Value-Networking

Annual Report 2013
For the year ended March 31, 2013

Profile
The Yamato Group consists of Yamato Holdings Co., Ltd. (“the Company”), 44 subsidiaries and3 affiliated companies. It is primarily involved in six business segments: Deliver y, BIZ-Logistics,
Home Convenience, e-Business, Financial, and Truck Maintenance*1, as well as ser vices incidental
to these activities.
The goal of the Yamato Group is to help bring about a better society by further refining the
TA-Q-BIN*2 network, which is a part of the social infrastructure, creating services that facilitate moreconvenient, comfortable lifestyles, and developing innovative logistics systems. The Group has
managed its businesses in pursuit of this goal, toward which it will continue to strive. To this end, theGroup is working to maximize corporate value through improving quality by constantly putting ourselvesin our customers’ position, while also using the capabilities of the whole Group to develop uniqueservices that further improve convenience for our customers.
*1 The segment name of Truck Maintenance was changed to Autoworks starting with the fiscal year ending March 31, 2014.
*2 TA-Q-BIN is the name in English for “Takkyubin,” the Yamato Group’s core small parcel delivery service.

Forward-Looking Statements
This annual report contains forward-looking statements concerning Yamato Holdings’ future plans, strategies and performance.
These statements represent assumptions and beliefs based on information currently available and are not historical facts.
Furthermore, forward-looking statements are subject to a number of risks and uncertainties that include, but are not limited to,
economic conditions, customer demand, foreign currency exchange rates, tax laws and other regulations.
Yamato Holdings therefore cautions readers that actual results may differ materially from these predictions.

C

Contents
2

To Our Shareholders

4

Per formance Highlights

5

A Message from the President

14

Market Data

16

At a Glance

18

Over view of Operations
18

Deliver y20

BIZ-Logistics

22

Home Convenience24

e-Business

26

Financial

28

Truck Maintenance

30

Other

31

Organization

32

Corporate Social Responsibility

35

Corporate Governance38

Directors and Audit & Super visor y Board Members

40

Analysis of Financial Position andManagement Results

44

Consolidated Balance Sheet

46

Consolidated Statement of Income

47

Consolidated Statement ofComprehensive Income

48

Consolidated Statement of Changes in Equity

49

Consolidated Statement of Cash Flows

50

Notes to Consolidated Financial Statements

70

Independent Auditor’s Repor t

71

Corporate Data

AnnuAl RepoRt 20131

To Our Shareholders
The Yamato Group is striving concertedly to materialize its management philosophy, which is to help enrich oursociety by enhancing the social infrastructure of TA-Q-BIN networks, creating more convenient services for comfortable lifestyles and developing an innovative logistics system.
It was to this end that our long-term DAN-TOTSU Management Plan 2019 was formulated in January 2011.
We are endeavoring to become Asia’s No. 1 solution provider in distribution and lifestyle support by fiscal
2020, when we will celebrate our 100th anniversary.
This long-term plan consists of three successive medium-term management plans. The first is the DAN-TOTSU
Three-Year Plan HOP (covering fiscal 2012 through fiscal 2014). The second is DAN-TOTSU Three-Year Plan STEP
(fiscal 2015 through fiscal 2017). The third is DAN-TOTSU Three-Year Plan JUMP (fiscal 2018 through fiscal 2020).
The past fiscal year (fiscal 2013) was the second year of DAN-TOTSU Three-Year Plan HOP, meaning fiscal
2014 will bring the curtain down on the first of our three successive medium-term management plans.
In fiscal 2013, the business environment in Japan saw positive factors such as a reversal of the strong yen
trend and rise in stock prices from December 2012 on the back of anticipation of the new administration of Prime
Minister Shinzō Abe and its growth strategies for reviving the economy. On the other hand, the economic outlook
continued to be clouded with uncertainty due to factors such as concerns about a resurgence of the debt crisis in
Europe.
Under this operating climate, the Yamato Group responded to ever-evolving customer needs by further enhancing the TA-Q-BIN and other existing businesses, while developing new business lines by comprehensively leveraging

left

Kaoru Seto
Representative Director andChairmanright

Makoto Kigawa
Representative Director,
President and Executive Officer2Group management resources.
In the existing Delivery Business, Kuroneko Mail handling volume declined owing to stricter policies on parcel
acceptance that emphasize compliance, and stiffer competition.
In our mainstay TA-Q-BIN service, we organically integrated a pioneering consumer-centric strategy of differentiation with non-delivery businesses to successfully expand our solution business. This enabled us to capture package delivery demand in the growing mail-order market.
In terms of new businesses, one business we launched in an increasingly borderless world was next-day document delivery to locations covered by our overseas TA-Q-BIN business. This service draws on our logistics hub
capabilities in Okinawa. This is the first step toward building an integrated transportation service in Asia.
As a result of these factors, operating revenues rose 1.7% year on year in fiscal 2013, to ¥1,282,374 million.
However, operating income was down 0.7%, to ¥66,203 million.

Millions of Yen

FY09/3Operating revenues
Delivery
Non-Delivery
Total
Operating income(Operating margin)
Net income(Net margin)

FY10/3

FY11/3

FY12/3

FY13/3¥ 997,898 ¥ 966,480 ¥ 995,651 ¥1,014,564 ¥1,028,219
254,024
234,354240,869
246,269
254,155
1,251,922
1,200,834
1,236,520
1,260,833
1,282,374
55,721
61,38964,314
66,651
66,203
4.5%
5.1%
5.2%
5.3%
5.2%
25,52332,282
33,20819,78735,144
2.0%
2.7%
2.7%
1.6%
2.7%

ChangeIncrease/
Decrease
YoY(%)¥13,655
7,886
21,541(448)–
15,357
–

1.3
3.2
1.7
(0.7)
–
77.6
–

Return on Equity
ROE improved steadily to 6.7%, one factor being a share buyback

(%)
8.0

of approximately ¥10.0 billion in February 2013.
6.53

6.0

6.70

6.46

We intend to continue managing the Company with an eye on
growth in order to continue to be the logistics partner chosen and5.42

trusted by customers.

3.84

4.0

We ask our shareholders for your ongoing encouragement andsupport.

2.0

0

August 2013
2009

2010

2011

2012

2013

AnnuAl RepoRt 20133

Performance Highlights
For the year ended March 31, 2013

Thousands of
U.S. Dollars (Note)

Millions of Yen

2013
Operating revenues
Delivery
Non-Delivery
Operating costs
Selling, general and administrative
expenses
Operating income
Delivery
Non-Delivery
Income before income taxes andminority interests
Income taxes
Net income

2012

2011

2010

2009

2013

2008

¥1,282,374 ¥1,260,833 ¥1,236,520 ¥1,200,834 ¥1,251,922 ¥1,225,974
1,028,219 1,014,564
995,651
966,480
997,898
981,142
254,155
246,269
240,869
234,354254,024
244,832
1,181,834 1,163,777 1,143,006 1,110,971 1,167,764 1,129,008$13,635,020
10,932,686
2,702,334
12,566,016

34,337
66,20342,12324,08030,40566,651
41,19925,452

29,20064,31440,844
23,47028,474
61,38938,34523,04428,43755,721
31,344
24,37628,786
68,18040,35027,830365,093
703,911447,880
256,031

64,28429,56335,14445,817
26,05919,787

61,83628,491
33,20860,43428,09632,282

48,99623,34925,52367,596
31,44735,353

683,504
314,325
373,679
U.S. Dollars (Note)Yen

Per share of common stock:
Basic net income
Diluted net income
Cash dividends
Net assets per share¥

81.85 ¥
46.00 ¥
73.42 ¥
71.84 ¥
57.60 ¥
79.80
79.84
44.87
73.30
71.16
56.45
78.12
23.00
22.00
22.00
22.00
22.00
22.00
1,261.35
1,197.26
1,173.60
1,130.33
1,073.86
1,050.99

0.87
0.85
0.24
13.41
Thousands of
U.S. Dollars (Note)

Millions of Yen

Working capital¥ 186,868 ¥ 182,111 ¥ 185,922 ¥ 165,890 ¥ 159,937 ¥ 125,355
Total shareholders’ equity
534,451
514,996515,602
512,910475,815465,801
Total assets
950,153919,295
899,363878,641
869,606
874,219
Capital expenditures
48,052
48,61552,47239,70045,856
124,832
Depreciation and amortization
37,936
38,68239,58339,88342,69744,772
Net cash provided by operating activities
73,95071,84387,89977,06484,463116,896$ 1,986,902
5,682,629
10,102,635
510,922403,355
786,283

Operating income margin (%)
Net margin (%)
Return on assets (%)
Return on equity (%)
Current ratio (%)
Shareholders’ equity ratio (%)
Assets turnover (Times)
Interest coverage ratio (Times)

5.16
2.74
3.76
6.70
162.3956.25
1.37
108.36

5.29
1.57
2.18
3.84
164.50
56.02
1.39
90.52

5.20
2.69
3.74
6.46
170.34
57.33
1.39
73.71

5.11
2.69
3.69
6.53
159.82
58.38
1.37
88.35

4.45
2.04
2.93
5.42
158.00
54.72
1.44
58.57

5.56
2.88
4.15
7.76
144.8953.28
1.44
223.00

–
–
–
–
–
–
–
–

Number of employees
Full-timePart-time
TA-Q-BIN delivery volume(Millions of parcels)
Unit price (Yen)
Kuroneko Mail handling volume(Millions of units)
Unit price (Yen)

177,108
84,422
92,686

177,301
84,29393,008

171,642
83,427
88,215167,555
82,39585,160170,662
82,601
88,061

169,836
80,843
88,993

–
–
–

1,487
591

1,423
600

1,348
609

1,262
624

1,232
646

1,236
644

–
–

2,112
61

2,187
62

2,312
64

2,262
65

2,231
65

2,206
64

–
–

Note: U.S. dollar amounts have been translated, for convenience only, at the rate of ¥94.05 to U.S.$1.

4$

Yamato Holdings Co., ltd.

A Message from the President

In this annual report, I would like to explain the YamatoGroup’s medium-term strategies in line with the following
four themes.
The Four Themes

1. The Yamato Group’s Vision
2. Our Unique Competitive Advantages
3. Tackling the Challenges of a Growing
E-Commerce Market
4. Fiscal 2014 Forecasts andShareholder Returns

Makoto Kigawa
Representative Director,
President and Executive Officer

1. The Yamato Group’s Vision
Through its network innovations, the Yamato Group will develop logistics as ameans for generating value. By reforming logistics, we will launch a value
networking concept that contributes to growth strategies in Japan’s economy.
Seeking to Become Asia’s No. 1 Solution Provider in Distribution and Lifestyle Support
In fiscal 2014, the final year of DAN-TOTSU Three-Year Plan HOP, we aim to link regional economic
zones and fully harness the unparalleled transportation speed of three logistics terminals. These are
the Atsugi Gateway, Haneda Chronogate, and the Okinawa International Logistics Hub.
We will seamlessly integrate the overwhelming speed of these three facilities with the strength of
our “last mile” network, which covers Japan and Asia, and our proprietary information technology (IT),logistics technology (LT), and financial settlement technology (FT), to launch new solutions that dramatically improve logistics speed, costs, and quality.
Through our network innovations, we will develop logistics as a means for generating value. By reforming logistics, we will launch a value networking concept that contributes to growth strategies in Japan’s
economy, thereby becoming Asia’s No. 1 solution provider in distribution and lifestyle support.

AnnuAl RepoRt 20135

Value Networking Concept
In an increasingly borderless age, boosting international competitiveness by reducing costs is a key
ongoing challenge for world-class Japanese manufacturers and companies in primary industries. However, they have already reached the limits to which they can trim production and personnel expenses.
But there is still great scope to lower costs in the logistics domain, our core business. The YamatoGroup believes that there are four issues that it can help resolve.
The first issue is that in the retail sector logistics costs are tending to rise as companies look tohandle many small orders and cut lead times to avoid losing sales opportunities amid stiffer competition with major e-commerce businesses.
The second is that logistics costs remain high at manufacturers, who have reached the limits towhich they can lower production costs, because they have left everything up to logistics companies
after shipment.
The third issue is that advancing globalization and borderlessness have resulted in increasing dispersion and complexity with respect to the locations of suppliers and production sites, meaning that
overall logistics, including inventory volume management, has not been optimized.
Finally, since the Great East Japan Earthquake of March 2011, there has been a growing needamong manufacturers, retailers, and other companies regardless of industry or size to control risks bydispersing inventory from a business continuity planning (BCP) perspective.
The Yamato Group aims to resolve these issues by seamlessly integrating the overwhelming speedof three facilities with our “last mile” network, which covers Japan and Asia and our proprietary IT, LT,
and FT, to launch new solutions that dramatically improve logistics speed, costs, and quality.
Specifically, we will leverage the five engines below to attain greater speed, lower costs, andhigher quality, and reduce overall inventor y volumes so we can reform logistics and contribute toJapan’s growth strategies.

The Five Engines of Value Networking(1) Non-stop logistics to add value by swiftly networking operations. This will be made possible by launching full-fledged operations at Haneda Chronogate, Atsugi Gateway, and the Okinawa International
Logistics Hub—multifunctional super-hubs that integrate speed and high value-added capabilities.
(2) Cloud-based networking regardless of shipping location, shipment type and shipment volume
through FRAPS*, which uses a network to swiftly and accurately ensure delivery to multiple locations
by optimizing the collection of goods.
(3) The world’s first network for the integrated global delivery of refrigerated packages through thelaunch of International Cool TA-Q-BIN.
(4) Visualization of logistics by both senders and receivers through seamless digital informatizationfrom shipment through arrival.
(5) Demand chain perspective innovations that satisfy needs of purchasers and suppliers.
*FRAPS is an acronym for the Free Rack Auto Pick System, a cloud-based setup that can use “last mile” networks. This picking system uses
proprietary flow-through racks. As the racks move along, items are sorted and cross-merged on the network, reducing overall inventory byenhancing flow speeds and visualizing inventory volumes and flows.

6

Yamato Holdings Co., ltd.

The Yamato Group offers fast delivery times as quick as four hours, with theminimum stock inventory dispersed close to the principal markets.
As only a quantity equivalent to items sold is speedily replenished, an improved
level of service is realized without increases in cost or inventory volume.

Example of “Logistics Reform” For Mail-Order Industry

Speedy Mail-Order Delivery
by Dispersed Warehousing
Mail-order company

FRAPS

Purchaser

Only a quantity equivalent toitems sold is replenished
Mail-order company:

Atsugi
Gateway

Improved speed; no picking;no logistics investment;
visualization of inventory;
reduced total inventory
volumeMinimumstock

Kansai

Minimum
stock

Minimumstock

Speedily replenishing stock by frequent
trunk-route transportation

Mail-order user:

Quicker receipt of item;
visualization of delivery

Purchaser

FRAPS

FRAPS

Example of “Logistics Reform” For Machine Builders

Component Procurement from Multiple Suppliers
Overseas component
supplier X

Purchaser

Chubu

Designated assembly plantLine 1

Domestic component
supplier Y

Purchaser:

Supplier:

Reduced operational burden;
extended production deadlines; visualization oflogistics

Purchaser

The Yamato Group provides a service for just-in-time bulk procurement fromsuppliers dispersed throughout Japan and Asia to factory lines.
This service shortens the procurement lead time, reduces inventory, and extends
delivery deadlines for suppliers.

Asian
network

Shorter lead time; just-intime line supply; visualizationof procurement; inventoryvolume/space minimization;
cost reduction

FRAPS
Sorting (Single picking)bundling of promotional
material, wrapping

Okinawa
Hub

HanedaChronogate

Designated assembly plant

Atsugi
Gateway

FRAPS at each
TA-Q-BIN base

Crossmerging(X+Y+Z)Line 2
Designated assembly plantLine 3
Domestic component
supplier Z

Designated assembly plantLine 4

We will harness these five engines to pursue logistics structure innovations extending from suppliers and manufacturers to end-users and retail stores.
To illustrate specific current and future initiatives, we present two business model examples above.

Establishing Platforms to Revitalize Communities and Provide Lifetime Lifestyle Support
Another key element in our drive to become Asia’s No. 1 solution provider in distribution and lifestyle support is establishing platforms to revitalize communities and provide lifetime lifestyle support.
Japan’s socioeconomic structure, values, and lifestyles are changing due to trends such as population aging, rural depopulation and greater social advancement by women. The Yamato Group is therefore forming partnerships with the government, local public bodies and other companies to establish
platforms for revitalizing communities and providing lifetime lifestyle support platforms closely tied to
local communities and lifestyles.

AnnuAl RepoRt 20137

Yamato Group Concept Map Ahead of 100th Anniversary
Customer Satisfaction (CS)
Create DAN-TOTSU businesses throughproviding high-quality service and CS
Enhancement of Asian network
Domestic parcel delivery market share: Over 50%
Non-delivery share of operating income: Over 50%
Overseas sales ratio: Over 20%

Business

Business groups
utilizing core competence

Business

Societal Satisfaction

Core competencies

Safety-Environment-CSR

IT

Become the company most loved andtrusted by society

LT

Business

Employee Satisfaction
Invigorating and fulfilling
workplace

FT“Last mile” network

Provision of improved labor
environment

Asia’s No. 1 solution provider in
distribution and lifestyle support
Business

Business
Business

Shareholder Satisfaction
Raise corporate value and pay
stable high dividends
ROE: Over 11%

Overall Image of Value-Networking Design
Customer

Customer

Sales Drivers
Sales Drivers
Base
Sales Drivers
Base

Customer

Customer

Sales Drivers

Sales Drivers
Sales Drivers

Base

Base
Base

Base

HanedaChronogate

Atsugi
Gateway

Okinawa
Hub

East Asia

Other
GatewaysBase

NaritaSoutheast
Asia

EuropeAmericasIT

8

Yamato Holdings Co., ltd.

Sales Drivers

LT

FT

For example, we offer the Magokoro TA-Q-BIN service through a tie-up with the Iwate Prefectural
Council of Social Welfare. The service combines checking on the wellbeing of the elderly and daily package deliveries. In another example, we collaborated with Tottori Prefecture to jointly open the Sanin
Ryutsu Trinity Center, which is helping promote local industry and job creation.
Over the years, the Yamato Group has built its business through close ties with the lifestyles ofindividuals and communities. It is essential for us to co-exist with society so that we can continue togenerate sustainable corporate value. We believe that it is important to balance the optimization of
economic returns and the maximization of social contributions.
From this perspective, we are refining our past approach to CSR, deploying regional revitalization
measures and providing lifetime lifestyle support through our core businesses based on a Creating
Shared Value concept to help create an affluent society.

2. Our Unique Competitive Advantages
We will pursue sustainable growth by combining the unique strengths of our“last mile” network covering Japan and Asia and our non-delivery businesses,
which maintain high profitability, to enhance added value.
The Yamato Group has several unique competitive advantages.
The following three elements are the cornerstones to the Yamato Group attaining sustainable growth.
1. A network extending the “last mile” in the Delivery Business
2. Enhancing added value by combining services with non-delivery businesses
3. Building our Asian TA-Q-BIN network

A Network Extending the “Last Mile” in the Delivery Business
The TA-Q-BIN business, which started as a consumer-to-consumer (C2C) delivery service, has been
operating for 37 years since its launch in 1976.
We have run that service steadily from the outset through pioneering efforts to become as close as
possible to our customers by operating from their perspective.
As with electricity and water supplies, the “last mile” of our network has become essential to thelifestyles of end-users.
In the fiscal year ended March 31, 2013, our approximately 3,900 direct retail stores around Japan
employed about 54,000 sales drivers. We maintained the No. 1 industry share in terms of delivery
volumes as a result of our high-quality transportation and high value-added services.
The brand strength stemming from the Yamato Group’s TA-Q-BIN services and great customer trust
in its quality are tremendous assets of the Group.

