Treasurystock
1,830 )

2,913 )
(

12 )

\

6,324

\

50,820\20,963 \ ((652 ) \ (8)
1,838 )\

14,617
1,426\

52,413\

22,816 \ (656 ) \ (

102 )

2,911

Increase resulting from newly consolidated

subsidiaries･・･････････・･･･・･････････

532

Increase due to changes in affiliates
accounted for by the equity method・･･････

Cash dividends at \5.0 per share･･･・･････
Bonuses to directors and corporate
auditors･･･・･････････・･･･・･････････・･
Net increase in unrealized gains on
investment securities, net of tax･･･・････
Foreign currency translation adjustments･･
Net decrease in treasury stock･･･・････････
Balance at 30 September 2005・･････････・ 182,119

See accompanying notes.

66
1,230 )

(

40 )
6,887
119

\

18,604\

Commonstock
Balance at 31 March 2005 ・･････････・･･･・･････････・
Conversion of convertible bonds ･･･・･･･・･････････・
Net income ･･･・･････････・･･･・･････・･････････・･･･
Increase resulting from newly consolidated
subsidiaries ･・･････････・･･･・･････････・･････････
Increase due to changes in affiliates accounted
for by the equity method ・･････････・･･･・････････
Cash dividends at \5 .0 (U.S.$0.04) per share ･･･・・･
Bonuses to directors and corporate auditors ･･･・･･･・
Net increase in unrealized gains on investment
securities, net of tax ･･･・･････････・･････････・････
Foreign currency translation adjustments ･･･・･････・
Net decrease in treasury stock ･･･・･････････・･・････
Balance at 30 September 2005 ・･････････・･･･・･･･････($

151,754
12,607$

16,043\54,652\

29,703 \ (537 ) \ (Thousands of U.S.dollars (Note 1)
Unrealized
Foreign
gains oncurrency
CapitalRetainedinvestment
translation
surplusearnings
securities
adjustments
129,137$ 463,053 $ 201,573 $ ( 5,796 ) $ (12,59825,718

795 )Treasury
stock
901 )

4,700
583
( 10,867 )353 )(60,844

1,052$

164,361$

141,735$ 482,834$

262,417$ ( 4,744 ) $ (

62
839 )

The Sumitomo Warehouse Co., Ltd.
Consolidated Statements of Cash Flows (Unaudited)
Six months ended 30 September 2004 and 2005

2004
Cash flows from operating activities:
Income before income taxes and minority interests･･･・･････････・･･ \Adjustments to reconcile income before income taxes andminority interests to net cash provided by operating activities
Depreciation and amortization･･･・･････････・･･･・･････････・･
Impairment loss of fixed assets・・・・・・・・・・・・・・・・・・・・・・・・・・
Equity in earnings of affiliates･･･・･････････・･･･・･････････・･
Interest and dividend income･･･・･････････・･･･・･････････・･･
Interest expense･･･・･････････・･･･・･････････・･････････・････
Loss on disposal of property and equipment･･･・･････････・･･･
Net gain on sale of investment securities･･･・･････････・･･･・･･
Increase in notes and accounts receivable･･･・･････････・･･･・･
Increase（decrease） in notes and accounts payable･･･・･･･････
Net decrease of allowance for doubtful receivables･･･・･･･････
Decrease in employees’ retirement benefits･･･・･････････・･･･
Decrease in directors’ and corporate auditors’ retirement
benefits･･･・･････････・･･･・･････････・･････････・･････････
Decrease in deposits on contracts･･･・･････････・･･･・････････
Fee for arrangement of syndicated loans･･・･････････・････････
Other, net･･･・･････････・･･･・･････････・･････････・･････････
Sub-total･･･・･････････・･･･・･････････・･････････・･････････・
Interest and dividends received･･･・･････････・･･･・･････････・
Interest paid･･･・･････････・･･･・･････････・･････････・･･･････
Income taxes paid･･･・･････････・･･･・･････････・･････････・･･
Net cash provided by operating activities
Cash flows from investing activities:
Acquisition of securities･･･・･････････・･･･・･････････・･････････・･
Proceeds from sale or redemption of securities･･･・･････････・･･･・･
Acquisition of property and equipment･･･・･････････・･･･・････････
Proceeds from sale of property and equipment･･･・･････････・･･･・･･
Advance of loans receivable･･･・･････････・･･･・･････････・････････
Collection of loans receivable･･･・･････････・･･･・･････････・･･････
Time deposits, maturing after three months and other, net･･･・･･････
Net cash used in investing activities･･･・･････････・･･･・･････････・･･･
Cash flows from financing activities:
Dividends paid･･･・･････････・･･･・･････････・･････････・･････････
Proceeds from short-term debt･･･・･････････・･･･・･････････・･･････
Repayments of short-term debt･･･・･････････・･･･・･････････・･････
Proceeds from long-term debt･･･・･････････・･･･・･････････・･･････
Proceeds from bond redemption funds･･･・･････････・･･･・･････････
Payment of fee for arrangement of syndicated loans･･・･････････・･･
Purchase of treasury stock･･･・･････････・･･･・･････････・･････････
Net cash provided (used in) by financing activities･･･・･････････・･･･・
Effect of exchange rate changes on cash and cash equivalents･･･・････
Net increase in cash and cash equivalents･･･・･････････・･･･・････････
Cash and cash equivalents of newly consolidated subsidiaries･･･・････
Cash and cash equivalents at beginning of period･･･・･････････・･･･・･
Cash and cash equivalents at end of period･･･・･････････・･･･・･･･････ \See accompanying notes.

