Fiscal Year ended October 31, 2011

Financial Statements Bulletin (Japan GAAP)
December 7, 2011
Listed Company Name

Kanamoto Company, Ltd.

Company Code Number

9678

Listing Exchanges

Tokyo Stock Exchange, Sapporo Stock Exchange(URL

http://www.kanamoto.co.jp)

Representative

Kanchu Kanamoto

Inquiries

Nobuhito Utatsu

President

Director & Corporate Officer, Division Manager, Accounting Division
TEL 81-11-209-1600
Please send inquiries in English to takayama@kanamoto.co.jp
Scheduled date for Regular General Meeting of the Shareholders:January 27, 2012
Scheduled date for commencement of dividend payments:
January 30, 2012
Scheduled date for submission of Annual Securities Report:
January 27, 2012
Preparation of Supplementary Explanatory Materials:
Yes
Earnings Briefings (for institutional investors and analysts):Yes
1. Consolidated Operating Results for the Fiscal Year ended October 31, 2011
(Nov. 1, 2010 – Oct. 31, 2011)(Numbers less than one million yen have been rounded down)(Percentages show the change from the prior year)(1) Consolidated Operating Results
Revenues

Operating Income

Ordinary Income

Net Income

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

Fiscal year ended
October 31, 2011

71,086

1.3

2,905

9.7

2,239

7.5

1,165

11.9

Fiscal year ended
October 31, 2010

70,173

9.9

2,648

－

2,083

－

1,041

－

(Note) Comprehensive income (millions of yen)
Fiscal year ended October 31, 2011
Fiscal year ended October 31, 2010

¥1,156 (33.3%)¥867 (－%)

Net Income per
Share of Common
Stock

Net Income per
Share on a Fully
Diluted Basis

Yen

Yen

%

%

%

Fiscal year ended
October 31, 2011

35.51

－

3.2

2.0

4.1

Fiscal year ended
October 31, 2010

31.73

－

2.9

1.9

3.8

Ordinary Income
to Total Assets

ROE

Operatingmargin(Reference) Investment profit or loss accounted for by the equity method－
Fiscal year ended October 31, 2011－
Fiscal year ended October 31, 2010

(2) Consolidated Financial Position
Total Assets

Fiscal year ended
October 31, 2011
Fiscal year ended
October 31, 2010

Shareholders’EquityShareholders’ Equity
per Share

Shareholders’Equity Ratio

Millions of yen

Millions of yen

115,120

37,59232.2

1,129.47

108,509

37,02533.7

1,112.46%

Yen(Reference) Owners’ equity (millions of yen):
Fiscal year ended October 31, 2011

¥37,085

Fiscal year ended October 31, 2010

¥36,527

Financial Statements Bulletin, FY Ended October 31, 2011
P. 1

(3) Consolidated Cash Flows
Balance of Cash andEquivalents at End of
PeriodCash Flow from
Financing Activities

Cash Flow from
Investing Activities

Cash Flow fromOperating Activities
Millions of yen

Millions of yen

Millions of yen

Millions of yen

6,903-1,013-6,262

20,374

9,088

101-2,737

20,751

Fiscal year ended
October 31, 2011
Fiscal year ended
October 31, 2010

2. Dividends
Dividends per Share
End offirstquarter

End ofsecondquarter

End ofthird
quarterYearend

Yen

Yen

Yen

Yen

Yen

Fullyear

Dividends intotal(full year)

Dividend
payout ratio(consolidated)

Dividends on
net assets(consolidated)

Millions of yen%%

Fiscal year ended
October 31, 2010

－

10.00

－

10.00

20.00

656

63.0

1.8

Fiscal year ended
October 31, 2011

－

10.00

－

10.00

20.00

656

56.3

1.8

－

10.00

－

10.00

20.00

Fiscal year ending
October 31, 2012

48.6

(projected)

3. Projected Consolidated Operating Results for the Fiscal Year Ending October 31, 2012
(November 1, 2011 - October 31, 2012)(Percentages show the change from the prior year)
Net Income per
Revenues

Operating Income

Ordinary Income

Net Income

Share of Common
Stock

Millions of yen%

Millions of yen%

Interim period

36,330

2.9

2,250

30.5

1,900

Full year

72,610

2.1

3,780

30.1

3,040

Millions of yen

%

Yen

34.9

830

－

25.28

35.7

1,350

15.8

41.12

Millions of yen%

4. Other(1) Changes to material subsidiaries during the period (transfer of specified subsidiaries in conjunction withrevision to scope of consolidation)? No
Company newly included (Company name:)Company newly excluded (Company name:)(2) Changes to accounting principles, procedures and reporting method(a) Changes accompanying revisions to accounting standards etc.? Yes(b) Changes other than those in (a)? No(3) Number of shares issued (common stock)(a) Number of shares issued and outstanding at end of period (including treasury stock)
Fiscal year ended October 31, 2011
32,872,241 sharesFiscal year ended October 31, 2010
32,872,241 shares(b) Number of shares of treasury stock at end of period
Fiscal year ended October 31, 2011
37,712 sharesFiscal year ended October 31, 2010
36,906 shares(c) Average number of shares outstanding during the period
Fiscal year ended October 31, 2011
32,834,328 sharesFiscal year ended October 31, 2010
32,836,692 shares

Financial Statements Bulletin, FY Ended October 31, 2011
P. 2

(Reference) Summary of Company Operating Results
1. Operating Results for the Fiscal year Ended October 31, 2011
(November 1, 2010–October 31, 2011)(Numbers less than one million yen have been rounded down)(1) Operating Results
Revenues

Operating Income

Millions of yen%

Ordinary Income

Millions of yen%

Millions of yen%

Fiscal year ended
October 31, 2011

60,906

4.9

2,819

11.1

2,598

9.6

Fiscal year ended
October 31, 2010

58,083

6.7

2,538

508.4

2,370

－

Net Income
Millions of yen%

Net Income per Share ofCommon StockYen

Net Income per Share ofCommon Stock Fully Diluted
Yen

Fiscal year ended
October 31, 2011

1,433

38.8

43.65

－

Fiscal year ended
October 31, 2010

1,032

－

31.45

－

(2) Financial Position
Total Assets

Shareholders’Shareholders’Shareholders’ Equity

EquityEquity Ratio

per Share

Millions of yen

Millions of yen%

Yen

Fiscal year ended
October 31, 2011

104,579

37,91136.3

1,154.63

Fiscal year ended
October 31, 2010

97,72937,08938.0

1,129.57(Reference) Owners’ equity (millions of yen):
Fiscal year ended October 31, 2011¥37,911

Fiscal year ended October 31, 2010

¥37,089

2. Projected Operating Results for the Fiscal Year Ending October 31, 2012
(November 1, 2011 - October 31, 2012)(Percentages show the change from prior year)

Revenues
Millions of yen

Ordinary Income%

Millions of yen

Net Income per ShareNet Income%of common stock

Millions of yen%

Yen

Interim period

31,300

3.5

1,650

27.3

860

－

26.19

Full year

62,100

2.0

2,740

5.4

1,390

-3.0

42.33

Note: Disclosure concerning implementation of audit proceduresThis financial report is exempt from audit procedures for financial statements based on the Financial
Instruments and Exchange Act. At the time of disclosure of this financial report, the Company has notcompleted the audit procedures for financial statements.
Note: Explanation concerning appropriate use of the projected operating results and other items to note
The above projections were prepared based upon information available to the Company at the time theprojections were announced as well as various assumptions concerning the future economic and businessenvironment. Actual operating results may differ from the projected figures depending upon various factors
in the future.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 3

Attachments Table of Contents
1. Operating Results ................................................................................................................................. 5(1) Analysis of Operating Results ........................................................................................................... 5(2) Analysis of Financial Position ........................................................................................................... 7(3) Basic Policy Concerning Distribution of Earnings and Dividends for the Consolidated
Fiscal Year under Review and Next Consolidated Fiscal Year ........................................................ 10(4) Business and Other Risks ............................................................................................................... 11
2. Current Conditions of the Company’s Group ...................................................................................... 13
3. Management Policies .......................................................................................................................... 16(1) Basic Management Policies ............................................................................................................. 16(2) Management Indicators Established as Objectives ........................................................................ 16(3) Medium to Long-term Corporate Management Strategy ................................................................. 16(4) Issues to be Addressed by the Company......................................................................................... 17(5) Other Important Company Management Issues ............................................................................ 18
4. Consolidated Financial Statements ...................................................................................................... 19(1) Consolidated Balance Sheets ........................................................................................................ 19(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income ..... 22
Consolidated Statements of Income ............................................................................................. 22
Consolidated Statements of Comprehensive Income ..................................................................... 24(3) Consolidated Statements of Changes in Net Assets ....................................................................... 25(4) Consolidated Statements of Cash Flows .......................................................................................... 28(5) Notes Relating to the Going Concern Assumption ........................................................................... 31(6) Significant Accounting Policies for the Consolidated Financial Statements ..................................... 31(7) Changes in Significant Accounting Policies for the Consolidated Financial Statements .................. 40(8) Changes in Reporting Method ........................................................................................................ 41(9) Supplemental Information ............................................................................................................ 41(10) Notes to the Consolidated Financial Statements .......................................................................... 42(Notes to the Consolidated Balance Sheets) ................................................................................ 42(Notes to the Consolidated Statements of Income) ..................................................................... 44(Notes to the Consolidated Statements of Comprehensive Income) ........................................... 46(Notes to the Consolidated Statements of Changes in Net Assets) ............................................. 47(Notes to the Consolidated Statements of Cash Flows) .............................................................. 49(Business Segment Information) ................................................................................................ 50(Notes to Leasing Transactions) .................................................................................................. 56(Per Share Information) ............................................................................................................. 58(Material Events after the Close of the Consolidated Fiscal Year) ............................................... 58(Items Omitted from Disclosure) ................................................................................................ 58
5. Company Financial Statements .......................................................................................................... 59(1) Balance Sheets ............................................................................................................................... 59(2) Statements of Income .................................................................................................................... 62(3) Statements of Changes in Net Assets ........................................................................................... 66(4) Notes Relating to the Going Concern Assumption .......................................................................... 71(5) Significant Accounting Policies ....................................................................................................... 71(6) Changes in Accounting Method ...................................................................................................... 78(7) Notes to the Company Financial Statements ................................................................................ 79(Notes to the Balance Sheets) ....................................................................................................... 79(Notes to the Statements of Income) ............................................................................................ 81(Notes to the Statements of Changes in Net Assets) ..................................................................... 83(Notes for Lease Transactions) ...................................................................................................... 84
6. Other ................................................................................................................................................... 85
Changes of Directors ............................................................................................................................ 85

Financial Statements Bulletin, FY Ended October 31, 2011
P. 4

1. Operating Results(1) Analysis of Operating Resultsa) Summary of consolidated fiscal year operating results
During the consolidated fiscal year under review, Japan’s economy began the year with a comparatively calm
start despite weak business sentiment. However, conditions were abruptly transformed by the Great East
Japan Earthquake, and economic activity slowed dramatically as production was hampered by supply chain
disruptions that significantly influenced economic activity both at home and abroad. Additionally, even as apall was cast over the domestic economy by the spread of rumors concerning Japan’s nuclear accident and aself-imposed mood that constrained consumption, Japan’s industries continued to face an extremely grim
economic situation that included turmoil in the global economy and financial markets caused by thedeteriorating European debt crisis, a marked economic slowdown in newly emerging countries, and theprolonged appreciation of the yen.
Following the Great East Japan Earthquake, construction equipment demand in conjunction with recovery andrestoration work in disaster areas in the Tohoku and Kanto regions, and generator demand spurred by electric
power supply problems, both expanded in industries related to construction equipment rental, the principal
business of the Kanamoto Group. On the other hand, depending on the region a polarized management
environment has emerged, as public works expenditures have been reduced in areas other than thosedevastated by the quake and private sector capital investment, with the exception of a few major metropolitan
centers, has trended downward.
The Kanamoto Group, which considers devoting its resources to recovery and reconstruction activities in the
Tohoku region to be its social mission, established a task force immediately after the earthquake and createdan organization to supply urgently needed support materials and construction equipment, and worked toprovide local support that included sending assistance teams, particularly maintenance and repair staff.
Moreover, as a result of standing its ground and firmly maintaining its market share in other operating regions,revenues expanded substantially, exceeding prior year levels in all regions except Hokkaido. Rental unit prices
improved somewhat as well.
From an earnings perspective, opportunities for profit were limited by the priority given to ensuring available
construction equipment for responding to the earthquake, and postponement of sales of used construction
equipment owned by the Company. Nevertheless, the asset utilization ratio improved as construction
equipment rental revenues rose briskly because of the Great East Japan Earthquake, comparatively steadydemand for equipment for recovery work after heavy rainfall disasters in areas that escaped the earthquake
devastation, and even the partial improvement in rental unit prices mentioned above. Furthermore, eventhough Kanamoto could not avoid recording a loss on assets destroyed by the earthquake and tsunami, thiswas offset by the creation of an extraordinary profit from revision of the Company’s pension system, andKanamoto was able to ensure higher earnings than in the previous fiscal year. Finally, despite an anticipatedincrease in claims in default in light of the recent economic environment, thorough day-to-day credit
management was successful in keeping such claims to a minimum.
As a result of these factors, rental revenue greatly exceeded the Company’s initial plan and consolidated
revenues the fiscal year ended October 2011 rose 1.3% from the previous consolidated fiscal year level to¥71,086 million. From an earnings perspective as well, operating income expanded 9.7% from the previous
consolidated fiscal year to ¥2,905 million and consolidated ordinary income increased 7.5% year-on-year to¥2,239 million. Net income, despite the recording of an extraordinary loss for damage to business facilities andrental assets from the Great East Japan Earthquake, increased 11.9% from the previous consolidated fiscal
year to ¥1,165 million.
A summary of operating results for each of the Company’s main businesses is provided below.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 5

[Operating Results for the Fiscal Year ended October 31, 2011](Million yen; % change from prior year)
Revenues
Year underreview

Consolidated

Prior year
Year under
Non-consolidated

reviewPrior year

Operating income

Ordinary income

Net income

71,086

1.3

2,905

9.7

2,239

7.5

1,165

11.9

70,173

9.9

2,648

－

2,083

－

1,041

－

60,906

4.9

2,819

11.1

2,598

9.6

1,433

38.8

58,083

6.7

2,538

508.4

2,370

－

1,032

－

b) Summary of consolidated operating results by business segment[Business related to the Construction Equipment Rental Division]
In the construction-related businesses of the entire Kanamoto Group, revenues and earnings were both higher.
For the consolidated fiscal year under review, consolidated revenues increased 0.7% from the previous
consolidated fiscal year to ¥64,711 million, and operating income rose 2.5% year-on-year to ¥2,586 million.
By region in Japan, the company was able to limit the year-on-year decline in rental revenue in the Hokkaido
Region to 10.5%, despite lower demand from both the public and private sectors that signaled the diminishedeffect of economic stimulus measures in the previous fiscal year and a local economic slowdown. This result
reflected of the Company’s overwhelming market share, plus demand from projects such as work for the
Hokkaido Shinkansen. In other regions, demand in the Tohoku Region jumped 26.6% year-on-year because of
special demand for restoration and reconstruction following the earthquake and heavy rainfall disasters. In the
Kanto Region, demand grew 12.4% over the previous fiscal year because of demand for generators related toplanned rolling blackouts and liquefaction damage restoration and reconstruction demand. Demand in the
Kinki & Chubu Region, which was unaffected by the earthquake, was driven by heavy rainfall disaster
restoration demand and private sector capital investment, rising 6.3% year-on-year. Finally, in the Kyushu &Okinawa Region, demand was nearly unchanged from the previous fiscal year, edging down just 0.1%,
supported by past official demand, countermeasures following an eruption of Shinmoedake and storm disasterdemand.
Revenue from the sale of used construction equipment contracted 44.1% from the level in the previous
consolidated fiscal year, reflecting planned equipment sales during the fiscal year under review that werepartially postponed to ensure availability of construction equipment for earthquake restoration works.
In foreign operations, Shanghai Jinheyuan Engineering Construction Co., Ltd., which is developing a
construction equipment rental business in China and currently accounts for only a small proportion of
Kanamoto’s operating results, achieved operating performance that was nearly identical to the previous year,
when revenues expanded because of special procurement related to the Shanghai Expo. Although affected by
China’s economic slowdown resulting from the government’s tight-money policy, this performance was theresult of opening new branches and attracting demand in Tianjin, Wuhan, Nanjing, Ningbo and other cities. In
Hong Kong, vigorous demand caused revenues to increase steadily, while revenues at SJ Rental, Inc. in the
Territory of Guam, United States were basically unchanged year-on-year, reflecting the lack of progress toward
the relocation of U.S. military facilities from Japan.
[Other businesses]
In the steel products sales the Company is developing in Hokkaido, demand remained steady despite a lull in
the region, and revenues were up 4.6% compared with the previous fiscal year, aided somewhat by the