AnnuAl RepoRt 20139

Delivery Volume(Including Taiwan)

Enhancing Added Value by Combining Services with Non-delivery
Businesses(Parcels)

The Yamato Group adopted a pure holding company structure in

90,00081,990We took advantage of that transition to reduce our reliance on

66,03260,000November 2005.
TA-Q-BIN and other Delivery Business services by organically linking

51,240resources with non-delivery businesses. These non-delivery busi30,000

nesses are the BIZ-Logistics, Home Convenience, e-Business, Financial and Truck Maintenance business segments. In this way, we are

0

2011

2012

2013

developing and deploying new business models, accelerating strategies to increase the earnings power of the entire Group.

Regarding the logistics reforms mentioned earlier, seamlessly integrating such non-delivery businesses as IT and FT with the “last mile” networks of our Delivery Business will empower us to provide
new solutions that dramatically improve logistics speed, costs, and quality.

Building Our Asian TA-Q-BIN Network
We launched Asian TA-Q-BIN services in 2000, expanding our business by providing know-how to
Taiwan’s Uni-President Enterprises Corp.
In January 2010, we took advantage of the economic growth potential of Asia by launching our own
businesses in the region, starting with Shanghai and Singapore.
In the fiscal year ended March 31, 2013, we also developed businesses in Hong Kong and Malaysia,
in addition to Shanghai and Singapore. Demand for delivery services is steadily rising in these locations.
Only a handful of companies anywhere have “last mile” networks in Asia.
We plan to engage in borderless logistics by reinforcing operations in countries in which wealready do business while reinforcing internationally integrated transportation services that link countries and regions.
Our first step toward building an internationally integrated transportation services structure in Asia
was in November 2012, when we used our Okinawa International Logistics Hub to launch a next-day
delivery service of documents to Shanghai, Singapore, Hong Kong, and Malaysia, where we have
TA-Q-BIN capabilities. In May 2013, we extended next-day deliveries to include small parcels.
Our Asian TA-Q-BIN network will likely play an important role as we roll out international Cool
TA-Q-BIN services and build a global supply chain.

10

Yamato Holdings Co., ltd.

3. Tackling the Challenges of a Growing E-Commerce Market
The Yamato Group has successfully expanded its solutions business, byorganically combining consumer-driven differentiation strategies, which it
pioneered and has continued to rigorously deploy, with its non-delivery
businesses. And as a result we have quickly increased our presence in thegrowing e-commerce market.
The prime driver of the express home delivery market in Japan is expansion in the B2C segment, particularly mail-order customers. This trend should continue.
In fiscal 2013, TA-Q-BIN delivery volume increased 4.5% from a year earlier. As of the start of fiscal
2014, we project 8.6% growth for the year.
The e-commerce market has expanded on the strength of enabling people to buy quality products at
reasonable prices from the comfort of their homes, in what amounts to a change in lifestyles. TA-Q-BIN
services have underpinned the expansion of this market.
Since initiating TA-Q-BIN services, the Yamato Group has remained true to its pioneering commitment to becoming as close as possible to customers by operating from their perspective and continuing
to deploy its differentiation strategies while succeeding with its solutions proposals. As a result, wehave quickly increased our presence in the e-commerce market.
We draw on our 54,000 sales drivers, approximately 3,900 direct retail stores, and the channel
diversity of our roughly 250,000 express agencies around Japan, including convenience stores, to offer
uncompromising delivery quality, information and tracking management, and payment and settlement
systems. These and other resources comprehensively support e-commerce companies and consumers
alike, giving us large first-mover advantages in the e-commerce market.
We are endeavoring to enhance delivery quality and labor productivity by building a team-based
structure that covers part-time employees and sales drivers to concurrently deliver parcels during times
when customers are most likely to be home.
These efforts have enabled us to constrain additional cost pressures even as the number of packages in the e-commerce market increases.
We also offer solutions that satisfy the needs of mail-order businesses that are seeing logistics
costs rise as they try to handle many small orders more quickly to avoid losing sales opportunities.
For example, we can ensure speedy deliveries through our Today Shopping Service, which candeliver goods in as quick as four hours after an order, and our Distributed Inventory-based Fast Direct
Sales service quickly delivers orders and swiftly replenishes products sold, preventing costs and inventory volumes from increasing. This is achieved by maintaining minimal inventories near key markets.
We therefore satisfy the needs of both senders and recipients. In other words, we have organicallyintegrated a pioneering consumer-centric strategy of differentiation with non-delivery businesses tosuccessfully expand our solution business. This has enabled us to capture package delivery demand in
the growing mail-order market.
The Yamato Group is thus perfectly placed to do well in an e-commerce market that should steadily
expand in the years ahead.

AnnuAl RepoRt 201311

4. Fiscal 2014 Forecasts and Shareholder Returns
Our basic shareholder policy is to try to increase total returns through a
combination of dividends and share buybacks.
In fiscal 2014, the final year of DAN-TOTSU Three-Year Plan HOP, in the domestic market we aim tocontinue creating new businesses and leverage Group collaboration to engage in proposal-based sales,
while supplying services closely tied to communities.
In overseas markets, we will reinforce management in locations that our TA-Q-BIN business covers.
In addition, we will engage in borderless logistics in Asia by bolstering our internationally integrated
transportation services structure.
We will link our strategies in the domestic and overseas markets to build a network that accelerates our long-term growth strategies. This will be achieved by completing the Atsugi Gateway and
Haneda Chronogate and fully operating our Okinawa International Logistics Hub.
For fiscal 2014, we forecast that consolidated operating revenues will increase 4.9% year on yearto ¥1,345.0 billion. Operating income is projected to rise 7.2% to ¥71.0 billion, while net income isforecast to increase 15.2% to ¥40.5 billion. We expect to increase capital investment 70.5% to ¥90.0
billion, as we look to deliver record-setting performance.

Operating Income

Cash Dividends per Share(Millions of Yen)

(Yen)

80,00060,00030
61,38964,314

66,651

71,00066,203

22.0

22.0

22.0

22.0

2009

2010

2011

2012

55,721

23.0

24.0

20
40,00010
20,000

0

2009

2010

2011

2012

n Non-Delivery n Delivery

2013

0

2014
(forecast)Acquisition of own shares(Billions of Yen)
20

18.1

11.8
10

0

12

Yamato Holdings Co., ltd.

9.8

9.9

9.9

10.3

2004

2005

2006

2007

10.0

0.2

0.2

0.0

2008

2009

2010

2011

2012

2013

2013

2014
(forecast)Capital investment will be higher than in previous
years because of several factors. These include spending to maintain existing businesses and investments ingrowth areas, one being emerging business opportunities that we have identified in intercompany logistics,
which encompasses e-commerce and procurements/
deliveries.
Under the DAN-TOTSU Three-Year Plan HOP, ending
in fiscal 2014, we are aiming for ROE exceeding 7.0%.
Meanwhile, we seek to generate an ROE of more than
11.0% under DAN-TOTSU Management Plan 2019, which runs through fiscal 2020.
Our basic shareholder returns policy is to try to increase the total return through a combination ofdividends and share buybacks.
We will continue to increase our earnings power by steadily executing our business plan, while raising capital efficiency by implementing flexible capital policies, as and when needed, by taking advantage
of our solid financial base.
For the fiscal year ended March 31, 2013, we paid dividends of ¥23 per share, up ¥1 from a year earlier.
For fiscal 2014, management plans to increase dividends by ¥1 per share, to ¥24.
The Yamato Group is striving concertedly to materialize its management philosophy, which is to help
enrich our society by enhancing the social infrastructure of TA-Q-BIN networks, creating more convenientservices for comfortable lifestyles and developing an innovative logistics system. By increasing thesatisfaction of all stakeholders, including shareholders, customers, society, and employees, we aim toenhance corporate value.
We ask our shareholders for their ongoing encouragement and support.
August 2013

Makoto Kigawa
Representative Director,
President and Executive Officer

AnnuAl RepoRt 201313

Market Data
Growth in the Express Home Delivery Market
Trends in Parcel Delivery Volume
This sur vey uses company-reported parcel deliver y volume data compiled by Japan’s Ministr y ofLand, Infrastructure, Transport and Tourism.
In the data, “parcels” denotes individual packages weighing less than 30 kg, irrespective of thetype of deliver y (C2C, B2C or B2B).
However, lots in which multiple packages are sent together and parcels that do not require a signature on deliver y are not counted as “parcels” for the purposes of the sur vey.

Growth of TA-Q-BIN
TA-Q-BIN is the Yamato Group’s flagship ser vice offering. Since its launch in 1976, we have pursued
a strategy of differentiation based on development of additional strategic offerings such as Cool
TA-Q-BIN and TA-Q-BIN Collect, and improvement of delivery quality, including enhanced features such as
Time Period Delivery and Driver Direct services. As a result of these efforts, the Yamato Group has outperformed the growth in the express home delivery market as a whole, and steadily expanded ourmarket share.

Timeline of New Product Development

1986 TA-Q-BIN Collect launched
1988 Cool TA-Q-BIN service launched

1996 Start of year-round
operations

YamatoJapan Post
1975
Source: Japan Post Holdings Co., Ltd.
Japan Post Co., Ltd.

14

Yamato Holdings Co., ltd.

1980

1985

1990

Note:
“Total Number of Deliveries” includes express home delivery services involving transport by truck, air and other methods.
Source: Statistical survey by the Ministry of Land, Infrastructure, Transport and Tourism.

Currently, the Group is working not only to develop new strategic offerings and improve service
quality, but to also adapt to the needs of customers that have grown in sophistication on an ongoingbasis. To this end, the Yamato Group will strive to attain further growth in TA-Q-BIN through the generation of new business and solution models in areas of the business in which growth can be expected.
Moreover, the Yamato Group is developing its overseas TA-Q-BIN business across Asia.
In addition to operations that have already begun in Shanghai, Singapore and Hong Kong, in September 2011, the Group launched a TA-Q-BIN operation in Malaysia.
Moving for ward, the Yamato Group will expand the TA-Q-BIN business in markets across Asia whererapid economic growth is expected to continue. By penetrating these markets with high-quality door-(Millions ofParcels)

to-door deliver y ser vices and a business model honed in Japan, the Yamato Group aims to contribute

4,000

to the prosperity of societies across Asia, and to evolve as the leading provider of distribution andlifestyle support ser vices in the region.
3,500

Trends in Delivery Volume

3,000

Total Number of Deliveries
By Truck

2,500

Enhancingsender-side customer service

Enhancingdelivery-side customer service

2,000

Enhancing
services by proposing solutions
2009 Five Solution Models (Today Shopping
Service, Global Direct, etc.)2007 Kuroneko Members
service launched

1,500

1,000

2010 TA-Q-BIN services
started in Shanghai
and Singapore
2011 TA-Q-BIN services
started in Hong Kongand Malaysia

500

1998 Start of Time
Period Delivery

2002 Start of Driver Direct service

0

1995

2000
1999

2005

2010

2013

2007

In fiscal 1999*1, certain firms switched their existing parcels to express
home delivery, and the data for the year reflects this increase. Excluding
this extraordinary factor, year-on-year growth was 5.9%.

As a result of the privatization of the postal service in October 2007, Japan
Post Co., Ltd. now falls under the jurisdiction of the Motor-Truck Transport
Business Law, and is included in the survey starting from fiscal 2007*2.

*1 The period April 1999 through March 2000 in this graph only

*2 The period April 2007 through March 2008 in this graph only
AnnuAl RepoRt 201315

At a Glance
Operating Revenues (Millions of Yen)

Delivery

1,000,000
800,000
600,000
400,000
200,000
0

BIZ-Logistics

2011

2012

2013

2011

2012

2013

2011

2012

2013

2011

2012

2013

2011

2012

2013

2011

2012

2013

2011

2012

2013

100,000
80,00060,00040,00020,0000HomeConvenience

60,00040,00020,0000

Share of Net Sales

e-Business

40,00030,00020,00010,000
0

Financial

40,000n Deliver y . . . . . . . . . . . . 80.2%

20,000n BIZ-Logistics . . . . . . . . . . 6.8%

0n Home Convenience . . . . . 3.5%
n e-Business . . . . . . . . . . . 2.9%
n Financial . . . . . . . . . . . . 4.4%

60,000

Truck
Maintenancen Truck Maintenance . . . . . 1.8%

25,00020,00015,00010,0005,000

n Other . . . . . . . . . . . . . . . 0.4%

0

Other

6,000

4,000

2,000

0

16

Yamato Holdings Co., ltd.

Operating Income (Loss) (Millions of Yen)
40,000Business Description
The Deliver y Business provides small parcel deliver y ser vices for the general publicand corporations.
Guided by its basic corporate philosophy of “Total Reliability,” the business provides
mainly TA-Q-BIN and Kuroneko Mail services to improve convenience in customers’ lives.

30,00020,00010,000
0

2011

2012

2013

4,000

The BIZ-Logistics Business is a corporate distribution operation involved in services suchas logistics and medical products distribution. The business provides customers with aninnovative logistics system by combining management resources such as the TA-Q-BIN
network with international transport and warehouse management functions.

3,000
2,000
1,000
0

2011

2012

2013

400

The Home Convenience Business is a community-based lifestyle support operation thatprovides services such as the pickup, delivery, and assembly and installation of homefurnishings and appliances. The business provides lifestyle-related services utilizing the
Yamato Group’s nationwide network, with the aim of supporting the convenient andcomfortable lifestyles of customers.

0

（400）

（800）

2011

2012

2013

8,000

The e-Business comprises operations in contract data processing and information systems
development.
The e-Business is actively engaged in proposing solutions that integrate data, distribution and settlement functions, to raise business process efficiency and solve potential
business problems customers face.

6,000
4,000
2,000
0

2011

2012

2013

12,000The Financial Business provides settlement services and financial products for corporations and the general public.
From payment collection on mail-order product deliveries to B2B logistics settlement,
the Financial Business is striving to respond to every means of settlement to meet theneeds of customers.

9,000
6,000
3,000
0

2011

2012

2013

3,000

2,000

1,000

0

2011

2012

2013

20,000The Truck Maintenance Business performs the maintenance and upkeep of trucks andother vehicles for transportation companies under contract.
Utilizing the Yamato Group’s technologies for reliably maintaining and repairing trucks,
the Truck Maintenance Business provides customers in the trucking and bus transportation sector with three forms of value: 1) convenient vehicle maintenance, 2) compliancewith statutory vehicle inspections, and 3) reduced maintenance and repair costs.

The Yamato Group’s Other businesses comprise the B2B logistics business involving the
JITBOX Charter service, personnel placement services, and shared services.

15,00010,000
5,000
0

2011

2012

2013

* Operating income in Other includes dividends from Group companies.

AnnuAl RepoRt 201317

Overview of Operations
Delivery

Masaki Yamauchi
Representative Director,
President and Executive Officer of Yamato Transport Co., Ltd.

Guided by its basic corporate philosophy of “Total Reliability,” the Delivery Business utilizes the business resources of
the Group in the Japanese and overseas markets to pursue
business development that improves convenience in customers’ lives. In the Japanese market, the Delivery Businessaims to establish an overwhelming competitive advantage
over rivals through various measures. These include evolving
our products and services, reinforcing our ability to propose
commercial distribution solutions, and addressing local
revitalization needs. In overseas markets, the Delivery Business aims to expand its TA-Q-BIN business in Asia anddevelop and cultivate services that streamline domestic andinternational transportation services.

Review of Fiscal 2013
In the Delivery Business, our basic strategy for the second
year of our medium-term management plan, DAN-TOTSU
Three-Year Plan HOP, was to build a foundation for further
growth and on this basis we worked to strengthen sales
capabilities in the small lot commercial distribution sector,
our core revenue base, and reinforce sales of solutions built
on the consolidated strengths of the Yamato Group.
As a result, in the rapidly growing e-commerce market,
we capitalized on our lineup of strategically differentiatedproducts that offer added-value and utilize the Group’s management resources, specifically our nationwide network that
extends the “last mile” to customers, to acquire new customers and boost deliveries from existing customers. This
led to record-high handling volume for TA-Q-BIN services.
Handling volume for Kuroneko Mail declined owing tostricter policies on parcel acceptance in keeping with ourcompliance commitment and stiffer competition.
We drew on part-timers in what we call our field cast andteam-based approaches to concurrently deliver parcels
during times when customers were most likely to be home,
as we worked to improve delivery quality and productivity.

18

Yamato Holdings Co., ltd.

At the same time, we worked to improve the accuracy ofwork volume projections and to rightsize our workforce. As aresult of these and other efforts, operating revenues rose
1.3% year on year to ¥1,028,219 million, and operating
income was up 2.3%, to ¥41,908 million.
In the Japanese market, in order to meet the diversifying
needs of customers with high-quality services, for corporate
customers in particular, we offered solutions such as
Yamato Business Members utilizing the TA-Q-BIN networkand other Yamato Group functions. At the same time, forindividual customers, we ran the Kuroneko Point Campaign
to build closer relationships with members of the Kuroneko
Members service. Moreover, to further raise conveniencelevels for people receiving parcels, in addition to our existing service that allows pickup at stores offering TA-Q-BIN
services, we began a service that allows people to choose
a convenience store in advance as the pickup location when
they purchase a mail-order product. In addition, use of our
shopping delivery service, health and well-being confirmation service and other services created in partnership withlocal governments also increased nationwide, as further
progress was made on building lifetime lifestyle support
platforms.
In the overseas market, as goods, money and information
have become increasingly borderless with the integration of
the Asian economic zone, there has been increasing need forquick, safe and secure delivery services that connect all ofAsia, including Japan. We have responded by developing the
TA-Q-BIN business in Shanghai, Singapore, Hong Kong and
Malaysia. Products and services we have honed in Japan,such as Cool TA-Q-BIN, TA-Q-BIN Collect and Time Period
Delivery services, are gradually gaining acceptance in othercountries and regions where we are now operating, as services continue to expand in the Asian zone. In November
2012, we launched a service that enables next-day delivery
from Japan to other parts of Asia with 24-hour customs clearance at our Okinawa International Logistics Hub, putting inplace a new Asian door-to-door integrated delivery platform.

Strategies for Fiscal 2014
As a result of the Japanese market contracting due to theaging population and low birthrate and to acceleration in
global competition, there has been increasing demand
among Japanese companies in connection with operational
efficiency, the provision of higher added-value products, andoverseas market development. At the same time, domestic
consumers currently have a mixture of needs that reflectongoing diversification in lifestyles. There is both the needmainly among young people for highly convenient services inline with their personal lifestyles, and the need mainly among
elderly people for highly conscientious and friendly services.
Amid such conditions, in fiscal 2014, the final year of our
medium-term management plan, DAN-TOTSU Three-Year Plan
HOP, we will provide innovative solutions with the goal of being
one of Japan’s most recognized, most appreciated companies.

1. Reforming Logistics with Value Networking
In the area of corporate solutions, we will develop advanced
solutions to help companies make breakthroughs in theirlogistics systems by combining networks for same-day intercity delivery and next-day delivery to Asia with advanced
logistics at distribution centers, under the value networking
concept. Logistics innovation will be promoted with priority
not only on the sender (supply) side, but also from thestandpoint of the demand chain to identify needs on thereceiver (procurement) side. For example, in the B2C
market, we will utilize the Free Rack Auto Pick System(FRAPS) to provide solutions that keep costs and inventory
from increasing and disperse inventory to radically shorten
lead times from order to delivery. These solutions will makeit possible for even smaller mail-order companies with local
inventory to provide delivery speeds and quality equivalent
to large mail-order enterprises as well as improve convenience for their customers. In the B2B market, we will provide solutions for integrated, global just-in-time delivery andprocurement via cross-merge functions to shorten leadtimes and reduce inventory on both the supply and procurement sides.
In addition, we will start an international Cool TA-Q-BIN
service to expand sales channels for fresh, high-quality
Japanese food in Asia and to directly tie producers all overJapan with customers in Asia through highly competitive
short lead times and refrigeration technology. We will begin
in Hong Kong and then gradually expand to other countries.
In parallel, we will work to further develop collection anddelivery networks in individual countries and carry out initiatives to improve delivery quality.

