TRANSPORTA
WAREHOUSIINTERNATIO
DISTRIBUTIOCONSULTING
TRANSPORTA
WAREHOUSIINTERNATIO
DISTRIBUTIO
Annual Report 2002

For the year ended March 31, 2002

SENKO Co., Ltd.

Logistics of the Future Logistics of the Future Logisti

Profile

Established in July 1947, Senko Co., Ltd. is an integrated distribution services
company. In addition to the parent company, a total of 29 subsidiaries and 6
affiliates operate under the umbrella of the Senko Group as of March 31, 2002. Oneof the leading distribution services companies in Japan, Senko boasts a national
network of more than 200 offices, 2,740 trucks, 7 cargo ships, and 735,702 square
meters of warehouse space.
Listed on the first sections of the Tokyo Stock Exchange and the Osaka Securities
Exchange, the Company’s operations cover a wide-range of businesses, centering on
its nationwide trucking network but extending to warehousing, marine transport,
railway forwarding, in-factory work, and door-to-door international transportation.
Senko specializes in supplying integrated distribution services, from distribution
consulting to system design and operations, that closely match customer needs.
The Company plans to further expand services that improve the efficiency of the
supply chain, including sourcing, production, and sales, by combining its systems
with the latest information technology. Through these and other efforts, Senko willcontinue to develop as a logistics information company.

Disclaimer Regarding Forward-Looking Statements
Forward looking statements made in this annual report concerning performance orbusiness strategies have been determined according to assumptions and beliefs
based on information available at the time and contain elements of risk anduncertainty.

Contents

Consolidated Financial Highlights
A Message from the President
Review of Operations
Truck Transport
Warehousing
In-factory Work
OthersFinancial Review
Financial Section
Report of Independent Certified Public Accountants
Consolidated Balance Sheets
Consolidated Statements of Income
Consolidated Statements of Shareholders’ Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
Consolidated Subsidiaries and Affiliated Companies
Board of Directors and Corporate Auditors
Corporate Data

1
2
4
5
6
7
8
11
12
14
15
16
17
23
24
25

Consolidated Financial Highlights
SENKO Co., Ltd. and Consolidated Subsidiaries

Thousands of
U.S. dollars

Millions of yen
Years ended March 31

2002

2001

2002

¥173,578¥185,603$1,303,138

For the year:
Operating revenues
Operating income

4,878

5,509

36,622

Net income (loss)

2,004(3,189)15,045

Total assets

132,845

151,874

997,335

Shareholders’ equity

41,08940,572

308,476

Net income (loss)¥17.69¥(27.93)$0.13

Cash dividends

7.50

7.50

0.06

367.74355.33

2.76

At year end:

Per share data:

Shareholders’ equity

Note : U.S. dollar amounts are converted from yen, for convenience only, at the prevailing rate of ¥133.20 to U.S.$1 on
March 31, 2002.

Operating revenues
200(Billions of yen)

Net income (loss)
2,500(Millions of yen)

Net income (loss) per share
25

2,000

20

1,500

15

1,000

10

500

5

0

0

(Yen)

150

100

50

0

98

99

00

01

02

-10,000

98

99

00

01

02

-100

98

99

00

01

02

1

A Message from the President
Satisfying Our Customers and Increasing
Business Environment
In the fiscal year ended March 31, 2002, consolidated operating revenues
decreased 6.5%, to ¥173,578 million and consolidated operating income
declined 11.4%, to ¥4,878 million. Consolidated net income, however,amounted to ¥2,004 million, moving back into the black after recording a loss
in the previous fiscal year.
During the fiscal year under review, the Japanese economy faced extremely
difficult conditions. Struggling with a continuing deflationary trend, personal
consumption weakened further under pressure from harsh labor conditions
and falling personal incomes. In addition, declining exports because of theslowdown in the U.S. economy caused private sector capital investment to falloff.
Amid a declining trend in freight volume, the transportation industry also had
to contend with a severe business climate, affected by demand for lower
transportation costs from customers and intensified competition among
distribution services companies.
In response to these circumstances, Senko pressed forward with its conversion
to a logistics information company, guided by a medium-term business plan
implemented in April 2001. In heading toward its goal, the Company worked
to further increase customer satisfaction by providing them with its Best
Partner System, a new logistics system that fully utilizes information
technology, and other high quality, high-value-added distribution services.
Based on these services, the Company also promoted the development of new
demand. To increase profitability, Senko pursued greater operating efficientand progress with measures to achieve low cost operations, such cost
reduction and more efficient use of capital.
Despite these efforts, operating revenues dropped 6.5%. Looking at a breakdown, nonconsolidated revenues
declined 1.9% while revenues of subsidiaries decreased 26.0%. The fall in the parent company’s revenues despite
a 22% jump in chain-store related revenues could be attributed to the impact of declining revenues from thehousing and petroleum and plastics sectors and to customer demand for lower prices and more efficient
services. The contraction in revenues from subsidiaries came from the impact of the sale of Senko Leasing Co.,
Ltd., and a decrease in revenues from the petroleum sales business because of the Company’s decision toconcentrate its business on fewer customers in accordance with efforts to improve the efficiency of its
management of receivables.
Looking at profitability, declining revenues from the housing and petroleum and plastics sectors, customer
demand for lower prices, and other factors placed strong negative pressure on operating income, but increased
revenue from an expanded customer base in the chain store-related market, various measures to improve
efficiency, and cost reductions helped hold the fall to 11.4%.
Consolidated net income moved into the black during the fiscal year under review, rebounding from the loss inthe previous fiscal year because there were no substantial other expenses, such as the write of the difference on
conversion to a new accounting standard for its severance and retirement benefits and the establishment of aseverance and retirement benefits investment trust that were recorded last year.
Progress of Medium-Term Business Plan and Future Business Development
With still no signs of recovery, the economic climate is expected to remain severe. This holds true for the
distribution services industry as well, where it is anticipated that the volume of freight will continue to fall andcompetition among the companies in the industry intensify.