Thousands of
U.S.dollars(Note 1)
2005

Millions of yen
2005

3,484

\

5,397

$

47,681

2,582
－
(62)
(380)
155
14
－
(670)
253
(176)
(37)

2,413
804
(61)
(566)
73
97
(3,395)
(388)
(240)
(58)
(124)

21,318
7,103(539)(5,000)645
857(29,994)(3,428)(2,120)(512)(1,096)

(146)
(260)
－
(552)
4,205
386
(155)
(1,015)
3,421

(775)
(1,039)
400
(644)
1,894
569
(70)
(1,976)417(6,847)(9,179)3,534(5,690)16,733
5,027(619)(17,457)
3,684

(96)
－
(2,126)
5
(33)
27
41
(2,182)(6,639)4,464(2,917)
10
(33)
25
(421)
(5,511)(58,654)
39,438(25,771)
88
(291)
221
(3,719)(48,688)

(400)
1,808
(2,509)60－－(7)(1,048)(4)
187－
16,704
16,891(1,237)2,329(3,017)
－
8,121
(400)
(17)
5,779
78
763
768
10,69012,221(10,929)
20,576(26,654)－
71,747(3,534)(150)
51,056
689
6,741
6,785
94,443
107,969\$

The Sumitomo Warehouse Co., Ltd.
Notes to Consolidated Interim Financial Statements (Unaudited)
30 September 2004 and 2005
1. Basis of Presenting Consolidated Financial Statements(a)

The accompanying consolidated financial statements have been prepared in accordance with the provisions set forth in the Japanese
Securities and Exchange Law and its related accounting regulations, and in conformity with accounting principles generally acceptedin Japan ("Japanese GAAP"), which are different in certain respects as to application and disclosure requirements of International
Financial Reporting Standards.
The accounts of overseas subsidiaries are based on their accounting records maintained in conformity with generally accepted
accounting principles prevailing in the respective countries of domicile. The accompanying consolidated financial statements havebeen restructured and translated into English (with some expanded descriptions and the inclusion of consolidated statements ofshareholders' equity) from the consolidated financial statements of the Company prepared in accordance with Japanese GAAP and
filed with the appropriate Local Finance Bureau of the Ministry of Finance as required by the Securities and Exchange Law. Some
supplementary information included in the statutory Japanese language consolidated financial statements, but not required for fairpresentation, is not presented in the accompanying consolidated financial statements.
Certain reclassifications have been made in the previous consolidated interim financial statements to conform to the presentation forthe current six month period.