2. Responding to Diversifying Lifestyles and Providing Lifetime Lifestyle Support Platforms to Contribute to Society
In the area of consumer solutions, we will increase theflexibility of parcel pickup in order to make it more convenient to receive deliveries. In addition to prior notification ofscheduled deliveries via e-mail and the ability to changedelivery times online, we will broaden the range of pickup
locations to accommodate the increasingly diverse lifestylesof consumers.
For consumers outside of major urban centers, we willdevelop services for making daily life more convenient in
partnership with the government, municipalities and othercompanies. Our shopping delivery service and service for
confirming the health and well-being of people when TA-Q-BIN
deliveries are made, which were created in partnership withsocial welfare councils, local merchants and other organizations, have already begun to spread across the country.
We intend to create business models for these types ofprograms to establish lifetime lifestyle support platforms
capable of creating value for society on a permanent basis.
3. Establishing Business Foundations for Highly EfficientManagement
At the same time as creating new solutions in this way, we
will establish business foundations for highly efficient operations. We will look first at the entire Yamato Group andthen begin revamping business site locations and reforming
work flows in each division to improve administrative efficiency and optimize personnel assignments.
And, clearly recognizing that our employees are thesource of our competitive advantage, we will work to refine
personnel systems and hiring practices and further enhance
employee training and internal communication.

TA-Q-BIN Services
Acceleration of Multi-Stores (3,900 Stores)

Customers whorequest delivery(Corporate or Individual)(FY2013)• High-Density Network with Our Catchphrase “No Matter What Time
Serve the Customer, No Matter How Many Times Serve the Customer”• Time-Differentiated High-Quality Service• Delivery System with In-House Employees• Delivery not Dependent on Trucks
Actions for Environment and Safety

Customers who expect toreceive packages(Corporate or Individual)

Express Agencies:
250,000*
Direct Retail Stores: 3,900*
Sales Drivers:
54,000** Approximate figures

CenterCenter Small Group Center
Small Group

Small GroupBase(76 centers
nationwide)

Arterial
Transportation(Outsourced)

CenterBase

CenterSmall Group

Small Group

CenterSmall Group

Greater Sophistication of ICT Infrastructure

Mobile Terminal• Real-Time Parcel Inquiry System via Mobile Terminals• Delivery Schedule and Missed Delivery E-mail System• Settlement System Including for Payment on Delivery

Mobile Terminal

IT and Settlement Data

AnnuAl RepoRt 201319

BIZ-Logistics
One domestic initiative during the year under review was
to materialize the new concept of “inventory free” using the
FRAPS (Free Rack Auto Pick System). Unlike conventional
logistics operations requiring storage, this approach allows
us to use the TA-Q-BIN network to achieve the fastest delivery regardless of where inventories may be. Through thisservice, we will help client companies to expand sales byreducing delivery lead time to consumers, in addition to
reducing their trading inventories.
One overseas initiative during the year under review was
Hitoshi Kanamori
Representative Director,
President and Executive Officer of Yamato Logistics Co., Ltd.

to begin providing companies conducting auctions in the
U.S. with logistics services incorporating advanced expertisefrom Japan. By introducing operations using digital devices,
we improved the efficiency of shipment work by 50%, while
reducing human error during the picking process by half. By

The BIZ-Logistics Business aims to amaze and satisfy its

helping client companies to enhance their operations andcustomers and the consumers of their products and ser-improve quality, the BIZ-Logistics Business has helped themvices by exceeding all customers’ expectations. The busi-

to achieve higher levels of consumer satisfaction.

ness realizes this goal by providing innovative logistics

By providing services from the standpoint of consumers,

solution models from the perspective of users, combining

the BIZ-Logistics Business will constantly drive logistics

logistics and international transportation capabilities withsolutions advances by customer and region to steadily

the TA-Q-BIN network and other management resources of

expand its domain.

the Yamato Group.

Strategies for Fiscal 2014
Review of Fiscal 2013

Fiscal 2014 is the final year of our medium-term manage-

In fiscal 2013, operating revenues increased 5.2% from ament plan DAN-TOTSU Three-Year Plan HOP. Guided by our

year earlier to ¥86,807 million, and operating income roseslogan of “LOGINNOVATION,” which encapsulates our goal

11.8% to ¥4,095 million. This was mainly due to steadyof achieving logistics innovation, we will work to create

growth in the medical equipment-related service and otherhigher value-added solutions.

logistics businesses, as well as services for the mail-orderindustry centered on Japan.

In domestic business, we aim to provide services thatfacilitate even more convenient and comfortable lifestyles innew business fields by creating business models ahead of
the government’s growth strategies.

20

Yamato Holdings Co., ltd.

In the medical field in particular, the BIZ-Logistics Business will establish a Medical Platform providing a one-stop
solution specializing in the medical field with operations
based in the Kobe Special Medical Zone. In doing so, the
BIZ-Logistics Business aims to contribute to the development of medical technologies such as regenerative medicine and preventive medicine.
The BIZ-Logistics Business also aims to supply evenhigher value-added services by combining its information
technology (IT), logistics technology (LT) and financial technology (FT) with Atsugi Gateway and Haneda Chronogate,
which will open in FY2014 as hubs linking Japan and over-

FRAPS

seas. The BIZ-Logistics Business will also provide Cross
Merger Delivery, which is a service designed to raise theefficiency of product distribution without increasing costs or

The BIZ-Logistics Business will contribute to the realiza-

inventories, and the Distributed Inventory-based Fast Directtion of a prosperous society, bringing “INNOVATION to

Sales service, which combines “inventory free” withLOGISTICS” by fusing the management resources of the

reduced delivery time. Through these services, the BIZ-

Yamato Group organically.

Logistics Business aims to further amaze and satisfy its
customers and consumers.

FRAPS

The day’s shipment

Manufacturer
TA-Q-BIN

FRAPS Center

Retail Store
Just-in-time deliveryof mixed shipments
Retail store

Manufacturer
Charter
Products from different
manufacturers are sorted bycommon delivery destinationand shipped

AnnuAl RepoRt 2013

21

Home Conveniencepeace of mind of customers with the need to organize thepersonal belongings of someone who has passed away.
These services were very well received by customers with ashortage of time or manpower.
In services for corporate clients, we marketed our comprehensive logistics support service to businesses involvedin eco-home related equipment such as home power generators and storage batteries. This service offers end-to-end
support covering import procedures, parts merging,
advance site surveys, delivery, set up, installation, inspecAtsushi Ichino
Representative Director,
President and Executive Officer of Yamato Home Convenience Co., Ltd.

tion and repairs. As a result, we were able to greatly
increase our handling volume. At the same time, we
achieved rapid growth by expanding the scope of this service to include businesses in IT devices, office equipment,
kitchen appliances and more.

In the Home Convenience Business, we provide lifestyle

We also launched a mail order service drawing on our

support services that help eliminate inconveniences at

capabilities cultivated for over 20 years in procuring local

home, along with moving services and home furnishingproduce from all over Japan. This service, used by many

delivery and assembly and installation services. In addition,customers, was launched mainly to help corporate clientsleveraging our networks, we provide a range of solutions toimprove customer footfall, or to order produce to enhance

corporate customers in both the private and public sectors

their employee benefit programs.

to support sales growth and help reduce costs.

Revenues from new services increased as a result of
the initiatives above. However, our volume zone in

Review of Fiscal 2013

Household TA-Q-BIN for delivering mainly television set pur-In fiscal 2013, which was the second year of DAN-TOTSU

chases diminished. This was owing to consumer demand forThree-Year Plan HOP, we actively engaged in product devel-

television sets waning after expiration of Japan’s home

opment and sales promotions while we worked to reform

appliance Eco Points program and the switch to digital ter-

our cost structure and strengthen management quality.

restrial broadcasting. As a result, operating revenues

In services for individual customers, we launched thedeclined 6.5% year on year to ¥44,602 million. In terms ofSingle-person Moving Mini Type service in combination withexpenses, we reduced fixed costs, including facilities-

convenient and open-ended rentals of home furnishing

related costs by consolidating sites, and administrative

essentials, with the aim of catering to a trend in which

personnel expenses by automating office processes, while

single people are taking fewer belongings with them when

also reining in variable costs, such as contract vehicle

they move. We also provided same-day services to complete

expenses by improving the productivity of our own fleet.

the move in one day. This has helped to differentiate our-

However, this was not enough to offset the decline in rev-

selves substantially in the market for moving single per-enue, and we recorded an operating loss of ¥527 million.

sons. Television commercials and other advertising were22

also strengthened in an effort to raise recognition of ourStrategies in Fiscal 2014

moving services.

This year, which is the final year of DAN-TOTSU Three-YearMoreover, we launched a convenient house cleaning

Plan HOP, we intend to further expand our business domain

service for customers wishing to tidy their living space

to secure growth into the future. Our focus in particular willtrouble-free, and an estate organization service for the

be on lifestyle support services. In this modern society it is

Yamato Holdings Co., ltd.

now easy to conduct various procedures and make pur-includes taking care of their office layout design, thechases from home thanks to advancements in IT and deliv-

arrangement of required fixtures, and measures for environ-

ery networks. Consumption in the privacy of one’s home will

mental care and disaster preparedness. In particular, we

continue to increase going forward, and it will not only be tointend to help small- and medium-size companies break thesimply eliminate inconvenience but to establish lifestyles

bottleneck they often experience in economies of scale bytailored to individual preferences. There will also likely bebundling their demand and providing them with businessacceleration in demand for services performed by third

structures and cost reductions that would have not been

parties as customers seek to make more effective use of

possible individually.

their own time. The Yamato Group can reach customers at

The above lifestyle support services and corporate activ-

their homes all over Japan. We also have the capability to

ity support services have the effect of increasing our aver-deliver packages whether large or heavy, as well as theage daily workload. And by smoothing out the downtime,

capable technicians to conduct electrical installation andthey help raise productivity and contribute to structural

other work. Utilizing this network, we intend to provide ser-improvements in profitability. We will also continue to reduce

vices that both eliminate inconvenience within the homeadministrative costs and reinforce controls on variable

and help individuals realize their own aspirations.

expenses as we work to ensure stable, sustainable profits.

In addition, we will expand the adaptation of our network

We are a company that will continue to be needed byto corporate clients. Along with our traditional office reloca-

society and we intend to develop services that are appreci-tion service, we will provide clients with a total package that

ated by customers and further raise our corporate value.

Services for Individual Customers (Raku Raku Okatazuke Pack) (Convenient House Cleaning Service)

1 Quotation

2

Sorting items tobe packed away

3

Rearrangement ofhome furniture

4 Tidying up

5 Cleaning

6

Confirm completionof work

Service for Corporate Customers (Solution Model for Eco-Friendly Home Equipment)
Manufacturer(Overseas plant)

Home equipment
manufacturer
Place order

Solar panels

Overseas Yamato
subsidiary
Special packaging withboxes for each residence

Related domestic
manufacturers
Place order

Coordinate order received

Peripheral devices

Yamato global customs
clearance office

Yamato Home
Convenience Co., Ltd.

Process importdeclaration
Arrange containertransport
Issue and affix slips

Merge accessories withboxes for each residence

End user
Just-in-time delivery,
installation, construction,
inspection, repairs

AnnuAl RepoRt 201323

e-Businessbusiness problems and proactively proposes solutions that
result in sales growth and cost reductions for customers.

Review of Fiscal 2013
The e-Business actively proposed solutions that integratedata, distribution and settlement functions, to raise business process efficiency and solve potential business problems of customers. Furthermore, we developed andoperated systems in step with business development
across the Yamato Group.
Kenji Minaki

In collaboration with the Financial Business in e-money

Representative Director,
President and Executive Officer of Yamato System Development Co., Ltd.

services, we have been promoting installation and operationof a multi e-money settlement terminal that allows settlement by multiple brands of e-money. During the year underreview, we saw expanded installation and use of these ter-

The e-Business is involved in a range of information ser-minals by a wide range of customers in terms of businessvices for corporations, including Application Service Provider

size and sector, including nationwide retailers and small and(ASP) services and information system development.

medium-sized retail and service businesses.

Using Information and Communication Technology (ICT),In our e-Logistics Solution business, we offer a service

the e-Business works in partnership with customers in pro-that visualizes delivery flows and the whereabouts of pack-moting efficient business processes. Based on these ser-ages by applying the tracking know-how of our TA-Q-BIN

vices, the e-Business provides solutions for potential

business for customers requiring individual goods

e-Logistics Solution
Yamato Group
Business Partner

Individual Product Management Enables Faster, More Accurate Response

Business Partner’s
Customers

Yamato Group Operations

Production Base

Customer

Information and Tracking Management
Storage, Transport and Delivery

Distribution Base

Flow of Goods

Sales BaseUsing Tracing to Achieve Uniform Information Management

24

Yamato Holdings Co., ltd.

Flow of Information

additionally cultivated its own operations in Taiwan.

management, such as telecommunications equipment andAs a result, operating revenues increased 4.4% year on

cable television businesses. In the year under review, we
accelerated business development mainly by promoting

year, to ¥37,061 million, supported mainly by growth inservices supporting reservations management, storage andservices linking data and logistics functions. Operating

retrieval management, and inventory management needed

income rose 4.2%, to ¥6,987 million due to productivity

by precision instruments and medical device manufacturers

enhancements and cost cutting measures, despite upfront

when renting products to hospitals and other customers. In

investments in e-money services and other factors.

addition, we saw expanded use of our existing services.

Strategies in Fiscal 2014

In e-On Demand Solutions, business expanded in thefiscal year under review thanks to the development of ser-Our first strategy is to strengthen the competitiveness of ourvices, particularly for the pharmaceutical industry, that sup-products. Besides refining existing services as a matter ofport improved sales efficiency and inventory reductions

course, we will create more services and businesses by com-through the management, on-demand printing, and just-in-

bining the management resources of the e-Business and thetime delivery of customers’ sales promotion materials.

rest of the Yamato Group. We will also collaborate with the

Our Web-Based Mail Order Solution business took steps

services of other companies to generate unique solutions.

to develop the “net supermarket” business, in which we

Our second strategy is to reinforce our sales capabili-

expect demand to expand. The business targeted retailties. We will employ the networks of the e-Business andbusiness customers, such as supermarkets and depart-the rest of the Yamato Group as part of efforts to enhance

ment stores, in expanding its Net Super Support service, aour solutions capabilities by collaborating with influential

comprehensive service offering Web system creation, deliv-

external partners in the marketplace. We will draw on our

ery of items, and collection of payments. Taking advantage

solid, wide-ranging sales structure to cultivate customerof the multifunctionality of the Yamato Group, this service

needs and deliver solutions.

has gained a strong reputation for its overall power as a

We will strive for superior ability to use the combined

service that deals with the underlying social trends of an

power of the Group in our business, continuing to offer

aging society and the depopulation of rural areas. Conse-

new solutions that contribute to improved efficiency in thequently, business is expanding firmly.

business processes of our customers. Our goal is to help

Overseas, the e-Business progressed in line with thebuild an enriched society as a solutions provider.

Yamato Group’s Asian developments using ICT. Our e-Business

Net Super Support Service
Customer places order

End customer
Able to accept settlement
using e-money

Order(NekoPit/Internet)

Same-day delivery• In-store selection• Collection by sales driver

Base

CenterAnnuAl RepoRt 201325

Financial
In the business-to-business (B2B) market in Japan, we
helped sellers expand sales channels and buyers perform
credit transactions through the Kuroneko Anshin Kessai
Service. We also provided value through improving businessefficiency and at the same time managing accounts receivable and reducing risk in debt collection.
Moreover, in Shanghai, Singapore, Hong Kong and
Malaysia, where we provide settlement solutions, we
worked to differentiate ourselves from local companies,
making proposals in line with customer needs. These
Toshizo Kurisu
Representative Director,
President and Executive Officer of Yamato Financial Co., Ltd.

efforts resulted in a year-on-year increase in the number ofsettlement transactions and in operating revenues.
Operating revenues were up 4.8% year on year to¥56,710 million due to an increase in the number of
TA-Q-BIN Collect and e-money settlement transactions. Oper-

The Financial Business aims to become a partner that pro-ating income was ¥8,516 million, down 14.3% year on year,

vides convenience for consumers and helps enterprises

due to the effect of a reversal of an allowance for doubtful

overhaul their logistics systems by providing settlement andaccounts in the previous fiscal year.

other financial solutions in Japan and abroad. We are determined to offer diverse settlement methods to fulfill cus-

Strategies in Fiscal 2014

tomer requirements, such as collecting payments uponIn the B2C market, in addition to cash-on-delivery settle-delivery on behalf of mail-order companies and handlingment, our mainstay service, we will enhance the functions

settlements between companies. Under our DAN-TOTSU

of TA-Q-BIN Collect to accommodate increasing numbers ofManagement Plan 2019, we will endeavor to develop vari-consumers purchasing products online. We will also revamp

ous services for becoming No. 1 in settlement, particularly

our sales system and work to further strengthen sales offor mail-order companies.

non-face-to-face settlement services.
In addition, we will propose solutions that go beyond

Review of Fiscal 2013settlement services and leverage the collective resources of

For our corporate customers in the business-to-consumer

the Yamato Group to flexibly meet the diversifying needs of(B2C) mail-order market, the Yamato Group proactively pro-consumers and mail-order companies while also working tomoted sales of Kuroneko Web Collect, a service that allows

refine those solutions to provide greater added value.

settlement by multiple methods of payment such as credit

In the B2B market, we will develop logistics consultants

card and e-money simultaneously. We also worked to pro-and utilize outbound calls to strengthen sales and continuepose a total solution in which we provide not only a settle-

working to develop the business around the Kuroneko

ment method but also assist in sales promotion activities

Anshin Kessai Service.

of customers.

26

Yamato Holdings Co., ltd.

With the B2C market for global logistics settlement services growing steadily, we intend to provide consulting forJapanese mail-order firms entering overseas markets and

The Growing Mail-Order Sales Market and TA-Q-BIN Collect
(%)

10.0
9.0

continue developing cash-on-delivery services in parts of

9.1

8.4
8.0

Asia where TA-Q-BIN is being made available. In the B2B

6.7
6.2

market, we will enhance services that make it easier to use

6.0
6.0

the Global Procurement Support Service by handling mul-

4.1
4.0

tiple currencies, for example.
With these objectives, we will provide fast, high-quality

4.1

3.2

2.0

services to mail-order companies through Haneda Chrono0

gate, Atsugi Gateway and the Okinawa International Logistics Hub, while also providing settlement solutions innresponse to the changing logistics infrastructure surrounding companies, users and the community in an effort to be

2009

2010

YoY growth in mail-order sales

2011
n

2012

2013

YoY growth in TA-Q-BIN Collect parcel volume

Source: The Japan Direct Marketing Association
Note: The growth rate in mail-order sales shown in this chart is through the year ended
March 31, 2012 because data for the year ended March 31, 2013 had not yet
been released by the Japan Direct Marketing Association as of August 23, 2013.

an ideal partner for customers in logistics reform.

TA-Q-BIN Collect: Flowchart of Cash-on-Delivery Service
Sales agreement
Product delivery

Seller

Yamato Transport Co., Ltd.

Buyer

Payment•Cash •Credit card

Net deposit•Debit card •Electronic money

Yamato Financial Co., Ltd.

Settlement•Product charge •Collection fee

Product charge collection contract

AnnuAl RepoRt 201327

Truck Maintenance
Review of Fiscal 2013

Keishirou Sasaki
Representative Director,
President and Executive Officer of Yamato Autoworks Co., Ltd.

The Truck Maintenance Business operates vehicle servicing
plants for logistics and distribution companies. Over theyears, the business has expanded the industry’s first maintenance service into a 24-hours-a-day, 365-days-a-year service that enables customers to service their vehicles
without stopping operations, schedule automobile safety
inspections and have routine check-ups.
Our vision is to transform this business from being theonly one customers choose to the No. 1 for autoworks inJapan. “Transform inconvenience into convenience from thecustomer’s standpoint” is the corporate DNA of the YamatoGroup. Based on this perspective, the business offers
services, chiefly for logistics and distribution companies,that go beyond vehicle maintenance to provide a one-stop
solution covering body and tire maintenance, as well as
fuel supplies.
In addition, in providing insurance consultations as apartner that helps customers manage risk associated with
their operations, and management solutions that allow
customers to get the most out of their facilities, plants andlogistics equipment, we are aiming for total vehicle management services that contribute to the revitalization of thebusinesses of customers.