2their Profits Using Our Supply Chain and Logistics
Under these conditions, we are continuing to propose comprehensive outsourcing of a variety of distributionrelated services to our customers. At the same time, we are aiming to differentiate ourselves from ourcompetitors by developing businesses to support a supply chain management (SCM) organization that utilizes
sophisticated technology based on the distribution expertise we have developed over the years and on our Best
Partner System.
The goal of these efforts is to contribute to greater profitability by our customers while also adding to our
profits. The development of this business is a good example of the supply chain logistics that we are pursuing as
a company. Specifically, we plan to further expand our distribution center and transportation and delivery
businesses to offer comprehensive distribution services for the entire supply chain, including the procurement
and order taking operations that were previously the domain of our customers. Because of their strong benefits,
we expect our customers to be highly satisfied with these services. In addition to providing overall lower costs
for customers, our supply chain logistics services aim to increase our share of customers’ business by assuming
responsibility for their entire distribution operations and to improve our profitability by expanding distribution
services to related companies.
We are taking concrete steps to develop our supply chain logistics services. In the petrochemical and plastics
sectors, which include such major groups Asahi Chemical, Sekisui Chemical, and Chisso, we are offering toprovide services that include order taking and distribution section functions. We are participating at all stages ofthe production and delivery process, from factory shipping to transportation, storage, procurement of raw
materials and supplies, and production planning and distribution expense budget making.
In the housing-related field, we have expanded our business to cover not only the plants of Sekisui House Co.,
Ltd., and other housing manufacturers, but also the procurement side of the business, including the distributionof the material producers that supply the housing manufacturers plants. We have also expanded our customer
base, adding such new customers as Toyota Home and Misawa Homes.
Our chain store-related business is also growing favorably. The services that we provide to many home center,drug store, and specialty store chains have helped our revenues in this business to quadruple over 10 years.
To improve profitability, we are thoroughly pursuing the establishment of low cost operations through businessrationalization and improved efficiency. In conjunction with these efforts, we are aiming to further strengthen
our financial position, including our ongoing program to reduce interest-bearing debt. I believe that thesemeasures will provide more specific advances in our pursuit of aggressive expansion and low cost operations aspart of our conversion to a logistics information company, the fundamental concept of our medium-termbusiness plan.
To Our Shareholders
As a Company, we consider the distribution of profits to shareholders as one of our most importantmanagement issues. For that purpose, our basic dividend policy is to target stable dividend payments thatreflect underlying corporate performance while also retaining sufficient internal capital reserves to provide forbusiness development and strengthening our business structure.
During the fiscal year under review, we paid interim and year-end cash dividends of ¥3.75 per share for a fullyear cash dividend of ¥7.50 per share.
As we pursue the goals of our medium-term business plan, we look forward to the continued support of ourshareholders.
June 2002

Hiroshi Koike
President and Representative Director

3

Review of Operations

Truck Transport
There was strong growth in our chain store-related business, including
supermarket-related cargo business related to the expansion of the Sendai
PD Center and the development of new demand for drug store-related
freight services in the Miyazaki region. Despite this growth, freight
volume fell because of declining demand from the housing-related
demand, with materials-related transportation also decreasing.
Consequently, truck transport operating revenues slid 3.6%, to ¥85,818
million.

Operating revenues
120(Billions of yen)100

Share of revenues

80

60

40
49.4%
20

0

4

98

99

00

01

02

The Senko Group’s truck transport operations have developed an
extensive nationwide network, providing our customers withtransportation and delivery services that match their products anddistribution structure, including exclusive, combination, route, and joint
transport services. We transport industrial raw materials, machine
products, construction materials, housing materials, agricultural
products, general commodities as well as providing moving serviceshandling almost anything to do with clothing, food, and housing. We
boast a diversified fleet comprised of regular trucks, large-trucks, andtrailers as well as specialty cargo trucks, such as tanker, loose powder
carrying, and refrigerated trucks. Our ability to transport items andmaterials correctly has won Senko high marks from manufacturers andother customers.

Warehousing

Share of revenues

Centered on the Sendai PD Center and other facilities,
aggressive efforts were made during the fiscal year
under review to develop new chain store-related cargobusiness. These efforts and the start of operations at the
Urawa Distribution Center contributed to earnings. As aresult, warehousing operating revenues advanced 5.0%,
to ¥21,531 million.
Our warehouses present a very different image from thewarehouses of the past. They are integrated function
distribution centers that combine a warehouse’s
distribution processing functions, such as storage,
delivery, set assembly, and labeling with advanced
information system services.
Presently, we have 172 facilities at our major
distribution points nationwide providing total storage
space of 730,000 square meters. Using thesewarehousing bases, we combine information services
and distribution services utilizing a system that
anticipates the needs of our diversified customers.
These capabilities allow us to offer a full range ofdistribution services that support our customers’
production and sales operations.

12.4%

Operating revenues
25(Billions of yen)

20

15

10

5

0

98

99

00

01

02

5

Review of Operations

Share of revenues

In-Factory WorkIn addition to the decline in business volume fromhousing-related markets, in-factory work business,principally materials-related cargo, also dropped,
resulting in operating revenues dipping 4.9%, to ¥14,703
million.
In-factory work comprises such distribution andproduction processes as unloading raw materials at ourcustomers’ factories, warehouses, and other sites. It also
includes wrapping, packaging, and loading products.
These professional distribution services support the
management of the flow of materials and products
within the factory.

8.5%

Operating revenues
20(Billions of yen)

15

10

5

0

6

98

99

00

01

02

Others
New business from the chain store-related market provided revenue growthduring the fiscal year under review. Nevertheless, a contraction in petroleum
and merchandise sales because of the sale of the consolidated subsidiary
Senko Leasing Co., Ltd., and a reduction in the number of customers as partof efforts to improve efficiency in receivables management produced a 14.9%
decline in operating revenues to ¥51,527 million.

Share of revenues

Operating revenues
60

The others business category of the Senko Group includes railway
forwarding on trunk routes; marine transport by container, mixed cargoscheduled, and specialty ships; leasing of specialized warehouses forcustomers and warehouse space; door-to-door international freight
forwarding; petroleum sales; merchandise sales; data processing; softwaredevelopment; general leasing; and vehicle maintenance.

(Billions of yen)

29.7%
50

40

30

20

10

0

98

99

00

01

02

7

Financial Review

Performance
Operating revenues for the fiscal year ended March 2002
decreased 6.5%, to ¥173,578 million. Operating revenues declined
despite the increase in wholesale and retail-related revenues
because of falling housing-related and petroleum and plastics
revenues, customer demands for greater efficiency and lower
costs, the sale of Senko Leasing Co., Ltd., and reduced revenues
from the petroleum sales business.
The overall decline in revenues, falling prices for distribution
services, and rising costs due to hikes in long-term care insurance
and employment insurance premiums place downward pressure
on profitability. As a result, operating income decreased 11.4%, to¥4,878 million and the operating income ratio declined 0.2%, to
2.8%.
Income before income tax and minority interests reversed fromthe loss recorded in the previous fiscal year to positive income
totaling ¥3,493 million. This rebound can mainly be attributed to
the lack of the substantial other expenses booked last year for
writing off the difference on conversion to a new accounting
standard for its severance and retirement benefits and forestablishing a severance and retirement benefits investment trust.
Consequently, consolidated net income amounted to ¥2,004
million.
Performance by Business Segment
Truck transport operating revenues for the fiscal year underreview decreased ¥3,235 million, or 3.6%, to ¥85,818 million,
generating 49.4% of total operating revenues. Operating revenues

Operating revenues

decreased despite the continued expansion in volume of cargohandled for chain stores achieved through an emphasis on
developing new customers because of a 10.2%, or ¥2,989 million,
drop in housing-related cargo revenues due to stagnant demand.
The operating revenues of our warehousing business, which
accounted for 12.4% of total operating revenues, totaled ¥21,531
million, rising ¥1,028 million, or 5.0%. This increase resulted fromgrowth in chain store-related cargo business as well as the
additional business contributed by the coming on stream of the
Urawa Distribution Center.
Accounting for 8.5% of total operating revenues, in-factory
operating revenues slipped ¥759 million, or 4.9%, to ¥14,703
million. Lower housing cargo related business and a decline in infactory services, mainly material-related cargo services for
petroleum and plastics-related customers produced the fall inrevenues.
Despite an increase in chain-store related revenues, operating
revenues slid ¥9,057 million, or 14.9%, to ¥51,527 million under the
impact of lost revenues due to the sale of Senko Leasing Co., Ltd.
Others operating revenues contributed 29.7% of total operating
revenues during the fiscal year. The others segment comprises
railway forwarding, marine transport, leasing of specialized
warehouses for customers and warehouse space, door-to-doorinternational freight forwarding, petroleum-related sales,
merchandise sales, and others.
Performance by Products Handled
The three core products types handled by the Company are

