Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2011
(April 1, 2010 through June 30, 2010)
All financial information has been prepared in accord with accounting principles generally accepted in Japan. This is apartial English translation of the original Japanese-language document. All information pertains to consolidated results
unless otherwise noted. Information on the basis of presentation of consolidated financial statements does not appear inthis translation.
August 12, 2010
Company name:
Stock exchange listings:
Stock code:
URL:
Representative:
Contact:
Phone:

IT Holdings Corporation
The First Section of the Tokyo Stock Exchange3626
http://www.itholdings.co.jp/e/Susumu Okamoto, President
Norio Maenishi, Executive Vice President+81 3-6738-7557

Scheduled dates
Submission of quarterly report:
Commencement of dividend payments:

August 13, 2010-

Supplementary materials to the quarterly results:
Quarterly results presentation:

Not available
Not conducted

Figures in millions of yen are rounded down to the nearest million
1. Consolidated Results for the First Quarter of the Fiscal Year Ending March 31, 2011
(April 1, 2010 – June 30, 2010)(1) Consolidated Financial Results

Percentages indicate year-over-year changes

Net salesFirst Quarter, FY2011First Quarter, FY2010

Operating income

Recurring profit

Net income

millions of yen%

millions of yen%

millions of yen%

millions of yen%

69,00765,8554.8(1.6)(2,142)851-(1,848)981-(2,817)
1,101-

Net income
per share – basic

Net income
per share – diluted

yenFirst Quarter, FY2011First Quarter, FY2010

yen(32.10)12.94-(2) Consolidated Financial Position
Total assets

Net assets

millions of yen

Equity ratio

millions of yen

Net assets per share%

End-First Quarter, FY2011
298,615
149,318
45.1
End-FY2010
313,077
155,075
44.2
For reference:
Shareholders’ equity: End-first quarter, FY2011: 134,737 million yen End-FY2010: 138,401 million yen.

2. Cash Dividends for Shareholders of Common Stock
Cash dividends per share
Record dateor period

End-Q1End-Q2End-Q3Year-end

yen

yen

yen

yen

Total
yen

12.00
20.00
FY201032.00
FY2011FY2011
12.00
20.00
32.00
(forecast)
Note: Revision of dividend forecast during the first quarter of the fiscal year ending March 31, 2011: No

yen

1,535.02
1,602.77

3. Forecast of Consolidated Results for FY2011 (April 1, 2010 – March 31, 2011)
Net sales

Operating income

Percentages indicate year-over-year changes
Net income per
Recurring profit
Net income
share – basic

millions of yen%

millions of yen%

millions of yen%

millions of yen%

yen

165,000

12.3

4,800

(17.3)

4,800(17.1)

800(75.1)

9.11

346,000

10.2

16,5003.2

16,0001.8

5,500(28.2)

62.66

First half of FY 2011
(six months ending Sep. 30,
2010)

Full FY2011(year ending Mar. 31, 2011)

Note: Revision of consolidated results forecast during the first quarter of the fiscal year ending March 31, 2011: No

4. OtherFor details, see “2. Other information” on page 3 in the accompanying material.
(1) Material reclassifications of subsidiaries during the period: No*This refers to additions and removals of materials subsidiaries to and from the scope of consolidated results during theperiod.
(2) Application of simplified accounting and/or accounting procedures: Yes*This refers to the application of simplified accounting methods and accounting procedures specific to the preparation ofquarterly consolidated financial statements.
(3) Changes in accounting principles, procedures, presentation methods, etc.
1) Changes associated with changes to accounting standards: Yes
2) Changes other than the above: No*This refers to changes in accounting principles, procedures, and presentation methods used in the preparation of thequarterly consolidated financial statements(4) Common stock issued
1) Issued shares as of period-end (including treasury stock):End-first quarter, FY2011 (June 30, 2010):
87,789,098 shares
End-FY2010 (March 31, 2010):
86,373,919 shares
2) Treasury stock as of period-end:
End-first quarter, FY2011 (June 30, 2010):
13,728 shares
End-FY2010 (March 31, 2010):
22,813 shares
3) Average number of shares (during the respective three-month period):First quarter, FY2011 (ended June 30, 2010):
87,765,572 sharesFirst quarter, FY2010 (ended June 30, 2009):
85,076,683 shares*Quarterly review status
A quarterly review of the quarterly financial statements had been completed by the date of this report’s publication.
Caution on Forward-Looking Statements and Other Important Matters
This report contains forward-looking statements that reflect IT Holdings Corporation (ITHD)’s plans and expectations.
These forward-looking statements are not guarantees of future performance and involve known and unknown risks,
uncertainties and other factors that may cause ITHD’s actual results, performance, achievements or financial position to bematerially different from any future results, performance, achievements or financial position expressed or implied by theseforward-looking statements.
Refer to “(2) Consolidated Earnings Outlook” in the “1. Consolidated Performance ” section beginning on page 2 in theaccompanying materials.