28

We posted increases in both revenues and profit in the year
under review. Our operating revenues were ¥23,229 million,
up 9.6% year on year. Operating income increased 6.1% to¥2,666 million.
A new Superworks vehicle maintenance plant was established in the Minami district of Okayama, Okayama Prefecture,a gateway to the Kansai and Shikoku regions of Japan.
Superworks plants represent a new paradigm in environmentally sensitive maintenance facilities and feature highoperating efficiency as well as solar power systems, LED
lighting and other energy-saving equipment. Of our 71 vehicle maintenance plants, 21 are now Superworks facilities,
which has reinforced our network.
We also launched a new Body Maintenance Service thatprovides chassis*1 inspection and maintenance along withbody (wing and tailgate*2) maintenance to help prevent delivery delays caused by breakdowns and reduce truck downtime. A new Tailgate Mounting Service*3 was also started.
As a result of leveraging our network strengths and solutions capabilities in this way, automobile safety inspections
for companies outside the Yamato Group increased 3.9%
over the previous year to 39,500 vehicles.
*1. The part of a vehicle that drives; includes the engine, brakes, drive-train, etc.
*2. Parts of a vehicle that are not needed to drive; includes the loading bed,loading equipment, etc.
*3. Equipment on the rear of a truck bed for lifting and lowering

Strategies for Fiscal 2014
In fiscal 2014, we intend to accelerate initiatives with thegoal of expanding our network of environmentally sensitive
Superworks facilities and further establish a managementbusiness based on maintenance and vehicle management.
We will also promote maintenance of the delivery infrastructure from a business continuity planning (BCP) standpoint.
We will establish a new location in the Chubu region andfurther extend our network to major urban areas, and we will
work to develop business in concert with local customers byfurther augmenting our service network. Moreover, we plan
to broaden the focus of our activities beyond just maintenance to include a more management-oriented approach inthe services we provide. We will further promote the

New Superworks vehicle maintenance plants pursue
greater gains in operating efficiency andenvironmental performance

Body Maintenance Service andTailgate Mounting Service

Superworks Okayama(Completed September 13, 2012)

Body Maintenance Service

Yamato Holdings Co., ltd.

Solar power system

Tailgate Mounting Service

existing 12-Month Fixed-Price Maintenance Package, andthe Tire Management Service, while expanding sales of newservices, namely the Body Maintenance Service, and asafety education program for transportation companies.
Through these efforts, we intend to provide new mechanisms that will allow our customers to more accurately
budget for and control vehicle maintenance costs. In addition, we will provide customers with expertise on safe andreliable operations.
In order to create one-stop services, we will step up
various efforts. One is to add a new management program
whereby we visit locations where customers’ vehicles are
stored and change the oil. In addition, we will promote ourrisk consulting business in our capacity as an insurance
agent and push ahead with our facilities and equipment
maintenance management business. Moreover, we will

Expanding our Superworks Network
21 locations out of 71 in total (as of March 31, 2013)

Hokkaido

Yamagata

Miyagi
Fukushima

Okayama

Fukuoka

Hyogo

Osaka
Kagawa

Aichi

Gunma
Saitama Ibaraki
Tokyo
Chiba

Kanagawa
Mie Shizuoka

establish fuel supply bases to support logistics and transportation infrastructure.
Through these sorts of new measures, we aim to growoperating revenues by 1.2% year on year to ¥23.5 billion,
and operating income by 16.3% to ¥3.1 billion.

Basic Concept—The “Three Cs” and “One C”
The Truck Maintenance Business provides one-stop services based on observing the three “Cs” underpinning management support for logistics and distribution companies.
The first “C” is Compliance, which is the foundation ofmanagement. Our Repairworks mobile plants have contributed to improving the completion rate for statutory vehicle
inspections of our customers.
Next, we have Convenience, where we pursue ever higher
levels of convenience for our customers. Based on this concept, we aim to establish a framework that enables operations 24 hours a day, 365 days a year, in order to carry out
vehicle inspections when the vehicles are not in operation.
Our third “C” stands for Cost Reduction based on helping to improve utilization rates for commercial vehicles whileleveraging procurement capabilities. By promoting measures
to constrain the need for spare vehicles and increasing thecompletion rate for statutory vehicle inspections, we havemade it possible to implement preventive maintenance,
which helps limit occurrences of unexpected costs. We will
harness our nationwide network to procure optimal partsand fuels so as to provide customers with high-quality products and services at low cost.
The last “C” stands for Clean. In keeping with the times,
we have addressed environmental issues by deploying solar
power systems, energy-efficient LED lighting, and otherfacilities at Superworks. Also, we have started to build asystem for being able to handle new technologies in ourmaintenance operations, with an eye on the increasing useof electric vehicles.
And we are recommending rebuilt and reused parts to
support the environmental efforts of logistics and distribution companies.

Okinawa

Vehicle Maintenance
Vehicle safety

Tire management

Risk Consulting

3C+1C

Fuel services

Compliance, Convenience,
Cost Reduction+
Clean

Non-life insurance
agencyLife insurance
agencyLogistics Maintenance
Maintenance oflogistics equipment

Sale of logistics
equipment

AnnuAl RepoRt 201329

Other
The JITBOX Charter service is a service that provides transportation by transport box. The service takes advantage of
its Group network consisting of multiple companies andprovides value to customers through timely delivery andfrequent, right-volume delivery. In the fiscal year ended
March 31, 2013, the Group increased the number of transportation orders of precision equipment and transportation
orders related to events, and the handling volume exceededthat of the previous fiscal year. In addition, we developed
returnable material suited for the transportation of precision

JITBOX Charter

equipment, among other items, and strove to provide anenvironmentally friendly and safe transportation service.
Operating income in Other, excluding dividends which
Yamato Holdings Co., Ltd. received from the Group companies, decreased 22.4% from the previous fiscal year to 898
million yen.

Operating Income

Track Record of JITBOX Charter(Millions of Yen)

(Units)

25,00020,000500,000

19,86318,76315,000400,000

368,409380,270403,018

300,000
11,877200,000

2,000
1,500

1,157

1,000

898

767

100,000

500
0

2011

2012

2013

n Including Yamato Holdings n Excluding Yamato Holdings

30

Yamato Holdings Co., ltd.

0

2011

2012

2013

Organization
As of March 31, 2013

Yamato Transport Co., Ltd.
Okinawa Yamato Transport Co., Ltd.
Yamato Global Express Co., Ltd.
Delivery

Express Network Co., Ltd.
Yamato (China) Transport Co., Ltd.
Yamato Transport (HK) Ltd.
Yamato Transport (S) Pte. Ltd.
Yamato Dialog & Media Co., Ltd.
Yamato Logistics Co., Ltd.
Yamato Global Logistics Japan Co., Ltd.
Yamato Multi-Maintenance Solutions Co., Ltd.
Yamato Packing Service Co., Ltd.
Yamato Packing Technology Institute Co., Ltd.
Konan Industry Co., Ltd.
Yamato Transport U.S.A., Inc.

BIZ-Logistics

Yamato Transport Europe B.V.
Yamato International Logistics (Hong Kong) Ltd.
Taiwan Yamato International Logistics Inc.
Yamato Asia Pte. Ltd.
Yamato International Logistics Co., Ltd.
Yamato Transport (M) Sdn. Bhd.
Yamato Logistics India Pvt. Ltd.
Shanghai Wai Gao Qiao Bonded Logistics Zone Yamato Warehouse Co., Ltd.

Yamato Holdings Co., Ltd.

Yamato Home Convenience Co., Ltd.

Home Convenience

Yamato System Development Co., Ltd.
Yamato Career Service Co., Ltd.*2

e-BusinessYamato Contact Service Co., Ltd.
Yamato Financial Co., Ltd.
Yamato Credit & Finance Co., Ltd.
Financial

Yamato Lease Co., Ltd.
Yamato Payment Service (HK) Ltd.
Yamato Payment Service (S) Pte. Ltd.
Yamato Autoworks Co., Ltd.
Yamato Autoworks Iwate Co., Ltd.

Truck Maintenance*

1

Yamato Autoworks Hokushinetsu Co., Ltd.
Yamato Autoworks Shikoku Co., Ltd.
Yamato Autoworks Okinawa Co., Ltd.
BoxCharter Co., Ltd.
Yamato Box Charter Co., Ltd.
Yamato • Staff • Supply Co., Ltd.

Other

Yamato Management Service Co., Ltd.
Yamato Multi Charter Co., Ltd.
Kobe Yamato Transport Co., Ltd.
Swan Co., Ltd.

Consolidated subsidiaries
Nonconsolidated subsidiaries*1 The segment name of Truck Maintenance was changed to Autoworks starting with the fiscal year ending March 31, 2014.
*2 Yamato Career Service Co., Ltd. in the e-Business was renamed Yamato Web Solutions Co., Ltd. on August 1, 2013.
AnnuAl RepoRt 201331

Corporate Social Responsibility
The Yamato Group believes that its sustained growth is

In May 2011, the Japan Federation of Freight Industries

largely contingent upon not only business profitability, butawarded the See-T Navi system a Prize for Technology Devel-also fair and proper management as a business group withoped to Reduce the Environmental Impact of Freight Trans-

operations that require a high degree of social interaction.

port at its 12th Freight Industry Environmental Awards. As

With the interests of all stakeholders in mind, the Groupof March 31, 2013, there were 29,947 Yamato Transport

actively conducts Corporate Social Responsibility (CSR) activi-delivery vehicles throughout Japan equipped with the See-T

ties from the perspectives of safety, the environment andNavi system.

society, in line with the Yamato Group Corporate Philosophy at
the heart of the Group’s business, with the aim of becoming aEnvironment

respected company admired the most and trusted by society.

Active Deployment of Low-Emission Delivery Vehicles
The Yamato Group is actively engaged in activities for pro-

Safetytecting the environment.

Promoting the Deployment of See-T NaviIn the fiscal year ended March 2013, the Group engaged

See-T Navi is a proprietary telematics system encouraging

in a wide range of initiatives for reducing CO2 emissions

safe and environmentally friendly driving that Yamato Trans-

during pickup and delivery that included the deployment ofport developed and began deploying in March 2010.

electric vehicles and the use of streetcars.

This system, which records an extensive array of driving

Yamato Transport added 100 light commercial electricperformance data, enables Yamato Transport sales drivers

vehicles to its fleet between 2011 and 2012 in coordination

to self-inspect their driving performance and make improve-with local municipalities in districts associated with thements. The data from this system can also be used to indi-

FutureCity Initiative and other progressive environmental

vidually instruct sales drivers, and has functioned as aprograms, and in districts requiring special environmental

strong support for safe driving habits within the Group.

measures, such as areas around World Heritage sites.

Diagram of Yamato Group Corporate Philosophy

Changes in the Number of Low-Emission Vehicles
16,809Customers

15,000Local
residents

Shareholders

10,0005,000

Partners

Employees

Management
Philosophy

Corporate
StanceEmployee Codeof Conduct

Yamato Group Corporate Philosophy

Precepts
Founding Spirit

32

Yamato Holdings Co., ltd.

02008 2009 2010 2011 2012 2013

n Hybrid Carsn CNG Carsn LPG Carsn Electric Vehicles

n Others* The Company introduced 100 electric delivery vehicles in 2013.

As a result, the accumulative total of low-emission vehi-

Yamato Transport has provided services to enhance thecles at Yamato Transport had reached 16,809 vehicles, orconvenience and peace of mind of the tenants of such com-approximately 39% of the entire fleet.

mercial buildings through in-building logistics and has suc-

In a similar vein, we have continued to actively introduce
low-emission vehicles. As of March 31, 2012, we had
added 37 hybrid vehicles and 1,901 low-emission vehicles
to our fleet.

cessfully reduced CO2 emissions and improved area safetylevels by reducing the number delivery trucks in operation.
And, in November 2012, the company established the
new Building-Town Management Promotion Office. This office
is in charge of establishing centralized parcel collection andSatellite Centers Eliminate Use of Vehicles for Parcel Delivery

delivery systems for commercial buildings combining in-

The opening of more satellite centers reduces the delivery

building and area logistics, and integrating these systems

area assigned to each sales driver. This change not onlywith urban development that goes beyond the buildings.

enables drivers to provide more detailed services to eachcustomer, but also helps to curb increases in the number ofSocietyvehicles required to keep pace with increased parcel volume.

Safety Classes for Children

Yamato Transport is promoting the development of these

The Group places top priority on respect for human life insatellite centers, which enable the pickup and delivery ofcarrying out its operations. This is reflected in a number ofparcels without the use of motor vehicles, apart from theinitiatives the Group implements.

occasional mini-vehicle, in mainly urban districts anddensely populated residential areas.

One such initiative is the Company’s program of safetyclasses for children, which we have been holding nationwide since 1998 to teach them ways to protect themselves from traffic accidents.
In the fiscal year ended March 31, 2013, 201,333
children participated in 1,945 of these classes held
throughout Japan. Since the program began, roughly 2.16
million children have taken part in classes that have been
held approximately 20,000 times.

Building-Town Promotion Office Established–Combining In-Building Logistics with Area Logistics to
Support Urban Development–
As more large-scale commercial buildings have been developed across the country, there has been increasing demand
for ways to raise logistics efficiency within the buildings,
reduce the impact on the surrounding environment, andaugment security measures.

AnnuAl RepoRt 201333

Taught entirely by Yamato Transport employees, theDecember 2012:classes employ various means to teach children about

2012 Environment Minister’s Award for Global Warming

traffic safety.

Prevention

The Group also held its first safety class for children
overseas in China.

—Implementation of Countermeasures“Promotion of environmental preservation activities underthe “(N)ecology “(black cat ecology) catchphrase”

Actively Employing People with Disabilities(YAMATO TRANSPORT CO., LTD.)The Yamato Group, primarily through the Yamato Welfare

Sponsor: Ministry of the Environment

Foundation, promotes various activities for the realization ofJanuary 2013:

a society in which people with disabilities can enjoy the

16th Nikkei Environment Management Survey*

world of work and the act of independently earning a living.

3rd Place (Distribution industry)

Such support for helping people with disabilities gain
their independence includes active employment at the
Swan Baker y, which produces and sells bread, and ascouriers for our Kuroneko Mail ser vice. In addition, theYamato Welfare Foundation operates a suppor t facility(YAMATO HOLDINGS CO., LTD.)
Sponsor: Nikkei Inc.
* Environment Management Survey: A ranking of the extent companies have strucka balance between environmental initiatives and enhancing business efficiency,
based on evaluating items such as the internal framework for promoting environmentally-sound management, measures to prevent global warming, and therecycling of resources.

where people with disabilities can receive training in
vocational skills and knowledge.

March 2013:

Key Firm of Integrity Award* for Excellence(YAMATO HOLDINGS CO., LTD.)• Under the basic credo of “I belong to Yamato,” all employees participate in the Group’s management.
• Making the most of management resources comprisingbusiness bases throughout Japan, sales drivers, employees and the Company’s information network, the YamatoGroup is collaborating with local governments, residents
and companies to revitalize communities and provide sup-External Praise
June 2012:

13th Environmental Grand Prize for Distribution—Special Environmental Award for Distribution“Pickup and delivery system utilizing streetcars with a low
carbon footprint”(YAMATO TRANSPORT CO., LTD., Keifuku Electric Railroad
Co., Ltd.)
Sponsor: Japan Federation of Freight Industries

34

Yamato Holdings Co., ltd.

port for senior citizens, among others initiatives.
• Voluntary support activities of Group employees in theimmediate aftermath of the Great East Japan Earthquake
were worthy of commendation.
Sponsor: Key Firm of Integrity Award Advisory Panel
Co-sponsors: Japan Corporate Governance Network IntegreX Inc.
* Key Firm of Integrity Award: Awards for companies selected for their excellence ina survey of corporate social responsibility (CSR), corporate ethics, compliance,internal control and other pertinent criteria.

Corporate Governance
As of March 31, 2013

Basic Position on Corporate Governance
Based on its corporate philosophy, the Yamato Group car-Outside Directors and Outside Audit & Supervisory
Board Members

ries out business activities in accordance with the law and

To ensure objective checks of management, two of the six

social norms and actively promotes compliance management.

directors were outside directors as of the year ended March
31, 2013.

Striving to maximize corporate value by effectively utilizing the management resources of the Group is one of the

Similarly, three of the four Audit & Supervisory Board

top priorities of management, and we have implemented

members are outside Audit & Supervisory Board members

measures and bolstered management systems as part ofto reinforce supervision of business execution.
Both outside directors have ample experience and exten-

our corporate governance initiative.

sive knowledge, Masayoshi Sato being a lawyer andStatus of Corporate GovernanceToshitaka Hagiwara being a businessman. They comment and

The Board of Directors, Management Advisory Committee

advise as needed on all aspects of business management.

and Executive Committee serve as administrative organs

Collaboration with the Independent Auditor and the Audit

involved in decision-making, execution and supervision of

Division enhances governance.

the Yamato Group. This management structure enables

Similarly, all outside Audit & Supervisory Board members

decisions to be made rapidly and precisely on important

have ample expertise in finance and accounting. They arebusiness matters.

Koji Okawa, whose experience has included working for a

The number of Board members cannot exceed 12 asfinancial institution and a tax and accounting firm, Motoharu

stipulated in the Company’s articles of incorporation. The

Yokose, a certified public accountant, and Hiroyuki Kanae,

term of office for directors has been set at one year in order

who has professional experience as a lawyer.

to clarify management responsibilities for each fiscal year.

Corporate Governance Framework
General Meeting of Shareholders
Elect

Elect

Elect/
Supervise

Audit &
Supervisory
Board

ReportIndependent
Auditor

Elect

Audit

Nomination andCompensation
Committee

Board ofDirectors

Management
Advisory Committee

ReportMake decisions/Supervise

ReportExecutive
Committee

Accounting
audit

Execute business

Propose/ReportCSR Division

Legal Advisor

Propose/ReportInternal
audit

Audit Division

Group Companies

AnnuAl RepoRt 201335

Outside Audit & Supervisory Board members attend
Audit & Supervisory Board meetings as well as periodic

framework that enables the Audit & Supervisory Board
members to smoothly carry out their functions.

meetings to exchange opinions with the President. These

In addition, Group Auditors’ Liaison Meetings are held

meetings also serve to confirm the status of directors’

periodically for the full-time Audit & Supervisory Board mem-

execution of duties, by means of including questions regard-bers of the major operating companies to confer on auditing

ing management policy.

policies and procedures, exchange information and other-

The abovementioned two outside directors and threeoutside Audit & Supervisory Board members have no conflicts of interest with the Group.

wise enhance collaboration. Meetings with internal auditors
are also held periodically to exchange information.
Internal audits are performed by a 12-member team that

The Group maintains a policy of satisfying the indepen-

operates independently from any other Group organ.

dence criteria of the Tokyo Stock Exchange, Inc., when choos-

Together with the 102 employees who conduct internal

ing outside directors and Audit & Supervisory Board members.

audits for Group companies, the Yamato Group has a total of

The Group has notified the Tokyo Stock Exchange that all

114 internal auditors, who check whether the business andthe above outside directors and Audit & Supervisory Board

affairs of the Group as a whole are being carried out appro-

members are independent, as required.

priately and efficiently based on the annual auditing plan. A

Outside Director Masayoshi Sato resigned at the closingof the Ordinary Meeting of Shareholders on June 25, 2013.
In his place, Masakatsu Mori was nominated and appointed
as a new outside director.

structure is in place under which results are reported to theBoard of Directors and the Audit & Supervisory Board.
Also, the Group Internal Auditing Committee meets regularly for the internal auditors of the operating companies toconfer on problems and proposed improvements based on

Status of Internal Audits, Audits by Audit &Supervisory Board Members and Accounting Audits

auditing policies and audit results. At the same time, man-

The Audit & Supervisory Board is made up of one full-time

trol divisions to improve and build systems to validate

Audit & Supervisory Board member and three outside Audit

internal controls.

agement collaborates with Group companies’ internal con-& Supervisory Board members. Audit & Supervisory Board

As the Group’s appointed Independent Auditor, Deloitte

members attend meetings of the Board of Directors andTouche Tohmatsu LLC holds regular meetings with Audit &other important meetings to audit the execution of duties bySupervisory Board members and conducts effective

the directors, and otherwise endeavor to improve the sound-accounting audits. Accounting audits are performed by two

ness of management and the trust of the public.

certified public accountants, Yoshiaki Kitamura andA full-time staff member has been appointed to assist
the Audit & Supervisory Board members to put in place a

Kazuhide Kobori, assisted by another 13 certified public
accountants and 13 other staff members.