Operating income

Net income

Ratio of SG&A
expenses to operating revenues

200(Billions of yen)

7,000(Millions of yen)

2,500

6,000
150

(Millions of yen)

5

(%)

2,000

5,000
1,500
4

4,000
1,000

100
3,000

500
2,000
50

0

8

98

99

00

01

02

0

3

0

1,000

98

99

00

01

02

-10,000

98

99

00

01

02

0

98

99

00

01

02

Consolidated Operating Revenues by Products Handledhousing-related, petroleum-related and plastic, andwholesale and retail-related products. For the fiscal year
ended March 2002, they accounted for 52.1% of ouroperating revenues. Among these three core producttypes, operating revenues from housing-related
products decreased ¥3,910 million, or 9.2%, to ¥38,660
million and accounted for 22.3% of total operating
revenues. Petroleum-related and plastic operating
revenues declined ¥530 million, or 1.6%, to ¥32,770
million, and contributed 18.9% of total operating
revenues. Continuing to realize the benefits a focused
growth strategies, operating revenues from wholesale
and retail-related products increased ¥3,380 million, or
21.9%, to ¥18,860 million, accounting for 10.9% of total
operating revenues.

(Units: billions of yen, %)In housing-related products operating revenues, thedecline in housing starts resulted in a contraction in
total operating revenues because of the drop in factory
shipments, but the supply business for factory materials
grew favorably, with revenues expanding 16%.
Petroleum-related and plastic products operating
revenues grew thanks to an increase in cargo volume
due to the start up of operations at Urawa Distribution
Center, but growth was dampened by the decline in thevolume of plastic raw materials cargo. On the other
hand, wholesale and retail-related products operating
revenues grew substantially because of increased
business volume from major home centers, direct sales
companies, and other existing customers as well as
additional business from large supermarkets, drugs

Operating income / net
income to operating revenues
4(%)

Net income per share

40

Operating income tooperating revenues

3

30

2

20

Year ended March 2002

Year ended March 2001

Revenues

Composition

Revenues

Composition

Change% Change

Housing

38.6

22.3

42.5

22.9

-3.9

-9.2

Petroleumrelated products,
and plastics

32.7

18.9

33.3

17.9

-0.6

-1.8

Wholesaleand retail

18.8

10.9

15.4

8.3

3.4

22.1

Chemicals andfertilizers

5.2

3.0

5.4

2.9

-0.2

-3.7

Foods

4.1

2.4

4.1

2.2

0.0

0.0

Electronics
products andmachinery

2.8

1.7

2.8

1.5

0.0

0.0

Textile goods

3.0

1.8

3.3

1.8

-0.3

-9.1

Others

67.9

39.0

78.5

42.5

-10.6

-13.5

Total

173.5

100.0

185.6

100.0

-12.1

-6.5

Cash dividends per share(Year ended March 2002)

(Yen)

(Yen)

8

Net income tooperating revenues
1

10

0

0

-5

98

99

00

01

02

-100

Composition of
products handled

22.3%

Housing

18.9%

Petroleum-related products
and plastics

10.9%

Wholesale and retail

47.9%

Others

7

98

99

00

01

02

0

98

99

00

01

02

9

stores, and other new customers.
Financial Position
Total assets at March 31, 2002 contracted ¥19,029 million, to¥132,845 million. Current assets decreased ¥8,873 million, to¥43,658 million, because of a decline in cash and cash equivalents
resulting from active efforts to reduce interest-bearing debt and afall in inventories related to the sale of Senko Leasing Co., Ltd.
Fixed assets declined ¥10,156 million, to ¥89,187 million, primarily
because of a drop in property and equipment. During the fiscal
year under review, The Company invested a total of ¥2,958 million
in property and equipment for the Sendai PD, the Oita Medical,
and the Miyazaki Distribution centers among other facilities.
Nevertheless, because of the elimination of ¥9,185 million in leased
assets due to the sale of Senko Leasing Co., Ltd., net property andequipment declined ¥10,012 million to ¥69,372 million.
At March 31, 2002, liabilities totaled ¥91,756 million, a decrease of¥19,547 million from the previous fiscal year.
Current liabilities increased ¥2,132 million, to ¥45,993 million.
Although trade accounts and notes payable declined substantiallybecause of the sales of Senko Leasing Co., Ltd., current liabilities
rose overall because of the increase in the current portion of longterm debt.
Conversely, long-term liabilities decreased ¥21,679 million, to¥45,763 million. This decrease mainly resulted from a ¥20,304
million contraction due to the establishment of a debt assumption
trust for an unsecured bond and the transfer of current portion of

Total assets

160

long-term debt to current liabilities. Consequently, interestbearing debt at the end of the fiscal year under review declined¥1,368 million, to ¥48,700 million. Along with this decline, theinterest-bearing debt ratio improved 3.6%, to 36.7%. Shareholders’equity at fiscal year end amounted to ¥41,089 million,
approximately the same as in the previous fiscal year.
Cash FlowsNet cash provided by operating activities for the year ended
March 31, 2002, declined ¥5,846 million, to ¥4,031 million. Thisdecrease can primarily be attributed to a reduction in depreciation
and amortization expenses due to the sale of Senko Leasing Co.,
Ltd., and an increase in income tax paid.
Net cash used in investing activities amounted to ¥1,083 million,
falling ¥5,638 million from the previous fiscal year. The recovery
of cash due to the collection of loans to Senko Leasing upon its saleand a reduction in payment for the purchase of leases as fixed
assets as a result of Senko Leasing’s exclusion from consolidation
were primarily responsible for this decline.
Consequently, free cash flow at fiscal year end totaled ¥2,948
million, down ¥207 million from the previous fiscal year.
Net cash used in financing activities amounted to ¥5,554 million,
increasing ¥2,226 million from a year earlier. This increase resulted
primarily from the establishment of a debt assumption trust for a¥10,000 unsecured bond issue as part of efforts to improve theCompany’s financial position by reducing total assets and interestbearing debt.

Total shareholders’equity / ratio(Billions of yen)

55

150

(Billions of yen)(%)

ROE / ROA

35

50

30

45

25

5

4

3
40

20

35

15

30

10

25

5

(%)

ROE

2

140

1
130

0

10

ROA

98

99

00

01

02

0

98

99

00

01

02

0

0

-15

98

99

00

01

02

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To the Board of Directors of SENKO Co., Ltd.

We have examined the accompanying consolidated balance sheets of SENKO Co., Ltd. and its consolidated
subsidiaries at March 31, 2001 and 2002 and the related consolidated statements of income, shareholders’ equity, andcash flows for the years then ended, all expressed in Japanese yen. Our examinations were made in accordance withauditing standards, procedures and practices generally accepted and applied in Japan and, accordingly, included
such tests of the accounting records and such other auditing procedures as we considered necessary in thecircumstances.