(b)

The translation of the Japanese yen amounts into U.S. dollars is included solely for the convenience of readers outside Japan, using theprevailing exchange rate at 30 September 2005, which was ¥113.19 to U.S. $1. The convenience translations should not be construed
as representations that the Japanese yen amounts have been, could have been, or could in the future be, converted into U.S. dollars at
this or any other rate of exchange.

2. Significant Accounting Policies(a)Consolidation
The consolidated financial statements include the accounts of the Company and 23 and 27 significant subsidiaries for the six
months ended 30 September 2004 and 2005, respectively. All significant intercompany transactions and accounts have been
eliminated. The fiscal six months end of all the consolidated foreign subsidiaries is 30 June and is different from theCompany’s. Significant transactions between 30 June and 30 September are reflected in the consolidated financial statements.
In the elimination of investments in subsidiaries, the assets and liabilities of the subsidiaries, including the portion
attributable to minority shareholders, are evaluated using the fair value at the time the Company acquired control of therespective subsidiaries. Excess of cost over equity in net assets acquired is amortized within five years.
The equity method is applied to two subsidiaries and four affiliates for the six months ended 30 September 2004 and four
affiliates for the six months ended 30 September 2005. Other unconsolidated subsidiaries and affiliates are not accounted forby the equity method because they are immaterial.

(b)

Foreign currency translation
Monetary assets and liabilities denominated in foreign currencies are translated into Japanese yen at the rate at the end ofeach six month period and resulting gains and losses are recognized in the statements of income.
The financial statements of consolidated foreign subsidiaries and affiliates are translated into Japanese yen at the rate at theend of each six month period, except that shareholders’ equity accounts are translated at historical rates.

−1−

(c)

Allowance for doubtful receivables
The Company and its consolidated subsidiaries (the "Companies") provide for doubtful accounts principally at an amountcomputed based on the actual ratio of bad debts in the past plus the estimated uncollectible amounts based on the analysis ofcertain individual receivables.

(d)Securities
The Companies classify securities as 1) securities held for trading purposes (hereafter, “trading securities”), 2) debt
securities intended to be held to maturity (hereafter, “held-to-maturity debt securities”), 3) equity securities issued bysubsidiaries and affiliates, and 4) all other securities that are not classified in any of the above categories (hereafter,“available-for-sale securities”).
The Companies have no trading securities.
Held-to maturity debt securities are stated at amortized cost.
Equity securities issued by subsidiaries and affiliates which are not consolidated or accounted for using the equity method
are stated at moving average cost.
Available-for-sale securities with available fair market values are stated at fair market value. Unrealized gains and losses onthese securities are reported, net of applicable income taxes, as a separate component of shareholders’ equity. Realized gains
or losses on sales of such securities are computed using moving-average cost. Other securities with no available fair market
value are stated at moving average cost.
If the market value of held-to-maturity debt securities and available-for-sale securities, declines significantly, such securities are stated
at fair market value and the difference between fair market value and the carrying amount is recognized as loss in the period of thedecline. If the fair market value of equity securities issued by unconsolidated subsidiaries and affiliated companies not on the equity
method is not readily available, such securities should be written down to net asset value with a corresponding charge in the income
statement in the event net asset value declines significantly.

(e) Property and equipment
Property and equipment are carried at cost. The Company and its domestic subsidiaries provide depreciation on a decliningbalance method over estimated useful lives in accordance with Japanese tax laws. However, depreciation for buildings, except
building fixtures, acquired after 31 March 1998 is stated on the straight-line method.
Consolidated foreign subsidiaries compute depreciation on the straight-line method over estimated useful lives.
In the six months ended 30 September 2005, the Company adopted the new accounting standard for impairment of fixed
assets (“Opinion Concerning Establishment of Accounting Standard for Impairment of Fixed Assets” issued by the BusinessAccounting Deliberation Council on 9 August 2002) and the implementation guidance for the accounting standard for
impairment of fixed assets (the Financial Accounting Standard Implementation Guidance No.6 issued by the AccountingStandards Board of Japan on 31 October 2003).
(f)

Finance leases
Finance leases of the Company and certain consolidated subsidiaries which do not transfer ownership are accounted for in
the same manner as operating leases in accordance with Japanese GAAP. Under Japanese accounting policies for leases,
finance leases that deem to transfer ownership of the leased property to the lessee are to be capitalized, while other financeleases are permitted to be accounted for as operating lease transactions if certain information is disclosed in the notes to thelessee’s financial statements.