Compensation of Directors and Audit & Supervisory Board Members
Details of Compensation for Directors and Audit & Supervisory Board Members

Director and Audit & Supervisory
Board member category

36

Total compensation andother remuneration(Millions of Yen)

Total by compensation andremuneration category(Millions of Yen)
Basic compensation

Headcount of eligible
directors and Audit &Supervisory Board
members

Directors (excluding outside directors)

225

225

4

Audit & Supervisory Board members (excluding outside
Audit & Supervisory Board members)

20

20

1

Outside directors and Audit & Supervisory Board
members

35

35

6

Yamato Holdings Co., ltd.

To ensure the objectivity and transparency of policies for

Director compensation comprises fixed remuneration that

determining director compensation, deliberations are con-reflects external standards and performance-based

ducted through the Nomination and Compensation Commit-

amounts. The compensation of Audit & Supervisory Board

tee, more than half of whose members are outside directors,

members and outside directors is fixed in keeping with thewith the Board of Directors making resolutions.

nature of their work.

Compensation of Accounting Auditor
Details of Compensation for Certified Public Accountants and Staff of the Accounting Auditor
Fiscal year ended March 31, 2012

Category

Compensation paid
for audit certification
activities(Millions of Yen)

Yamato Holdings Co., Ltd.

Fiscal year ended March 31, 2013

Compensation paid
for non-audit activities(Millions of Yen)

Compensation paid
for audit certification
activities(Millions of Yen)

Compensation paid
for non-audit activities(Millions of Yen)

41

8

42

1

Consolidated subsidiaries

133

—

133

4

Total

174

8

175

5

Other Important Compensation Details

Details of Non-Audit Activities of Certified PublicFiscal year ended March 31, 2012

Accountants and Staff of the Accounting Auditor

The compensation that 11 overseas subsidiaries, including

Fiscal year ended March 31, 2012

consolidated subsidiary Yamato Transport U.S.A., Inc., paid

The non-audit activities for which the Company paid theto Deloitte Touche Tohmatsu Limited, which is part of thecertified public accountants and staff of the accounting

same network of the accounting firm that audits Yamato

auditors entailed advice and guidance relating to the intro-

Holdings, was as follows.

duction of International Financial Reporting Standards.

Compensation paid for audit certification and related
activities: ¥82 million

Fiscal year ended March 31, 2013
Non-audit activities for which the Company paid the certified

Fiscal year ended March 31, 2013

public accountants and staff of the accounting auditors

The compensation that 12 overseas subsidiaries, including

entailed advice and guidance on the introduction of Interna-consolidated subsidiary Yamato Transport U.S.A., Inc., paidtional Financial Reporting Standards.

to Deloitte Touche Tohmatsu Limited, which is part of thesame network of the accounting firm that audits Yamato

Policy for Determining Accounting Auditor Compensation

Holdings, was as follows.

We determine audit compensation for the certified publicCompensation paid for audit certification and related

accountants and staff of the accounting auditor based on

activities: ¥98 million

the number of days required for audits, the Company’s size,
and the nature of its operations.

AnnuAl RepoRt 201337

Directors and Audit & Supervisory Board Members
As of June 25, 201338

Yamato Holdings Co., ltd.

1

2

3

4

6

7

8

9

11

12

13

14

16

17

18

19

5

Directors
1.

Kaoru Seto

Makoto Kigawa

2.

Representative Director andChairman
4. Masaki Yamauchi

Representative Director,
Senior Executive Officer

5. Kenji Minaki

Director and Executive Officer

10

3. Haruo Kanda

Representative Director,
President and Executive Officer

Director and Executive Officer

Outside Directors
6.

Toshitaka Hagiwara

7.

Masakatsu Mori

Full-time Audit & Supervisory Board Member
8.

Hiroshi Kawada

Audit & Supervisory Board Members
15

9.

Koji Okawa

10.

Motoharu Yokose

11.

Hiroyuki Kanae

Managing Executive Officer
12.

Kenichi Shibasaki

Executive Officers
13.

Toshizo Kurisu

14.

Hitoshi Kanamori

15.

Atsushi Ichino

16.

Keishirou Sasaki

17.

Tadao Mikami

18.

Hideo Tanzawa

19.

Hidenori Osano

20

Advisor20.

Keiji Aritomi

AnnuAl RepoRt 2013

39

Analysis of Financial Position and Management Results

some signs of improvement since December 2012. These
include the reversal of the yen’s appreciation and a rise in

Kenichi Shibasaki
Managing Executive Officer
responsible for Financing andAccounting

stock prices on the back of anticipation of the new administration of Prime Minister Shinzō Abe and its growth strategies toward revival of the Japanese economy. Meanwhile,the economic recovery remained in the balance due touncertain factors such as concerns about a resurgence ofthe debt crisis in Europe.

In this year’s annual report, I would like to look back on the

Operating in this environment, the Yamato Group worked

year ended March 31, 2013 based on the following themes

to achieve greater sophistication of its existing businesses,

and discuss the Yamato Group’s capital policies.

particularly the TA-Q-BIN business, and took steps todevelop new businesses by utilizing a multiple assortment

1. Attainment of Numerical Targets in Fiscal 2013 andof the management resources within the Group for properly
responding to customers’ ever-evolving needs.

Evaluation

In our existing Delivery Business, the handling volume of

2. The Yamato Group’s Long-term Management Plan andKuroneko Mail decreased due to stricter policies on parcel

ROE Target
3. Agility and Flexibility of Financial Activities

acceptance that emphasize compliance, along with intensi-

4. Implementation Status of Capital Policies to Enhance

fied competition.
In our mainstay TA-Q-BIN service, we organically inte-

Financial Quality and Basic Policy on Shareholder Returns

grated a pioneering consumer-centric strategy of differen-

5. Business Risks

tiation with non-delivery businesses to successfully expand

1. Attainment of Numerical Targets in Fiscal 2013and Evaluation

our solution business. This enabled us to capture package

Regarding the business environment during the fiscal year

As a new business, the Yamato Group launched a service

delivery demand in the growing mail-order market.

ended March 31, 2013, economic conditions have shownthat delivers documents to destinations inside overseas

Operating Revenues

Operating Income/Operating Income Margin(Millions of Yen)

(Millions of Yen, %)1,400,000

80,0001,251,922

1,200,000

1,200,834

1,236,520 1,260,833

8.0

1,282,374

60,0001,000,000

61,38966,651

66,203
6.0

55,7215.1

800,000

64,314

5.2

5.3

5.2

4.5
40,000

4.0

20,0002.0

600,000
400,000
200,000
0

2009

2010

2011

2012

0

2013
n
n

40

Yamato Holdings Co., ltd.

2009

2010

2011

Operating Income (left scale)Operating Income Margin (right scale)

2012

2013

0

TA-Q-BIN service areas as early as the next day by utilizing
the Okinawa International Logistics Hub.

The major theme of this long-term management plan is toincrease satisfaction of shareholders, customers, theAs a result, operating revenues increased 1.7% year on

public, employees and all other stakeholders.

year to ¥1,282,374 million, while operating income
decreased 0.7% to ¥66,203 million.

From my perspective as Managing Executive Officer
responsible for Financing and Accounting, I recognize thatROE for the fiscal year ended March 31, 2013 rose to

the keys for success are to increase our profitability by

6.7%, helped partly by share buybacks of approximately

steadily executing our business plan, and also raising capi-¥10.0 billion conducted in February 2013. In this manner,

tal efficiency by implementing capital policies that takeROE has gradually shown steady improvement.

advantage of our solid financial base. And we must tie
these improvements to a further increase in corporate

2. The Yamato Group’s Long-term Management Plan
and ROE Target

value.

The management philosophy of the Yamato Group is to help

benchmark to keep in mind as we seek to raise shareholder“enrich our society by enhancing the social infrastructure ofvalue, in order to achieve both strengthened capital accu-

TA-Q-BIN networks, creating more convenient services formulation and utilization of business assets.

From this perspective, we consider ROE to be a key

comfortable lifestyles and developing an innovative logistics

We plan to raise ROE to over 7.0% in the year ending

system.” The entire Yamato Group is making a concerted

March 2014, the final year of the medium-term management

effort to realize this philosophy.

plan DAN-TOTSU Three-Year Plan HOP, and to over 11.0% in

To this end, in January 2011, we formulated a long-term

the year ending March 2020, the final year of the long-term

management plan, DAN-TOTSU Management Plan 2019,

management plan DAN-TOTSU Management Plan 2019.

whose final year is fiscal 2020. Guided by this plan, we are

We revised the ROE target for the year ending Marchmaking every effort to become a leading provider of distri-2014, the final year of the medium-term management plan,bution and lifestyle support solution services in Asia by thefrom 8.5% to over 7.0%. However, our basic approachyear ending March 2020, when we will celebrate the 100th

toward achieving the overall objectives of our business andanniversary of our founding.

financial strategies remains unchanged.

Net Income/Net Margin

Operating and Investing Cash Flows/Free Cash Flows(Millions of Yen, %)(Millions of Yen)

40,000100,000

4.0

84,46335,14432,28230,00060,0003.0
25,52320,00080,00033,2082.0

73,95042,821
36,22040,00019,787

71,84361,368

2.7

2.7

2.7

87,89977,06430,75023,41020,000

2.0

1.6

0

10,0001.0(20,000)(23,095)(34,243)(40,000)
0

n
n

2009

2010

2011

2012

2013

0

(60,000)(41,093)(50,540)(51,679)

2009

2010

2011

Net Income (left scale)nCash Flows from Operating Activities

Net Margin (right scale)nCash Flows from Investing Activities

2012

2013

Free Cash Flows* Free Cash Flows = Cash Flows from Operating Activities+ Cash Flows from Investing Activitiesn

AnnuAl RepoRt 201341

While steadily executing our business plan, we will con-

We have a basic policy of paying dividends with a target

sider and implement capital policies by taking into consider-consolidated dividend payout ratio of 30% of consolidated

ation financial stability and soundness, as well as

net income.

efficiency, with the aim of achieving our targets.

During the fiscal year ended March 31, 2013, we boughtback about ¥10.0 billion in shares, and retired 6.7 million

3. Agility and Flexibility of Financial Activities

shares of treasury stock.

The Yamato Group consistently and continually generates

For the fiscal year ended March 31, 2013, we paid divi-

between ¥70.0 billion and ¥80.0 billion in cash annually todends of ¥23 per share, ¥1 higher than in the previous

maintain the agility and flexibility of financial activities while

fiscal year. The return to shareholders ratio, a combination

sufficiently covering ordinary expenditures.

of both dividends and share buybacks, was over 50% for the

As of March 2013, Yamato Holdings has received thefiscal year ended March 31, 2013.

following credit rating from Rating and Investment Information, Inc. (R&I):

For the fiscal year ending March 31, 2014, we are considering plans to increase the dividend slightly. We are planning an annual dividend of ¥24 per share, ¥1 higher than in

R&I AA–the fiscal year ended March 31, 2013.
While increasing our profitability by steadily executing our

The Yamato Group will strive to remain aware of capitalbusiness plan, we will work to raise capital efficiency bycosts, while at the same time maintain the existing credit

implementing capital policies that take advantage of ourrating in order to facilitate smooth capital procurement.

solid financial base. And we will strive to tie these improvements to a further increase in corporate value.

4. Implementation Status of Capital Policies toEnhance Financial Quality and Basic Policy on
Shareholder Returns

The following is a review of our capital policy measures inpast years:

The Yamato Group seeks to provide returns to shareholders
based on the return to shareholders ratio, a combination ofboth dividends and share buybacks.
Interest-Bearing Liabilities/Equity

ROA/ROE(Millions of Yen)(%)

600,000

8.00
523,473

500,000

524,505

523,784

542,915486,259

6.5

6.7

6.5

6.00
5.4

400,000

300,000

4.00

3.7

3.8

3.7

3.8

2.9
200,000

2.2

2.00
100,000

0

42

107,427

2009

81,598101,373

2010

2011

92,7802012

93,7800

2013

n Interest-Bearing Liabilities

n ROA

n Equityn ROEYamato Holdings Co., ltd.

2009

2010

2011

2012

2013

From the fiscal years ended March 31, 2003 to 2007

These donations, which totaled ¥14.2 billion, were used

The Yamato Group bought back about ¥10.0 billion in

to provide grants exclusively for the restoration and revitaliza-

shares continuously every year for five years from the fiscaltion of the local infrastructure and for rebuilding of the fishingyear ended March 31, 2003 to the fiscal year ended Marchand agriculture industries in the region. An independent com-

31, 2007.

mittee of experts selected projects for grants under a basic

Of these shares, approximately 12.0 million shares werepolicy of visible, quick and effective assistance. Priority was

retired in the fiscal year ended March 31, 2006, and approxi-

placed on subsidizing the types of projects that do not nor-mately 3 million shares were used for M&As in the fiscal

mally receive government support.

years ended March 31, 2007 and March 31, 2008.

5. Business Risks
Fiscal year ended March 31, 2011

The Yamato Group is fully aware of the potential impact of

In February 2011, we issued corporate bonds with new

the following risks on its business performance and financial

share warrants attached for the purpose of share buybacks

position, and is accordingly managing these risks.

as part of efforts to implement flexible financial strategies.
Proceeds of approximately ¥20.0 billion from the issu-

The following risks are solely within the scope of projections possible from information available at the end ofance of corporate bonds with new share warrants were

March 2013, and may not encompass all of the risks

allocated in their entirety to share buybacks for the purpose

related to the business of the Yamato Group.

of enhancing capital efficiency.
These buybacks resulted in the repurchase of shares at
a total cost of approximately ¥30.0 billion, representing ourlargest buybacks ever.
Considering the prevailing market conditions then, we
selected this scheme for share buybacks because webelieved that buying back shares using low-cost corporate(1) Legal Regulations(2) High Reliance on the TA-Q-BIN Business for Operating
Revenues(3) Secure Human Resources(4) Loss of Business Expertise Caused by Personnel Leaving the Company

bonds with new share warrants attached and enhanced(5) Decline in Trust in the Company

debt characteristics would maximize the positive impact on(6) Leak of Customer Information

capital efficiency, such as ROE and EPS.

(7) Loss of Social Trust Due to Major Traffic Accident andAdministrative Action

Fiscal year ended March 31, 2012(8) Official Regulation Due to Environmental Issues

No share buybacks were conducted during the fiscal year(9) Natural Disasters or Power Outages

ended March 31, 2012.

(10) Computer Viruses and Criminal Hacking Activity

The Company did not conduct share buybacks in thefiscal year ended March 31, 2012 because it decided to
devote resources to fulfilling the Group’s social mission in(11) International Developments or Terrorism(12) Credit Management Costs and Interest Rate
Fluctuations

response to the unprecedented damage caused by the
major earthquake that struck in March 2011. To this end,
the Yamato Group helped deliver supplies to the region to

We ask our shareholders and other investors for their
ongoing encouragement and support.

assist in its recovery, while Group employees donated theirtime as volunteers. The Group also donated ¥10 per TA-Q-BIN
parcel to help in the revitalization of local people’s living
conditions and industrial infrastructure, and continued theinitiative for a full year.

AnnuAl RepoRt 201343

Consolidated Balance Sheet
March 31, 2013

Thousands of
U.S. Dollars(Note 1)Millions of Yen

ASSETS

2013

2012

2013

¥ 213,619¥ 209,179$ 2,271,336

Trade163,790

158,175

1,741,518

Installment (Note 3)

37,45635,539398,261

Lease (Note 12)

22,37718,925

237,924

Allowance for doubtful accounts(1,654)(2,261)(17,592)

CURRENT ASSETS:
Cash and cash equivalents (Notes 2.d and 13)
Notes and accounts receivable (Note 13):Inventories (Note 4)

3,601

3,345

38,291

Deferred tax assets (Note 11)

16,647

17,078177,000

Prepaid expenses and other current assets

30,572

24,475325,064

486,408

464,455

5,171,802

Land

187,108

182,304

1,989,446

Buildings and structures

281,096

273,7122,988,797

Vehicles

182,679

182,004

1,942,360

Leased assets (Note 12)23,54925,937250,387

Machinery and equipment

108,493

105,325

1,153,570

Construction in progress

35,89230,052

381,624

Others

9,432

6,243

100,291

Total current assets

PROPERTY, PLANT AND EQUIPMENT—At cost:

Total
Accumulated depreciation
Net property, plant and equipment

828,249805,577

8,806,475(445,092)(430,397)(4,732,503)

383,157

375,180

4,073,972

INVESTMENTS AND OTHER ASSETS:
21,787

18,749231,658

Investments in and advances to nonconsolidated subsidiaries and affiliates,
net of valuation allowance of ¥222 million ($2,360 thousand) in2013 and 2012

838

3,339

8,907

Long-term loans

915

952

9,733

Investment securities (Notes 5 and 13)

Goodwill
Software12,38912,018

131,723

Lease deposits

19,373

20,202205,982

Deferred tax assets (Note 11)18,515

17,197

196,868

Other assets

6,771

6,618

71,990Total investments and other assets
TOTAL
See notes to consolidated financial statements.

44

585

Yamato Holdings Co., ltd.