Financial Statements Bulletin, FY Ended October 31, 2011
P. 6

general sense of insufficient supply and a strong push to sell steel materials. In Kanamoto’s information andtelecommunications-related business, on the other hand, revenues expanded a healthy 23.3% because of
growth in personal computer rentals and the steady expansion of activities related to other specified worker
dispatching.
As a result of the above factors, for the consolidated fiscal year under review revenues for the Company’s otherbusinesses increased 7.9% from the previous consolidated fiscal year to ¥6,374 million, and operating income
soared 213.6% year-on-year to ¥143 million.
<Change in number of branches>
During the consolidated fiscal year under review, Kanamoto newly opened 2 branches and closed 8 branches.
New branches:

Rokkasho Branch, Kesennuma Branch

Closed branches: Shiranuka Equipment Center, Tomikawa Equipment Center, Muroran Equipment Center,
Makubetsu Equipment Center, Yaita Branch, Nanyo Branch, Murakami Branch, Biratori
Equipment Center(2) Analysis of Financial Positiona) Financial position
Total assets at the end of the consolidated fiscal year under review increased ¥6,610 million compared with theend of the previous consolidated fiscal year to ¥115,120 million. The main factors were an increase of ¥5,948
million in rental equipment and an increase of ¥1,432 million in notes and accounts receivable, trade.
Total liabilities were ¥77,527 million, an increase of ¥6,043 million compared with the end of the previous
consolidated fiscal year. This mainly reflected an increase of ¥3,625 million in the total amount for long-termbank loans due within one year and long-term bank loans, and an increase of ¥4,757 million in long-term
accrued expenses.
Total net assets were ¥37,592 million, ¥567 million higher than at the end of the previous consolidated fiscal
year. This mainly reflected net income of ¥1,165 million, and a decrease in earned surplus as the result ofdividend payments.
b) Cash flows(Millions of yen)
FY Ended October 2010 FY Ended October 2011
(Prior consolidated(Consolidated fiscal
fiscal year)
year under review)

Change fromprior year

Cash flow from operating activities

9,088

6,903

-2,185

Cash flow from investing activities

101-1,013-1,114

Cash flow from financing activities-2,737-6,262-3,524

Decrease in cash and equivalents

6,429

-376

-6,805

14,086

20,751

6,665

20,751

20,374-376

Balance of cash and equivalents at
beginning of period
Balance of cash and equivalents at
end of period

The balance of cash and cash equivalents (“cash”) on a consolidated basis at the end of the consolidated fiscal
year under review decreased ¥376 million from the end of the previous consolidated fiscal year, to ¥20,374
million. Cash flows for the consolidated fiscal year under review are discussed below.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 7

(Cash flow from operating activities)
Cash generated as a result of operating activities decreased 24.0% from the previous consolidated fiscal yearto ¥6,903 million.
Although the Company reported higher depreciation and amortization expense and income before taxes andadjustments, this mainly reflected a decrease of ¥1,304 million for increase (decrease) in accrued employees
retirement benefits as a result of transferring the Company’s retirement benefits system from a defined
benefit corporate pension plan to a defined contribution corporate pension plan, and higher payments forcorporate and other taxes.
(Cash flow from investing activities)
Cash flow used in investing activities was ¥1,013 million, compared with cash flow provided by investing
activities in the previous consolidated fiscal year of ¥101 million.
This mainly reflected factors such as funds used for the purchase of investment securities and funds used forthe purchase of tangible fixed assets.
(Cash flow from financing activities)
Cash flow used as a result of financing activities was ¥6,262 million, compared with cash flow used as a resultof financing activities in the previous consolidated fiscal year of ¥2,737 million.
This mainly reflected a net decrease in short-term bank loans, and increases in funds used for repayment of
installment obligations and funds used for repayment of lease obligations, compared with the previous
consolidated fiscal year.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 8

The cash flow indicator trends for the Kanamoto Group are provided below.
FY Ended

FY Ended

FY Ended

FY Ended

October 2008

October 2009

October 2010

October 2011

41.4

37.5

33.7

32.2

11.2

13.2

12.6

15.1

10.2

20.2

5.7

8.5

Interest coverage ratio (times)

7.1

3.3

10.4

7.4

(Notes) Shareholders’ equity ratio:

Shareholders’ equity / Total assets

Shareholders’ equity ratio (%)
Shareholders’ equity ratio on amarket capitalization basis (%)
Years to repay debt

Shareholders’ equity ratio on
a market capitalization basis: Shareholders’ equity on a market capital basis / Total assets
Years to repay debt:

Interest-bearing liabilities / Cash flow from operating activities

Interest coverage ratio:

Cash flow from operating activities / Interest payments*All indicators are calculated using financial values on a consolidated basis.
*Total market capitalization is calculated by multiplying the closing share price at the end of the term by the
number of shares outstanding (after deducting treasury stock) at the end of the term.
*Cash flow from operating activities shown on the Consolidated Statements of Cash Flows is used as operating
cash flow. Interest-bearing liabilities include all liabilities on which the Company pays interest that are
accounted for on the Consolidated Balance Sheets. The amounts shown as interest expense on theConsolidated Statements of Cash Flows are used as interest payments.

Outlook for the next fiscal year (Business Period ending October 2012)
As the European debt crisis has grown more serious, global financial markets have become less flexible andthe weaknesses of a free economy have spread to newly developing countries. Lacking any means to correct
itself, this confusion could have a major impact on Japan’s economy, which relies heavily on exports, andbecome a factor causing the strengthening tendency of the yen to become even more serious. Given concernsthat a contraction of the financial markets will lengthen the deflationary trend in Japan unless a corrective
mechanism is found, the outlook for Japan’s economy, including the slump in consumption and reductions tocapital investment, is becoming increasingly uncertain.
Although earthquake reconstruction demand is expected to be substantial, the trend in reconstruction plans
for the devastated areas remains unclear as well, and the domestic construction demand in Japan, which
influences the earnings of the Kanamoto Group, will require more time. In addition, central government
allocations for public works have been pared back substantially, and nationally there is little hope forinvestment in public works. Furthermore, given the uncertainties in the business outlook, firms are notrelaxing their prudent stance toward new private sector capital investment, and the severity affecting
construction demand in local regions particularly has intensified. Except in regions where earthquake recovery
demand is anticipated, heightened competition in various regions among firms in the construction equipment
rental industry is inevitable, and the seesaw nature of the operating environment appears set to continue.
In addition to further enhancing its support for reconstruction efforts in the wake of the Great East Japan
Earthquake, the Kanamoto Group will utilize all of its abilities to capture public and private sector demand inregions other than the stricken areas and proceed to build a solid business base, just as it has during theconsolidated fiscal year under review. Moreover, because the demand for generators is expected to continue
in industries other than construction such as manufacturing, Kanamoto will focus on this demand as a future
new business area.
On the other hand, with regard to sales of used construction equipment, some of which Kanamoto postponedin order to respond to the earthquake, for the next business period the Company has prepared a sales plan
similar to its plan in a typical year, to reflect the gradual progress in introducing new equipment and theheightened demand for used construction machinery in other countries as a disaster recovery measure. Given

Financial Statements Bulletin, FY Ended October 31, 2011
P. 9

current conditions, the Company judges it will be able to proceed with sales as planned, but will exercise
greater prudence while closely monitoring the overseas used construction equipment market and theexchange rate trend.
Furthermore, as it continues to focus on controlling costs, boosting asset operating efficiency andimplementing other measures to improve its financial position, the Company will take steps to bolster its
regional sales organization, which has achieved substantial results. Kanamoto will also move forward withefforts to generate earnings from all aspects of rentals, including the creation of rental demand in sectors otherthan construction.
In summary, factors such as the anticipated earthquake recovery demand in the Tohoku Region and gradualprogress in the sale of the Company’s used construction equipment will help improve Kanamoto’s operating
performance in the construction equipment rental business in the Business Period ending October 2012.
Nevertheless, in light of other considerations, including the uncertain construction demand trend in regions
other than those devastated by the earthquake and the fact its depreciation burden will increase because of
the rental assets introduced to respond to the earthquake, Kanamoto has prepared the forecast summarized
in the table below. The Company will continue to closely watch the construction demand trend in each region,
work to increase revenues and earnings through effective asset deployment and a sure response to customers’
needs, and seek to expand the content of its business, including the development of new sectors and newmarkets domestically and overseas.
Turning briefly to the businesses being developed by Kanamoto’s subsidiaries overseas, which account for only
a very small portion of the Company’s consolidated earnings, in China a large shadow has begun to fall acrossprivate sector demand as the government adopts a tight monetary policy and a real estate bubble has formed,
while in the Territory of Guam, United States, issues affecting the relocation of U.S. military forces remain influx, and conditions affecting Kanamoto’s redevelopment business are uncertain. On the other hand, in Hong
Kong and Singapore there are no major changes in the present circumstances. Although there are concerns
about the effect of weakening private sector demand in each region, fortunately Kanamoto has cultivated new
business centered on rentals for public works, and will continue focusing on business expansion while giving
sufficient consideration to both country and business risks.
The Company’s earnings projection for the fiscal year ending October 2012 is shown in the table below.
Fiscal year ending October 2012 Projected Operating Results(November 1, 2011-October 31, 2012)(Millions of yen except net income per share, which is in yen)

Revenues
Consolidated
full-year projection
Non-consolidated
full-year projection

Operating

Ordinary

incomeincomeNet income

Net income pershare ofcommon stock

72,610

3,780

3,040

1,350

41.12

62,100

3,050

2,740

1,390

42.33

(3) Basic Policy Concerning Distribution of Earnings and Dividends for the Consolidated
Fiscal Year under Review and Next Consolidated Fiscal YearAs the basis of its earnings distribution policy, Kanamoto seeks to ensure a stable return of earnings to the
maximum extent possible. Under its dividend policy, the Company considers the maintenance of a stabledividend to be a key management issue. For the immediate future, the Company will work to ensure it canmaintain the current full-year dividend of ¥20 per share, consisting of a per-share interim dividend of ¥10 anda year-end dividend of ¥10. The Company also plans to use internal reserves to enhance shareholders’ equity
as a source of funds for capital investment including purchases of rental equipment. To provide for a flexible
Financial Statements Bulletin, FY Ended October 31, 2011
P. 10

capital policy, the Company has prepared a system for treasury stock purchases.
For the Business Period ended October 2011, the Company plans to pay a regular dividend of ¥20 per share forthe full year, consisting of an interim dividend of ¥10 per share and a year-end dividend of ¥10 per share(subject to approval at the regular Board of Directors meeting on December 27, 2011).
Special benefits plan for shareholders
Shareholders owning at least 1,000 shares who are described or recorded in the Register of Shareholders andList of Beneficial Shareholders as of October 31 (Date of Record) of each year will receive fresh products from
Hokkaido, the birthplace of Kanamoto, with a value equivalent to ¥3,000(selected from a specially mailed
catalog).

(4) Business and Other Risks
The following risks are included among the business and accounting matters described in the Financial
Statements Bulletin that might have an important influence on investors’ decisions. Forward-looking
statements included in this document are judgments made by the Company based on information available atthe present point in time.
a) Economic conditions
In the construction-related business that is the main business of Kanamoto Group, earnings are influenced
significantly by the domestic construction investment trend whether it reflects public or private sector demand.
Consequently there is a possibility future operating results including revenues will be negatively affected if
further large reductions in public works or other changes affecting industry demand occur in the future. In
addition, overseas sales of used construction equipment are affected by the global economy and the exchange
rate trend prevailing at the time of sale.
b) Seasonal variations in operating results
Because budget decisions for public works are made in April of each year, there is a time lag of roughly six
months before construction actually is begun. Therefore the construction-related businesses that are
Kanamoto’s main business experience a trend in which the busy season during each business period extends
from about October until the following March, and construction equipment rental demand reaches its
maximum peak during this period. As a result, the revenues and earnings of the Kanamoto Group tend to beconcentrated in the Company’s first-half accounting period (the six-month period from November through thefollowing April).
c) Interest rate trends
The Kanamoto Group allocates internal capital and procures funding from outside sources to meet its need forfunds to purchase rental equipment and other assets, make branch-related capital investments and provide
working capital for business activities. Although the Company takes steps to mitigate the affect of interest rate
fluctuations on its externally borrowed funds, including transactions to fix the interest rates paid on borrowed
funds to the extent possible, there is a possibility the operating results and financial position of the Kanamoto
Group will be affected by future large changes in short-term interest rates.
d) Guarantees
The Kanamoto Group has entered into guarantee agreements with financial institutions for certain obligations
owed by affiliated companies on the basis of loans, finance lease obligations and installment payment
contracts. There is a possibility the operating results and financial position of the Kanamoto Group might be
adversely affected should circumstances under which the Company is requested to perform its guarantee arisein the future.
f) Asset impairment accounting for fixed assets
The Kanamoto Group has adopted the Accounting Standard for Impairment of Fixed Assets. There is apossibility the operating results and financial position of the Kanamoto Group might be negatively affected if
Financial Statements Bulletin, FY Ended October 31, 2011
P. 11

the profitability of fixed assets declines because of factors such as a marked deterioration in the Company’sbusiness environment in the future.
g) Restrictive financial covenants
Agreements with financial institutions pertaining to the borrowings of the Kanamoto Group frequently
establish restrictive financial covenants. Although Kanamoto judges the probability of violating theserestrictive financial covenants to be low, there is a possibility the operating results and financial position of theKanamoto Group will be adversely affected if the Company has violated such restrictive financial covenants.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 12