−2−

(g)

Software costs
The Company and its consolidated domestic subsidiaries depreciate software using the straight-line method over theestimated useful life of five years.

(h)Income taxes
The Companies recognize tax effects of temporary differences between the carrying amounts of assets and liabilities for tax andfinancial reporting. The asset and liability approach is used to recognize deferred tax assets and liabilities for the expected future tax
consequences of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and theamounts used for income tax purposes.

(i) Bonuses
The Company and its consolidated domestic subsidiaries follow the general Japanese practice of paying bonuses mainly inJune and December. Accrued bonus liabilities at the balance sheet date are calculated based upon management’s estimate ofannual amounts thereof.
Bonuses to directors and corporate auditors, which are subject to approval at the shareholders’ meeting, are accounted for as
an appropriation of retained earnings.
(j)Retirement benefits○iEmployees:
The Company and its consolidated domestic subsidiaries provide two types of post-employment benefit plans, unfunded
lump-sum payment plans and funded non-contributory pension plans, under which all eligible employees are entitled to benefits
based on the level of wages and salaries at the time of retirement or termination, length of service and certain other factors.
The liabilities and expenses for retirement benefits are determined based on the amounts actuarially calculated using certain
assumptions.
The Company and its consolidated domestic subsidiaries provide the liability for employees’ retirement benefits at the balance
sheet date based on the estimated amount of projected benefit obligation and the plan assets at that date.
Actuarial gains and losses are recognized in expenses using the straight-line method within the average of the estimatedremaining service lives commencing with the following period.

○ii

Directors and corporate auditors:
Certain subsidiaries accrue the liability for directors’ and corporate auditors’ retirement benefits equal to the amountof their retirement payment required if they retired their positions at the balance sheet dates.
On 29 June 2005, the Company terminated its retirement benefits plan for directors and corporate auditors. Thebalance of benefits granted prior to the termination date is included in other non-current liabilities.

(k) Net income per share
The computations of basic net income per share of common stock shown in the consolidated statements of income are basedon the weighted average number of shares outstanding during the period and net income available to common shareholders.
The computation of dilutive net income per share of common stock is based on the weighted average number of shares ofcommon stock outstanding increased by the number of shares which would have been outstanding assuming the conversion ofoutstanding dilutive bonds at the beginning of the period. The related interest expense, net of income taxes, has been
eliminated for the purposes of this calculation.
(l)Cash and cash equivalents
Cash and cash equivalents include cash on hand, readily-available deposits and short-term investments, which are easily
convertible into cash and present insignificant risk of changes in value, with original maturities of three months or less.

−3−

3.

Securities
The following tables summarize acquisition costs, book values and fair value of securities with available fair values as of 30 September 2004:
Held-to-maturity debt securities:
Book value･･･････････････････････････････････････････････････････
Fair value･････････････････････････････････････････････････････････
Difference･･･････････････････････････････････････････････････

Millions of yen
¥
870
856
¥
( 14)

These debt securities are pledged as deposits on lease contracts of land.
Available-for-sale securities:

Equity securities･･････････････････････････････････････････
Bonds･･････････････････････････････････････････････････
Other･･･････････････････････････････････････････････････
Total･･･････････････････････････････････････････････

Acquisition cost
¥ 8,85294¥ 8,865

Millions of yen
Book value¥ 44,29313
4¥ 44,310

Difference¥ 35,4414( 0)¥ 35,445

The following table summarizes book values of securities with no available fair values as of 30 September 2004:
Millions of yen
Available-for-sale securities:
Non-listed equity securities･･････････････････････････････････････¥
2,048
Equity securities issued by subsidiaries and affiliates･･････････････････
1,075
¥
3,123
Total････････････････････････････････････････････････････････