80,58879,660856,861¥ 950,153¥ 919,295$10,102,635

Thousands of
U.S. Dollars(Note 1)Millions of Yen

LIABILITIES AND EQUITY

2013

2013

2012

CURRENT LIABILITIES:
Short-term bank loans (Notes 7 and 13)¥ 15,704

¥

5,260

$

166,972

18,82517,082200,157

Trade

138,288

129,454

1,470,370

Other

15,283

21,736

162,501

Income taxes payable

22,442

17,631

238,616

Employees’ savings deposits

4,453

4,200

47,346

Accrued expenses

57,34457,801

609,717

Deferred profit on installment sales (Notes 3 and 13)

5,006

4,960

53,233

Other current liabilities (Note 9)22,19524,220235,989

Total current liabilities

299,540

282,344

3,184,901

59,25270,439630,003

Current portion of long-term debt (Notes 7, 13 and 14)
Notes and accounts payable (Note 13):

LONG-TERM LIABILITIES:Long-term debt (Notes 7, 13 and 14)
Long-term accounts payable

2,414

3,798

25,664

Liability for employees’ retirement benefits (Note 8)

38,17831,733405,934

Deferred tax liabilities (Note 11)

459

269

4,886

Other long-term liabilities (Note 9)

7,395

6,928

78,629Total long-term liabilities

107,698

113,167

1,145,116

Common stock—authorized, 1,787,541,000 shares in 2013 and 2012;
issued, 461,345,492 shares in 2013 and 468,052,892 shares in 2012

127,235

127,235

1,352,842

Capital surplus

111,291

121,3141,183,312

Retained earnings

347,358

321,862

3,693,335

Treasury stock—at cost, 37,631,001 shares in 2013 and37,905,955 shares in 2012

(56,496)(56,514)(600,698)

COMMITMENTS LIABILITIES (Note 12)
EQUITY (Notes 10 and 18):

Accumulated other comprehensive income:Unrealized gain on available-for-sale securities

6,095

2,976

64,812Foreign currency translation adjustments(1,032)(1,877)(10,974)

534,451

514,996

5,682,629

8,464

8,788

89,989Total
Minority interests
Total equity
TOTAL

542,915

523,784

5,772,618¥950,153¥919,295$10,102,635

AnnuAl RepoRt 201345

Consolidated Statement of Income
Year Ended March 31, 2013

Thousands of
U.S. Dollars(Note 1)Millions of Yen

OPERATING REVENUES

2013

2012

2013

¥1,282,374¥1,260,833$13,635,020

1,181,834

1,163,777

12,566,016

OPERATING COSTS AND EXPENSES:
Operating costs

34,33730,405365,093

1,216,171

1,194,182

12,931,109

66,20366,651

703,911

Interest and dividend income

(661)

(606)

(7,026)

Interest expense

612

737

6,505

Loss on disposal of property, plant and equipment—net

224

286

2,386

1,769

222

18,815

1,982

12,500

Selling, general and administrative expenses
Total operating costs and expenses
Operating income
OTHER (INCOME) EXPENSES:

Loss on impairment of long-lived assets (Note 6)(42)

Gain on sales of marketable and investment securities

(448)

1,176

Loss on valuation of investment securities

453

Loss on valuation of investment in nonconsolidated subsidiaries and affiliate

4,818

Donations concerning restoration support

14,236Retirement benefits related to the extension of the retirement age

4,444(1,612)(467)(17,143)

1,919

20,834

20,40764,28445,817

683,504

Current

31,26925,690332,464

Deferred(1,706)369(18,139)

29,56326,059314,325

34,721

19,758369,179

Other—net
Other expenses—net
INCOME BEFORE INCOME TAXES AND MINORITY INTERESTSINCOME TAXES (Note 11):

Total income taxes
NET INCOME BEFORE MINORITY INTERESTSMINORITY INTERESTS IN NET INCOME OF CONSOLIDATED SUBSIDIARIESNET INCOME

(423)
¥

(4,500)(29)

35,144¥

19,787$

Yen

373,679
U.S. Dollars

2013

2013

2012

PER SHARE OF COMMON STOCK (Notes 2.r and 16):
Basic net income

81.85

¥

46.00

$

0.87

79.84

44.87

0.85

Cash dividends applicable to the year

23.00

22.00

0.24

See notes to consolidated financial statements.

46¥

Diluted net income

Yamato Holdings Co., ltd.

Consolidated Statement of Comprehensive Income
Year Ended March 31, 2013

Thousands of
U.S. Dollars(Note 1)Millions of Yen

2013

2012

2013

¥34,721¥19,758$369,179

Unrealized gain on available-for-sale securities

3,199

1,514

34,010Foreign currency translation adjustments

1,035

(433)

11,005NET INCOME BEFORE MINORITY INTERESTSOTHER COMPREHENSIVE INCOME (Note 15):

Total other comprehensive income
COMPREHENSIVE INCOME

4,234

1,081

45,015¥38,955¥20,839$414,194¥39,210¥20,827$416,900

(255)

12

(2,706)TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Owners of the parent
Minority interests
See notes to consolidated financial statements.

AnnuAl RepoRt 201347

Consolidated Statement of Changes in Equity
Year Ended March 31, 2013

Thousands

Millions of Yen
Accumulated Other
Comprehensive Income

Outstanding
Number of
Shares ofCommonStock

BALANCE, APRIL 1, 2011
Net income
Cash dividends, ¥22 per share
Adjustment of retained earnings
for changes in the scope of consolidation
Purchase of treasury stock
Disposal of treasury stock
Net change in the year

439,336BALANCE, MARCH 31, 2012
Net income
Cash dividends, ¥22 per share
Adjustment of retained earnings
for changes in the scope of consolidation
Purchase of treasury stock
Disposal of treasury stock
Retirement of treasury stock
Net change in the year
BALANCE, MARCH 31, 2013

430,147

CommonStockCapitalSurplusRetained
Earnings

Treasury
Stock

Unrealized
Gain onAvailablefor-Sale
Securities¥127,235¥121,315¥311,569
19,787(9,564)¥(44,631)¥1,501

Foreign
Currency
Translation
Adjustments¥(1,387)70(9,190)1
127,235

121,314321,862
35,144(9,463)(56,514)423,714¥127,235¥111,291¥347,358¥(56,496)¥524,505
19,787(9,564)70(11,884)

(490)

985

(115)

870

2,976

(1,877)514,996
35,144(9,463)

8,788

523,784
35,144(9,463)(185)(10,006)
1(10,006)
1
10,023(10,023)¥8,903Total
Equity

1,475

(185)
(6,433)¥515,602
19,787(9,564)70(11,884)(11,884)
1(1)

Minority
Interests

Total

3,119
¥6,095845¥(1,032)

3,964¥534,451(185)(10,006)1(324)¥8,4643,640¥542,915

Thousands of U.S. Dollars (Note 1)
Accumulated Other
Comprehensive Income

CommonStock

BALANCE, MARCH 31, 2012
Net income
Cash dividends, $0.23 per share
Adjustment of retained earnings
for changes in the scope of consolidation
Purchase of treasury stock
Disposal of treasury stock
Retirement of treasury stock
Net change in the year
BALANCE, MARCH 31, 2013
See notes to consolidated financial statements.

48

Yamato Holdings Co., ltd.

CapitalSurplusRetained
Earnings

Treasury
Stock

Unrealized
Gain onAvailablefor-Sale
Securities$1,352,842 $1,289,893 $3,422,248 $(600,899) $31,643
373,679(100,619)(1,973)(1)(106,580)$1,352,842 $1,183,312 $3,693,335(106,389)10
106,580
33,169$(600,698) $64,812

Foreign
Currency
Translation
Adjustments

Total

Minority
Interests

Total
Equity$(19,957) $5,475,770
373,679(100,619)$93,435 $5,569,205
373,679(100,619)(1,973)(106,389)
9(1,973)(106,389)
9

8,983
42,152$(10,974) $5,682,629(3,446)38,706$89,989 $5,772,618

Consolidated Statement of Cash Flows
Year Ended March 31, 2013

Millions of Yen

OPERATING ACTIVITIES:
Income before income taxes and minority interests
Adjustments for:
Income taxes—paidDepreciation and amortization
Loss on disposal of property, plant and equipment—net
Loss on impairment of long-lived assets
Gain on sales of marketable and investment securities
Loss on valuation of investment securities
Donations concerning restoration support paid
Changes in assets and liabilities, net of effects from newly consolidated
subsidiaries:
Increase in notes and accounts receivable
Decrease (increase) in inventories
Increase in notes and accounts payable
Increase in liability for employees’ retirement benefits
Other—net
Total adjustments
Net cash provided by operating activities
INVESTING ACTIVITIES:
Proceeds from sale of property, plant and equipment
Purchases of property, plant and equipment
Proceeds from sales of marketable and investment securities
Purchases of marketable and investment securities
Decrease (increase) in investments in and advances to nonconsolidated
subsidiaries and affiliates
Collection of loans
Payments of loans
Other
Net cash used in investing activities
FINANCING ACTIVITIES:
Proceeds from short-term bank loans
Repayments of short-term debt
Proceeds from long-term debt
Repayments of long-term debt
Dividends paid
Purchase of treasury stock—net
Other
Net cash used in financing activities
FOREIGN CURRENCY TRANSLATION ADJUSTMENTS ON CASH AND
CASH EQUIVALENTS
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS OF NEWLYCONSOLIDATED SUBSIDIARIES, BEGINNING OF YEAR
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
CASH AND CASH EQUIVALENTS, END OF YEAR (Note 2.d)Thousands of
U.S. Dollars(Note 1)

2013

2012

2013

¥ 64,284¥ 45,817$ 683,504(28,078)
37,944
224
1,769
(42)
1,176
(1,148)(26,743)
38,685
286
222
1,982
(13,088)(298,543)
403,450
2,386
18,815(448)
12,500(12,210)(10,526)
87
8,406
6,442
(6,588)
9,666
73,950(11,962)(520)
15,771
3,264
18,12926,026
71,843(111,922)
924
89,37868,501(70,052)
102,779
786,283582(47,099)
52
(12)

788
(35,913)
9
(11)

6,189
(500,784)
557
(126)

511
881
(847)
(4,608)(50,540)(1,202)969(788)(4,945)(41,093)

5,430
9,367
(9,008)(48,998)(537,373)

68,949(63,955)5,538(12,199)(9,528)(10,008)181(21,022)

23,214(32,410)9,850(13,008)(9,707)(11,889)
1,033(32,917)733,108(680,014)
58,883(129,705)(101,308)(106,413)
1,925(223,524)

457
2,845

(182)
(2,349)4,860
30,246

1,403
208,393¥212,641

1,950
208,792¥208,393

14,9222,215,772$2,260,940

See notes to consolidated financial statements.

AnnuAl RepoRt 201349

Notes to Consolidated Financial Statements
Year Ended March 31, 2013

1. BASIS OF PRESENTATION OF CONSOLIDATED FINANCIAL STATEMENTS
The accompanying consolidated financial statements have been prepared in accordance with the provisions set forth in theJapanese Financial Instruments and Exchange Act and its related accounting regulations, and in accordance with accounting principles generally accepted in Japan (“Japanese GAAP”), which are different in certain respects as to the application and disclosure
requirements of International Financial Reporting Standards.
In preparing these consolidated financial statements, certain reclassifications and rearrangements have been made to the consolidated financial statements issued domestically in order to present them in a form which is more familiar to readers outside
Japan. In addition, certain reclassifications and rearrangements have been made in the 2012 consolidated financial statements toconform them to the classifications and presentations used in 2013.
The consolidated financial statements are stated in Japanese yen, the currency of the country in which Yamato Holdings Co., Ltd.
(the “Company”) is incorporated and operates. The translations of Japanese yen amounts into U.S. dollar amounts are included
solely for the convenience of readers outside Japan and have been made at the rate of ¥94.05 to $1, the approximate rate ofexchange at March 31, 2013. Such translations should not be construed as representations that the Japanese yen amounts could
be converted into U.S. dollars at that or any other rate.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESa. Consolidation—The consolidated financial statements as of March 31, 2013, include the accounts of the Company and its 40
significant (39 in 2012) subsidiaries (together, the “Group”).
Under the control or influence concept, those companies in which the Company, directly or indirectly, is able to exercise control
over operations are fully consolidated, and those companies over which the Group has the ability to exercise significant influence areaccounted for by the equity method.
The nonconsolidated subsidiaries, whose combined assets, net sales, net income and retained earnings in the aggregate are notsignificant to the consolidated financial statements, have not been consolidated with the Company.
There were no affiliates accounted for by the equity method in 2013 or 2012.
Investments in the nonconsolidated subsidiaries and affiliates are stated at cost, less a valuation allowance representing possible losses on the investments that are deemed to be other than temporary. If the equity method of accounting had been applied tothe investments in such companies, the effect on the accompanying consolidated financial statements would not be material.
The excess of the costs over the underlying net equity of investments in consolidated subsidiaries is recognized as goodwill andamortized on a straight-line basis over a five-year period, with the exception of minor amounts, which are charged or credited toincome in the period of acquisition.
All significant intercompany balances and transactions have been eliminated in consolidation. All material unrealized profit
included in assets resulting from transactions within the Group is also eliminated.
b. Unification of Accounting Policies Applied to Foreign Subsidiaries for the Consolidated Financial Statements—In May 2006, the
Accounting Standards Board of Japan (the “ASBJ”) issued ASBJ Practical Issues Task Force (PITF) No. 18, “Practical Solution on
Unification of Accounting Policies Applied to Foreign Subsidiaries for the Consolidated Financial Statements.” PITF No. 18 prescribesthat the accounting policies and procedures applied to a parent company and its subsidiaries for similar transactions and events
under similar circumstances should in principle be unified for the preparation of the consolidated financial statements. However, financial statements prepared by foreign subsidiaries in accordance with either International Financial Reporting Standards or
the generally accepted accounting principles in the United States of America tentatively may be used for the consolidation process,except for the following items which should be adjusted in the consolidation process so that net income is accounted for in accordance with Japanese GAAP, unless they are not material: (a) amortization of goodwill; (b) scheduled amortization of actuarial gain orloss of pensions that has been directly recorded in equity; (c) expensing capitalized development costs of R&D; (d) cancellation of50

Yamato Holdings Co., ltd.

the fair value model accounting for property, plant and equipment and investment properties and incorporation of the cost modelaccounting; and (e) exclusion of minority interests from net income, if contained in net income.
c. Recognition of Operating Revenues—The Group recognizes freight charge income as operating revenue at the time when freight
has been received from the shipping customer for transportation.
Fees from customers based on installment sales contracts are recognized by the equal installment method.
d. Cash Equivalents—Cash equivalents in the consolidated statement of cash flows are short-term investments that are readily
convertible into cash and that are exposed to insignificant risk of changes in value. Cash equivalents in the consolidated statementof cash flows include time deposits, certificates of deposits, and mutual funds investing in bonds that represent short-term investments, all of which mature or become due within three months of the date of acquisition.
The difference between cash and cash equivalents in the accompanying consolidated balance sheet and cash and cash equivalents in the accompanying consolidated statement of cash flows is as follows:
Thousands of
U.S. Dollars

Millions of Yen

Cash and cash equivalents presented in the consolidated balance sheet
Time deposits due beyond three months
Bank overdraft
Cash and cash equivalents presented in the consolidated statement of cash flows

2013

2012

2013

¥213,619
(695)
(283)
¥212,641¥209,179
(490)
(296)
¥208,393$2,271,336(7,387)(3,009)$2,260,940

e. Inventories—Inventories are stated at the lower of cost determined by the first-in, first-out method or net selling value.
f. Marketable and Investment Securities—Marketable and investment securities are classified and accounted for, depending on
management’s intent, as follows: (1) trading securities, which are held for the purpose of earning capital gains in near term arereported at fair value, and the related unrealized gains and losses are included in earnings, (2) held-to-maturity debt securities, forwhich there is the positive intent and ability to hold to maturity are reported at amortized cost, and (3) available-for-sale securities,
which are not classified as either of the aforementioned securities, are reported at fair value, with unrealized gains and losses, netof applicable taxes, reported in a separate component of equity. The Group had no trading securities at March 31, 2013 and 2012.
Nonmarketable available-for-sale securities are stated at cost determined by the moving-average method.
For other-than-temporary declines in fair value, investment securities are reduced to net realizable value by a charge to income.
g. Property, Plant and Equipment—Property, plant and equipment are stated at cost. Depreciation of property, plant and equipment
excluding leased assets of the Company and its domestic consolidated subsidiaries is computed substantially by the decliningbalance method, while the straight-line method is applied to buildings acquired after April 1, 1998. Depreciation of leased assets iscomputed by the straight-line method over the lease period with no residual value carried.
The depreciation of property, plant and equipment of foreign consolidated subsidiaries is computed by the straight-line method
over the estimated useful lives of the assets. The range of useful lives is principally as follows:
Buildings and structures

7–60 years

Vehicles

2– 7 years

Machinery and equipment

2–20 years

Maintenance and repairs, including minor renewals and improvements, are charged to income as incurred.

AnnuAl RepoRt 201351

h. Long‑Lived Assets—The Group reviews its long-lived assets for impairment whenever events or changes in circumstances indicate
the carrying amount of an asset or asset group may not be recoverable. An impairment loss is recognized if the carrying amount ofan asset or asset group exceeds the sum of the undiscounted future cash flows expected to result from the continued use and eventual disposition of the asset or asset group. The impairment loss would be measured as the amount by which the carrying amount of
the asset exceeds its recoverable amount, which is the higher of the discounted cash flows from the continued use and eventual
disposition of the asset or the net selling price at disposition.
i. Other Assets—Amortization of intangible assets is computed by the straight-line method.
Depreciation of leased assets is computed by the straight-line method over the lease period with no residual value carried.
j. Retirement and Pension Plan—The Company and substantially all domestic consolidated subsidiaries have a contributory trusteed
pension plan and an unfunded retirement benefit plan. In addition, a defined contribution retirement plan was introduced along withthese defined benefit pension plans.
In the year ended March 31, 2013, a domestic consolidated subsidiary withdrew from a cooperative welfare pension fund inwhich the subsidiary had participated as a substitute for the aforementioned contributory-trusteed pension plan.
The foreign subsidiaries have defined contribution retirement plans.
Directors and Audit & Supervisory Board members are not covered by the retirement and pension plans described above.
k. Asset Retirement Obligations—In March 2008, the ASBJ issued ASBJ Statement No. 18, “Accounting Standard for Asset Retirement Obligations” and ASBJ Guidance No. 21, “Guidance on Accounting Standard for Asset Retirement Obligations.” Under thisaccounting standard, an asset retirement obligation is defined as a legal obligation imposed either by law or contract that resultsfrom the acquisition, construction, development, and normal operation of a tangible fixed asset and is associated with the retirement of such tangible fixed asset.
The asset retirement obligation is recognized as the sum of the discounted cash flows required for the future asset retirement
and is recorded in the period in which the obligation is incurred if a reasonable estimate can be made. If a reasonable estimate of
the asset retirement obligation cannot be made in the period the asset retirement obligation is incurred, the liability should be recognized when a reasonable estimate of asset retirement obligation can be made. Upon initial recognition of a liability for an asset
retirement obligation, an asset retirement cost is capitalized by increasing the carrying amount of the related fixed asset by theamount of the liability. The asset retirement cost is subsequently allocated to expense through depreciation over the remaining
useful life of the asset. Over time, the liability is accreted to its present value each period. Any subsequent revisions to the timing or
the amount of the original estimate of undiscounted cash flows are reflected as a reconciliation to the carrying amount of the liability
and the capitalized amount of the related asset retirement cost.
l. Leases—For a lessee, all finance lease transactions are capitalized to recognize lease assets and lease obligations in thebalance sheet.
For a lessor, all finance leases that deem to transfer ownership of the leased property to the lessee are recognized as leasereceivables, and all finance leases that deem not to transfer ownership of the leased property to the lessee are recognized as
investments in leases.
m. Income Taxes—The provision for income taxes is computed based on the pretax income included in the consolidated statementof income. 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 and the tax bases of assets and liabilities. Deferred taxes aremeasured by applying currently enacted tax laws to the temporary differences.

52

Yamato Holdings Co., ltd.

n. Appropriations of Retained Earnings—Appropriations of retained earnings at each year-end are reflected in the consolidated
financial statements for the following year upon shareholders’ approval.
o. Foreign Currency Transactions—All short-term and long-term monetary receivables and payables denominated in foreign currencies are translated into Japanese yen at the exchange rates at the balance sheet date.
p. Derivative Financial Instruments—Certain consolidated subsidiaries use derivative financial instruments to manage their exposures to fluctuations in interest rates. Interest rate swaps are utilized by the consolidated subsidiaries to reduce interest rate risks.
The consolidated subsidiaries do not enter into derivatives for trading or speculative purposes.
The interest rate swaps, which qualify for hedge accounting and meet specific matching criteria, are not remeasured at market
value but the differential paid or received under the swap agreements are recognized and included in interest expense or income.
q. Foreign Currency Financial Statements—The balance sheet accounts of the consolidated foreign subsidiaries are translated into
Japanese yen at the current exchange rate as of the balance sheet date except for equity, which is translated at the historical rate.
Differences arising from such translation are shown as “Foreign currency translation adjustments” under accumulated other comprehensive income in a separate component of equity.
Revenue and expense accounts of the consolidated foreign subsidiaries are translated into Japanese yen at the current exchange
rates as of the balance sheet date.
r. Per Share Information—Basic net income per share is computed by dividing net income available to common shareholders, by theweighted-average number of common shares outstanding for the period, retroactively adjusted for stock splits.
Diluted net income per share reflects the potential dilution that could occur if securities were exercised or converted into common
stock. Diluted net income per share of common stock assumes full conversion of the outstanding convertible notes and bonds at the
beginning of the year (or at the time of issuance) with an applicable adjustment for related interest expense, net of tax, and full
exercise of outstanding warrants.
Cash dividends per share presented in the accompanying consolidated statement of income are dividends applicable to therespective years, including dividends to be paid after the end of the year.
s. Accounting Changes and Error Corrections—In December 2009, the ASBJ issued ASBJ Statement No. 24, “Accounting Standard
for Accounting Changes and Error Corrections” and ASBJ Guidance No. 24, “Guidance on Accounting Standard for Accounting
Changes and Error Corrections.” Accounting treatments under this standard and guidance are as follows:(1) Changes in Accounting Policies—When a new accounting policy is applied following revision of an accounting standard, thenew policy is applied retrospectively unless the revised accounting standard includes specific transitional provisions, in which casethe entity shall comply with the specific transitional provisions. (2) Changes in Presentation—When the presentation of financial
statements is changed, prior-period financial statements are reclassified in accordance with the new presentation. (3) Changes in
Accounting Estimates—A change in an accounting estimate is accounted for in the period of the change if the change affects that
period only, and is accounted for prospectively if the change affects both the period of the change and future periods. (4) Correctionsof Prior-Period Errors—When an error in prior-period financial statements is discovered, those statements are restated.
t. New Accounting Pronouncements
Accounting Standard for Retirement Benefits—In May 2012, the ASBJ issued ASBJ Statement No. 26, “Accounting Standard for
Retirement Benefits” and ASBJ Guidance No. 25, “Guidance on Accounting Standard for Retirement Benefits,” which replaced theformer standard and the other related practical guidance.