In our opinion, the consolidated financial statements referred to above, expressed in Japanese yen, present fairly the
consolidated financial position of SENKO Co., Ltd. and its consolidated subsidiaries at March 31, 2001 and 2002, theconsolidated results of their operations and their cash flows for the years then ended, in conformity with accounting
principles and practices generally accepted in Japan applied on a consistent basis.

The United States dollar amounts shown in the accompanying consolidated financial statements have been translated
solely for convenience. We have reviewed this translation and, in our opinion, the consolidated financial statements
expressed in Japanese yen have been translated into United States dollars on the basis described in Note1.

Ohtemae Audit Corporation
Osaka, Japan
June 27, 2002

11

Consolidated Balance Sheets
SENKO Co., Ltd. and Consolidated Subsidiaries March 31, 2002 and 2001
Thousands of
U.S.dollars

Millions of yen

ASSETS

2002

2001

2002

¥ 15,264¥ 17,869$ 114,594

105

177

788

24,80925,526

186,254

(180)

(63)

(1,351)

1,018

5,669

7,643

323

333

2,425

2,319

3,020

17,41043,65852,531

327,763

Investments in and long-term loans to non-consolidated subsidiaries and affiliates

441

501

3,311

Investment securities (Notes 3 and 7)

874

1,128

6,562

121,063

144,053

908,881Less accumulated depreciation(51,691)(64,669)(388,071)

Net property and equipment

69,372

79,384

520,810Deferred tax assets-non-current (Note 11)

9,615

9,563

72,185

Other assets

8,885

8,767

66,704¥ 132,845¥ 151,874$997,335

Current assets:
Cash and cash equivalents
Trade accounts and notes receivable—
Non-consolidated subsidiaries and affiliates
OthersLess allowance for doubtful accounts
Inventories
Short-term loans to non-consolidated subsidiaries and affiliates
Prepaid expenses and other current assets
Total current assets

Property and equipment, at cost (Notes 4 and 7)

Total assets

See the accompanying notes to the consolidated financial statements.

12

Thousands of
U.S.dollars

Millions of yen

LIABILITIES AND SHAREHOLDERS’ EQUITY

2002

2001

2002

Short-term loans (Note 5)¥ 8,650¥ 5,700$ 64,940

Current portion of long-term debt (Note 5)

14,7397,541

110,653

141

158

1,059

13,027

19,76497,800

2,422

3,054

18,183

Accrued income taxes

837

1,654

6,284

Other current liabilities

6,177

5,990

46,37445,99343,861

345,293Long-term debt, less current portion (Note 5)

25,284

46,140189,820

Accrued severance indemnities (Note 6)

17,357

17,422

130,308

Other long-term liabilities

3,122

3,879

23,438

Total liabilities

91,756111,302688,859

18,296

18,296

137,357

Additional paid-in capital

16,387

17,001

123,026

Retained earnings

6,422

5,275

48,213

Unrealized holding loss on securities

(13)

—

(98)

Less treasury stock, at cost

(3)

(0)

(22)

41,08940,572

308,476¥ 132,845¥151,874$997,335

Current liabilities:

Trade accounts and notes payable—
Non-consolidated subsidiaries and affiliates
Others
Accrued expenses

Total current liabilities

Contingent liabilities (Note 8)
Shareholders’ equity (Note 10):
Common stock, no par value in 2002 and¥50 par value in 2001
Authorized-294,999,000 shares in 2002 and
297,433,000 shares in 2001
Issued-111,746,167 shares in 2002 and114,180,167 shares in 2001

Total shareholders’ equity
Total liabilities and shareholders’ equity

See the accompanying notes to the consolidated financial statements.

13

Consolidated Statements of Income
SENKO Co., Ltd. and Consolidated Subsidiaries Years Ended March 31, 2002 and 2001
Thousands of
U.S.dollars

Millions of yen

2002

2001

2002

¥ 85,818¥ 89,054$ 644,279

87,76096,549658,859

173,578

185,6031,303,138

Truck transport

80,587

83,134605,008

Others81,35389,345

610,758

Selling, general and administrative expenses

6,760

7,615

50,750Total operating costs and expenses

168,700

180,094

1,266,516

4,878

5,509

36,622

Interest and dividend income

182

355

1,366

Interest expenses(816)(1,061)(6,126)

Others, net(751)(9,576)(5,638)(1,385)(10,282)(10,398)

3,493(4,773)

26,224Current

1,614

2,541

12,117

Deferred(125)(4,123)

(938)

1,489

(1,582)

11,1792,004(3,191)

15,045

Minority Interests

—

2

—

Net income(loss)¥ 2,004¥ (3,189)$ 15,045

Operating revenues:
Truck transport
OthersTotal operating revenues
Operating costs and expenses:

Operating income
Other income (expenses):

Income(Loss) before income taxes and minority interests
Income taxes (Note11):

Income(Loss) before minority interests

Yen

Net income(loss) per share¥17.69

U.S.dollars¥ (27.93)$ 0.13

See the accompanying notes to the consolidated financial statements.

14

Consolidated Statements of Shareholders’ Equity
SENKO Co., Ltd. and Consolidated Subsidiaries Years Ended March 31, 2002 and 2001
Millions of yen

Thousands
Number ofshares ofcommon stock
issuedCommon stock

Additional
paid-in capital

114,180¥ 18,296¥ 17,001

Increase as a result of merger——

Net loss—

Cash dividends

Unrealized
holding loss on
securities

Treasury stock¥ 9,467

¥—

¥ (0)

—

24

—

—

—

—

(3,189)

—

—

—

—

—

(856)

—

—

Increase of treasury stock

—

—

—

—

—

(0)

Decrease in translation adjustments offoreign currency financial statements

—

—

—

(171)

—

—

114,180

18,29617,001

5,275

—

(0)

Net income

—

—

—

2,004

—

—

Cash dividends

—

—

—

(857)

—

—

Unrealized holding loss on securities

—

—

—

—

(13)

—

Increase of treasury stock

—

—

—

—

—

(3)

Retirement treasury stock(2,434)

—

(614)

—

—

—

111,746¥ 18,296¥ 16,387¥ 6,422¥ (13)¥ (3)Unrealized
holding loss on
securities

Treasury stock

Balance at April 1, 2000

Balance at March 31, 2001

Balance at March 31, 2002

Retainedearnings

Thousands of U.S. dollars

Common stock

Additional
paid-in capital

Retainedearnings$ 137,357$ 127,635$ 39,602

$—

$ (0)

Net income——

15,045——

Cash dividends——(6,434)——

Unrealized holding loss on securities

—

—

—

(98)

—

Increase of treasury stock

—

—

—

—

(22)

Retirement treasury stock—(4,609)———$ 137,357$ 123,026$ 48,213$ (98)$ (22)

Balance at March 31, 2001

Balance at March 31, 2002

See the accompanying notes to the consolidated financial statements.