2. Current Conditions of the Company’s GroupThe Kanamoto Group (Kanamoto and its affiliated companies) has organized its principal business activities
around “Business related to the Construction Equipment Rental Division,” which is engaged in the rental andsale of construction equipment and construction-related equipment parts, “Business related to the Steel Sales
Division,” which sells materials for construction such as steel products, and “Business related to the
Information Products Division and Other Businesses,” including the rental and sale of computers such asworkstations and PC servers and computer peripheral equipment, and the provision of specified worker
dispatching services.
The Group is comprised of the parent company, ten consolidated subsidiaries and five non-consolidated
subsidiaries. There are no companies that apply equity method accounting to non-consolidated subsidiaries.
An explanation of the business activities and position of each company in the Kanamoto Group, and therelationships to the Group’s segments by business category, is provided below.
<Business related to the Construction Equipment Rental Division>
The Company’s Construction Equipment Rental Division, Daiichi Kikai Co., Ltd. (a consolidated subsidiary),
Kanki Corporation (a consolidated subsidiary) and Toyo Industry Co., Ltd. (a consolidated subsidiary) areengaged in the rental and sale of construction equipment and machines used for construction. These
companies borrow rental equipment assets from the Company as needed in order to meet customer demand.
In addition, the Company borrows rental assets from each of these companies as needed to rent to othercompanies.
Assist Co., Ltd (a consolidated subsidiary) and Comsupply Co., Ltd. (a non-consolidated subsidiary) areengaged in the rental and sale of furniture and fixtures and safety products, and SRG Kanamoto Co., Ltd. (aconsolidated subsidiary) rents and sells temporary materials for construction use. The Company borrows
rental assets from these three companies as needed to rent to other companies.
SRG Kanamoto Co., Ltd. (head office: Chuo Ward, Sapporo City), was absorbed by and merged with theCompany on November 1, 2011, with Kanamoto as the surviving company.
Kanatech Co., Ltd. (a consolidated subsidiary) sells modular housing units for temporary use. Flowtechno Co.,
Ltd. (a non-consolidated subsidiary), is engaged in the technical development, manufacture and sale ofconstruction equipment for ground improvement works. Kanamoto purchases modular housing units for
temporary use and construction equipment for ground improvement from these two companies as needed torent to its own customers.
Kyushu Kensan Co., Ltd. (a consolidated subsidiary) rents and sells construction equipment and foundationequipment, and rents construction cranes and small machines. Kyushu Kensan borrows rental equipment
assets from Kanamoto as needed in order to meet its customer demand.
Shanghai Jinheyuan Engineering Construction Co., Ltd. (a consolidated subsidiary; Shanghai, China) and SJ
Rental, Inc. (a consolidated subsidiary; Territory of Guam, United States), are engaged in the rental and saleof construction equipment and tools and the import and export of construction materials.
In addition to the above, Kanamoto has three unconsolidated subsidiaries: KG Machinery Co., Ltd., KANAMOTO(HK) CO., LTD. and Kanamoto & JP Nelson Equipment (S) PTE Ltd. KG Machinery Co., Ltd. (head office: Tokyo)
mainly rents specialized large-scale construction equipment in foreign countries. KANAMOTO (HK) CO., LTD.
(head office: Hong Kong, China) borrows rental assets from Kanamoto and is engaged in the rental and saleof construction equipment and tools and the import and export of construction materials. Kanamoto & JP
Nelson Equipment (S) PTE Ltd. (head office: Singapore) rents and sells specialized equipment for engineering
works in Singapore.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 13

<Business related to the Information Products Division and Other Businesses>
The Company’s Steel Sales Division sells steel products and other construction-related manufactured products.
The Company has no subsidiaries or affiliated companies related to this business. Kanamoto’s Information
Products Division is engaged in the rental and sale of computers, including workstations and PC servers, aswell as computer peripheral equipment. Kanamoto Engineering Co., Ltd. (a consolidated subsidiary) manages
specified worker dispatching undertakings to dispatch engineering-related research and development
employees to manufacturers and other entities.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 14

Domestic Customers

Kanamoto Co., Ltd.

Rental of construction related products and parts

Assist Co., Ltd.

Construction equipment rental

Rental and sale of furniture, fixtures

Daiichi Kikai Co., Ltd.

and safety products

Construction equipment rentals andsales

Comsupply Co., Ltd.
Rental and sale of furniture, fixturesand safety products

Kanki Corporation
Construction equipment rentals andsales

Construction
Equipment Rental

Kyushu Kensan Co., Ltd.

SRG Kanamoto Co., Ltd.
Rental and sale of temporary
materials for construction use

Division

Construction equipment rentals
centered on foundation equipment
Overseas

Toyo Industry Co., Ltd.

Steel Sales Division

Shanghai Jinheyuan
Engineering Construction Co.,
Ltd.
Construction equipment rentals andsales
Import and export of construction
materials

Information Products
Division

SJ Rental, Inc.
Construction materials import andexport business and construction
equipment rentals

Shield tunneling method-related
peripheral equipment rentals and

KANAMOTO (HK) CO., LTD.
Construction materials import andexport business and construction
equipment rentals

Supply of modular housing units
Supply of steel frames and construction materials

Business cooperation and technical support

Kanamoto & JP Nelson
Equipment (S) PTE Ltd.
Specialized engineering works
equipment rentals and sales

Provision and exchange of market information

Provision and exchange of market information

Design, manufacture and sale of related products

Overseas customers andKanatech Co., Ltd
Design and sale of modular housing
units for temporary use

overseas trading companies

Other Business(Specialized construction equipment rentals)

KG Machinery Co., Ltd.
Ground improvement equipment
rentals and sales

Flowtechno Corporation

Technical development, manufactureand sale of ground improvement
construction equipment

Overseas customers andCustomers, trading companies,

domestic trading companies

etc.

Kanamoto Engineering Co., Ltd.
Engineer dispatching(Specified Worker Dispatching
Undertakings)

Manufacturers, etc.

(Notes)(1) There are no non-consolidated subsidiaries to which equity method accounting is applied.
(2) Consolidated subsidiaries are indicated by white boxes, and non-consolidated subsidiaries are shown in greyboxes. Dotted lines indicate the companies that are grouped in the same business classification.
(3) Arrows indicate business transactions. For details please see the text on the previous page.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 15

3. Management Policies(1) Basic Management Policies
In Kanamoto’s core equipment rental business, the Kanamoto Group seeks to be a corporate group that cancontribute to local communities and ultimately Japan by providing customers with services that are both highly
economic and convenient. When managing its business, the Group adheres to the thinking that it should be
aggressive yet prudent in sales and marketing, while always being conservative in the management of its
financial affairs.
Furthermore, Kanamoto regards the completion of its corporate social responsibilities, including providing
employees with a sense of accomplishment and satisfaction, customers with the greatest convenience,
suppliers with opportunities to expand their business and shareholders with rising asset value and continuous
dividends, to be its most important obligation, and believes it can achieve continuous growth as a company
and contribute to society by accomplishing these objectives.

(2) Management Indicators Established as Objectives
Because the construction equipment rental businesses managed by the Kanamoto Group require a substantial
capital investment burden, which necessitates a profit and loss outlook extending over several years, theKanamoto Group has always positioned growth in EBITDA+ (earnings before interest, taxes, depreciation andamortization) as its most important management indicator, while also taking into consideration ROI (return on
investment). As an indicator for measuring the size and corresponding efficiency of a business, EBITDA+ in
particular complements future earnings, and Kanamoto recognizes that maintaining and expanding EBITDA+
is absolutely critical to its future success.
At the same time, revenues and operating income are also figures that show the size and earning capacity of
a company, and Kanamoto emphasizes the steady growth of these measures as indicators highlighting its
growth potential as a firm.

(3) Medium to Long-term Corporate Management Strategy
The Kanamoto Group has formulated a long-term management plan extending through the Business Period
ending October 2014. However, because the management environment has changed more than initiallyassumed, the Company has re-set its earnings objectives for the three remaining fiscal years as follows.
Restoration and reconstruction demand generated by the Great East Japan Earthquake is reflected in thismedium term plan as temporary demand that sees a certain degree of convergence.
Details of Kanamoto’s management strategy are provided below.
(Unit: Millions of yen)
Business
Period ending
October 2010

Business
Period ending
October 2011

Business
Period ending
October 2012

Business
Period ending
October 2013

Business
Period ending
October 2014

Initial plan

¥67,100¥68,100¥69,300¥70,700¥72,200

Revised plan

* ¥70,173*¥71,086¥72,610¥74,700¥76,630

Initial plan

¥1,100¥1,800¥2,900¥3,800¥4,300

Revised plan* ¥2,648*¥2,905¥3,780¥4,370¥5,000Consolidated revenues

Consolidated operating income

An asterisk (*) indicates actual figures.

a) Response to the Great East Japan Earthquake and Fukushima nuclear accident
The Kanamoto Group considers a strong involvement in the support for restoration and recovery work to be asocial mission it shoulders willingly. Along with continuing its efforts to supply construction-related materials
on a timely basis, Kanamoto will participate in this project, which is expected to take many years, on an
ongoing basis, by undertaking ground improvement works, an activity in which Kanamoto particularly excels,and establishing a full-time team to concentrate on the Fukushima nuclear accident. The Kanamoto Group will
work zealously to achieve the quick restoration and recovery of the stricken areas in the Tohoku and Kanto

Financial Statements Bulletin, FY Ended October 31, 2011
P. 16

regions.
b) Expand and enlarge Kanamoto’s domestic base of operations
Beyond the Tokyo metropolitan area where much of Japan’s public and private sector demand is concentrated,
the Kanamoto Group is actively pursuing branch development, including M&A, in areas west of the Kanto
Region where the Company’s presence until now has been limited. Moreover, Group firms are also working to
expand operations through cooperation centered on Kanamoto’s Regional Special Procurement Sales Division.
c) Broaden sectors and enlarge new businesses
In Japan there is a heightened desire for new power generation facilities, including biomass power generation,
to supplement electricity shortages. Microturbine generators manufactured by the U.S. firm Capstone Turbine
Corporation and marketed in Japan by Kanamoto are already delivering results to domestic biomass power
generation facilities, and as a leading member of Japan’s Biogas Council, Kanamoto will broaden theopportunities for introduction of this technology, and pursue development of its equipment rental business inother sectors that are unrelated to the construction business.
d) Undertake overseas deployment
In addition to operations in mainland China, Hong Kong, Guam and Singapore where it has establishedoverseas affiliates, the Company will pursue development in ASEAN countries that are exhibiting remarkable
growth. Because the sales of high-quality used construction equipment implemented by Kanamoto each year
enhance the Company’s reputation, and contribute substantially to business development in other countries,
Kanamoto also will continue to offer high-quality used construction equipment for sale.
e) Increase asset management efficiency
In the future, the Company will continue efforts to enhance the operating income margins on its rental assets,by disposing of rental equipment with low operating rates and optimizing its asset portfolio by model and age
through asset introductions and sales.

(4) Issues to be Addressed by the Company
Because construction equipment rentals are its core business, the Kanamoto Group must achieve a robust
earnings structure and establish a strong sales and marketing organization, by seeking to optimize its
business sectors, owned asset levels and asset portfolio structure in a manner that will ensure operating
results are not significantly affected by the volume of domestic construction investment.
a) Strengthen human resources training and the Kanamoto Group and allianceOver the next several years, rising competition among firms is expected to further throw distinctions into
sharp relief. As the leading firm in the construction equipment rental industry, Kanamoto strives to foster
employees who possess appropriate knowledge and skills and is working to provide employee training alignedwith the Company’s overseas development and domestic business expansion. Strengthening cooperation
among Group firms and increasing transactions with alliance firms will be essential for expansion of theKanamoto Group’s business sectors and regions, and Kanamoto will pursue measures to augment the Group’s
integrated corporate vitality.
b) Reinforce Kanamoto’s financial strategy
Kanamoto is taking steps to ensure timely and optimal funds procurement, while giving consideration toequipment plans including purchases of rental equipment assets and corporate facilities. At the same time, theCompany is focusing on improving its financial position, and reducing interest-bearing debt and improving
capital efficiency as much as possible, by incorporating measures such as the liquidation of assets.
c) Continuous cost reductions
When introducing assets the Company utilizes a thorough benchmark system and strives to maintain asset
value by optimizing asset maintenance costs based on its rental assets operating policies.
d) Strengthen overseas branch management
Financial Statements Bulletin, FY Ended October 31, 2011
P. 17

The Company will enhance marketing and sales aspects, and strengthen management systems in areas suchas asset management and operations management, to match its overseas development. It also will urgently
prepare a system for the assignment of human resources and personnel training for this purpose.

(5) Other Important Company Management Issues
Compliance and internal controls
Even if it does not work continuously to strengthen its employee training and compliance systems, or takespecial steps to heighten compliance awareness, a firm must fulfill its social responsibility by establishing anorganization to ensure compliance will be implemented.
For the Kanamoto Group, which aspires to sustained growth, a compliance organization is indispensable forthe formation of a staunch organization. Kanamoto therefore prepared ethical guidelines several years ago toserve as a compliance standard, established a Compliance Committee headed by Kanamoto’s president andtook steps to strengthen company-wide observance of laws and ethics regulations. The Company works toensure every individual is thoroughly familiar with its guidelines, and manages its organization in accordancewith these compliance materials.
In addition, to respond appropriately and take measures to prevent a recurrence if unforeseen circumstancesthat will have a serious affect on the Company’s operations have occurred or if there is concern suchcircumstances might occur, the Company has prepared an Emergency Response Manual (Contingency Plan).
One measure for clarifying these activities further is Kanamoto’s “internal controls reporting system,” which allof the Company’s employees have been united in supporting since the system was placed into full-scale
operation in the Business Period ended October 2009.
In the recent Great East Japan Earthquake, important customers of the Kanamoto Group as well as
Kanamoto’s own branches suffered damage. Communications infrastructure in particular was disrupted,
creating circumstances that made it difficult to confirm local conditions. Fortunately, in areas such as
information gathering, the reporting of situation assessments by nearby branches and observance of the chainof command, the Company generally was able to act according to the categories envisaged in the Emergency
Response Manual. However, there also were aspects that need to be addressed for the future, and Kanamoto
is improving the accuracy of the manual with a focus on the related divisions.
Other measures taken by the Company included the publication of compliance bulletins mailed from theCompliance Committee Secretariat to each company in the Kanamoto Group to enlighten employees
concerning legal compliance, and a reorganization that will enable a more precise response based onstrengthening of the Legal Office’s staff. In addition, guidance and training programs were conducted by theInternal Control Promotion Office at 59 offices, and internal controls similar to Kanamoto’s have been
established and are now being utilized by 11 Kanamoto Group companies. The Safety and Health Office also
performed audits at 79 offices, and together with the safety patrols conducted by the Safety and HealthCommittee, all of the Company’s branches were inspected.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 18

4.