Accompanying Material – Contents
1. Consolidated Performance(1) Consolidated Operating Results(2) Consolidated Earnings Forecast
2. Other Information(1) Overview of Material Reclassifications of Subsidiaries during the Period(2) Overview of Simplified Accounting and/or Specific Accounting Procedures(3) Overview of Changes in Accounting Principles, Procedures, and Presentation Methods
3. Consolidated Financial Statements(1) Consolidated Balance Sheets(2) Consolidated Statements of Income(3) Notes on the Going-concern Assumption(4) Note on Significant Changes in the Amount of Shareholders’ Equity

1

2
2
2
3
3
3
3
4
4
6
7
7

1. Consolidated Performance(1) Consolidated Operating Results
In the first quarter of fiscal 2011 (year ending March 31, 2011), the Japanese economy saw a pickup in exports andproduction that inspired confidence in economic recovery. In the IT services industry, some customers began to show signsof positive change in their propensity for IT investment, as evidenced by a planned year-on-year increase in software
investment in the current fiscal year per the Bank of Japan's Short-term Economic Survey of Enterprises in Japan (theTankan survey). Nonetheless, the IT services industry's operating environment remains adverse as companies continue toclamp down on investment in new system installations and seek reductions in system maintenance and operating costs.
In the fiscal first quarter, the IT Holdings Group's consolidated net sales grew 4.8% year on year to ¥69,007 million by
virtue of SORUN CORPORATION's inclusion as a consolidated subsidiary effective December 2009. Despite such top-line
growth, the Group incurred a quarterly consolidated operating loss of ¥2,142 million, consolidated recurring loss of ¥1,848
million, and consolidated net loss of ¥2,817 million versus year-earlier quarterly consolidated operating, recurring, and net
profits of ¥851 million, ¥981 million, and ¥1,101 million, respectively. Factors that detracted from the Group's profitability
included customers' continued cutbacks in IT investment dating back to the previous fiscal year and the Group's ongoing
initiatives to adapt its business model to the prevailing adverse operating environment. Another contributing factor was that
the Group booked a one-time charge of ¥2,199 million related to asset retirement obligations.
Fiscal first-quarter consolidated net sales by segment were as follows.
1) Outsourcing and networking segment
Consolidated net sales grew 0.8% year on year to ¥31,127 million as newly consolidated subsidiary SORUNCORPORATION 's contribution offset lower sales elsewhere.
2) Software development segment
Consolidated net sales grew 13.3% year on year to ¥31,060 million by virtue of incremental sales contributed by newly
consolidated subsidiary SORUN CORPORATION.
3) Solution services segment
Consolidated net sales fell 16.9% year on year to ¥4,818 million, largely as a result of continued retrenchment in hardware
demand among customers.
4) Other businesses segment
Consolidated net sales increased 13.7% year on year to ¥2,001 million.
(2) Consolidated Earnings Forecast
In light of the uncertain economic outlook, the Group anticipates that IT investment will take a while longer to recover inearnest across all industries. The Group accordingly expects to continue to face an adverse operating environment in fiscal
2011.
Against such a backdrop, the Group aims to achieve its initial fiscal 2011 operating performance targets by continuing toreform its cost structure and focusing on unfailingly meeting IT investment demand by tapping into group synergies throughsuch means as joint order booking activities by Group companies working in cooperation with each other. The Grouprefrains from revising its existing consolidated earnings forecast announced on May 11, 2010.