The following tables summarize acquisition costs, book values and fair value of securities with available fair values as of 30 September 2005:
Held-to-maturity debt securities:

Book value･･･････････････････････････････････････････････････････
Fair value････････････････････････････････････････････････････････
Difference･･･････････････････････････････････････････････････

Millions of yen
¥
811
801
¥
( 10)

Thousands of U.S.
dollars
$
7,165
7,077
$
( 88)

These debt securities are pledged as deposits on lease contracts of land.
Available-for-sale securities

Equity securities･･････････････････････････････････････････
Other･･･････････････････････････････････････････････････
Total･･･････････････････････････････････････････････

Acquisition cost
¥ 15,597
4¥ 15,601

Acquisition cost
Equity securities･･･････････････････････････････････････････$ 137,795
Other･･･････････････････････････････････････････････････
35$ 137,830
Total･･･････････････････････････････････････････････−4−Millions of yen
Book value¥
65,885
4¥
65,889Difference¥
50,2880¥50,288

Thousands of U. S. dollars
Book value$ 582,075
35$ 582,110

Difference$ 444,280
0$ 444,280

The following table summarizes book values of securities with no available fair values as of 30 September 2005:
Millions of yen
Available-for-sale securities:
Non-listed equity securities････････････････････････････････････････
Equity securities issued by subsidiaries and affiliates････････････････････
Total･･････････････････････････････････････････････････････････¥¥

Thousands of U.S.
dollars

2,134
958
3,092

$
$

18,8538,464
27,317

4. Bank Loans and Long-term Debt
Short-term bank loans at 30 September 2004 and 2005 bore interest ranging from 0.46% to 2.20% and from 0.47% to 3.74%, respectively.
Long-term debt at 30 September 2004 and 2005 consisted of the following:

SecuredLoans principally from banks 0.89%- 6.60% maturing though 2019･･････････････
Unsecured
1.0% convertible bonds due 2005, convertible into shares of the Company’scommon stock at a price of ¥401 (US$3.54) per share･･･････････････････････
Zero Coupon convertible bonds due 2009, convertible into shares of theCompany’ common stock at a price of ¥466 (US$4.12) per share･･････････････
Loans principally from banks 0.53%-2.13% maturing though 2010･･･････････････

Millions of yen
2004
2005
¥ 2,770¥ 2,373

Thousands of
U. S. dollars
2005$ 20,965

14,657−−

13,0003,046
33,473( 15,602)¥ 17,871

6,982
2,464
11,819(1,017)¥ 10,802

61,684
21,768104,417(8,985)＄95,432

30 September
Millions of yen
2006･･･････････････････････････････････････････････････････････････････････¥ 1,017
2007･･･････････････････････････････････････････････････････････････････････
1,033
2008･･･････････････････････････････････････････････････････････････････････
796
2009･･･････････････････････････････････････････････････････････････････････
7,786
2010･･･････････････････････････････････････････････････････････････････････
461
2011 and thereafter･･･････････････････････････････････････････････････････････
726¥ 11,819

Thousands of
U. S. dollars$ 8,985
9,126
7,032
68,7874,073
6,414＄ 104,417

Less amounts due within one year･･･････････････････････････････････････････

The aggregate annual maturities of long-term debt at 30 September 2005, were as follows:

At 30 September 2005, assets pledged as collateral for short-term bank loans of ¥4,038 million (US$35,675 thousand) and secured
long-term debt were as follows:
Thousands of
U. S. dollars
Millions of yen¥ 231$ 2,041
Deposits placed with banks with maturities of over three months (short-term investments)･････････
Investments securities･･････････････････････････････････････････････････････････････
7,648
67,568Property and equipment, net of accumulated depreciation･･･････････････････････････････････
4,123
36,425
Leasehold and other････････････････････････････････････････････････････････････････
368
3,251
＄ 109,285¥ 12,370−5−5. Leases(a) Finance leases as lessee
At 30 September 2004 and 2005, non-capitalized finance leases for machinery and equipment were as follows:

Original lease obligations･･･････････････････････････････････････････････
Lease payments･･････････････････････････････････････････････････････
Remaining lease obligations･････････････････････････････････････････････

Millions of yen
2004
2005
¥ 1,856¥ 1,595( 993)( 888)¥ 863¥ 707

Thousands of
U. S. dollars
2005$ 14,091( 7,845)$ 6,246

Total lease payments under non-capitalized finance lease arrangements were ¥185 million and ¥171 million (US$1,511 thousand) for the six
months ended 30 September 2004 and 2005, respectively.
Lease obligations under non-capitalized finance leases, including finance charges, at 30 September 2004 and 2005, were as follows:
Thousands ofMillions of yen
U. S. dollars
2004
2005
2005
Due within one year･･･････････････････････････････････････････････････
¥ 329
¥ 289
$ 2,553
Due after one year･････････････････････････････････････････････････････
534
418
3,693
¥ 863
¥ 707
$ 6,246
Total･･･････････････････････････････････････････････････････････････(b) Finance leases as lessor
At 30 September 2004 and 2005, buildings and structures leased by a consolidated subsidiary under finance leases were as follows:
Thousands ofMillions of yen
U. S. dollars
2004
2005
2005
Acquisition cost･･････････････････････････････････････････････････････
¥ 6
¥ 6
$ 53
Less accumulated depreciation･･･････････････････････････････････････････
( 4)
( 6)
( 53)
¥ 2
¥−
$−
Total･･･････････････････････････････････････････････････････････････(c) Operating leases as lessee
At 30 September 2004 and 2005, lease costs under operating leases were as follows:
Millions of yen
2004
2005
−
¥ 1
−
3
−
¥ 4

Thousands of
U. S. dollars
2005
$ 9
26
$ 35

Millions of yen
2004
2005
Due within one year･･･････････････････････････････････････････････････ ¥ 544¥ 544
Due after one year･････････････････････････････････････････････････････
4,765
4,222
¥ 4,766
Total･･･････････････････････････････････････････････････････････････ ¥ 5,309

Thousands of
U. S. dollars
2005$ 4,806
37,300$42,106

Due within one year･･･････････････････････････････････････････････････
Due after one year･････････････････････････････････････････････････････
Total･･･････････････････････････････････････････････････････････････(d) Operating leases as lessor
At 30 September 2004 and 2005, lease receipts under operating leases were as follows:−6−6. Shareholders’ Equity
Under the Commercial Code of Japan, the entire amount of the issue price of shares is required to be accounted for as capital, although
a company may, by resolution of its Board of Directors, account for an amount not exceeding one-half of the issue price of the new sharesas additional paid-in capital, which is included in capital surplus.
The Commercial Code of Japan provides that an amount equal to at least 10% of cash dividends and other cash appropriations shall beappropriated and set aside as a legal reserve until the total amount of legal reserve and additional paid-in capital equals 25% of common
stock. The legal reserve and additional paid-in capital may be used to eliminate or reduce a deficit by resolution of the shareholders’meeting or may be capitalized by resolution of the Board of Directors. On condition that the total amount of legal reserve and additional
paid-in capital remains being equal to or exceeding 25% of common stock, they are available for distribution by the resolution ofshareholders’ meeting. Legal reserve is included in retained earnings in the accompanying financial statements.
The maximum amount that the Company can distribute as dividends is calculated based on the non-consolidated financial statements of
the Company in accordance with the Commercial Code.