Consolidated Financial Statements(1) Consolidated Balance Sheets(Unit: Thousands of yen)Classification

Notes

Prior Consolidated Fiscal Year(As of October 31, 2010)

Current Consolidated Fiscal Year(As of October 31, 2011)

AmountAmount(Assets)
Current assets
Cash and deposits*220,486,217

20,059,836

Notes and accounts
receivable, trade*5, 7

14,987,135

16,419,596

Negotiable securities

350,000

350,000

Merchandise inventories andproducts

606,265

621,325

Work in progress

37,04633,299Raw materials and supplies

161,250

198,063

Construction equipment

1,187,474

1,557,207

Income taxes receivable－

10,156

Consumption taxes
receivable－

103,824Deferred tax assets

360,857

383,915

Other585,387

606,178-372,925-368,095

38,388,709

39,975,310

62,487,304

72,929,202

Accumulated depreciation-36,740,651-41,233,812

Net rental Equipment
assets25,746,653

31,695,389

Buildings and structures

20,754,755

20,871,684-12,855,277-13,481,705

7,899,477

7,389,979

5,136,911

5,131,902

Accumulated depreciation-4,386,927-4,491,947

Net machinery,equipment, vehicles anddelivery equipment

749,983

639,955

29,689,403

29,907,779

1,332,572

1,422,796-1,076,712-1,186,184

Allowance for doubtful
accounts
Total Current Assets
Fixed assets
Tangible fixed assets
Rental equipment assets

Accumulated depreciation
Net buildings andstructures*2

Machinery, equipment,
vehicles and delivery
equipment

Land
Other
Accumulated depreciation*2

Financial Statements Bulletin, FY Ended October 31, 2011
P. 19

Net other

255,859

236,61164,341,377

69,869,715

345,456

159,081304,779

243,722650,235

402,804

2,768,524

3,202,316

Deferred tax receivable

1,186,595

658,472

Other

2,081,861

1,866,172

Allowance for doubtful
accounts-827,005-732,482

Reserve for investment
losses-80,700-122,010

Total Investments and Other
Assets5,129,276

4,872,468

Total Fixed Assets

70,120,890

75,144,988

Total Assets

108,509,599

115,120,298

Total Tangible Fixed Assets
Intangible fixed assets
Goodwill*6

Other
Total Intangible Fixed Assets
Investments and other assets
Investment securities

Classification

*1

Notes

Prior Consolidated Fiscal Year(As of October 31, 2010)

Current Consolidated Fiscal Year(As of October 31, 2011)

AmountAmount(Liabilities)
Current liabilities
Notes and accounts payable,
trade

*7

13,076,469

13,318,570

Short-term bank loans*213,415,487

11,155,150

Long-term bank loans due
within one year*2

9, 529,170

9,853,531

Current portion of bonds

22,00022,000

Lease obligations

859,558

1,087,355

1,106,405

322,353

589,042531,006－

289,850

5,587,413

7,574,532

1,514,896

1,188,201

45,700,445

45,342,552

22,000－13,762,305

17,063,051

1,903,249

1,430,603

Corporate taxes payable
Accrued bonuses to
employees
Allowance for disaster losses
Accounts payable, other
Other

*7

Total Current Liabilities
Long-term liabilities
Bonds
Long-term bank loans
Lease obligations*2

Financial Statements Bulletin, FY Ended October 31, 2011
P. 20

Accrued employees
retirement benefits

1,341,459

37,455Retirement allowances todirectors and auditors

205,627

210,336

Long-term accrued expenses

8,493,598

13,251,369

Asset retirement obligations－

147,078

55,31645,143

Total Long-term Liabilities

25,783,556

32,185,039

Total Liabilities

71,484,001

77,527,592

Capital stock

9,696,717

9,696,717

Capital surplus

10,960,869

10,960,749

Retained earnings

15,788,189

16,297,314-24,963-25,240

36,420,813

36,929,541

Valuation difference on otherinvestment securities

147,516

198,819

Translation adjustments
account-40,486-42,758

Total accumulated othercomprehensive income

107,030

156,060

497,753

507,104

Total Net Assets

37,025,597

37,592,706

Total Liabilities and Net
Assets108,509,599

115,120,298

Other(Net Assets)
Shareholder’s equity

Treasury stock
Total Shareholders’ Equity
Accumulated othercomprehensive income

Minority Interests

Financial Statements Bulletin, FY Ended October 31, 2011P. 21

(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive
Income(Consolidated Statements of Income)(Unit: Thousands of yen)Classification

Notes

Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)

Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)

AmountAmountTotal revenues

70,173,653

71,086,825

Total cost of revenues fromoperations

49,855,304

50,631,190

Gross profit

20,318,348

20,455,634

17,669,412

17,550,043

2,648,935

2,905,590

Interest revenue

15,877

11,006

Dividend income

41,76850,991

Insurance benefits

96,31233,926

Rents received

39,09345,488Cash bonus received

23,109

5,528

Amortization of negative
goodwill

69,831

69,831

Other

158,841

122,820444,834

339,594

Interest expense

764,399

792,703

Loss on sale of notes
receivable

45,411

41,949Other

200,477

170,971

Total non-operating expenses

1,010,288

1,005,625

Ordinary income

2,083,481

2,239,560

164,389

32,612

10,45911,418

153,765

52

795

1,935

57,842

13,989－1,465,200

9,214

9,125

Selling, general andadministrative expenses*1

Operating income
Non-operating revenues

Total non-operating revenues
Non-operating expenses

Extraordinary profits
Subsidies
Gain on sale of fixed assets
Gain on sale of investment
securities
Gain on investment in
partnership enterprise
Gain on reversal of allowancefor doubtful accounts
Gain on termination ofretirement benefit plan
Other

*2

Financial Statements Bulletin, FY Ended October 31, 2011
P. 22

Total extraordinary profits

396,466

1,534,332

Extraordinary losses
Loss on sale or retirement of
fixed assets*3

104,323

132,878

Impairment loss

*4－

63,44027,925

134,714－

837,968

Provision of allowance forinvestment losses

30,67541,310

Provision of allowance for
doubtful accounts

35,507

1,550

Loss on liquidation ofsubsidiaries

81,511－－

95,53037,60519,990Total extraordinary losses

317,547

1,327,382

Income before taxes andadjustments

2,162,400

2,446,510

Corporate, local and business
taxes

1,171,343

862,362

Adjustment for corporate andother taxes-17,068

470,434

Total corporate and other taxes

1,154,275

1,332,796－

1,113,713-33,838-52,107

1,041,965

1,165,821

Valuation loss on investment
securities
Loss from disaster

Loss on adjustment forchanges of accounting
standard for asset retirement
obligations
Other

Income before adjustment forminority interests (loss)
Minority interest in income
Net income (loss)*5

Financial Statements Bulletin, FY Ended October 31, 2011
P. 23

(Consolidated Statements of Comprehensive Income)(Unit: Thousands of yen)Classification

Notes

Income before adjustment forminority interests (loss)

Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)

Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)

AmountAmount－1,113,713

Valuation difference on otherinvestment securities－

51,302

Translation adjustments
account－-8,073*2－

43,229*1－

1,156,942

Comprehensive income
attributable to owners of
the parent－

1,214,851

Comprehensive income
attributable to minority
interests－-57,908

Other comprehensive income

Total other comprehensive
incomeComprehensive income(Breakdown)

Financial Statements Bulletin, FY Ended October 31, 2011P. 24

(3) Consolidated Statements of Changes in Net Assets

Classification

Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)

Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)

AmountAmountShareholders’ equity
Capital stock
Balance at beginning of year

9,696,717

9,696,717－－

9,696,717

9,696,717

10,960,869

10,960,869

－

-120

－

-120

10,960,869

10,960,749

15,334,652

15,788,189

Dividends from surplus-656,742-656,695

Net income (loss)

1,041,964

1,165,821

Increase from change in scope of
consolidation

68,315－

Total changes of items during theyear

453,537

509,125

15,788,189

16,297,314-23,917-24,963

Purchase of treasury stock-1,045-848

Disposal of treasury stock－

571-1,045-277-24,963-25,240

35,968,321

36,420,813

Dividends from surplus-656,742-656,695

Net income (loss)

1,041,964

1,165,821

Changes of items during the year
Total changes of items during theyear
Balance at end of year
Capital surplus
Balance at beginning of year
Changes of items during the year
Disposal of treasury stock
Total changes of items during theyear
Balance at end of year
Retained earnings
Balance at beginning of year
Changes of items during the year

Balance at end of year
Treasury stock
Balance at beginning of year
Changes of items during the year

Total changes of items during theyear
Balance at end of year
Total shareholders’ equity
Balance at beginning of year
Changes of items during the year

Financial Statements Bulletin, FY Ended October 31, 2011
P. 25

Increase from change in scope of
consolidation

68,315Purchase of treasury stock-1,045-848

Disposal of treasury stock－450

452,491

508,727

36,420,813

36,929,541

235,603

147,516

Net changes of items other thanshareholders’ equity-88,086

51,302

Total changes of items during theyear-88,086

51,302

147,516

198,819－-40,486

Net changes of items other thanowners’ equity-40,486-2,272

Total changes of items during theyear-40,486-2,272-40,486-42,758

235,603

107,030

Net changes of items other thanshareholders’ equity-128,572

49,030Total changes of items during theyear-128,572

49,030107,030

156,060

337,929497,753

Net changes of items other thanshareholders’ equity

159,823

9,350

Total changes of items during theyear

159,8239,350

497,753

507,104

36,541,854

37,025,597

Total changes of items during theyear
Balance at end of year
Accumulated other comprehensive
incomeValuation difference on
available-for-sale securities
Balance at beginning of year
Changes of items during the year

Balance at end of year
Translation adjustments accountBalance at beginning of year
Changes of items during the year

Balance at end of year
Total accumulated othercomprehensive income
Balance at beginning of year
Changes of items during the year

Balance at end of year
Minority interests
Balance at beginning of year
Changes of items during the year

Balance at end of year
Total net assets
Balance at beginning of year
Changes of items during the year

Financial Statements Bulletin, FY Ended October 31, 2011
P. 26

Dividends from surplus-656,742-656,695

Net income (loss)

1,041,964

1,165,821

Increase from change in scope of
consolidation

68,315－Purchase of treasury stock-1,045-848

Disposal of treasury stock－450

Net changes of items other thanshareholders’ equity

31,25058,381

Total changes of items during theyear

483,742

567,108

37,025,597

37,592,706

Balance at end of year

Financial Statements Bulletin, FY Ended October 31, 2011P. 27

(4) Consolidated Statements of Cash Flows(Unit: Thousands of yen)
Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)

Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)
Classification
Cash flow from operating activities
Income before taxes and adjustments

2,162,400

2,446,510

Depreciation and amortization expense

7,766,703

8,835,460－

63,440

Amortization of goodwill

202,746

206,378

Loss on sale or retirement of fixed
assets

93,864

121,460

Installment purchases of assets forsmall-value rentals

17,062

38,057

Reclassification of cost of sales
associated with disposal of construction
equipment

11,065

3,703

Reclassification of cost of sales
associated with disposal of rental
assets804,250

469,093-2,462,216-1,959,417

27,925

134,714(Gain) loss on sales of investment
securities-153,309

16,948

Increase in allowance for doubtful
accounts-220,029-94,970

Increase in allowance for investment
loss

30,67541,310

Increase (decrease) in accrued
bonuses to employees

115,490-57,951

Increase (decrease) in accrued
employees retirement benefits

21,285-1,304,003

Increase (decrease) in retirement
allowances to directors and auditors-20,7294,708Interest revenue and dividend income-57,646-61,998

Interest expense on installment
purchases of rental assets

179,445

183,318

Interest expense

764,399

792,703

Decrease in accounts receivable, trade-267,722-1,463,045(Increase) decrease in inventory

55,469-49,726

Increase (decrease) in accounts
payable, trade-551,554

261,380

Loss on adjustment for changes ofaccounting standard for asset
retirement obligations－

95,530Loss from disaster－

837,968

Impairment loss

Expenditures for acquisition of rental
assetsValuation loss on investment securities

Financial Statements Bulletin, FY Ended October 31, 2011
P. 28

Increasein accounts payable, other

490,071742,842

Other

757,743-690,944

Subtotal

9,767,392

9,613,471

59,39662,017-869,996-926,960－-187,226

Refund (payment) of corporate andother taxes

131,844-1,657,775

Cash flow from operating activities

9,088,637

6,903,527

Interest and dividends received
Interest expense
Payments for loss on disaster

Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)

Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)

Classification
Cash flow from investing activities
Disbursements for investments in term
deposits-85,000－

Revenue from redemption of term
deposits

59,00050,000-265,253-517,851

Funds provided from the sale oftangible fixed assets

60,577

16,556

Funds used for the purchase ofintangible fixed assets-47,944-9,840Funds used for the purchase ofinvestment securities-538,548-449,791

Funds provided from sale of investment
securities

775,390299

Funds used for the purchase of
subsidiary stock-12,250-61,310Funds used for establishment ofsubsidiary company－-45,181

Funds used for short-term loans-84,986-163,140

Funds provided from collection ofshort-term loans receivable

160,680

105,056

Other

80,18062,101

Cash flow from investing activities

101,846-1,013,101

Decrease in short-term bank loans

11,332,180

9,767,868

Funds provided by long-term bankloans

2,609,045

2,580,000

Funds used to repay long-term bankloans

-10,804,656-10,935,261-42,000-22,000

Funds used for the purchase of tangible
fixed assets

Cash flow from financing activities

Funds used to redeem corporate bonds

Financial Statements Bulletin, FY Ended October 31, 2011
P. 29

Funds used for repayment of
installment obligations-4,382,407-6,006,420-790,532-1,057,208-1,045-848

Funds provided from the sale oftreasury stock－

450

Funds used for the purchase of treasury
stock of subsidiary－-3-657,319-656,398

Funds provided by payment fromminority shareholders－

68,265

Payment of dividends to minority
shareholders-1,006-1,006

Cash flow from financing activities-2,737,741-6,262,560-23,465-4,245

Increase (decrease) in cash andequivalents

6,429,277-376,380

Balance of cash and equivalents at
beginning of period

14,086,028

20,751,217

Increase in cash and cash equivalents due
to newly consolidated subsidiaries

185,114－

Increase in cash and cash equivalents
resulting from merger withunconsolidated subsidiaries

50,797－

20,751,217

20,374,836

Funds used for repayment of leaseobligations
Funds used for the purchase of treasury
stock

Payment of dividends

Effect of exchange rate changes on cash
and cash equivalents

Balance of cash and equivalents at end of
period*1

Financial Statements Bulletin, FY Ended October 31, 2011P. 30

(5) Notes Relating to the Going Concern Assumption
The Company had no material items to report.

(6) Significant Accounting Policies for the Consolidated Financial Statements
Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)
1. Companies included in the

Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)(1) Number of consolidated companies: 11 (1) Number of consolidated companies: 10

consolidation
Assist Co., Ltd.

Assist Co., Ltd

SRG Kanamoto Co., Ltd.

SRG Kanamoto Co., Ltd

Kanatech Co., Ltd.

Kanatech Co., Ltd

Daiichi Kikai Co., Ltd.

Daiichi Kikai Co., Ltd

Kanki Corporation

Kanki Corporation

Kyushu Kensan Co., Ltd.

Kyushu Kensan Co., Ltd.

Toyo Industry Co., Ltd.

Toyo Industry Co., Ltd.

Shanghai Jinheyuan Equipment

Shanghai Jinheyuan Engineering

Rental Co., Ltd.

Construction Co., Ltd.

Shanghai Jinheyuan Engineering

SJ Rental, Inc.

Construction Co., Ltd.

Kanamoto Engineering Co., Ltd.

SJ Rental, Inc.
Kanamoto Engineering Co., Ltd.
Beginning from the consolidated

Shanghai

Jinheyuan

Equipment

fiscal year under review, Shanghai

Rental Co., Ltd., which was included in

Jinheyuan Equipment Rental Co., Ltd.,the scope of consolidation until the

ShanghaiEngineering

previous consolidated fiscal year, wasConstruction Co., Ltd., SJ, Rental, Inc.

absorbed by and merged with Shanghai

and Kanamoto Engineering Co., Ltd.

Jinheyuan

are

Co.,

Jinheyuan

included

in

the

scope

of

EngineeringLtd.

duringConstruction
thecurrent

consolidation because the importanceconsolidated fiscal year, with Shanghaiof these companies to Kanamoto's

Jinheyuan

operations has increased.

Co., Ltd. as the surviving company.

Engineering

Construction

Kensan Techno Co., Ltd., which was
included in the scope of consolidation
until the previous consolidated fiscal
year, has been excluded from the scopeof consolidation because it merged with
Kyushu Kensan Co., Ltd
Narasaki

Lease

Co.,

Ltd.,

a

consolidated subsidiary, was absorbed
by and merged with the Company
during the consolidated fiscal year
under review, with Kanamoto, theownercompany,asthesurvivingcompany.
(2) Number of non-consolidated(2) Number of non-consolidated

companies: 5companies: 5

Non-consolidated subsidiary company

Non-consolidated subsidiary company

name:

name:

Comsupply Co., Ltd.

Comsupply Co., Ltd

Flowtechno Corporation

Flowtechno Corporation

Center Corporation

KG Machinery Ltd.

KG Machinery Co., Ltd.

KANAMOTO (HK) CO., LTD.

KANAMOTO (HK) CO., LTD.