2

2. Other Information(1) Overview of Material Reclassifications of Subsidiaries during the Period
Not applicable(2) Overview of Simplified Accounting and/or Specific Accounting Procedures
1) Simplified accounting
Bad debt estimation method for general claims
Certain consolidated subsidiaries estimated the value of uncollectible general claims based on the credit loss rate as ofthe end of the previous fiscal year, unless the credit loss rate as of the end of the first quarter under review was deemed
to have changed substantially relative to the rate calculated at the end of the previous fiscal year.
Inventory valuation method
Certain consolidated subsidiaries write-down the book value of inventory to estimated net realizable value only whenutility has clearly diminished.
Calculation method for income taxes and deferred-tax assets and liabilities
Certain consolidated subsidiaries calculate income tax payments with a method that limits deductible and taxable
items and tax-credit items to those that are material. To assess deferred assets’ collectability, certain consolidated
subsidiaries used the tax planning and earnings forecasts used at the end of the previous fiscal year, as no substantialchanges in the operating environment and status of temporary differences were deemed to have taken place since
beginning of the fiscal year.
2) Accounting procedures specific to preparation of quarterly consolidated financial statements
Not applicable(3) Overview of Changes in Accounting Principles, Procedures, and Presentation Methods, etc.
1) Changes related to accounting standards
Adoption of the Accounting Standard for Asset Retirement Obligations
Effective the first quarter of the fiscal year ending March 31, 2011, the Company adopted the Accounting Standard for
Asset Retirement Obligations (Statement No. 18, March 31, 2008) and its associated Guidance on AccountingStandard for Asset Retirement Obligations (Guidance No. 21, March 31, 2008).
Due to the standard and guidance’s adoption, operating loss and recurring loss each increased by 57 million yen,loss before income taxes increased by 2,257 million yen, and asset retirement obligations changed by 2,554 million
yen.
Adoption of the Accounting Standard for Business Combinations
Effective the first quarter of the fiscal year ending March 31, 2011, the Company adopted the Accounting Standard forBusiness Combinations (ASBJ Statement No. 21, December 26, 2008), the Accounting Standard for Consolidated
Financial Statements (ASBJ Statement No. 22, December 26, 2008), the Amendments to Accounting Standard for
Research and Development Costs (ASBJ Statement No. 23, December 26, 2008), the Revised Accounting Standard
for Business Divestitures (ASBJ Statement No. 7, December 26, 2008), the Revised Accounting Standard for Equity
Method of Accounting for Investments (ASBJ Statement No. 16, December 26, 2008), and the Revised Guidance on
Accounting Standard for Business Combinations and Accounting Standard for Business Divestitures (ASBJ GuidanceNo. 10, December 26, 2008).

2) Changes related to presentation methods
Due to the adoption of the Cabinet Office Ordinance on Partial Revision of the Regulations Concerning the
Terminology, Forms and Preparation Methods of Financial Statements and Other Items (Cabinet Office Ordinance
No. 5, March 24, 2009) based on the Accounting Standard for Consolidated Financial Statements (ASBJ Statement
No.22, December 26, 2008), the Company used the account title “Loss before minority interests” for the first quarterof the fiscal year ending March 31, 2011.

3

3. Consolidated Financial Statements(1) Consolidated Balance Sheets
As of Jun. 30, 2010

Items
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable
Lease receivables and lease investment assets
Marketable securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Deferred tax assets
Other current assets
Allowance for doubtful accounts
Total current assets
Fixed assets
Property and equipment
Buildings and structures, net
Machinery and equipment, net
Land
Leased assets, net
Construction in progress
Other property and equipment, net
Total property and equipment
Intangible assets
Goodwill
Other intangible assets
Total intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Other assets
Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
Total assets

4

As of Mar. 31, 2010

millions of yen

millions of yen

49,35638,550
7,491
221
2,424
12,016230
10,0108,911(167)
129,045

47,19262,619
7,590
321
1,914
7,121
227
8,527
6,649
(197)
141,967

53,741
4,565
22,564
2,422
3,044
5,458
91,79552,331
4,851
22,630
2,476
4,106
5,602
91,9996,738
12,48819,226

6,741
12,388
19,13032,8108,236
20,254(2,754)58,547
169,569
298,615

34,593
6,994
21,171(2,779)59,980171,109
313,077

As of Jun. 30, 2010

Items
Liabilities
Current liabilities
Notes and accounts payable
Short-term borrowings
Corporate bonds (redeemed within one year)
Income taxes payable
Accrued bonuses to directors and employees
Other allowances
Other current liabilities
Total current liabilities
Non-current liabilities
Corporate bonds
Long-tern debt
Lease obligations
Accrued retirement benefits to employees
Accrued retirement benefits to directors
Deferred tax liabilities
Deferred tax liabilities from revaluation of land
Other non-current liabilities
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Common stock
Additional paid-in capital
Retained earnings
Less treasury stock, at cost
Total shareholders’ equity
Valuation and translation adjustments
Net unrealized gains on other securities
Revaluation of land
Foreign currency translation adjustments
Total valuation and translation adjustments
Stock acquisition rights
Minority interests
Total net assets
Total liabilities and net assets

5

As of Mar. 31, 2010

millions of yen

millions of yen

10,211
27,613
1,173
5,204
325
26,87971,40914,95334,8954,000
2,114
10,820374
19,097
86,255

7,600
48,781
3,784
10,900
443
653
993
4,732
77,888149,297

7,600
45,151
3,914
10,672
470
694
993
2,250
71,746
158,001

10,00186,78839,549(23)
136,315

10,001
85,20744,088(57)
139,239429(1,841)(165)(1,577)18
14,561
149,318
298,6151,182(1,841)
(178)
(837)
18
16,654
155,075
313,077