15

Consolidated Statements of Cash FlowsSENKO Co., Ltd. and Consolidated Subsidiaries Year Ended March 31, 2002 and 2001
Thousands of
U.S.dollars

Millions of yen

Cash flows from operating activities:
Income(Loss) before income taxes and minority interests
Adjustments for:
Depreciation and amortization
Gain on sale of affiliates
Loss on disposals of property and equipment
Loss from devaluation of investment securities
Amortization of transitional obligation for employees’ severance indemnities
Retirements benefit trust loss
Decrease in employees’ past severance indemnities
Decrease in accrued bonuses to employees
Interest and dividend income
Interest expenses
Devaluation of land
Write-off of investment securities
Increase(Decrease) in trade receivable
Increase in inventories
Increase in trade payableOther
Sub totalInterest and dividend income received
Interest expenses paid
Income tax paid
Net cash provided by operating activities
Cash flows from investing activities:
Payments for purchases of fixed assets
Proceeds from sales of fixed assets
Payments for purchases of investment securities
Proceeds from sales of investment securities
Decrease in short-term loans, net
Proceeds from sales of subsidiary
Other
Net cash used in investing activities
Cash flows from financing activities:
Increase in short-term debt, net
Proceeds from long-term debt
Repayment of long-term debt
Purchases of treasury stock retired
Dividends paid
Other
Net cash provided by financing activities
Effect of exchange rate changes on cash and cash equivalents
Net decrease in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents increased by merger
Cash and cash equivalents at end of year

2002

2001

2002

¥ 3,493¥ (4,773)$26,224

3,477
(668)
212
203
—
—
—
(607)
(182)
816
—
—
828
(246)
12
(163)
7,175
195
(910)
(2,429)
4,031

6,903
—
—
—
10,391852(3,243)
—
(355)
1,061
851
500
(1,884)(1,543)3,322
217
12,299351(1,049)(1,725)
9,876

26,104(5,015)
1,592
1,524
—
—
—
(4,557)(1,366)
6,126
—
—
6,216
(1,847)90(1,224)53,867
1,464(6,832)(18,236)
30,263(2,983)
123
(190)
247
1,313
496
(89)
(1,083)(8,865)
1,165
(758)
1,033
—
—
704
(6,721)(22,395)923(1,426)
1,854
9,857
3,724
(668)
(8,131)

2,950
11,424(18,438)
(615)
(857)
(18)
(5,554)1(2,605)
17,869—¥ 15,264

2,945
2,898
(8,315)—(856)(0)(3,328)4(169)
17,882156¥ 17,869

22,14785,766(138,424)(4,617)(6,434)(135)(41,697)8(19,557)
134,151—$114,594

See the accompanying notes to the consolidated financial statements.

16

Notes to the Consolidated Financial Statements
SENKO Co., Ltd. and Consolidated Subsidiaries

1. Basis of Presenting Consolidated Financial Statements:
SENKO Co., Ltd. (the “Company”) and its domestic subsidiaries maintain their accounts and records in accordance with the provisions set forthin the Commercial Code of Japan (the “Code”) and the Securities and Exchange Law and in conformity with accounting principles and practices
generally accepted in Japan, which are different from the accounting and disclosure requirements of International Accounting Standards.
The Company’s overseas subsidiary maintains its accounts and records in conformity with generally accepted accounting principles andpractices prevailing in the country of its domicile.
The accompanying consolidated financial statements are prepared based on consolidated financial statements of the Company and its
subsidiaries(the“Companies”) which were filed with the Director of Kanto Local Finance Bureau as required by the Securities and Exchange Law.
In preparing the accompanying consolidated financial statements, certain reclassifications and rearrangements have been made to theconsolidated financial statements issued domestically in order to present them in a form which is more familiar to readers outside Japan.
The translation of the Japanese yen amounts into U.S. dollars is included solely for the convenience of the reader, using the exchange rate
prevailing at March 31, 2002, which was ¥ 133.20 to US$1.00. These convenience translations should not be construed as representations that theJapanese yen amounts have been, could have been, or could in the future be, converted into U.S.dollars at this or any other rate of exchange.

2. Summary of Significant Accounting Policies:(a) Principles of consolidation
The consolidated financial statements include the accounts of the Company and its significant subsidiaries. All significant intercompany
balances and transactions are eliminated. Non-consolidation of subsidiaries, whose combined assets, net sales, net income and retained earnings
in the aggregate are not significant in relation to those of the consolidated with the Companies.
Adjustment for consolidated account, at the time of acquisition, between the cost and underlying net equity of investments in consolidated
subsidiaries are amortized over a five-year period on straight-line method.
The Company has adopted the equity method of accounting for investments in significant affiliates. The investments in other insignificant
unconsolidated subsidiaries and affiliates are stated at cost.
(b) Cash equivalents
Cash and cash equivalents comprise cash in hand, deposits held at call with banks, net of overdrafts and all highly liquid investments withmaturities of three months or less.
(c) Investment Securities
Effective April 1, 2000, the Companies adopted the Accounting Standards for Financial Instruments which issued by the Business Accounting
Deliberation Council. In accordance with the new standards, securities are classified into three categories: trading securities, held-to-maturity debt
securities, equity investments in associates and other securities. Based on this classification, the Companies have no trading securities and no heldto-maturity debt securities. All other securities have been included in investment securities as noncurrent assets. Through March 31, 2001, othersecurities were stated at cost determined by the moving average method.
Effective April 1, 2001, marketable securities classified as other securities are stated at fair value with changes in unrealized holding gain or loss,
net of the applicable income taxes, reported in a separate component of shareholders’ equity. Non-marketable securities classified as othersecurities are started at cost. The cost of other securities are determined by the moving average method.
(d) Allowance for Doubtful Accounts
The allowance for doubtful accounts is stated in amounts considered to be appropriate based on the companies’ past credit loss experience andan evaluation of potential losses in the receivables outstanding.
(e) Inventories
Purchased goods are stated at cost determined by the first-in first-out method. Supplies are stated at cost determined by the moving-average
cost method. Real estate for sale and work in process are stated at cost determined by the specific cost method.
(f) Property and Equipment and Depreciation
Property and equipment are stated at cost. Depreciation is principally computed at rates based on the estimated useful lives of assets using thedeclining-balance method except for buildings for which the straight-line method is applied.
The principal estimated useful lives are as follows:
Buildings and structures
3 to 60 years
Machinery and equipment
3 to 17 years(g) Accrued Severance Indemnities and Pension Plan
Effective April 1, 2000, the Companies adopted the Accounting Standards for Retirement Benefit which was issued by the Business Accounting
Deliberation Council. In accordance with the new standards, accrued severance indemnities are provided based on the account of projected
benefit obligation reduced by pension plan assets at fair value at the end of annual period.
Employees’ retirement benefits, covering employees of the Company and certain consolidated subsidiaries, are provided through unfunded
lump-sum benefit plans and funded noncontributory pensions plans.
Under the plans, eligible employees are entitled, under most circumstances, to severance payments based on compensation at the time ofseverance and years of service.
In addition, the Company and certain consolidated subsidiaries have a contributory funded pension plan for most employees.
The Company and certain consolidated subsidiaries also have a severance indemnity plan for directors and corporate auditors, whose accrued
severance indemnities are stated at 100% of the amount which is computed according to internal rules.
Actuarial gains and losses is amortized by the straight-line method over a period of 14 years, which is within the estimated average remaining
years of service of the Group’s employees. The amortization of such gains and losses is recognized effective the year subsequent to the year inwhich they are incurred.