Kanamoto & JP Nelson Equipment (S)Pte.Ltd.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 31

(Reason for exclusion from scope of(Reason for exclusion from scope of

consolidation)

consolidation)

The size of the non-consolidated

Same as at left

subsidiaries is small and their total
assets, sales and fiscal year profit orloss (amount corresponding to equity)andretainedearnings(amount

corresponding to equity) are small insize and do not have a material effectontheconsolidated

financialstatements.
2. Matters pertaining toFive

non-consolidated

subsidiaries

application of equity

have been omitted from items to which

method accounting

equity method accounting is applied
becausetheirrespective

effectSame as at lefton

consolidated net income or loss (amountcorresponding to minority interest) andconsolidated retained earnings (amountcorresponding to minority interest) is
immaterial and none of the companies isimportant to the Company’s overall
operations.
3. Matters pertaining to the

The fiscal year closing date for all offiscal year closing date fortheconsolidated subsidiaries

Kanki

consolidated

subsidiaries

Corporation

andexceptKanamoto

The fiscal year closing date for all oftheconsolidated

Kanki

subsidiaries

Corporation

andexceptKanamoto

Engineering Co., Ltd. is August 31. The

Engineering Co., Ltd. is August 31. The

fiscal year closing date for SJ Rental,

fiscal year closing date for SJ Rental,

Inc. is September 30. The fiscal year

Inc. is September 30. The fiscal year

closing date for Shanghai Jinheyuan

closing date for Shanghai Jinheyuan

Equipment

RentalEngineering Construction Co., Ltd. isShanghai

Jinheyuan

Co.,

Ltd.

and

Engineering

Construction Co., Ltd. is December 31.
When

preparingWhen

preparingtheconsolidated

consolidated

financial statements the Company usedfinancial statements the Company used

the financial statements of Shanghai

the financial statements of Shanghai

Jinheyuan Engineering Construction Co.,

Jinheyuan Equipment Rental Co., Ltd.

Ltd. based on a provisional settlement ofand Shanghai Jinheyuan Engineering

accounts implemented as of September

Construction

Co.,

a

30 and the financial statements of theprovisional

settlement

accounts

other subsidiaries as of each company’s

implemented as of September 30 andclosing date, adjusted for significant

the financial statements of the othertransactions that occurred between thesubsidiaries

company’s

subsidiaries’ fiscal year-end and theclosing date, adjusted for significant

consolidation date that have a materialtransactions that occurred between theeffectsubsidiaries’ fiscal year-end and theresults.

astheDecember 31.

Ltd.

of

based
of

each

on

on

the

consolidated

financialconsolidation date that have a material
effectontheconsolidated

financialresults.
4. Accounting principles andstandards used for normal
accounting treatment(1) Appraisal standards andappraisal methods forprincipal assets

a. Negotiable securities

a. Negotiable securities

Other negotiable securities

Other negotiable securities

Securities with a market price

Securities with a market priceFinancial Statements Bulletin, FY Ended October 31, 2011
P. 32

The Company has adopted the market

Same as at left

value method (the full amount of thevaluation difference is charged to net
assets using the direct transfer to capitalmethod,withthedisposal

cost

determined by the moving averagemethod) based on the market price on
the consolidated accounting fiscal year
closing date or similar prices.
Securities without market prices

Securities without market prices

The Company has adopted the cost

Same as at left

method, cost being determined by themoving average method
b. Construction equipment
Amountafter

depreciationb. Construction equipment

deduction

expenseofSame as at left

calculated

according to the straight-line methodfrom the original prices, by separate
fiscal year of purchase.
c. Merchandise inventories and suppliesc. Merchandise inventories and supplies(i) Merchandise inventories and products(i) Merchandise inventories and products

The Company has adopted the cost

The Company has adopted the cost

method, cost being determined based

method, cost being determined based onon

the periodic average method (amounts

theLast-in,First-out

method(amounts shown on the balance sheet

shown

are

determining

calculated by determining write-downs

write-downs of book value based on theof book value based on the decline in

decline in profitability)

profitability)

calculated

by

on

the

balance

sheet

are

(Change in accounting method)
Beginning

from

the

current

consolidated fiscal year, the Company
has adopted the Accounting StandardforMeasurementof

Inventories(Accounting Standards Board of Japan
Statement No. 9 dated September 26,2008), and Kanamoto and certain of its
domestic consolidated subsidiaries havechanged the measurement method formerchandise inventories and products
from the last-in-first-out method to theperiodic average method.
The affect of this change on earnings is
not material.
(ii) Work in process(ii) Work in process

The Company has adopted the cost

Same as at left

method, cost being determined by the
specific identification method(iii) Raw materials and supplies(iii) Raw materials and supplies

The Latest Purchase Cost method

Same as at left

(amounts shown on the balance sheet
arecalculatedbydetermining

write-downs of book value based on the
decline in profitability)(2) Depreciation methods forprincipal depreciablea. Tangible fixed assets (excluding leasea. Tangible fixed assets (excluding leaseassets)assets)Financial Statements Bulletin, FY Ended October 31, 2011
P. 33

assets

The

CompanyhasadoptedtheSame as at left

straight-line method for rental assets
and the declining-balance method forother assets. Buildings on land that isleased under a fixed-term land leaseagreement, however, are depreciatedusing the straight-line method using theremaining period of the fixed-term leaseas the depreciable life and zero residual
value.

For

certainconsolidated

subsidiaries the Company has adopted
the straight-line method for buildings
and structures acquired on or after April
1, 2000, but excluding fixtures andequipment.
The depreciable lives mainly used by
the Company are as follows.
Rental assets
Buildings andstructures

The depreciable lives mainly used by
the Company are as follows.

2-16 years

Rental assets
Buildings andstructures

2-60 years

2-15 years
2-60 years

b. Intangible fixed assets excluding leaseb. Intangible fixed assets (excluding leaseassets)assets)The

CompanyhasadoptedtheSame as at left

straight-line method.
Software for use within the Company
is depreciated using the straight-line
method based on the assumed useful life
for internal use (5 years)c. Lease assets
Thec. Lease assets

CompanyhasadoptedtheSame as at left

straight-line method using the leaseterm as the depreciable life and zero
residual value.
The Company accounts for financelease transactions except for leases thattransfer ownership of the property forwhich the lease start date is before
October

31,

2008

by

applying

accounting treatment based on themethodappliedforordinary

rentaltransactions.
(3) Accounting standards forprincipal allowances andreserves

a. Reserve for doubtful accounts

a. Reserve for doubtful accounts

To provide for losses on doubtfulSame as at left

accounts such as accounts receivable,
the Company charges to income anamount based on actual loss experience
for normal accounts, plus an amount for
projected unrecoverable amounts basedon assessments of individual accounts.
b. Accrued bonuses to employeesb. Accrued bonuses to employees

To fully provide for expenditures ofbonusestheCompany

will

paySame as at leftto

employees, an amount is appropriatedto the reserve during the year based
upon a salary estimate amount.
c. Allowance for disaster losses

Financial Statements Bulletin, FY Ended October 31, 2011
P. 34

To

providefor

repaircosts

anddisposal costs for assets damaged or
destroyed by the Great East Japan
Earthquake, the Company charged theestimated amount of such costs toincome at the end of the current
consolidated fiscal year.
d. Accrued employees retirement benefitd. Accrued employees retirement benefit

The Company provides for employees’

The Company provides for directors’

accrued retirement benefits based upon

accrued retirement benefits based upon

the projected amounts of the liability for

pertinent rules and appropriated to theaccrued employees retirement benefits

account proportionately at the end of theand the value of pension assets at theconsolidated fiscal year based uponend of the consolidated fiscal year. At

length of service.

the end of each consolidated fiscal year,
the Company appropriates an amount to
the reserve to provide for the liability
recognized

duringtheperiod.

difference

based

on

an

calculationischargedThe

actuarial

toincomebeginning in the fiscal year following theyear in which incurred, with the amounts
allocated

proportionately

straight-line

method,

using

based

on

the
a

specified number of years (10 years)
that is less than the average remaining
period of employment for employees at
the time the difference arises.
(Change in accounting method)
Beginning from the consolidated fiscal
year under review, the Company has
adopted the Partial Amendments to the
AccountingStandardfor

Retirement

Benefits (Part 3) (Accounting Standards
Board of Japan Statement No. 19 dated
July 31, 2008).
The effect of this change on theoperating income, ordinary income andincome before income taxes is notmaterial.
(Supplemental information)
On October 1, 2011, the Company
transferreditsretirement

benefits

system for employees from a defined
benefit corporate pension plan to adefined contribution corporate pension
plan, and has applied the Accounting fortheTransfer

Benefit

Plans

Standards

BetweenRetirement(Financial

Accounting

Implementation

Guidance

No. 1).
The

Company¥1,465,200,000

accounted
effectfortheaccompanying

this transfer as a “gain on termination ofretirement benefit plan” in extraordinary
profits.
e. Retirement allowances to directors ande. Retirement allowances to directors andauditors

auditors

Financial Statements Bulletin, FY Ended October 31, 2011
P. 35

The Company provides for retirement

Same as at left

allowances to directors and auditors
based

upon

pertinent

appropriatedtoproportionately

at

rules

the
the

and

account

end

of

the

consolidated fiscal year based upon
length of service.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 36

f. Reserve for investment losses

f. Reserve for investment losses

The Company provides for losses

Same as at leftfrom the decline in real prices of assets
such

as

the

stock

of

subsidiarycompanies that are not subject to asset
impairment

accounting

byapplying

internally established standards that
take

into

consideration

subsidiarycompany operating results and asset
quality.
(4) Accounting standards forprincipal income andexpenses

Accounting standards for amount of

Accounting standards for amount ofcompleted works and cost of construction

completed works and cost of construction

works

works

a. Construction works for which theSame as at left

portion of the works completed by the endof the year can be reliably determined
Percentage-of-completion method(progressin

construction

works

is

estimated using the cost comparison
method)b. Other construction works
Completed-contract method(Change in accounting method)
The Company traditionally reported
revenues and costs of construction
contracts

byapplying

thecompleted-contract method. Beginningfrom the consolidated fiscal year underreview, the Company will apply the
Accounting Standard for Construction
Contracts (Accounting Standards Boardof Japan Statement No. 15, December
27,

2007)

and

the

Guidanceon

Accounting Standard for Construction
Contracts (Accounting Standards Boardof Japan Implementation Guidance No.
18, December 27, 2007). Beginning
from

works

contracts

for

which

construction activity was begun during
theconsolidated

fiscal

year

under

review, the Company will apply thepercentage of completion method forworks for which the outcome of theconstruction activity is deemed certainby the end of the consolidated fiscal
year under review (with the estimate of
the percentage of completion based on
the cost incurred as a percentage of
estimated total cost), and will apply thecompleted-contract

methodforallother works.
The effect of this change on earnings
is not material.
The effect of this change on the
Company’s information by segment is
described in the relevant section.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 37

(5) Standard for conversionof foreign
currency-denominatedassets or liabilities into
Japanese yen

TheCompany

converts

monetaryclaimsandmonetary

liabilities

Same as at leftdenominated in foreign currencies into
Japanese yenat the spot market

exchange rate on the consolidated fiscal
year settlement date, and charges thetranslation difference to income as again or loss. The assets and liabilities ofcontrolledforeigncorporations

areconverted into Japanese yen at the spot
exchange

rate

on

the

foreigncorporation’s fiscal year closing date,
and

the

earnings

and

costs

are

converted into Japanese yen using to
the average market price during theperiod, and the translation difference isaccounted for by including the amounts
in the total valuation and translation
adjustments

account

andminority

interests in net assets.
(6) Hedge accounting forprincipal hedging
methodsa. Hedge transactions

a. Hedge transactions

The Company accounts for hedge

Same as at lefttransactions using allocations based on
accounting

standards

currency-denominatedforforeigntransactions,and special rule accounting based on
accounting

standards

forfinancial

products.
b. Hedge methods and hedgedb. Hedge methods and hedgedtransactionstransactions

The Company uses currency swaps

Same as at left

and forward transactions in order toavoid thecurrency fluctuation risk

relatedthetoCompany’s

foreigncurrency-denominated straight bonds
and liabilities for import payments. The
Company also uses interest swaps to
avoid

interest

rate

fluctuation

risk

related to interest on bank borrowing.
c. Hedging policies

c. Hedging policies

The Company’s use of derivative

Same as at lefttransactions is limited to hedging risk
within the scope of the Company’s
assets and liabilities subject to market
fluctuation risk.
d. Method for evaluating the effectivenessd. Method for evaluating the effectivenessof hedgesof hedges

The

Company’s

interest

swap

Same as at lefttransactions fulfill the requirements for
specialruleaccounting,

and

the

Company has elected to use this inplace of an evaluation of effectiveness.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 38

The Company amortizes goodwill and(7) Amortization method andamortization period for
goodwill

negativegoodwill

generated

beforeOctober 31, 2010 using straight-line
depreciation over five years. However,extremely small amounts are written off
completely in the year in which theyoccur.
Funds included in cash (cash and cash(8) Items included in cash
and equivalents on theConsolidated Statementsof Cash Flowsequivalents)

on

the

Consolidated

Statement of Cash Flows include cash
on

hand,

deposits

that

can

be

withdrawn on demand and highly liquid
short-term investments that mature
within three months of the date ofacquisition and which can be easily
converted into cash and that haveminimal risk of a change in price.
(9) Accounting standards for
consumption tax

Consumption tax is taken out of all

Same as at left

Statement of Income items and Balance
Sheet

items,

exceptmainlyforadoptedthereceivables and payables.
5. Valuation of consolidated

The

Companyhas

subsidiary assets andmarket value appraisal method for theliabilities

evaluation of assets and liabilities of
consolidated subsidiaries.

6. Amortization of goodwill

The remainder is amortized over fiveand negative goodwill

years using level amortization, except
for extremely small amounts that are
written off completely in the year inwhich they occur.

7. Items included in cash andCash on hand, deposits that can beequivalents on thewithdrawn on demand and highly liquid

Consolidated Statements

short-term investments that matureof Cash Flows

within three months of the date ofacquisition and which can be easily
converted into cash and that haveminimal risk of a change in price.

Financial Statements Bulletin, FY Ended October 31, 2011P. 39

(7) Changes in Significant Accounting Policies for the Consolidated Financial Statements
Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)

Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)(Application of the Accounting Standard for Business(Application of the Accounting Standard for Asset

Combinations etc.)

Retirement Obligations etc.)

In conjunction with the application of the AccountingStandard

Business

the Company has adopted the Accounting Standards forStandards Board of Japan Statement No. 21, December

Asset Retirement Obligations (Accounting Standards

26, 2008, the Accounting Standard for Consolidated

Board of Japan Statement No. 18 dated March 31, 2008

Financial Statements (Accounting Standards Board ofand the Guidance on Accounting Standard for AssetJapan Statement No. 22, December 26, 2008), theRetirement Obligations (Accounting Standards Board ofPartial Amendments to the Accounting Standard forJapan Guidance No. 21 dated March 31, 2008).

andCombinations

Beginning from the current consolidated fiscal year,(Accounting

ResearchforDevelopment

Costs(Accounting

As a result, operating income and ordinary income

Standards Board of Japan Statement No. 23, December

were ¥7,162,000 lower, respectively, and income before

26, 2008), the Accounting Standard for Businesstaxes and adjustments was ¥102,692,000 lower, thanDivestitures (Accounting Standards Board of Japanthey otherwise would have been had the accounting

Statement No. 7, December 26, 2008), the Revised

standards used in past periods been applied.

Accounting Standard for Equity Method of Accounting
for Investments (Accounting Standards Board of Japan
Statement

No.

16,

portionreleasedpubliclyonDecember 26, 2008) and the Revised Guidance on the
Accounting Standard for Business Combinations andAccountingStandard

forBusiness

Divestitures(Accounting Standards Board of Japan Guidance No. 10,
December 26, 2008) beginning from the first businesscombinationandbusiness

separation

that

is

implemented on or after April 1, 2010, beginning fromthe consolidated fiscal year under review the Company
will apply these accounting standards for businesscombinations and business divestitures implemented on
or after April 1, 2010.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 40

(8) Changes in Reporting Method
Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)(Consolidated Statements of Income)Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)(Consolidated Statements of Income)1. Until the previous consolidated fiscal year, “rental

Beginning from the current consolidated fiscal year,

revenues” and “sales” were reported separately under

the Company will apply the Cabinet Office Ordinance“Revenues from operations,” and the “cost of rental

Partially Revising the Regulations for Terminology,

revenues” and “cost of goods sold” were reported

Formats

separately under “Cost of revenues from operations,”

Statements (Cabinet Ordinance No. 5 dated March 24,

respectively. Beginning from the consolidated fiscal

2009),

year under review, these items will be reported as

Consolidated Financial Statements (ASBJ Statement No.

single amounts in “Total revenues” and “Total cost of

22 dated December 26, 2008) and has disclosed the line

revenues from operations,” respectively.
2. Until the previous consolidated fiscal year, the

and
based

Preparationonthe

Methods

AccountingofFinancialStandard

foritem “income before adjustment for minority interests(loss).”