(2) Consolidated Statements of Income
First Quarter FY2010

Items
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income (loss)
Non-operating income
Interest income
Dividends income
Amortization of negative goodwill
Other
Total non-operating income
Non-operating expenses
Interest expenses
Equity in losses of non-consolidated subsidiaries andaffiliates
Other
Total non-operating expenses
Recurring profit (loss)
Extraordinary income
Gain on sale of investment securities
Reversal of allowance for doubtful accounts
Other
Total extraordinary income
Extraordinary loss
Loss on disposal of fixed assets
Valuation loss on investment securities
Effect of adoption of new accounting standards for asset
retirement obligations
Other
Total extraordinary loss
Income (loss) before income taxes
Income taxes: current
Income taxes: deferred
Total income taxes
Loss before minority interests
Minority interests (loss) in earnings of consolidated subsidiaries
Net income (loss)

6

First Quarter FY2011

millions of yen

millions of yen

65,85554,526
11,32910,478851

69,00758,868
10,13812,281(2,142)

19
367
22
133
543

9
435
21
227
694

262

268

57

69

92
412
981

62
400
(1,848)

20
48
0
69

119
43
13
176

29
12

-

-

2,199

6
48
1,002
260
(422)
(161)
62
1,101

288
2,487
(4,159)1,083(2,091)(1,008)(3,151)(334)(2,817)

(3) Notes on the Going-concern Assumption
Not applicable(4) Note on Significant Changes in the Amount of Shareholders’ Equity
Not applicable

7For Reference:
Supplementary Information for the First Quarter of the Fiscal Year Ending March 31, 2011
Consolidated Results and Forecasts
1. Net Sales by Business Segment(millions of yen)
FY2011
Net sales
Outsourcing andnetwork
Software development

First Quarter (A)69,007
31,127First Half
165,000
64,500

Full Year (B)346,000
131,000

45.1%

39.1%

37.9%

31,06084,500179,500

45.0%

51.2%

51.8%

4,818

13,00029,000

7.0%

7.9%

8.4%

2,001

3,000

6,500

2.9%

1.8%

1.9%

(Forecast)(Forecast)

Solution services
Other business

Progress ratio (A/B)
19.9%
23.8%
17.3%
16.6%
30.8%
(millions of yen)

FY2010Net sales
Outsourcing andnetwork
Software development

First Quarter (A)65,85530,870First Half
146,954
61,623Full Year (B)313,856
126,164

46.9%

41.9%

40.2%

27,42570,308

155,976

41.6%

47.9%

49.7%

5,798

11,79825,021

8.8%

8.0%

8.0%

1,760

3,224

6,693

2.7%

2.2%

2.1%

Solution services
Other business

Progress ratio (A/B)
21.0%
24.5%
17.6%
23.2%
26.3%

* SORUN CORPORATION’s effect on consolidated results (SORUN became a consolidated subsidiary in December 2009).
Net sales for the first quarter of FY2011: 9,194 million yen (breakdown: Outsourcing and Network segment, 2,207 million yen; Software
Development segment, 6,373 million yen; Solution Services segment, 531 million yen; Other Business segment, 82 million yen).
Net sales for the first half of FY2011(forecast): 21,730 million yen (breakdown: Outsourcing and Network segment, 4,690 million yen;
Software Development segment, 15,600 million yen; Solution Services segment, 1,190 million yen; Other Business segment, 250 million
yen).
Full-year net sales for FY2011(forecast): 46,900 million yen (breakdown: Outsourcing and Network segment, 10,690 million yen;
Software Development segment, 32,860 million yen; Solution Services segment, 2,830 million yen; in the Other Business segment, 520
million yen).
Net sales for the fourth quarter of FY2010: 14,034 million yen (breakdown: Outsourcing and Network segment, 3,093 million yen;
Software Development segment, 9,941 million yen; Solution Services segment, 917 million yen; Other Business segment, 81 million yen).
*Earnings forecasts and other forward-looking statements in this document are based on information available to the Company at the time of
preparation and certain assumptions that it believes to be reasonable. Actual results may differ materially from those expressed or implied byforward-looking statements due to various factors.

2. Orders for Software Development

Orders received during the period
Order backlog at period-end(millions of yen)
FY2011First Quarter
38,51957,028(millions of yen)Orders recevied during the period
Order backlog at period-end

FY2010First Half
69,80852,308First Quarter
38,12563,508Full Year
146,62149,569*Orders for outsourcing and network services are not stated in this report because such services are conducted on an ongoing basis.
* SORUN CORPORATION’s effect on consolidated results (SORUN became a consolidated subsidiary in December 2009).
First quarter, FY2011: 9,547 million yen in orders received, 7,012 million yen order backlog at quarter-end.
Fourth quarter, FY2010: 7,665 million yen in orders received, 3,839 million yen order backlog at quarter-end.

8