AnnuAl RepoRt 201353

Under the revised accounting standard, actuarial gains and losses and past service costs shall be recognized within equity on the
consolidated balance sheet after adjusting for tax effects, and the funded status shall be recognized as a liability or asset. With
respect to the method for attributing the expected benefit to periods of service, the benefit formula basis is newly allowed as an
option, in addition to the straight-line basis. The method for determining the discount rate is also amended.
The accounting standard and the guidance will be applied to the Company and its domestic consolidated subsidiaries from theend of the fiscal year that begins on or after April 1, 2013. However, the revision of the attribution method of the expected benefit
will be applied from the beginning of the fiscal year that begins on or after April 1, 2014. The accounting standard and the guidance
will not be applied retrospectively to the financial statements in the prior years, following the transitional provisions.
The application of the accounting standard and the guidance is expected to have an effect on the consolidated financial statements and the Company is now in the process of measuring it.

3. NOTES AND ACCOUNTS RECEIVABLE
Sales recorded on the installment basis were 0.3% of operating revenues in 2013 and 2012, respectively.
Annual maturities of notes and accounts receivable—installment at March 31, 2013, and related amortization of deferred profit
on installment sales are as follows:
Millions of Yen

2014
2015
2016
2017
2018
2019 and thereafter
Total

Thousands of U.S. Dollars

Receivables

Deferred Profit
on Installment
Sales

Receivables

Deferred Profit
on Installment
Sales¥19,318
9,191
4,899
2,339
1,127
582
¥37,456¥2,080
1,348
790
412
229
147
¥5,006$205,398
97,72652,09324,874
11,9816,189$398,261$22,116
14,337
8,406
4,381
2,431
1,562
$53,233

4. INVENTORIESInventories at March 31, 2013 and 2012, consisted of the following:

Millions of Yen

MerchandiseWork in process
Raw materials and supplies
Total

Thousands of
U.S. Dollars

2013

2012

2013

¥ 852
161
2,588
¥3,601

¥ 770
87
2,488
¥3,345$ 9,059
1,716
27,516$38,291

5. MARKETABLE AND INVESTMENT SECURITIESMarketable and investment securities as of March 31, 2013 and 2012, consisted of the following:

Millions of Yen

Noncurrent:
Marketable equity securities
Nonmarketable equity securities
Other
Total

54

Yamato Holdings Co., ltd.

Thousands of
U.S. Dollars

2013

2012

2013

¥20,516
1,175
96¥21,787¥17,504
1,140
105¥18,749$218,136
12,496
1,026$231,658

Information regarding each category of the securities classified as available-for-sale at March 31, 2013 and 2012, was as follows:
Millions of Yen
2013

Securities classified as:
Available-for-sale: Equity securities

Cost

Unrealized
Gains

Unrealized
Losses¥12,257¥8,277¥18

Fair Value¥20,516

Millions of Yen
2012

Securities classified as:
Available-for-sale: Equity securities

Cost

Unrealized
Gains

Unrealized
Losses¥13,421¥4,282¥199

Fair Value¥17,504

Thousands of U.S. Dollars
2013

Securities classified as:
Available-for-sale: Equity securities

Cost

Unrealized
Gains

Unrealized
Losses$130,324$88,000$188

Fair Value$218,136

Information for available-for-sale securities, which were sold during the years ended March 31, 2013 and 2012, was as follows:
Millions of Yen
March 31, 2013

Available-for-sale:
Equity securities
Other
Total

Proceeds

Realized
Gains

Realized
Losses

¥44
8
¥52

¥42

¥–

¥42

¥–

¥–
9
¥9

¥–

¥–

¥–

¥–

March 31, 2012

Available-for-sale:
Equity securities
Other
Total

Thousands of U.S. Dollars
March 31, 2013

Available-for-sale:
Equity securities
Other
Total

Proceeds

$467
90
$557

Realized
Gains

Realized
Losses

$448

$–

$448

$–

Impairment losses on available-for-sale equity securities for the years ended March 31, 2013 and 2012, were ¥1,176 million($12,500 thousand) and ¥1,982 million, respectively.

AnnuAl RepoRt 201355

6. LONG-LIVED ASSETSThe Group reviewed its long-lived assets for impairment as of the years ended March 31, 2013 and 2012. As a result, the Group
recognized an impairment loss of ¥1,769 million ($18,815 thousand) as other expense for the asset groups of the Nishi-Kanto
Regional Branch of Yamato Home Convenience Co., Ltd. and eight other asset groups for the year ended March 31, 2013, and ¥222
million as other expense for the asset groups of the Iwate Regional Branch of Yamato Transport Co., Ltd. and another asset groupfor the year ended March 31, 2012, respectively, due to continuous operating losses of those units. The carrying amounts of therelevant asset groups were written down to the recoverable amounts. The recoverable amounts of the relevant asset groups were
measured by net selling prices and evaluated based mainly on Real Estate Appraisal Standards, assessed value of fixed assets, andposted land prices.

7. BANK LOANS AND LONG-TERM DEBT
Short-term bank loans at March 31, 2013 and 2012, consisted of notes to banks and bank overdrafts. The weighted-average interest rates applicable to the bank loans as of March 31, 2013 and 2012, were approximately 0.663% and 1.365%, respectively.
Long-term debt at March 31, 2013 and 2012, consisted of the following:

Millions of Yen
2013

0.200% to 6.900% loans from Japanese banks due 2013 to 2017
0.200% to 2.000% loans from Japanese banks due 2012 to 2016
Lease obligations
Zero coupon convertible bonds due in March 2016
Total
Less current portion
Total

2012

¥ 46,321
11,75620,00078,077(18,825)¥ 59,252

Thousands of
U.S. Dollars
2013$ 492,505¥ 52,981
14,54020,00087,521(17,082)¥ 70,439

125,002212,653
830,160(200,157)$ 630,003

Millions of Yen

Thousands of
U.S. Dollars¥18,825
21,47331,6015,381
764
33¥78,077$200,157
228,312
336,001
57,2128,128
350$830,160

Annual maturities of long-term debt at March 31, 2013, were as follows:Year Ending March 31

2014
2015
2016
2017
2018
2019 and thereafter
Total

The conversion price of the convertible bonds due in March 2016 was ¥1,850 per share at March 31, 2013. If all the outstanding convertible bonds had been exercised at March 31, 2013, 10,811 thousand shares of common stock would have been issued.
The conversion price of the convertible bonds is subject to adjustments to reflect stock splits and certain other events. Eachstock acquisition right may be exercised at any time during the period from March 22, 2011 to February 22, 2016.

56

Yamato Holdings Co., ltd.

8. RETIREMENT AND PENSION PLANS
The Group has severance payment plans for employees.
Under most circumstances, employees terminating their employment are entitled to retirement benefits determined based on therate of pay at the time of termination, years of service, and certain other factors. Such retirement benefits are made in the form of a
lump-sum severance payment from the Company or from the consolidated subsidiaries and annuity payments from a trustee. Employees are entitled to larger payments if the termination is involuntary, by retirement at the mandatory retirement age, by death, or byvoluntary retirement at certain specific ages prior to the mandatory retirement age. The retirement benefits for directors and Audit &Supervisory Board members, which are paid subject to the approval of the shareholders, are not included in the aforementioned plans.
The liability for employees’ retirement benefits at March 31, 2013 and 2012, consisted of the following:Thousands of
U.S. Dollars

Millions of Yen

Projected benefit obligation
Fair value of plan assets
Unrecognized actuarial loss
Prepaid pension cost
Net liability

2013

2012

2013

¥112,493(64,927)(9,502)114¥ 38,178¥ 97,901(58,359)(8,027)218¥ 31,733$1,196,097(690,345)(101,034)
1,216$ 405,934

The components of net periodic benefit costs for the years ended March 31, 2013 and 2012, are as follows:
Thousands of
U.S. Dollars

Millions of Yen

Service cost
Interest cost
Recognized actuarial loss
Net periodic benefit costs

2013

2012

2013

¥ 7,106
1,946
3,399¥12,451¥5,453
1,786
2,006¥9,245$ 75,552
20,69736,143$132,392

2013

2012

1.3%
0.0%
5 years2.0%
0.0%
5 years

Assumptions used for the years ended March 31, 2013 and 2012, are set forth as follows:

Discount rate
Expected rate of return on plan assets
Recognition period of actuarial gain/loss

9. ASSET RETIREMENT OBLIGATIONS
The changes in asset retirement obligations for the years ended March 31, 2013 and 2012, were as follows:

Millions of Yen

Balance at beginning of year
Additional provisions associated with the acquisition of property, plant and equipment
Reconciliation associated with passage of time
Reconciliation associated with changes in accounting estimates
Reduction associated with settlement of asset retirement obligations
OthersBalance at end of year

Thousands of
U.S. Dollars

2013

2012

2013

¥4,059
197
85
141
(26)
3
¥4,459¥3,831
185
80
2
(36)
(3)
¥4,059$43,157
2,089
905
1,502
(278)
31
$47,406

AnnuAl RepoRt 201357

In the year ended March 31, 2013, changes in accounting estimates were recorded as it became evident that the discounted
cash flows required for the future asset retirement exceed the amount estimated at the beginning of the year, which resulted fromcertain events such as obtaining new information. A reconciliation has been prepared for the excess, which resulted in an increaseof the asset retirement obligation for the year ended March 31, 2013, by ¥141 million ($1,502 thousand).

10. EQUITY
Japanese companies are subject to the Companies Act of Japan (the “Companies Act”). The significant provisions in the Companies
Act that affect financial and accounting matters are summarized below:
a. Dividends
Under the Companies Act, companies can pay dividends at any time during the fiscal year in addition to the year-end dividend upon
resolution at the shareholders meeting. For companies that meet certain criteria such as (1) having the Board of Directors,(2) having independent auditors, (3) having the Audit & Supervisory Board, and (4) the term of service of the directors is prescribedas one year rather than two years of normal term by its articles of incorporation, the Board of Directors may declare dividends(except for dividends-in-kind) at any time during the fiscal year if the company has prescribed so in its articles of incorporation. The
Company meets all the above criteria.
The Companies Act permits companies to distribute dividends-in-kind (noncash assets) to shareholders subject to a certain limitation and additional requirements.
Semiannual interim dividends may also be paid once a year upon resolution by the Board of Directors if the articles of incorporation of the company so stipulate. The Companies Act provides certain limitations on the amounts available for dividends or the purchase of treasury stock. The limitation is defined as the amount available for distribution to the shareholders, but the amount of net
assets after dividends must be maintained at no less than ¥3 million.
b. Increases/Decreases and Transfer of Common Stock, Reserve and Surplus
The Companies Act requires that an amount equal to 10% of dividends must be appropriated as a legal reserve (a component ofretained earnings) or as additional paid-in capital (a component of capital surplus) depending on the equity account charged upon thepayment of such dividends until the aggregate amount of legal reserve and additional paid-in capital equals 25% of the common
stock. Under the Companies Act, the total amount of additional paid-in capital and legal reserve may be reversed without limitation.
The Companies Act also provides that common stock, legal reserve, additional paid-in capital, other capital surplus, and retained
earnings can be transferred among the accounts under certain conditions upon resolution of the shareholders.
c. Treasury Stock
The Companies Act also provides for companies to purchase treasury stock and dispose of such treasury stock by resolution of theBoard of Directors. The amount of treasury stock purchased cannot exceed the amount available for distribution to the shareholders,which is determined by specific formula. The Companies Act also provides that companies can purchase both treasury stock acquisition rights and treasury stock. Such treasury stock acquisition rights are presented as a separate component of equity.

58

Yamato Holdings Co., ltd.

11. INCOME TAXESThe Company and its domestic subsidiaries are subject to Japanese national and local income taxes, which, in the aggregate,
resulted in normal effective statutory tax rates of approximately 38% and 40% for the years ended March 31, 2013 and 2012,
respectively.
The tax effects of significant temporary differences, which resulted in deferred tax assets and liabilities at March 31, 2013 and2012, were as follows:
Thousands of
U.S. Dollars

Millions of Yen
2013

2012

2013

¥ 10,994
2,015
211
1,728
2,456
(392)
¥ 17,012¥ 11,156
1,628
394
1,696
3,037
(466)
¥ 17,445$ 116,903
21,4262,241
18,373
26,115(4,172)$ 180,886¥ 13,720
2,202
24,218
4,150
546
1,660
10,087(34,472)¥ 22,111¥ 11,301
1,741
24,219
3,715
546
1,522
9,522
(32,853)¥ 19,713$ 145,876
23,413
257,504
44,124
5,808
17,650107,249(366,529)$ 235,095

Deferred tax liabilities:
Current—other
Deferred tax liabilities—current

¥
¥

¥
¥

$
$

Noncurrent:
Unrealized gain on available-for-sale securities
Other
Deferred tax liabilities—noncurrent
Deferred tax assets—net¥ 2,020
2,035¥ 4,055¥ 34,703

Deferred tax assets:
Current:
Accrued expenses
Enterprise tax
Allowance for doubtful accounts
Legal welfare expense
Other
Less valuation allowance
Deferred tax assets—current
Noncurrent:
Liability for employees’ retirement benefits
Investment securities
Loss on devaluation of land
Loss on impairment of long-lived assets
Loss on devaluation of telephone subscription rights
Unrealized profit
Other
Less valuation allowance
Deferred tax assets—noncurrent

365
365

367
367

¥ 1,027
1,758¥ 2,785¥ 34,006

3,886
3,886

$ 21,478
21,635$ 43,113$ 368,982

A reconciliation between the normal effective statutory tax rates and the actual effective tax rates reflected in the accompanying
consolidated statement of income for the year ended March 31, 2013, with the corresponding figures for 2012 is as follows:

Normal effective statutory tax rate
Per capita levy of local taxes
Valuation allowance
Downward revision to deferred tax assets as of end of the period due to the change inthe corporate tax rate
Other—net
Actual effective tax rate

2013

2012

38.0%
4.2
2.2

40.0%
5.9
3.5

1.6
46.0%

6.3
1.2
56.9%

AnnuAl RepoRt 201359

12. LEASES(1) Lessee
The Group leases certain machinery, computer equipment and other assets.
Future rental income payable under noncancelable operating leases at March 31, 2013 and 2012, was as follows:

Millions of Yen
2013

Due within one year
Due after one year
Total

¥507
44
¥551

Thousands of
U.S. Dollars

2012

2013

¥ 503
497
¥1,000$5,385469$5,854(2) Lessor
The net investments in lease as of March 31, 2013 and 2012, are summarized as follows:

Millions of Yen

Gross lease receivables
Unguaranteed residual values
Unearned interest income
Investments in leases, current

Thousands of
U.S. Dollars

2013

2012

2013

¥22,859
1,820(2,302)¥22,377¥19,860
1,488(2,423)¥18,925$243,049
19,354(24,479)$237,924

Maturities of lease receivables for finance leases that are deemed not to transfer ownership of the leased property to the lessee
as of March 31, 2013, are as follows:Year Ending March 31

2014
2015
2016
2017
2018
2019 and thereafter
Total

Millions of Yen

Thousands of
U.S. Dollars¥ 7,379
6,195
4,771
3,101
1,260
153
¥22,859$ 78,457
65,86550,72732,972
13,396
1,632$243,049

The minimum rental commitments under noncancelable operating leases at March 31, 2013 and 2012, are as follows:

Millions of Yen

Due within one year
Due after one year
Total

60

Yamato Holdings Co., ltd.

Thousands of
U.S. Dollars

2013

2012

2013

¥1,5093,431¥4,940¥ 966
2,245¥3,211$16,042
36,481$52,523

13. FINANCIAL INSTRUMENTS AND RELATED DISCLOSURES(1) Group Policy for Financial Instruments
The Group uses financial instruments, mainly long-term debt including bank loans and bonds, in order to expand its business basedon its investment plan to expand its network. Cash surpluses, if any, are invested in low risk financial assets. Derivatives are used,
not for speculative purposes, but to manage exposure to interest fluctuation risk. Certain consolidated subsidiaries conduct leasing
or installment sales operations.
(2) Nature and Extent of Risks Arising from Financial Instruments and the Risk Management for Financial Instruments
Receivables such as notes and accounts receivable and installment sales receivable are exposed to customer credit risk.
Therefore, the Group maintains customers’ credit risk by monitoring collections and accrued receivables at due dates.
Marketable and investment securities are mainly equity securities of the companies that have business relationships or capitalalliances. Such securities are exposed to the risk of market price fluctuations.
Most payment terms of payables such as notes and accounts payable are less than one year.
Short-term bank loans are related to a financial business, and long-term bank loans are used for expanding its business andnetwork. Although a portion of such bank loans are exposed to market risks from changes in variable interest rates, those risks are
mitigated by using derivatives of interest rate swaps. In addition, such interest rate swaps are contracted in accordance with theinternal rule, which prescribes the authority over derivative transactions.
Accounts payable and bank loans exposed to liquidity risks are managed by each company of the Group, such as fund settlement,
bookkeeping, monitoring of the balances outstanding, and managing cash flows.
(3) Fair Values of Financial Instruments
Fair values of financial instruments are based on quoted prices in active markets. If a quoted price is not available, other rational
valuation techniques are used instead. According to the techniques used, the value could be different.
Fair values of financial instruments at March 31, 2013 and 2012, were as follows:
Millions of Yen
March 31, 2013

Cash and cash equivalents
Trade notes and accounts receivable
Allowance for doubtful accounts
Installment sales receivable
Allowance for doubtful accounts
Deferred profit on installment sales
Investment securities
Trade notes and accounts payable
Short-term loans
Long-term loans
Derivatives

Carrying Amount

Fair Value¥213,619
163,790(143)
163,647
37,456(1,112)(5,006)
31,33820,516138,288
29,81432,210¥213,619

Difference

164,258¥ 611

36,11020,516138,288
29,89232,275

4,772

78
65

AnnuAl RepoRt 201361

Millions of Yen
March 31, 2012

Cash and cash equivalents
Trade notes and accounts receivable
Allowance for doubtful accounts
Installment sales receivable
Allowance for doubtful accounts
Deferred profit on installment sales
Investment securities
Trade notes and accounts payable
Short-term loans
Long-term loans
Derivatives

Carrying Amount

Fair Value¥209,179
158,175(79)
158,096
35,539(1,561)(4,960)29,01817,504
129,454
17,39040,850¥209,179

Difference

158,675¥ 579

33,68817,504
129,454
17,39640,882

4,670

6
32

Thousands of U.S. Dollars
March 31, 2013

Carrying Amount

Fair Value

Cash and cash equivalents
Trade notes and accounts receivable
Allowance for doubtful accounts$2,271,336
1,741,518(1,518)
1,740,000
398,261(11,824)(53,233)
333,204
218,136
1,470,370
317,004
342,473$2,271,336

Installment sales receivable
Allowance for doubtful accounts
Deferred profit on installment sales
Investment securities
Trade notes and accounts payable
Short-term loans
Long-term loans
Derivatives

Difference

1,746,496$ 6,496

383,943
218,136
1,470,370
317,827
343,164

50,739823
691

Cash and cash equivalents
The carrying values of cash and cash equivalents approximate fair value because of their short maturities.
Trade notes and accounts receivable
The fair values of receivables are measured at the amount to be received at maturity discounted at the Group’s assumed corporate
discount rate. A portion of these receivables is determined by discounting the cash flows related to the receivables at the rate ofgovernment bonds.
Installment sales receivable
Allowances for doubtful accounts and deferred profit on installment sales are deducted from the fair values of installment sales receivable, which are determined by discounting the cash flows related to the installment sales receivable at the market interest rate.
Marketable and investment securities
The fair values of marketable and investment securities are measured at the quoted market price of the stock exchange for theequity instruments, and at the quoted price obtained from the financial institution for certain debt instruments. Information of thefair value for marketable and investment securities by classification is included in Note 5.