Company reported the gain on sale of investment
securities in “Other” under extraordinary profits. The
Company has reported this item separately because
the amount exceeded 10% of total extraordinary
profits.
The amount of “Gain on sale of investment
securities” in the previous consolidated accounting
fiscal year was ¥50,000.

(9) Supplemental Information
Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)

Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)

Beginning from the current consolidated fiscal year,
the Company has adopted the Accounting Standard
forPresentationofComprehensive

Income(Accounting Standards Board of Japan Statement No.
25 dated June 30, 2010). However, in the priorconsolidated

fiscalyear

theamountsfor“Accumulated other comprehensive income” and“Total accumulated other comprehensive income”
were reported in the amounts shown for “Valuationand translation adjustments” and “Total valuation andtranslation adjustments.”

Financial Statements Bulletin, FY Ended October 31, 2011
P. 41

(10) Notes to the Consolidated Financial Statements(Notes to the Consolidated Balance Sheets)(Unit: Thousands of yen)
Prior Consolidated Fiscal Year(As of October 31, 2010)

Current Consolidated Fiscal Year(As of October 31, 2011)

1. Matters related to non-consolidated subsidiaries and

1. Matters related to non-consolidated subsidiaries andaffiliated companies are as follows.
Investment securities (stocks)

affiliated companies are as follows.
117,270

2. Assets provided for security

Investment securities (stocks)

190,191

2. Assets provided for security

Cash and deposits

35,000Cash and deposits

Buildings and structures

44,713

Buildings and structures

20,00041,703Land472,376Land

435,940

The above assets have been pledged as security for

The above assets have been pledged as security forshort-term bank loans of ¥295,000, long-term bankshort-term bank loans of ¥280,000 long-term bankloans due within one year of ¥98,344 and long-termloans due within one year of ¥63,154 and long-termbank loans of ¥115,296.

bank loans of ¥52,262.

3. Guarantees

3. Guarantees

Joint and several guarantees ofbank loans to employees (Bankof Tokyo-Mitsubishi UFJ, others)

34,788

Joint and several guarantees ofbank loans to employees (Bankof Tokyo-Mitsubishi UFJ, others)

32,486

Guarantee of borrowing liabilities
of Flowtechno Corporation, a
non-consolidated subsidiarycompany

100,000

Guarantee of borrowing liabilities
of Flowtechno Corporation, a
non-consolidated subsidiarycompany

100,000

Guarantee of borrowing liabilities
of KG Machinery Co., Ltd., a
non-consolidated subsidiarycompany

15,010

Guarantee of borrowing liabilities
of KG Machinery Co., Ltd., a
non-consolidated subsidiarycompany

970

52,693

Guarantee of installment
payment liabilities of KG
Machinery Co., Ltd., a
non-consolidated subsidiarycompany

Guarantee of installment
payment liabilities of KG
Machinery Co., Ltd., a
non-consolidated subsidiarycompany
Total

202,491

Guarantee of borrowing liabilities
of KANAMOTO (HK) CO., LTD., a
non-consolidated subsidiarycompany
Guarantee of borrowing liabilities
of KANAMOTO (HK) CO., LTD., a
non-consolidated subsidiarycompany
Total

4. Discount on notes receivable, trade

110,006

5. Liquidation of receivables based on receivablestransfer facility
Notes receivable, trade

4. Discount on notes receivable, trade38,947

HK$15,500,000(155,155)

US$155,000(12,051)
339,610100,209

5. Liquidation of receivables based on receivablestransfer facility

4,732,008

Notes receivable, trade

5,000,559

Liquidated claims bearing a right of recourse to the

Liquidated claims bearing a right of recourse to theCompany and included in the balance of notes

Company and included in the balance of notes

receivable, trade transferred total ¥1,046,075.

receivable, trade transferred total ¥1,054,898.

6. Goodwill and negative goodwill
Goodwill and negative goodwill are offset and shown
as a net amount.
The amounts before being offset are shown below

6. Goodwill and negative goodwill
Goodwill and negative goodwill are offset and shown
as a net amount.
The amounts before being offset are shown below

Financial Statements Bulletin, FY Ended October 31, 2011
P. 42

Goodwill

536,697

Goodwill

280,490

Negative goodwill

191,241

Negative goodwill

121,409

Net amount

345,456

Net amount

159,081

7. Notes and bills maturing at the end of the consolidated
fiscal year
Notes and bills maturing on the last day of theconsolidated fiscal year are settled and processed on
the note and bill clearing date. Because the last day of
the Company's consolidated fiscal year was a financial
institution holiday, notes and bills maturing on the final
day of the following consolidated fiscal year are
included in the consolidated fiscal year balance.
Notes receivable, trade
Notes payable, tradeOther

70,284
1,193,675
12,658Financial Statements Bulletin, FY Ended October 31, 2011
P. 43

(Notes to the Consolidated Statements of Income)(Unit: Thousands of yen)
Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)

Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)
1. Major expense categories and amounts included in

1. Major expense categories and amounts included inselling, general and administrative expenses

selling, general and administrative expenses

Employee salaries and wages

7,071,779

Employee salaries and wages

Depreciation expense

1,016,536

Depreciation expense

Rents

1,851,971

Rents

Transfer to allowance for
doubtful accounts
Transfer to accrued bonuses to
employees
Employees retirement benefit
expenseTransfer to retirement
allowances to directors andauditors
Amortization of goodwill

38,187585,982
524,374
23,692

272,578

2. Gain on sale or retirement of fixed assets
Buildings and structures
Machinery, equipment anddelivery equipment
Other
Total

2,770
3,475
4,212

87,445
511,159
558,660
19,986276,210

Buildings and structures
Machinery, equipment anddelivery equipment
Total

381
11,036
11,418

3. Loss on sale or retirement of fixed assets(Loss on sale of fixed assets)
11,458
1,100
10,344208(Loss on retirement of fixed assets)
Rental equipment

41,355

Buildings and structures
Machinery, equipment anddelivery equipment
Other

28,726

Total

Transfer to allowance for
doubtful accounts
Transfer to accrued bonuses to
employees
Employees retirement benefit
expenseTransfer to retirement
allowances to directors andauditors
Amortization of goodwill

10,459(Loss on sale of fixed assets)

Other

957,725
1,809,345

2. Gain on sale or retirement of fixed assets

3. Loss on sale or retirement of fixed assets

Buildings and structures
Machinery, equipment anddelivery equipment
Land

7,063,829

2,730
8,399

Buildings and structures
Machinery, equipment anddelivery equipment
Other

9,981
81
40

(Loss on retirement of fixed assets)
Rental equipment

83,482

Buildings and structures
Machinery, equipment anddelivery equipment
Other

35,973

Total

2,369
949
132,878

104,323

Financial Statements Bulletin, FY Ended October 31, 2011
P. 44

Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)

Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)
4. Impairment loss
During this consolidated fiscal year the Kanamoto
Group incurred an impairment loss on the following
asset groups.
Location
Ichihara City,
Chiba Prefecture
Iiyama City,
Nagano Prefecture

Use

Asset

Dormant assets

Land

Dormant assets

Land

Asset groupings used by the Kanamoto Group to
apply asset impairment accounting are based on theblock classified by the segment and operating area forwhich

profitability

can

be

determined

regularly.

Dormant assets are grouped as units that generate
independent cash flow.
For certain dormant assets for which the asset value
was less than book value, the Company reduced bookvalue to the recoverable value, and accounted for the
reduction as an impairment loss (¥63,440) under
extraordinary losses. This ¥63,440 was for land.
The recoverable value for this asset group ismeasured according to net sales price, and the land isevaluated using the inheritance tax assessment value
based on the land tax assessment value or otheramount as a base.
5. Loss from disaster
The Company accounted for the losses incurred as aresult of the Great East Japan Earthquake on March 11,2011 as a “Loss from disaster.”At the end of the current consolidated fiscal year, anamount for estimated losses related to the Great East
Japan Earthquake was reported in the allowance fordisaster losses, and the transfer to allowance fordisaster losses of ¥289,850 was included in “Loss fromdisaster.”
The principal amounts are provided below.
Cost to restore fixed assets etc. to224,515
their original condition
Destruction loss of fixed assets etc.
444,118
Other
Total

169,335
837,968

Financial Statements Bulletin, FY Ended October 31, 2011
P. 45

(Notes to the Consolidated Statements of Comprehensive Income)Current consolidated fiscal year (From November 1, 2010 to October 31, 2011)
1. Previous consolidated fiscal year comprehensive income reported in the current consolidated fiscal year
Comprehensive income attributable to owners of the parent

915,855,000

Comprehensive income attributable to minority interests-47,922,000

Total

867,933,000

2. Previous consolidated fiscal year other comprehensive income reported in the current consolidated fiscal
year
Valuation difference on other investment securities-85,621,000

Translation adjustments account-54,570,000

Total-140,191,000

Financial Statements Bulletin, FY Ended October 31, 2011
P. 46

(Notes to the Consolidated Statements of Changes in Net Assets)
Prior consolidated fiscal year (From November 1, 2009 to October 31, 2010)
1. Class of shares issued and number of shares, treasury stock and number of shares(Thousands of shares)
Number of shares at Increase in number of Decrease in number Number of shares atthe end of the priorshares during theof shares during the the end of the current
consolidated fiscal
current consolidated current consolidated
consolidated fiscal
year
fiscal year
fiscal year
year
Number of shares issued
Common stock (Note)

32,872－－32,872

Total

32,872－－32,872

Common stock (Note)

34

2

－

36

Total

34

2

－

36

Treasury stock(Notes) The number of treasury stock shares of common stock increased by 2,000 shares through purchases of sharescomprising less than one investment unit.

2. Matters pertaining to subscription rights and treasury stock subscription rights
The Company had no material items to report.
3. Dividends(1) Dividends paid
Resolution
December 29, 2009
Board of Directors
June 4, 2010
Board of Directors

Class of stock

Total dividend(Thousand yen)

Dividend pershare (yen)Common stock

328,378

Common stock

328,363

Date of record

Payment date

10.00

October 31, 2009

January 29, 2010

10.00

April 30, 2010

July 12, 2010

(2) Dividends for which the date of record falls in the current consolidated fiscal year and thedividend payment date is in the following fiscal year
Resolution

Class ofstock

December 27, 2010

CommonBoard of Directors

stock

Total dividend
Source of funds Dividend per(Thousandfor dividend
share (yen)yen)
328,353

Retainedearnings

10.00

Date of record

Payment date

October 31, 2010 January 28, 2011

Financial Statements Bulletin, FY Ended October 31, 2011
P. 47

Current consolidated fiscal year (From November 1, 2010 to October 31, 2011)
1. Class of shares issued and number of shares, treasury stock and number of shares(Thousands of shares)
Number of shares at Increase in number of Decrease in number Number of shares atthe end of the priorshares during theof shares during the the end of the current
consolidated fiscal
current consolidated current consolidated
consolidated fiscal
year
fiscal year
fiscal year
year
Number of shares issued
Common stock (Note)

32,872－－32,872

Total

32,872－－32,872

Common stock (Note)

36

1

0

37

Total

36

1

0

37

Treasury stock(Notes) The number of treasury stock shares of common stock increased by 1,000 shares through purchases of sharescomprising less than one investment unit.

2. Matters pertaining to subscription rights and treasury stock subscription rights
The Company had no material items to report.
3. Dividends(1) Dividends paid
Resolution
December 27, 2010
Board of Directors
June 8, 2011
Board of Directors

Class of stock

Total dividend(Thousand yen)

Dividend pershare (yen)Common stock

328,353

Common stock

328,342

Date of record

Payment date

10.00

October 31, 2010

January 28, 2011

10.00

April 30, 2011

July 11, 2011

(2) Dividends for which the date of record falls in the current consolidated fiscal year and thedividend payment date is in the following fiscal year
Resolution

Class ofstock

December 27, 2011

CommonBoard of Directors

stock

Total dividend
Source of funds Dividend per(Thousandshare (yen)for dividend
yen)
328,345

Retainedearnings

10.00

Date of record

Payment date

October 31, 2011 January 30, 2012

Financial Statements Bulletin, FY Ended October 31, 2011
P. 48

(Notes to the Consolidated Statements of Cash Flows)(Unit: Thousands of yen)
Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)

Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)

1. Relationships between fiscal year-end balance for cash

1. Relationships between fiscal year-end balance for cash

and equivalents and amounts for items shown on theand equivalents and amounts for items shown on the

consolidated fiscal year balance sheet

consolidated fiscal year balance sheet

Cash and deposits accountTime deposits with a maturity

20,486,217-85,000

longer than 3 months
Negotiable securities
Cash and cash equivalents

Cash and deposits account

20,059,836

Time deposits with a maturity-35,000

longer than 3 months
350,000
20,751,217

2. Details of major non-cash transactions

Negotiable securities

350,000

Cash and cash equivalents

20,374,836

2. Details of major non-cash transactions

The amount of assets and liabilities related to(1) The amount of assets and liabilities related to

installment transactions and the amount of assets andinstallment transactions and the amount of assets andliabilities related to lease transactions that are newly

liabilities related to lease transactions that are newly

accounted for during the consolidated fiscal year underaccounted for during the consolidated fiscal year underreview are ¥6,774,979 and ¥1,484,045, respectively.

review are ¥12,081,313 and ¥914,127, respectively.
(2)

The

amountrelatedtoasset

retirement

obligations that are newly accounted for during thisconsolidated fiscal year is ¥147,078.
3. A breakdown of the main assets and liabilities
succeeded to from the non-consolidated subsidiary
Aomori Narasaki Rental Co., Ltd., which was merged
into Kanamoto during the consolidated fiscal year underreview, is shown below:
Aomori Narasaki Rental Co., Ltd.
Current assets

94,787

Fixed assets

8,489

Total assets

103,277

Current liabilities

89,309Total liabilities

89,309Financial Statements Bulletin, FY Ended October 31, 2011
P. 49

(Business Segment Information)
1. Segment Information by Type of BusinessPrior consolidated fiscal year (From November 1, 2009 to October 31, 2010)(Unit: Thousands of yen)
Construction
equipment
rentalbusiness

Steel sales
business

Information
products
businessand otherbusinesses

64,263,139

5,219,731

690,782

70,173,653－

70,173,653

－

－

－

－

－

－

Eliminations
or entire
Consolidated
company

Total

I. Revenues and operating income
Revenues(1) Sales to outside customers(2) Sales or transfers between
related segments

64,263,139

5,219,731

690,782

70,173,653－

70,173,653

Operating expenses

61,609,389

5,193,281

671,385

67,474,056

50,66067,524,717

Operating income-50,660

2,648,935

Total

2,653,749

26,44919,3972,699,596

II. Assets, depreciation expenseand capital disbursements
Assets

78,896,353

2,011,080

125,245

81,032,679

Depreciation expense

7,427,005

3,218

598

7,430,822

335,880

7,766,703

Capital disbursements

15,160,136

756－

15,160,893

269,511

15,430,405

27,476,919 108,509,599(Notes) 1. Method of business classification
Businesses are classified based on consideration of similarities such as the type of labor and products, the natureof the business and the business markets.
2. Principal products, by businessBusiness

Principal products

Construction equipment
rentals

Construction equipment such as hydraulic shovels, generators,
temporary construction materials, construction safety equipment,
temporary modular housing units