17

(h) Income Taxes
Deferred income taxes are recognized by the asset and liability method. Under the asset and liability method, deferred tax assets and liabilities
are determined based on difference of between financial reporting and the tax basis of the assets and liabilities, and are measured using theenacted tax rate and laws that will be in effect when the differences are expected to reverse.
(i) Appropriation of Retained Earnings
Cash dividends, transfers to legal reserve and bonuses to directors and corporate auditors are recorded in the financial year in which a
proposed appropriation of retained earnings is approved by shareholders.
(j) Leases
In Japan finance leases other than those that are deemed to transfer the ownership of the leased assets to lessees are accounted for by a method
similar to that applicable to ordinary operating leases.
(k) Net Income Per Share
Net income per share is based on the weighted average number of shares of common stock outstanding during the relevant year.
(l) Translation of Foreign Currencies
Effective April 1, 2000, the Companies adopted the revised accounting standards for foreign currency transactions which issued by the BusinessAccounting Deliberation Council. In accordance with the revised standards, all monetary assets and liabilities denominated in foreign currencies
are translated into Japanese yen at the exchange rate at the balance sheet date. Revenue and expenses are translated at the rate of exchange
prevailing when transactions are made.
Assets and liabilities of foreign subsidiary are translated into Japanese yen at the exchange rates in effect on the respective balance sheet dates.
Revenue and expenses are translated at the average rate of exchange for the respective years.
(m) Consumption Tax
The consumption tax is not included in the amount of “Operating revenues” and “Operating costs” and expenses.

3. Investment Securities
The carrying amounts of securities in current assets and investment securities at March 31,2002 and 2001, consisted of the following:—
Millions of yen
2002
2001
¥ 378
¥ 662
496
466
¥ 874
¥ 1,128¥ 874¥ 1,091

Marketable securities
Non-marketable equity securities
Market value of marketable equity securities

Thousands of
U.S.dollars
2002$ 2,838
3,724$ 6,562$ 6,562

The following is a summary of marketable securities included in investment securities at March 31, 2002:—
Millions of yen
Gross
Gross
Acquisition
unrealized
unrealized
2002
cost
gains
lossesEquity security
¥ 390
¥ 11
¥ (34)
Bonds and Others
11
0
(0)
¥ 401
¥ 11
¥ (34)

Book
value(Market value)
¥ 367
11
¥ 378

Thousands of U.S.dollars
Gross
Gross
unrealized
unrealized
gains
losses$83$(256)
0(0)$83$(256)

Book
value(Market value)$2,75583$2,8382002
Equity security
Bonds and Others

Acquisition
cost$2,92883$3,011

Proceeds from sales of available-for-sales securities were ¥ 248 million (US$1,862 thousand) and ¥ 982 million for the years ended March 31,
2002 and 2001, respectively. The gross realized gains and losses on those sales were ¥ 91 million (US$683 thousand) and ¥ 100 million (US$751
thousand), respectively, for the year ended March 31,2002. The gross realized gains and losses on those sales were ¥ 309 million and ¥ 204 million,
respectively, for the ended March 31,2001.

4. Property and Equipment:
At March31,2002 and 2001,property and equipment at cost consisted of the following:—

Land
Buildings and structures
Machinery and equipment, Vehicle and Vessels
Tools, furniture and fixtures
Construction in Progress

18

Millions of yen
2002
2001
¥ 34,529¥ 34,475
64,78963,004
18,41824,683
3,191
21,358136
533¥ 121,063¥ 144,053

Thousands of
U.S.dollars
2002$ 259,227
486,404
138,273
23,956
1,021$ 908,881

5. Short-term Loans and Long-term Debt:
At March31, 2002 and 2001, short-term loans consisted of the following:—

0.7875% to 1.375% unsecured loans from banks

Millions of yen
2002
2001
¥ 8,650¥ 5,700

Thousands of
U.S.dollars
2002$ 64,940

Millions of yen
2002
2001
¥ 45
¥ 45
13,33013,8375,000
10,0005,000
10,000Thousands of
U.S.dollars
2002
$ 337
100,075
37,53837,538At March 31, 2002and 2001,long-term debt consisted of the following:—

2.30% mortgage convertible bonds due 2002 (Note 1)
0.45% convertible bonds due 2003 (Note 2)
3.25% bonds due 2004 (Note 3)
2.025% bonds due 2002 (Note 3)
0.60% to 4.90% loans from banks and insurance companies:
SecuredUnsecured—
16,64840,023(14,739)¥ 25,284

Less current portion

6,631
13,16853,681(7,541)¥ 46,140—
124,985
300,473(110,653)$ 189,820

Notes: 1. In August 1987,the Company issued ¥5,000 million principal amount of 2.3 per cent. mortgage convertible bonds due 2002. At April 1,
2002, holders of the bonds were entitled to convert such bonds into 82 thousand shares of common stock of the Company. The bonds areconvertible at any time before September 27, 2002 at a conversion price of ¥545.90 per share.
2. In April 1996,the Company issued ¥15,000 million principal amount of 0.45 per cent. convertible bonds due 2003. At April 1, 2002,
holders of the bonds were entitled to convert such bonds into 21,520 thousand shares of common stock of the Company. The bonds areconvertible at any time before September 29, 2003 at a conversion price of ¥697 per share.
3. The bond was accounted for as redeemed due to a debt assumption contract. The debt assumption contract requires a counterparty toassume obligations of paying principal and interests on bond. See Note 8 for underlying obligations of the Company.
The annual maturities of long-term debt at March 31, 2002 for the next five years are as follows:—
Year ending
March 31
2003
2004
2005
2006
2007

Millions of yen¥ 14,739
14,865
5,869
4,550
—

Thousands of
U.S.dollars$ 110,653
111,600
44,061
34,159—6. Accrued Severance indemnities:
The following tables sets forth the changes in benefit obligation, plan assets and funded status of the Company and its subsidiaries at March 31,
2002 and 2001.
Thousands ofMillions of yen
U.S.dollars
2002
2001
2002
Benefit obligation at the end of year
¥ (58,758)¥ (55,806)$ (441,126)
Fair value of plan assets at the end of the year
29,80932,706
223,791
Funded status:
Benefit obligation in excess of plan assets(28,949)(23,100)(217,335)
Unrecognized actuarial loss
11,592
5,678
87,027
Accrued pension liability recognized in the consolidation balance sheets¥ (17,357)¥ (17,422)$ (130,308)

Severance and pension costs of the Company and its subsidiaries included the following components for the year ended March 31, 2002 and2001.
Thousands ofMillions of yen
U.S.dollars
2002
2001
2002
Service cost
¥ 1,808¥ 1,918$13,573
Interest cost
1,936
1,942
14,535
Expected return on plan assets(1,336)(1,399)(10,030)
Amortization:
Transition obligation at date of adoption—
10,391—
Prior service cost (credit)—(3,243)—
Recognized actuarial loss
406
—
3,048
Net periodic benefit cost
¥ 2,814¥ (9,609)$21,126