62

Yamato Holdings Co., ltd.

Trade notes and accounts payable
The fair values of payables, all of which are substantially paid within one year, are measured at the amount to be paid.
Short‑term loans and long‑term loans
The fair values of short-term bank loans and long-term loans are determined by discounting the cash flows related to the debt at theGroup’s assumed corporate borrowing rate.
The current portion of long-term bank loans is included in short-term loans in the above table in addition to short-term bank loanson the consolidated balance sheet. Lease payments are not included in long-term loans in the above table.
Derivatives
Information of the fair value for derivatives is included in Note 14.
(4) Financial Instruments Whose Fair Value Cannot Be Reliably Determined

Millions of Yen

Investments in equity instruments that do not have a quoted market pricein an active market

Thousands of
U.S. Dollars

2013

2012

2013

¥2,082¥4,465$22,132(5) Maturity Analysis for Financial Assets and Securities with Contractual Maturities
Millions of Yen

March 31, 2013

Cash and cash equivalents
Trade notes and accounts receivable
Installment sales receivable
Total

Due in One Yearor Less

Due after
One Year throughFive Years¥213,619
156,108
19,318¥389,045¥ 7,637
17,556¥25,193

¥ 45
582
¥627

¥209,179
151,663
19,886¥380,728¥ 6,463
15,310¥21,773

¥ 49
343
¥392

Due after
Five Years

March 31, 2012

Cash and cash equivalents
Trade notes and accounts receivable
Installment sales receivable
Total

Thousands of U.S. Dollars

March 31, 2013

Due in One Yearor Less

Due after
One Year throughFive Years

Due after Five
Years

Cash and cash equivalents
Trade notes and accounts receivable
Installment sales receivableTotal$2,271,336
1,659,838
205,398$4,136,572$ 81,206
186,674$267,880

$ 474
6,189
$6,663

AnnuAl RepoRt 201363

(6) Maturity Analysis for Long‑term Loans, Lease Obligations and Convertible Bonds
Millions of Yen
Year Ending March 31

Long-term loans

Lease obligations¥14,111
17,118
9,967
4,617
508

¥ 4,714
4,355
1,634
764
256
33
¥11,756

2014
2015
2016
2017
2018
2019 and thereafter
Total¥46,321

Zero coupon
convertible bonds¥20,000¥20,000

Thousands of U.S. Dollars
Year Ending March 31

Long-term loans

Lease obligations$150,032
182,001
105,977
49,093
5,402$ 50,125
46,311
17,371
8,119
2,726
350
$125,002

2014
2015
2016
2017
2018
2019 and thereafter
Total$492,505

Zero coupon
convertible bonds$212,653$212,653

Please see Note 7 for annual maturities of long-term debt.

14. DERIVATIVES
Certain consolidated subsidiaries use derivative financial instruments to manage their exposure to fluctuations in interest rates.
Interest rate swaps are utilized by the consolidated subsidiaries to reduce interest rate risk. The consolidated subsidiaries do notenter into derivatives for trading or speculative purposes.
The interest rate swaps, which qualify for hedge accounting and meet specific matching criteria, are not remeasured at market
value but the differential paid or received under the swap agreements is recognized and included in interest expense or income.
Derivative Transactions to Which Hedge Accounting Is Applied
Millions of Yen
Contract
Amount Dueafter One Year

Fair Value

March 31, 2013

Hedged Item

Contract
AmountInterest rate swaps(fixed rate payment, floating rate receipt)

Long-term bank loans¥42,050¥28,050*

Long-term bank loans¥49,074¥37,550*

March 31, 2012

Interest rate swaps(fixed rate payment, floating rate receipt)

Thousands of U.S. Dollars

March 31, 2013

Hedged Item

Interest rate swaps(fixed rate payment, floating rate receipt)

Long-term bank loans*The information of the fair value of interest rate swaps is included in that of hedged items (see Note 13).

64

Yamato Holdings Co., ltd.

Contract
AmountContract
Amount Dueafter One Year

Fair Value$447,103$298,246*

15. COMPREHENSIVE INCOME
Each component of other comprehensive income for the years ended March 31, 2013 and 2012, was as follows:
Thousands of
U.S. Dollars

Millions of Yen

Unrealized gain on available-for-sale securities:
Gains arising during the year
Reclassification adjustments to profit or loss
Amount before income tax effect
Income tax effectTotal
Foreign currency translation adjustments:
Adjustments arising during the year
Total other comprehensive income

2013

2012

2013

¥ 3,036
1,176
4,212(1,013)¥ 3,199

¥ 428
1,390
1,818
(304)
¥1,514$ 32,281
12,49944,780(10,770)$ 34,010¥ 1,035¥ 4,234¥ (433)¥1,081$ 11,005$ 45,015

16. NET INCOME PER SHARE
Reconciliation of the differences between basic and diluted net income per share (“EPS”) for the years ended March 31, 2013 and2012, is as follows:Year Ended March 31, 2013

Basic EPS—Net income available to common shareholders
Effect of dilutive securities—Convertible bonds
Diluted EPS—Net income for computation

Millions of Yen

Thousands ofSharesNet Income

Weightedaverage Shares¥35,144¥35,144

Yen

U.S. Dollars
EPS

429,377
10,811
440,188¥81.85$0.87¥79.84$0.85

430,181
10,811
440,992¥46.00Year Ended March 31, 2012

Basic EPS—Net income available to common shareholders
Effect of dilutive securities—Convertible bonds
Diluted EPS—Net income for computation¥19,787¥19,787¥44.87

17. SEGMENT INFORMATION(1) Description of Reportable Segments
The Group identifies operating segments as units of segment reporting for which discrete financial information is available andwhose operating results are regularly reviewed by the Board of Directors, in order to make decisions about resources to be allocatedto the segment and assess its performance.
The Company, as a pure holding company, forms six business formations classified according to each business contents andmanages based on these business formations. The Group categorizes as the six reporting segments, “Delivery,” “BIZ-Logistics,”“Home Convenience,” “e-Business,” “Financial,” and “Truck Maintenance” based on the above policy.

AnnuAl RepoRt 2013

65

The Group defines the reporting segments as follows:
Delivery:

Small-parcel delivery services such as TA-Q-BIN (door-to-door parcel delivery) and Kuroneko Mail (posting
service)

BIZ-Logistics:

Intercompany logistics services, aimed at the B2B supply-chain management market

Home Convenience:

Lifestyle support services intimately connected with the needs of local markets, such as moving and household effects delivery services

e-Business:

Information services targeted at the business market, including ASP services and the development of information systems

Financial:

Financial services targeted at business customers and consumers, such as settlement and collection

Truck Maintenance:

Vehicle maintenance services and fuel supply targeted at transport companies(2) Methods of Measurement for the Amounts of Segment Revenues, Segment Income (Loss), Segment Assets, and Other Items
for Each Reportable Segment
The accounting policies of each reportable segment are consistent to those disclosed in Note 2, “Summary of Significant Accounting
Policies.”(3) Information about Segment Revenues, Segment Income (Loss), Segment Assets, and Other Items
Millions of Yen
2013

Segment revenues:
Segment revenues from
customers
Intersegment revenues
Total segment revenues
Segment income (loss)
Segment assets
Other:
Depreciation and amortization
Increase of tangible and intangible fixed assets

Home
Convenience

Delivery

BIZ-Logistics¥1,028,219
56,439¥1,084,658¥ 41,908
575,699¥86,807
11,486¥98,293¥ 4,095
52,52527,7701,542

756

31,725

1,655

550

Financial

Truck
Maintenance

Other

Total

Reconciliation

Consolidated¥ 56,710
3,911¥ 60,621¥ 8,516
189,457¥23,229
27,531¥50,760¥ 2,666
21,804¥ 5,746
52,994¥58,740¥18,763
10,845¥1,282,374
194,973¥1,477,347¥ 82,408
905,607¥–(194,973)¥(194,973)¥ (16,205)
44,546¥1,282,374¥1,282,374¥ 66,203
950,153

3,759

2,357

948

253

37,385551

37,936

2,262

4,483

729

233

41,637

6,415

48,052

Reconciliation

Consolidated¥¥1,260,833

e-Business¥44,602 ¥37,061
14,752
27,860¥59,354 ¥64,921¥ (527) ¥ 6,987
18,41536,862Millions of Yen
2012

Segment revenues:
Segment revenues from
customers
Intersegment revenues
Total segment revenues
Segment income (loss)
Segment assets
Other:
Depreciation and amortization
Increase of tangible and intangible fixed assets

66

Yamato Holdings Co., ltd.

Home
Convenience

Delivery

BIZ-Logistics¥1,014,564
54,096¥1,068,660¥ 40,965
558,494¥82,479
11,827¥94,306¥ 3,663
50,52029,4061,534

756

35,654

1,386

595

Financial

Truck
Maintenance

Other

Total

¥ 54,115
4,171¥ 58,286¥ 9,938
174,683¥21,188
26,896¥48,084¥ 2,514
21,635¥ 5,268
44,604¥49,872¥11,877
10,948¥1,260,833
182,245¥1,443,078¥ 75,616
872,626

3,691

1,932

931

366

3,353

3,609

1,208

147

e-Business¥47,715 ¥35,504
14,157
26,494¥61,872 ¥61,998¥ (44) ¥ 6,703
19,79636,550–(182,245)¥(182,245)¥ (8,965)
46,669¥1,260,833¥ 66,651
919,295

38,61666

38,68245,952

2,663

48,615

Thousands of U.S. Dollars
2013
DeliverySegment revenues:
Segment revenues from
customers
Intersegment revenues
Total segment revenues
Segment income (loss)
Segment assets
Other:
Depreciation and amortization
Increase of tangible and intangible fixed assets

BIZ-Logistics

Home
Convenience

e-Business

Truck
Maintenance

Financial

Other

Total

Reconciliation$10,932,686 $ 922,986 $474,235 $394,054 $ 602,979 $246,981 $ 61,099 $13,635,020
600,096
122,132 156,855 296,223
41,580 292,731 563,466
2,073,083$11,532,782 $1,045,118 $631,090 $690,277 $ 644,559 $539,712 $624,565 $15,708,103$ 445,597 $ 43,535 $ (5,606) $ 74,287 $ 90,551 $ 28,349 $199,498 $ 876,211
6,121,197
558,482 195,799 391,938 2,014,433 231,835 115,310
9,628,994

Consolidated$– $13,635,020(2,073,083)$(2,073,083) $13,635,020$ (172,300) $ 703,911
473,641 10,102,635

295,263

16,394

8,035

39,97025,061

10,084

2,694

397,501

5,854

403,355

337,324

17,594

5,851

24,05547,662

7,750

2,472

442,708

68,214510,922

Notes: “Other” includes JITBOX charter services, staffing services, and shared services.
Segment revenues and segment income of “Other” include dividends for the years ended March 31, 2013 and 2012, of ¥17,553 million ($186,636
thousand) and ¥10,219 million, respectively, which the Company received from its subsidiaries as a pure holding company.
Reconciliations are as follows:(1) Reconciliations of segment income for the years ended March 31, 2013 and 2012, of ¥16,205 million ($172,300 thousand) and ¥8,965 million,
respectively, are intersegment eliminations.
(2) Reconciliations of segment assets at March 31, 2013 and 2012, of ¥44,546 million ($473,641 thousand) and ¥46,669 million, respectively, include
intersegment eliminations of ¥118,389 million ($1,258,793 thousand) and ¥119,764 million, and corporate assets which are not allocated to eachreporting segment of ¥162,935 million ($1,726,692 thousand) and ¥166,433 million, respectively.
(3) Reconciliations of increases of tangible and intangible fixed assets at March 31, 2013 and 2012, of ¥6,415 million ($68,214 thousand) and ¥2,663
million, respectively, are the Company’s capital investment.
Segment income is reconciled with the consolidated statement of income.

[Related Information about Reporting Segments](1) Information about products and services
Operating revenues from customers for the years ended March 31, 2013 and 2012, are as follows:
Millions of Yen
2013

2012

TA-Q-BIN

Kuroneko Mail

Other

Total

TA-Q-BIN

Kuroneko Mail

Other

Total

¥831,083¥122,277¥329,014¥1,282,374¥811,906¥129,870¥319,057¥1,260,833

Thousands of U.S. Dollars
2013
TA-Q-BIN

Kuroneko Mail

$8,836,602$1,300,127

Other

Total

$3,498,291 $13,635,020

AnnuAl RepoRt 201367

(2) Information about geographical areas
Operating revenues for the years ended March 31, 2013 and 2012, are as follows:
Millions of Yen
2013
Japan

¥1,259,728

North America

2012
Other

¥9,545¥13,101

Total

Japan

¥1,282,374¥1,242,311

North America

Other¥8,264¥10,258

Total¥1,260,833

Thousands of U.S. Dollars
2013
Japan

North America$13,394,232$101,493

Other

Total

$139,295 $13,635,020

Property, plant and equipment at March 31, 2013 and 2012, are as follows:
Millions of Yen
2013
Japan

¥380,952

North America

2012
Other

¥300

¥1,905

Total

Japan

¥383,157¥373,322

North America

Other

¥204

¥1,654

Total¥375,180

Thousands of U.S. Dollars
2013
Japan

$4,050,532

North America$3,186

Other

Total

$20,254$4,073,972(3) Information about impairment losses of long‑lived assets by reporting segments
Impairment losses of long-lived assets by reporting segments for the years ended March 31, 2013 and 2012, are as follows:
Millions of Yen
2013
Delivery

Impairment losses oflong-lived assets¥357

BIZHome
Logistics Convenience e-Business¥1,409Truck
Maintenance

Financial

Other

¥3

Total

¥1,769Eliminations or
Corporate
Consolidated¥1,769Millions of Yen
2012
Delivery

Impairment losses oflong-lived assets

BIZHome
Logistics Convenience e-Business

Truck
Maintenance

Financial

Other

¥222

Total

¥222

Eliminations or
Corporate
Consolidated¥222

Thousands of U.S. Dollars
2013
Delivery

Impairment losses oflong-lived assets

68

Yamato Holdings Co., ltd.

$3,797

BIZHome
Logistics Convenience e-Business$14,987

Financial

$31

Truck
Maintenance

Other

Total

$18,815

Eliminations or
Corporate
Consolidated$18,815

(4) Information about amortization and amounts of goodwill by reporting segments
Amortization and balance of goodwill by reporting segments for the years ended March 31, 2013 and 2012, are as follows:
Millions of Yen
2013
Delivery¥68

Amortization of goodwill
Amounts of goodwill

BIZHome
Logistics Convenience e-Business

Financial

Truck
Maintenance

Other

¥104

Eliminations or
Corporate
Consolidated

Total

¥172

¥172

Millions of Yen
2012
DeliveryAmortization of goodwill
Amounts of goodwill

¥ 91
273

BIZHome
Logistics Convenience e-Business

Financial

Truck
Maintenance

Other

¥104
312

Eliminations or
Corporate
Consolidated

Total

¥195
585

¥195
585

Thousands of U.S. Dollars
2013
DeliveryAmortization of goodwill
Amounts of goodwill$726

BIZHome
Logistics Convenience e-Business$1,106

Financial

Truck
Maintenance

Other

Eliminations or
Corporate
Consolidated

Total$1,832$1,832

18. SUBSEQUENT EVENT
Appropriations of Retained Earnings
The following appropriation of retained earnings at March 31, 2013, was approved at the Company’s Board of Directors meeting
held on May 16, 2013:

Year-end cash dividends, ¥12.00 ($0.13) per share

Millions of Yen

Thousands of
U.S. Dollars¥5,085$54,062

AnnuAl RepoRt 201369

Independent Auditor’s Report

To the Board of Directors of
Yamato Holdings Co., Ltd.:We have audited the accompanying consolidated balance sheet of Yamato Holdings Co., Ltd. and its consolidated subsidiaries as ofMarch 31, 2013, and the related consolidated statements of income, comprehensive income, changes in equity, and cash flows for theyear then ended, and a summary of significant accounting policies and other explanatory information, all expressed in Japanese yen.
Management’s Responsibility for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance withaccounting principles generally accepted in Japan, and for such internal control as management determines is necessary to enable
the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit inaccordance with auditing standards generally accepted in Japan. Those standards require that we plan and perform the audit toobtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial
statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order todesign audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the consolidated
financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
OpinionIn our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Yamato Holdings Co., Ltd. and its consolidated subsidiaries as of March 31, 2013, and the consolidated results of
their operations and their cash flows for the year then ended in accordance with accounting principles generally accepted in Japan.
Convenience Translation
Our audit also comprehended the translation of Japanese yen amounts into U.S. dollar amounts and, in our opinion, such translation
has been made in accordance with the basis stated in Note 1 to the consolidated financial statements. Such U.S. dollar amounts
are presented solely for the convenience of readers outside Japan.

June 6, 201370

Yamato Holdings Co., ltd.

Corporate Data
As of March 31, 2013

Principal Shareholders

Head Office
Yamato Holdings Co., Ltd.
16-10, Ginza 2-chome, Chuo-ku, Tokyo
104-8125 Japan
Telephone: 81-3-3541-4141
Facsimile: 81-3-5565-3427

Percentage of total
shares outstanding

The Master Trust Bank of Japan, Ltd. (Trust Account)

6.09%

Yamato Employees’ Shareholding Association

4.31%

Japan Trustee Services Bank, Ltd. (Trust Account)

3.96%

Mizuho Bank, Ltd.

3.74%

State Street Bank and Trust Company 505223

3.12%

Nippon Life Insurance Company

3.09%

Meiji Yasuda Life Insurance Company

2.66%

Yamato Trading-Partner Shareholding Association

2.48%

SSBT OD05 Omnibus Account Treaty Clients

1.81%

Transfer Agent and Registrar

Sompo Japan Insurance Inc.

1.31%

Mizuho Trust & Banking Co., Ltd.

Total

32.57%

Common Stock
Authorized: 1,787,541,000 shares
Issued: 461,345,492 shares

Stock Exchange Listing
Tokyo Stock Exchange

Annual Meeting
The annual meeting of shareholders isnormally held in June in Tokyo, Japan.

Auditor
Deloitte Touche Tohmatsu LLC

Stock Price Range (Tokyo Stock Exchange)
(Yen)

(Yen)

2,000

16,00014,0001,500
12,0001,000

10,000

8,000
500
6,000

0

10/4

7

10

11/1

4

n Stock Price Range (left scale)

7

10

12/1

Average (left scale)

4

7

10

13/1

4,000

Nikkei Stock Average (right scale)

ANNuAL REPORT 201371

YAMATO HOLDINGS CO., LTD.

Annual Repor t 2013

Printed in Japan