Steel sales

Steel bar, sheet steel, steel products such as round bar, steel scrap

Information products andother businesses

Computers
equipment

andperipheraldevices,

telecommunications-related

3. The total amount for assets that were eliminated or included in the categories for all companies was¥27,476,919,000 and represents primarily idle working capital (cash, deposits and negotiable securities)
long-term investment funds (investment securities) and assets used in administrative departments at theparent company.
4. Changes in accounting methods(Change in accounting standard for completed contract revenues and cost of completed contracts)
As reported in 4. (4) in “Significant Accounting Policies for the Consolidated Financial Statements,” beginningfrom the consolidated fiscal year under review the Company will apply the Accounting Standard for Construction
Contracts (ASBJ Statement No. 15, December 27, 2007) and the Guidance on Accounting Standard forConstruction Contracts (ASBJ Implementation Guidance No. 18, December 27, 2007).
In conjunction with this change, the effect on the profit and loss of the Company's Steel Sales Division-related
businesses is not material compared with what earnings otherwise would have been had the accounting standard
used in prior fiscal years been applied.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 50

2. Segment information by location
Prior consolidated fiscal year (From November 1, 2009 to October 31, 2010)
The Company has omitted a description of segment information by location because the amounts forrevenues and assets in Japan account for more than 90% of total revenue and total assets in all
segments.
3. Foreign sales
Prior consolidated fiscal year (From November 1, 2009 to October 31, 2010)
The Company has omitted a description of foreign sales because foreign sales are less than 10% ofconsolidated revenues.
4. Segment information
Current consolidated fiscal year (From November 1, 2010 to October 31, 2011)
1. Summary of reportable segments
The Company’s reportable segments are those units of the Company’s for which discrete financial
statements are available and for which the Board of Directors regularly conducts a review for the purposeof making decisions about resources to be allocated to the segments and assess the segments’performance.
The Company is developing its businesses according to products and services, and has assumed“business related to the Construction Equipment Rental Division” as its reporting segment.
The Company’s “business related to the Construction Equipment Rental Division” rents and sells
construction equipment and temporary materials for construction use.
2. Method of calculating the amount of revenues, income or loss, assets, liabilities and other items of eachreporting segment
Except for the Standard for Measurement of Inventories, the accounting standards and methods for thereported business segment are generally identical to the description in “Significant Accounting Policies for
the Consolidated Financial Statements”.
The Company values inventory assets using prices before write-downs of book value based on decline
in profitability.
Reporting segment earnings are the values on an operating income basis.
3. Information concerning the amount of revenues, income or loss, assets, liabilities and other items ofeach reporting segment
Prior consolidated fiscal year (From November 1, 2009 to October 31, 2010)(Unit: Thousands of yen)
Reporting segment
Construction-related

Other businesses(Note)

Total

Revenues
Sales to outside customers

64,263,139

5,910,513

70,173,653

－

－

－

64,263,139

5,910,513

70,173,653

Segment income

2,653,749

45,846

2,699,596

Segment assets

78,896,353

2,136,326

81,032,679

7,427,005

3,817

7,430,822

Sales or transfers between related
segments
Total

Other items
Depreciation and amortization
expenseFinancial Statements Bulletin, FY Ended October 31, 2011
P. 51

Amount of increase of tangible
fixed assets and intangible fixed

15,160,136

756

15,160,893

assets(Note) The “Other businesses” classification encompasses business segments not included in the reporting segment,
and includes business related to the Steel Sales Division and business related to the Information Products
Division and other businesses.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 52

Current consolidated fiscal year (From November 1, 2010 to October 31, 2011)(Unit: Thousands of yen)
Reporting segment

Other businesses(Note)

Construction-related

Total

Revenues
Sales to outside customers
Sales or transfers between related
segments
Total

64,711,947

6,374,877

71,086,825

－

－

－

64,711,947

6,374,877

71,086,825

Segment income

2,586,175

143,769

2,729,945

Segment assets

86,651,284

1,944,837

88,596,122

8,524,057

3,460

8,527,518

Amortization of goodwill

276,210－276,210Extraordinary losses

63,440－63,440(Impairment loss)

63,440－63,44016,127,361

781

16,128,142

Other items
Depreciation and amortization
expenseAmount of increase of tangible
fixed assets and intangible fixed
assets(Note) The “Other businesses” classification encompasses business segments not included in the reporting segment,
and includes business related to the Steel Sales Division and business related to the Information Products
Division and other businesses.

4. Difference between total reporting segment amount and the amount reported on the Consolidated
Statements of Income, and the main reasons for the difference (Matters Pertaining to Reconciliation ofDifference)(Unit: Thousands of yen)
Revenues

Prior consolidated

Current consolidated

fiscal year

fiscal year

Reporting segment total

64,263,139

64,711,947

Revenues for “Other businesses” classification

5,910,513

6,374,877

70,173,653

71,086,825

Revenues reported in the consolidated financial
statements(Unit: Thousands of yen)
IncomeReporting segment total

Prior consolidated

Current consolidated

fiscal year

fiscal year

2,653,749

2,586,175

Income for “Other businesses” classification

45,846

143,769

Other adjustments-50,660

175,6452,648,935

2,905,590

Operating income reported in the consolidated
financial statements

Financial Statements Bulletin, FY Ended October 31, 2011
P. 53

(Unit: Thousands of yen)
AssetsPrior consolidated

Current consolidated

fiscal year

fiscal year

Reporting segment total

78,896,353

86,651,284

Assets of “Other businesses” classification

2,136,326

1,944,837

Company assets (note)

27,476,919

26,524,175

108,509,559

115,120,298

Total assets reported in the consolidated financial
statements(Note) Company assets are mainly assets used in administrative divisions at the parent company that are not
attributable to the reporting segment.
(Unit: Thousands of yen)Amount reported in theReporting segment total

Other businesses

Adjustment

consolidated financial
statements

Other items
Prior

Consolidated

Prior

Consolidated

Prior

Consolidated

Prior

Consolidated

consolidated

fiscal year

consolidated

fiscal year

consolidated

fiscal year

consolidated

fiscal year

fiscal year

under review

fiscal year

under review

fiscal year

under review

fiscal year

under review

7,427,005

8,524,057

3,817

3,460

335,880

307,941

7,766,703

8,835,460

15,160,136

16,127,361

756

781

269,51139,45915,430,405

16,167,601

Depreciation andamortization expense
Increase in tangible
fixed assets andintangible fixed assets(Note) The adjustments to the increases in tangible fixed assets and intangible fixed assets are capital investments
related to administrative divisions.

5. Related information
Current consolidated fiscal year (From November 1, 2010 to October 31, 2011)
1. Information by product and service
The Company has omitted a description of information by product and service because revenues tooutside customers in each product and service classification account for more than 90% of revenues
reported in the Consolidated Statements of Income.
2. Information by region(1) Revenues
The Company has omitted a description of information by region because revenues to outside
customers in Japan account for more than 90% of total revenues reported in the Consolidated
Statements of Income.
(2) Tangible fixed assets
The Company has omitted a description of tangible fixed assets because the amount of tangible
fixed assets located in Japan account for more than 90% of the total for tangible fixed assets
reported in the Consolidated Balance Sheets.
3. Main customers
The Company has omitted a description of sales to outside customers because there are no specificcustomers to which sales account for more than 10% of the revenues reported in the Consolidated
Statements of Income.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 54

6. Information concerning impairment losses on fixed assets by reporting segment
Current consolidated fiscal year (From November 1, 2010 to October 31, 2011)(Unit: Thousands of yen)
Business related to
the Construction
Equipment Rental

Corporate andOthersTotaleliminations

Division
Impairment losses

63,440－63,440－7. Information concerning amortization of goodwill and unamortized balances by reporting
segment
Current consolidated fiscal year (From April 1, 2010 to March 31, 2011)(Unit: Thousands of yen)
Business related to
the Construction
Equipment Rental

Corporate andOthersTotaleliminations

Division
Amortization in thecurrent period
Balance at the endof current period

276,210－－276,210

280,490－－

280,490

8. Information concerning gain on negative goodwill by reporting segment
Current consolidated fiscal year (From November 1, 2010 to October 31, 2011)
The Company had no material items to report.
(Supplemental information)
Current consolidated fiscal year (From November 1, 2010 to October 31, 2011)
Beginning from the current consolidated fiscal year, the Company has adopted the AccountingStandard for Disclosures about Segments of an Enterprise and Related Information (AccountingStandards Board of Japan Statement No. 17, revision dated March 27, 2009 and the Guidance on
Accounting Standard for Disclosures about Segments of an Enterprise and Related Information(Accounting Standards Board of Japan Guidance No. 20 dated March 31, 2008).

Financial Statements Bulletin, FY Ended October 31, 2011
P. 55

(Notes to Leasing Transactions)(Unit: Thousands of yen)
Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)

Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)
1. Finance lease transactions (Lessor)

1. Finance lease transactions (Lessor)

Finance lease transactions except for leases that

Finance lease transactions except for leases thattransfer ownership of the property to the lesseetransfer ownership of the property to the lesseea) Lease assetsa) Lease assets

Tangible fixed assets

Tangible fixed assets

Construction-related business rental equipment andSame as at left

other tangible fixed assets.
b) Method of depreciation for lease assetsb) Method of depreciation for lease assets

Lease assets are depreciated according to the method

Same as at left

described in “4. Accounting principles and standards
used for normal accounting treatment(2) Depreciation

methods

assets”

forprincipal

depreciable

in

the

Significant Accounting Policies for the Consolidated
Financial Statements.
The Company accounts for finance lease transactions
except for leases that transfer ownership of the property
for which the lease start date is before October 31, 2008
by applying accounting treatment based on the method
applied for ordinary rental transactions. Details areprovided below.
(1) Amounts corresponding to lease property(1) Amounts corresponding to lease property
acquisition price, accumulated depreciation andacquisition price, accumulated depreciation andoutstanding balances at the end of the consolidated

outstanding balances at the end of the consolidated

fiscal year

fiscal year
Acquisition
price

Accumulated Outstanding
depreciation
balance

Rental assets

20,542,117

11,098,177

9,443,939

Rental assets

14,861,842

8,956,252

5,905,589

Total

20,542,117

11,098,177

9,443,939

Total

14,861,842

8,956,252

5,905,589(2) Outstanding balance of future lease payments at
the end of the consolidated fiscal year

Acquisition
price

Accumulated Outstanding
depreciation
balance(2) Outstanding balance of future lease payments at
the end of the consolidated fiscal year

Within one year

3,538,973

Within one year

2,560,414

After one year

6,347,709

After one year

3,713,623

Total

9,886,682(3) Amount of lease payments, depreciation expense
and interest expense

Total

6,274,037(3) Amount of lease payments, depreciation expense
and interest expense

Lease payments

4,240,829

Lease payments

2,940,717

Depreciation expense

2,867,517

Depreciation expense

2,253,747

Interest expense

413,752(4) Accounting method for amount equivalent todepreciation expense

Interest expense

219,405(4) Accounting method for amount equivalent todepreciation expense

Straight-line depreciation using the lease term as theSame as at leftdepreciable life and zero residual value.
(5) Accounting method for amount equivalent tointerest expense
Interest method using the difference between total(5) Accounting method for amount equivalent tointerest expense
Same as at left

lease payments and the acquisition price of the leaseproperty, allocated to each year.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 56

2. Operating leases

2. Operating leases

Prepaid lease payments pertaining to non-cancellable
operating lease transactions

Prepaid lease payments pertaining to non-cancellable
operating lease transactions

Within one year

1,621,381

Within one year

1,978,904

After one year

4,078,407

After one year

5,390,811

Total

5,699,788

Total

7,369,716

Financial Statements Bulletin, FY Ended October 31, 2011
P. 57

(Per Share Information)
Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)
Net assets per share

Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)¥1,112.46

Net income (loss) per share ofcommon stock¥31.73

Net income per share of common－
stock after adjustment for potential
ordinary shares
The Company has not reported net income per share of

Net assets per share¥1,129.47

Net income (loss) per share of¥35.51

common stock
Net income per share of common
stock after adjustment for potential
ordinary shares
Same as at left－common stock after adjustment for potential ordinary
shares because it does not have any potential shares thatwould have a dilution effect.
(Note) The basis for calculating consolidated fiscal year earnings per share or net loss per share is as follows.
(Unit: Thousands of yen)
Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)

Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)

1,041,964

1,165,821－－

Net income related to common stock

1,041,964

1,165,821

Average number of outstanding shares
during the fiscal year

32,836,692

32,834,328

Net income (loss)
Amount not attributed to common stock
shareholders(Material Events after the Close of the Consolidated Fiscal Year)
The Company had no material items to report.

(Items Omitted from Disclosure)
The Company has omitted disclosure of notes concerning information on financial products, negotiablesecurities, derivatives transactions, retirement benefits, tax effect accounting, rented and leased real estate,transactions with related parties, asset retirement obligations and business combinations, because disclosureof these items in its financial bulletin for the consolidated fiscal year is not deemed necessary.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 58

5

Company Financial Statements(1) Balance Sheets(Unit: Thousands of yen)Classification

Notes

Prior Fiscal Year(As of October 31, 2010)

Current Fiscal Year(As of October 31, 2011)

AmountAmount(Assets)
Current assets
Cash and deposits

18,067,374

17,761,176

2,044,034

2,225,810

10,289,247

11,539,603

Negotiable securities

350,000

350,000

Merchandise inventories andproducts

303,056

261,074

Work in process

37,04633,299Construction equipment

993,929

1,331,441

Raw materials and supplies

84,612

85,836

Prepaid expenses

214,506

208,042

Deferred tax assets

322,794354,664

Consumption taxes receivable－

88,344

Short-term loans receivable360

474,360

Other

211,510

168,155

Allowance for doubtful accounts-254,464-221,500

32,664,008

34,660,310

49,930,606

58,591,293

Accumulated depreciation-30,376,404-33,436,965

Net rental equipment

19,554,202

25,154,327

14,489,771

14,584,949

Accumulated depreciation-8,203,064-8,662,259

Net buildings

6,286,707

5,922,690

4,887,085

4,840,169

Accumulated depreciation-3,811,190-3,897,884

Net structures

1,075,895

942,284

4,706,551

4,654,461-4,013,045-4,071,130

Net machinery andequipment

693,505

583,331

Vehicles and delivery
equipment

75,611

68,467

Notes receivable, trade
Accounts receivable, trade

Total Current Assets*2, *3Fixed assets
Tangible fixed assets
Rental equipment

Buildings

Structures

Machinery and equipment
Accumulated depreciation

Financial Statements Bulletin, FY Ended October 31, 2011
P. 59

Accumulated depreciation-69,798-64,802

Net vehicles and delivery
equipment

5,813

3,664

1,193,280

1,211,811

Accumulated depreciation-965,515-1,008,597

Net tools, furnishings andfixtures227,764

203,21328,439,924

28,651,057

2

2,131

56,283,815

61,462,702

Goodwill

133,725

90,981

Software196,552

145,584

Telephone subscription rights

50,76950,769Total Intangible Fixed Assets

381,047

287,335

Investment securities

2,597,327

2,933,002

Stock of affiliated companies

3,556,028

3,461,685

9,137

9,137

2,617,080

2,394,475

Claims in bankruptcy, claims inreorganization and other similar
claims160,309125,593Long-term prepaid expenses

38,082

28,7181,057,220

450,600

Insurance reserve

17,52817,528Long-term guaranty money
deposited

851,664

837,810

Other

53,32652,966

Allowance for doubtful accounts-1,812,033-1,587,929

Reserve for investment losses-744,710-554,617

Total investments and otherassets8,400,962

8,168,972

Total Fixed Assets

65,065,825

69,919,010

97,729,834

104,579,320

Tools, furnishings andfixtures

Land
Construction in progress
Total Tangible Fixed Assets
Intangible fixed assets

Investments and other assets

Advances
Long-term loan to affiliatedcompany

Deferred tax assets

Total Assets

Financial Statements Bulletin, FY Ended October 31, 2011
P. 60

Classification

Notes

Prior Fiscal Year(As of October 31, 2009)