7. Contingent Liabilities
At 30 September 2004 and 2005, the Companies were contingently liable as follows:

As endorser of notes endorsed･･･････････････････････････････････････････
As guarantor of indebtedness････････････････････････････････････････････

Millions of yen
2004
2005
¥ 548
¥ 514
4,587
4,191

Thousands of
U. S. dollars
2005$ 4,541
37,026

8. Segment Information
Information by operational segment
Segment
Logistics

Real estate

Main operations
Warehousing (stock operations, bonded cargo handling)
Harbor transportation, Customs clearance
International multimodal transportation, Air cargo agent
Land transportation
Office space and land leasing

Six months ended 30 September 2004

Logistics

Millions of yen
Corporate
Real estate& Elimination

Sales to outside customers････････････････････････････
Inter-segment transfers･･････････････････････････････
Total sales････････････････････････････････････
Operating cost･････････････････････････････････････
Operating income･･････････････････････････････････

¥

¥

¥

42,58818
42,606
41,188
1,418

¥

6,750
186
6,936
3,611
3,325

−
( 204)( 204)1,477¥ (1,681)¥

Six months ended 30 September 2005

Logistics

Millions of yen
Corporate
Real estate& Elimination

Sales to outside customers････････････････････････････
Inter-segment transfers･･････････････････････････････
Total sales････････････････････････････････････
Operating cost･････････････････････････････････････
Operating income･･････････････････････････････････

¥

¥

¥

−7−

46,666−
46,66644,584
2,082

¥

4,369
87
4,456
2,072
2,384

¥

¥

−
( 87)
( 87)
1,636
(1,723)

Consolidated¥¥

49,338−49,33846,276
3,062

Consolidated¥¥

51,035−51,03548,292
2,743

Logistics

Six months ended 30 September 2005
Sales to outside customers････････････････････････････
Inter-segment transfers･･････････････････････････････
Total sales････････････････････････････････････
Operating cost･････････････････････････････････････
Operating income･･････････････････････････････････$

412,280−
412,280
393,886
18,394$

Thousands of U. S. dollars
Corporate
Real estate& Elimination$$

38,599768
39,36718,30521,062$$−( 768)( 768)
14,454(15,222)

Consolidated$$

450,879−
450,879
426,645
24,234

Corporate costs and expenses of ¥1,681 million and ¥ 1,723 million (US$ 15,222 thousand) for six months ended 30 September 2004
and 2005, respectively, mainly consisted of expenses of administrative departments of the Company.
Effective April 1, 2005, the Companies shifted the warehouse and logistics facilities leasing operation from the Real Estate segment to
the Logistics segment.
The Companies changed the classifications in the information by operational segment in accordance with that in the business
management and the Mid-term Business Plan to achieve a better presentation of operations.
If the segment information for the six months ended 30 September 2004 was prepared using the new segmentation, such information
would be as follows:

Six months ended 30 September 2004

Logistics

Millions of yen
Corporate
Real estate& Elimination

Sales to outside customers････････････････････････････
Inter-segment transfers･･････････････････････････････
Total sales････････････････････････････････････
Operating cost･････････････････････････････････････
Operating income･･････････････････････････････････

¥

¥

¥

44,282044,282
42,536
1,746

¥

5,056
71
5,127
2,130
2,997

¥

¥

−
( 71)
( 71)
1,610
(1,681)

Consolidated¥¥

49,338−49,33846,276
3,062

Sales of the consolidated foreign subsidiaries were immaterial. Accordingly, information by geographic segment is not disclosed.
Overseas sales, which represent sales to customers outside Japan, of the Companies were immaterial. Accordingly, overseas sales are
not disclosed.

9. Impairment loss on fixed assets
The Company and its consolidated domestic subsidiaries grouped their business assets based on the business management units and assets forleasing based on each asset. The Company recognized impairment losses on a part of business assets due to the recent decline in land prices ordeterioration of profitability and wrote them down to the recoverable amounts.
Impairment losses of ¥ 804 million (US$ 7,103 thousand) were recognized in the period ended 30 September 2005 consisting of losses on land.
The recoverable amounts of these business assets were their net realized values principally calculated based on estimated values by real estateappraisers.
The amount of recognized impairment losses was deducted directly from the acquisition costs of land.

10. Subsequent Event
At the Board of Directors’ meeting of the Company held on 18 November 2005, the appropriation of retained earnings at 30 September
2005 was duly approved as follows:
Millions of yen
Cash dividends at ¥ 5.0 (U. S. $0.04) per share････････････････････････････････････
¥ 909

−8−

Thousands of
U. S. dollars$ 8,031