19

Assumption used in the accounting for the defined benefit plans for the year ended March 31, 2002 and 2001 is as follows:
2002
straight-line basis
3.5%
Primarily4.8%

Method of attributing benefit to periods of service
Discount rateLong-term rate of return on fund assets
Amortization period of transition obligation at date of adoption
Amortization period of prior service cost
Amortization period of actuarial losses—
1 year14 years

2001
straight-line basis
3.5%
primarily4.8%
1 year
1 year14 years

7. Pledged Assets:
The following assets were pledged as collateral as at March 31, 2002 and 2001:—
Millions of yen
2002
2001
¥ 5,483¥ 5,483
2,902
3,034
2
3
10
10
—
7,945
¥ 8,397¥ 16,475

Land
Buildings
VehiclesInvestment securities
Lease receivables

Thousands of
U.S.dollars
2002$ 41,164
21,78715
75—$ 63,041

Obligations which were secured on the above assets were as follows:—

Long-term debt, including current portion

Millions of yen
2002
2001
¥ 45
¥ 6,676

Thousands of
U.S.dollars
2002
$337

Millions of yen
2002
2001
¥ 113
¥ 77
2,722
—
29
3,000
209
—
¥ 3,073¥ 3,077

Thousands of
U.S.dollars
2002
$ 848
20,435218
1,569$ 23,070

8. Contingent Liabilities:
At March 31, 2002 and 2001, contingent liabilities were as follows:

Guarantees of loans to non-consolidated subsidiaries and affiliates
Guarantees of installment obligation and lease obligation for others
Notes discounted
Buyback obligations associated with securitization of receivables

In addition to the above, at March 31, 2002, the Company was committed to provide guarantees for the following bonds which were transferred
to banks under debt assumption agreements.
Thousands ofDate of
Millions of yen
U.S.dollars
agreement
3.25% bonds due 2004
¥ 5,000$ 37,538
Jul. 24, 2001
2.025% bonds due 2002
5,000
37,538Jul. 24, 2001
¥ 10,000$ 75,076

9. Lease:
At March 31, 2002 and 2001, financing lease transactions whose ownership are not to be transferred were as follows:

Machinery and equipment
Tools, furniture and fixtures

Machinery and equipment
Tools, furniture and fixtures

20

Purchasecost¥ 9,265
11,025¥ 20,290

Thousands of
U.S.dollars
2002

Millions of yen
2002
Accumulated
depreciation¥ 4,699
4,750¥ 9,449

Book value¥ 4,566
6,275¥ 10,841

Book value$ 34,279
47,109$ 81,388

Cost¥ 4,612
4,481¥ 9,093

Millions of yen
2001
Accumulated
amortization¥ 2,645
2,010¥ 4,655

Net amount¥ 1,967
2,471¥ 4,438

At March 31, 2002 and 2001, lease obligations were as follows:

Millions of yen
2002
2001
¥ 3,577¥ 1,418
7,868
3,195¥ 11,445¥ 4,613

Due within one year
Due after one year

Thousands of
U.S.dollars
2002$ 26,854
59,069$ 85,923

10. Shareholder’s equity
On October 1, 2001, an amendment (the “Amendment”) to the Code became effective. The Amendment eliminates the stated par value of theCompany’s outstanding shares, which results in all outstanding shares having no par value as of October 1, 2001. The Amendment also provides
that share issuances after September 30, 2001 will be of shares with no par value. Prior to the Amendment, the Company’s shares of common stock
had a par value of ¥50 per share.
The Code provides that an amount equal to at least 10% of the amounts to be disbursed as distributions of earnings be appropriated to the legal
reserve until such reserve and additional paid-in capital equals 25% of the common stock account. The Code also stipulates that, to the extent thatthe sum of the additional paid-in capital and the legal reserve exceeds 25% of the common stock account, the amount of any such excess isavailable for appropriation by resolution of the shareholders.
The retained earnings account in the accompanying consolidated financial statements at March 31, 2002 included the company’s legal reserve of¥1,506 million ($11,306 thousand).

11. Income Taxes
The Company and its domestic subsidiaries are subject to several taxes based on income, which in the aggregate resulted in statutory tax rates
of approximately 42.0% for the years ended March 31, 2002 and 2001.
The tax effects of temporary differences that give rise to significant portions of the deferred tax assets at March 31, 2002 and 2001 are presented
below:

Millions of yen
2002
2001
Deferred tax assets:
Accrued severance indemnities to employees
Accrued bonuses to employees
Revaluation of land
Retirement benefit trust loss
Unrealized gain on fixed assets and others
Tax loss carryforwards
Accrued severance indemnities to directors and corporate auditors
Accrued enterprise tax
Other
Total gross deferred tax assets
Less valuation allowance
Net deferred tax assets
Deferred tax liabilities:
Property and equipment
Other
Total gross deferred tax liabilities
Net deferred tax assets

Thousands of
U.S.dollars
2002¥ 9,239
574
358
580
200
81
140
69
285
11,526(36)
11,490¥ 9,067
597
358
580
290
205
151
138
284
11,670(78)
11,592$ 69,362
4,309
2,688
4,354
1,502
608
1,051
518
2,140
86,532(270)
86,262(1,031)(222)(1,253)¥ 10,237(1,033)(235)(1,268)¥ 10,324(7,740)(1,667)(9,407)$ 76,855

12. Subsequent Events:
Shareholders approved the following appropriation of retained earning at the annual meeting held on June 27, 2002

Cash dividends

Millions of yen¥ 419

Thousands of
U.S.dollars$ 3,14621

13. Segment information
Business segment information of the Company and its consolidated subsidiaries for the years ended March 31, 2002 and 2001 issummarized as follows:
Millions of yen

2002
Truck
Transport

Warehousing

In-factory
works

Other

Total

Elimination or
Corporate Consolidated

a. Operating revenues and operating income
Customers¥ 85,818Intersegment
2,542
Total operating revenues
88,360Operating costs and expenses
86,024
Operating income¥ 2,336¥ 21,531
114
21,645
20,527¥ 1,118¥ 14,703
4,287
18,99017,913¥ 1,077¥ 51,526
5,305
56,831
56,493¥ 338¥ 173,578
12,248
185,826
180,957¥ 4,869¥ —(12,248)(12,248)(12,257)¥ (-9)¥ 173,578—
173,578
168,700¥ 4,878b. Assets, depreciation and capital expenditures;
Assets¥ 32,010
Depreciation
974
Capital expenditures
610¥ 44,242
1,261
1,443

¥ 8,634
140
135¥ 34,424
1,045
755¥ 119,310
3,420
2,943

¥ 13,53557
15¥ 132,845
3,477
2,958

Millions of yen

2001
Truck
Transport

Warehousing

In-factory
works

Other

Total

Elimination or
Corporate Consolidated

a. Operating revenues and operating income:Customers¥ 89,054
Intersegment
2,355
Total operating revenues
91,409Operating costs and expenses
88,736
Operating income¥ 2,673¥ 20,503
117
20,62019,618¥ 1,002¥ 15,462
3,054
18,516
17,526¥ 990¥ 60,584
8,796
69,38068,524¥ 856¥ 185,603
14,322
199,925
194,404¥ 5,521¥—(14,322)(14,322)(14,310)¥ (12)¥ 185,603—
185,603
180,094¥ 5,509b. Assets, depreciation and capital expenditures;
Assets¥ 34,689
Depreciation
1,132
Capital expenditures962¥ 37,876¥ 1,200
1,201¥ 8,489
175
127¥ 53,868
4,339
9,052

¥ 134,922
6,846
11,342¥ 16,952
58
542¥ 151,874
6,904
11,884

Thousands of U.S. dollars

2002
Truck
Transport

Warehousing

In-factory
works

Other

Total

a. Operating revenues and operating income:Customers$ 644,279
Intersegment
19,084
Total operating revenues
663,363
Operating costs and expenses
645,826
Operating income$ 17,537$ 161,644
856
162,500
154,107$ 8,393$ 110,383
32,185
142,568
134,482$ 8,086$ 386,832
39,827
426,659
424,121$ 2,538$ 1,303,138
91,952
1,395,090
1,358,536$ 36,554$—(91,952)(91,952)(92,020)$(-68)$ 1,303,138—
1,303,138
1,266,516$ 36,622

b. Assets, depreciation and capital expenditures;
Assets$ 240,315$ 332,147
Depreciation
7,312
9,467
Capital expenditures
4,580
10,833$ 64,820
1,051
1,014

$ 258,438
7,845
5,668

$ 895,720
25,67522,095$ 101,615
429
112$ 997,335
26,104
22,20722

Elimination or
Corporate Consolidated

Consolidated Subsidiaries and Affiliated Companies (As of April 1, 2002)

Company Name

Paid-in
CapitalEquityOwnership

Location

Main Business

SENKO TRADING Co., Ltd.

¥300 million

100.0%

Tokyo

Sales of petroleum-related products anddistribution and information processing
equipment

SENKO INFORMATION SYSTEM Co., Ltd.

¥60 million

100.0%

Osaka

Information processing

SENKO MOVING PLAZA Co., Ltd.

¥60 million

100.0%Tokyo

Trucking, in-factory work, moving services

SAPPORO SENKO TRANSPORT Co., Ltd.

¥30 million

100.0%

SapporoTrucking

TOHOKU SENKO TRANSPORT Co., Ltd.

¥30 million

100.0%

MiyagiTrucking, in-factory work

KANTO SENKO TRANSPORT Co., Ltd.

¥90 million

100.0%

SaitamaTrucking, in-factory work

TOKYO SENKO TRANSPORT Co., Ltd.

¥10 million

100.0%

Chiba

Trucking, in-factory work

CHIBA SENKO TRANSPORT Co., Ltd.

¥30 million

100.0%

Chiba

Trucking, in-factory work, vehicle maintenance

FUJI SENKO TRANSPORT Co., Ltd.

¥30 million

100.0%

Shizuoka

Trucking, in-factory work

TOKAI SENKO TRANSPORT Co., Ltd.

¥30 million

100.0%

Aich

Trucking, in-factory work

SHIGA SENKO TRANSPORT Co., Ltd.

¥30 million

100.0%

Shiga

Trucking, in-factory work, vehicle maintenance

OSAKA SENKO TRANSPORT Co., Ltd.

¥90 million

100.0%

Osaka

Trucking, in-factory work, vehicle maintenance

CHUSHIKOKU LOGISTICS Co., Ltd.

¥80 million

100.0%OkayamaTrucking, in-factory work, warehousing

SANKYO FREIGHT Co., Ltd.

¥10 million

100.0%

Hiroshima

Trucking, in-factory work

SANYO SENKO TRANSPORT Co., Ltd.

¥20 million

100.0%

Yamaguchi

Trucking, in-factory work

SHIKOKU REEFER TRANSPORT AND
WAREHOUSING Co., Ltd.

¥50 million

100.0%

KagawaTrucking, warehousing

FUKUOKA SENKO TRANSPORT Co., Ltd.

¥50 million

100.0%

FukuokaTrucking

KUMAMOTO SENKO TRANSPORT Co., Ltd.

¥25 million

100.0%

Kumamoto

Trucking, in-factory work

MIYAZAKI SENKO TRANSPORT Co., Ltd.

¥90 million

100.0%

Miyazaki

Trucking, in-factory work, vehicle maintenance

SAITAMA SENKO APOLLO Co., Ltd.

¥50 million

100.0%

Saitama

In-factory work, vehicle maintenance

OSAKA KAIUN Co., Ltd.

¥20 million

30.0%

Osaka

Domestic marine transport

ASICS PHYSICAL DISTRIBUTION CORPORATION¥300 million

20.0%

Hyogo

Product control, vehicle shipment agency

23

Board of Directors and Corporate Auditors (As of June 27, 2002)

Chairman and Representative Director
Eiji Baba

President and Representative Director
Hiroshi Koike

Chairman and Representative Director
Eiji Baba

Vice-president and Representative Director
Akio Tanaka

Full-time Corporate Auditors
Masahiro Hayashi
Saburo Takahashi

President and Representative Director
Hiroshi Koike
Vice-president and Representative Director
Akio Tanaka
Managing Directors
Yasuhisa Fukuda
Isao Kagi
Directors
Yoshio Ikeda
Sadayuki Wada
Michiyoshi Tsuge
Tadao Ito
Kazuo Saga
Tetsuo Hatano
Isao Suzuki

24

Hideo Asano
Corporate Auditor
Hiroshi Itawaki

Corporate Data (As of March 31, 2002)

Date of Establishment:

July 1946

Paid-in Capital:¥18,295,643,751

Authorized Shares:

294,999,000

Outstanding Shares:

111,746,167

Number of Shareholders: 9,112
Stock Listing:Tokyo Stock Exchange
Osaka Securities Exchange

Transfer Agent:

The Mitsubishi Trust and Banking Corporation
11-1, Nagata-cho 2-chome, Chiyoda-ku, Tokyo 171-8508, Japan

Network:(As of April 1, 2002)

Represents Branches
and Departments

No. 1 Sales Headquarters
Logistics Sales Headquarters
Kanto Logistics Sales Division

Chubu Logistics Sales Division

Kyushu Logistics Sales Division

Branches:

Head Office
No. 2 Sales Headquarters
Kansai Logistics Sales Division

Sapporo, Sendai, Ibaraki, Kita Kanto, Saitama, Kashiwa, Tokyo, Kanagawa, Chiba, Shizuoka East,
Shizuoka West, Nagoya, Mie, Hokuriku, Keiji, Keiji South, Osaka, Hanshin, Okayama, Kurashiki,
Yamaguchi, Fukuoka, Nobeoka, Minamata

Departments:

International Distribution, Marine Transport, Railway forwarding

25

SENKO Co., Ltd.
Umeda Sky Bldg., Tower West, 1-30, Oyodonaka 1-chome, Kita-ku, Osaka 531-6115, Japan
Tel: 06-6440-5155 Fax: 06-6440-5175
URL http: //www.senko.co.jp/
Printed in Japan