Current Fiscal Year(As of October 31, 2010)

AmountAmount(Liabilities)
Current liabilities
Notes payable, trade*3

8,987,870

9,114,892

Accounts payable, trade

2,483,085

2,699,853

Long-term bank loans due
within one year

9,089,000

9,411,000

Short-term bank loans

12,000,000

10,000,000

Accounts payable, other

4,636,566

6,345,435

314,150

353,9811,017,327

286,603

Consumption and other taxes
payable448,544－

Deposits

38,692

45,464

Accrued bonuses to employees

501,488

443,024－

289,850

263,493291,60379,793

107,337

39,860,013

39,389,046

Long-term bank loans

12,349,000

15,648,000

Long-term accrued expenses

6,875,527

11,282,279

Accrued employees retirement
benefits

1,334,958

30,377Retirement allowances todirectors and auditors

153,892

158,061

Provision for loss on guarantees

66,77336,312－

123,472

20,780,151

27,278,503

60,640,165

66,667,549

9,696,717

9,696,717

Capital legal reserve

10,817,389

10,817,389

Other capital surplus

143,480

143,359

Total capital surplus

10,960,869

10,960,749

Accrued expenses
Corporate taxes payable

Allowance for disaster losses
Equipment notes payable
Other
Total Current Liabilities*3Long-term liabilities

Asset retirement obligations
Total long-term liabilities
Total Liabilities(Net Assets)
Shareholders’ equity
Capital stock
Capital surplus

Retained earnings

Financial Statements Bulletin, FY Ended October 31, 2011
P. 61

Earned legal reserve

1,375,287

1,375,287

19,601

19,601

General reserve

13,731,684

13,731,684

Retained earnings brought
forward

1,176,466

1,953,137

16,303,040

17,079,711-24,963-25,240

36,935,664

37,711,937

Valuation difference on otherinvestment securities

154,004

199,832

Total valuation and translation
adjustments

154,004

199,832

Total Net Assets

37,089,669

37,911,770

Total Liabilities and Net Assets

97,729,834

104,579,320

Other retained earnings
Reserve for advanced
depreciation of fixed assets

Total retained earnings
Treasury stock
Total Shareholders’ Equity
Valuation and translation
adjustments

Financial Statements Bulletin, FY Ended October 31, 2011
P. 62

(2) Statements of Income(Unit: Thousands of yen)Classification

Notes

Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)

Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)

AmountAmountOperating revenues
Rental revenues

39,480,705

43,790,202

Sales

18,603,078

17,116,709

Total revenues

58,083,784

60,906,911

28,596,893

30,947,887

248,457

308,120

12,748,642

13,002,023

663,191

274,660

13,660,290

13,584,803

303,056

268,535

2,263

7,460

13,359,497

13,323,728

41,956,391

44,271,616

16,127,393

16,635,295

Freight-out

71,54275,977

Vehicle fuel expense

155,218

167,254

Advertising and public relations
expense126,177

120,353－

20,995

Director compensation

66,74571,993

Salaries and allowance

5,462,976

5,580,477

Bonuses

981,366

1,049,765

Transfer to accrued bonuses to
employees

501,488

443,024

Transfer to retirement
allowances to directors andauditors

13,05912,777

Cost of revenues
Cost of rental revenues
Cost of goods sold
Balance of merchandise
inventories at beginning of
periodMerchandise inventories
purchases
Merchandise received fromother accounts
Total
Balance of merchandise atend of period
Valuation loss onmerchandise
Total cost of goods soldTotal cost of revenues
Gross profit*2

Selling, general andadministrative expenses

Transfer to allowance for
doubtful accounts

Financial Statements Bulletin, FY Ended October 31, 2011
P. 63

Employees retirement benefit
expense428,836

497,038

Travel and transportation
expenses

267,602281,883

Entertainment expenses

69,09080,498Insurance premiums

148,418

165,993

Communications expense

284,940

264,066

Maintenance and repairs

133,281

115,721

Consumables expense

281,363279,788

Utilities

243,339

246,910

Taxes and public charges

423,699

397,899

Welfare expense

946,968

1,017,618

Depreciation expense

915,384

811,854

1,475,794

1,487,997

592,070

626,134

13,589,363

13,816,023

2,538,030

2,819,272

Interest revenue

27,76933,813

Interest revenue on negotiablesecurities

3,514

907

Dividend income

42,35050,868166,053

174,595

Insurance benefits

69,99032,431

Cash bonus received

22,966

5,499

140,864

114,200

473,509412,316

Interest expense

431,634

449,770

Loss on sale of notes receivable

42,46639,445

Other

166,821

143,387

Total non-operating expense

640,923

632,6032,370,616

2,598,985

3,781

11,022Gain on sale of investment
securities

153,765

52

Subsidies

144,854－

Reversal of provision for loss on
guarantees

139,849

30,461

Rent
Other expenses
Total selling, general andadministrative expenses
Operating income
Non-operating revenues

Rents received

Other

*1

*1

Total non-operating revenues
Non-operating expenses

Ordinary income
Extraordinary profits
Gain on disposal of fixed assets*3

Financial Statements Bulletin, FY Ended October 31, 2011
P. 64

Reversal of allowance for
doubtful accounts

45,686－－

1,465,200

7,631

5,709

495,569

1,512,445

67,24575,277

Valuation loss on investment
securities

20,097

133,922

Loss on investment in
partnership enterprise

5,117

1,234

Transfer to allowance forinvestment loss

103,065

73,755

Transfer to reserve for doubtful
accounts for affiliated company
stock

200,000

75,982

Loss on cancellation of stock
due to absorption of subsidiary

173,205－

Loss on liquidation ofsubsidiaries

81,511－－

837,886－

83,021

Other

40,32575,534

Total extraordinary losses

690,568

1,356,615

Income (loss) before taxes

2,175,617

2,754,814

Corporate, local and business
taxes

1,032,143

777,763

Adjustment for corporate andother taxes

110,847

543,685

Total corporate and other taxes

1,142,991

1,321,448

Net income (loss)

1,032,626

1,433,366

Gain on termination ofretirement benefit plan
Other
Total extraordinary income
Extraordinary losses
Loss on sale or retirement of
fixed assets

Loss from disaster
Loss on adjustment for changesof accounting standard for asset
retirement obligations*4*5

Financial Statements Bulletin, FY Ended October 31, 2011
P. 65

Statements of Cost of Rental Revenues(Unit: Thousands of yen)
Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)

Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)
Classification

Notes

AmountPercent

AmountPercent

Rent

13,813,285

48.3

13,755,193

44.5

Repair expense

2,796,705

9.8

2,981,259

9.6

Freight charges

4,779,140

16.7

5,323,138

17.2

5,197,025

18.2

6,387,806

20.6

762,238

2.7

1,132,761

3.7

1,248,496

4.3

1,367,728

4.4

28,596,893

100.0

30,947,887

100.0

Depreciation expense*2

Consumables expense
Other costs

*3

Total

Note 1

Cost of rental revenues is the direct cost
incurred to receive revenues from therental of construction equipment andother goods.

Same as at left

Note 2The Company posted rental equipment
asset
depreciation
expenseof¥5,130,041 and construction equipment
depreciation expense of ¥66,983.

The Company posted rental equipment
asset
depreciation
expenseof¥6,288,687 and construction equipment
depreciation expense of ¥99,118.

Note 3

Other costs consisted mainly of taxes andpublic charges of ¥455,766, insurance
premiums of ¥532,623 and interest of¥103,927 related to installment payment
purchases of rental equipment assets.

Other costs consisted mainly of taxes andpublic charges of ¥534,530, insurance
premiums of ¥535,540 and interest of¥112,641 related to installment payment
purchases of rental equipment assets.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 66

(3) Statements of Changes in Net Assets(Unit: Thousands of yen)Classification

Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)

Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)

AmountAmountShareholders’ equity
Capital stocks
Balance at beginning of year

9,696,717

9,696,717－－

9,696,717

9,696,717

10,817,389

10,817,389－－

10,817,389

10,817,389

143,480

143,480

Disposal of treasury stock

－

-120

Total changes of items
during the year

－

-120

143,480

143,359

10,960,869

10,960,869

Disposal of treasury stock

－

-120

Total changes of items
during the year

－

-120

10,960,869

10,960,749

1,375,287

1,375,287－－

Changes of items during theyear
Total changes of items
during the year
Balance at end of year
Capital surplus
Legal capital surplus
Balance at beginning of year
Changes of items during theyear
Total changes of items
during the year
Balance at end of year
Other capital surplus
Balance at beginning of year
Changes of items during theyear

Balance at end of year
Total capital surplus
Balance at beginning of year
Changes of items during theyear

Balance at end of year
Retained earnings
Legal retained earnings
Balance at beginning of year
Changes of items during theyear
Total changes of items
during the year

Financial Statements Bulletin, FY Ended October 31, 2011
P. 67

Balance at end of year

1,375,287

1,375,287

19,601

19,601－－

19,601

19,601

15,631,684

13,731,684

Provision of generalreserve-1,900,000－

Total changes of items
during the year

-1,900,000－

13,731,684

13,731,684-1,099,417

1,176,466

Provision of generalreserve

1,900,000－

Dividends from surplus-656,742-656,695

Net income (loss)

1,032,626

1,433,366

Changes of items during
the year

2,275,884

776,670

1,176,466

1,953,137

15,927,156

16,303,040

Dividends from surplus-656,742-656,695

Net income (loss)

1,032,626

1,433,366

375,884

776,670

16,303,040

17,079,711-23,917-24,963

Purchase of treasury stock-1,045-848

Disposal of treasury stock－

571

Other retained earnings
Reserve for advanced
depreciation of noncurrent
assetsBalance at beginning of year
Changes of items during theyear
Total changes of items
during the year
Balance at end of year
General reserve
Balance at beginning of year
Changes of items during theyear

Balance at end of year
Retained earnings brought
forwardBalance at beginning of year
Total changes of items
during the year

Balance at end of year
Total retained earnings
Balance at beginning of year
Changes of items during theyear

Total changes of items
during the year
Balance at end of year
Treasury stock
Balance at beginning of year
Changes of items during the year

Financial Statements Bulletin, FY Ended October 31, 2011
P. 68

Total changes of items during
the year-1,045-277-24,963-25,240

36,560,825

36,935,664

Dividends from surplus-656,742-656,695

Net income (loss)

1,032,626

1,433,366

Purchase of treasury stock-1,045-848

Disposal of treasury stock－450

374,838

776,272

36,935,664

37,711,937

234,101

154,004

Net changes of items otherthan shareholders’ equity-80,096

45,828

Total changes of items
during the year

-80,096

45,828154,004

199,832

234,101

154,004

Net changes of items otherthan shareholders’ equity-80,096

45,828

Total changes of items
during the year

-80,096

45,828154,004

199,832

36,794,927

37,089,669

Dividends from surplus-656,742-656,695

Net income (loss)

1,032,626

1,433,366

Purchase of treasury stock-1,045-848

Disposal of treasury stock－450

Net changes of items otherthan shareholders’ equity-80,096

45,828

Balance at end of year
Total shareholders’ capital
Balance at beginning of year
Changes of items during the year

Total changes of items during
the year
Balance at end of year
Valuation and translation
adjustments
Valuation difference on
available-for-sale securities
Balance at beginning of year
Changes of items during theyear

Balance at end of year
Total valuation and translation
adjustments
Balance at beginning of year
Changes of items during theyear

Balance at end of year
Total net assets
Balance at beginning of year
Changes of items during the year

Financial Statements Bulletin, FY Ended October 31, 2011
P. 69

Total changes of items during
the year
Balance at end of year

294,742822,101

37,089,669

37,911,770

Financial Statements Bulletin, FY Ended October 31, 2011
P. 70

(4) Notes Relating to the Going Concern Assumption
The Company had no material items to report.

(5) Significant Accounting Policies
Item
1. Valuation standards andvaluation methods fornegotiable securities

Prior Consolidated Fiscal Year
(From November 1, 2009
to October 31, 2010)

Current Consolidated Fiscal Year
(From November 1, 2010
to October 31, 2011)

Common stock of subsidiaries andaffiliated companies
The Company has adopted the cost
method

based

upon

the

Common stock of subsidiaries andaffiliated companies
Same as at left

movingaverage method
Other negotiable securities

Other negotiable securities

Securities with a market price
The

CompanyhasadoptedSecurities with a market pricetheSame as at left

market value method (the full amountof the valuation difference is charged to
net assets using the direct transfer tocapital method, with the disposal cost
determined by the moving averagemethod) based on the market price on
the fiscal year closing date or similar
pricesSecurities without market prices
The Company has adopted the cost
method

based

upon

the

Securities without market prices
Same as at left

movingaverage method

Financial Statements Bulletin, FY Ended October 31, 2011
P. 71

2. Appraisal standards andAmountappraisal method for

depreciation

construction equipment

according to the straight-line method

after

deduction

expenseofSame as at left

calculated

from the original prices, by separate
fiscal year of purchase
3. Appraisal standards andappraisal method forinventories(1) Merchandise inventories and products(1) Merchandise inventories and products

The Company has adopted the cost

The Company has adopted the cost

method, cost being determined based

method, cost being determined based

on

on

the

Last-in,First-out

methodtheperiodic

averagemethod(amounts shown on the balance sheet(amounts shown on the balance sheet

are

are

calculatedbydetermining

calculatedbydetermining

write-downs of book value based on thewrite-downs of book value based on the

decline in profitability).

decline in profitability)(Change in accounting policy)
Beginning from the current fiscal
year, the Company has adopted the
Accounting Standard for Measurementof Inventories (Accounting Standards
Board of Japan Statement No. 9 dated
September 26, 2008) and has changedthemeasurement

methodformerchandise inventories and products
from the last-in-first-out method to theperiodic average method.
The affect of this change on earnings
is not material.
(2) Work in process(2) Work in process
The Company has adopted the cost

Same as at left

method, cost being determined by the
specific identification method(3) Raw materials and supplies
The Latest Purchase Cost method(3) Raw materials and supplies
Same as at left

(amounts shown on the balance sheet
arecalculatedbydetermining

write-downs of book value based on the
decline in profitability)

Financial Statements Bulletin, FY Ended October 31, 2011
P. 72

4. Depreciation method for
fixed assets(1) Tangible fixed assets (excluding lease(1) Tangible fixed assets (excluding leaseassets)assets)The

CompanyhasadoptedtheSame as at left

straight-line method for rental assets
and the declining-balance method forother assets. Buildings on land that isleased under a fixed-term land leaseagreement, however, are depreciatedusing the straight-line method using
the remaining period of the fixed-termlease as the depreciable life and zero
residual value. The depreciable lives
mainly used by the Company are as
follows.
Rental assets
Buildings

2-16 years
2-50 years

Rental assets
Buildings

2-15 years
2-50 years(2) Intangible fixed assets (excluding(2) Intangible fixed assets (excluding

lease assets)lease assets)

The

Companyhasadoptedthestraight-line method.
Software for use within the Company
is depreciated using the straight-line
method based on the assumed usefullife for internal use (5 years)(3) Lease assets
The

CompanyhasadoptedtheSame as at left

(3) Lease assets
Same as at left

straight-line method using the leaseterm as the depreciable life and zero
residual value.
The Company accounts for financelease transactions except for leases
thattransferownershipoftheproperty for which the lease start dateis before October 31, 2008 by applying
accounting treatment based on themethod applied for ordinary rental
transactions.
(4) Long-term prepaid expenses
The

Companyhasadopted(4) Long-term prepaid expenses
theSame as at left

straight-line depreciation method.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 73

5. Standard for conversion of

The Company converts monetaryforeignclaimscurrency-denominateddenominated in foreign currencies into

assets or liabilities into

Japanese yen at the spot market

Japanese yen

exchange rate on the fiscal year

andmonetarySame as at left

liabilities

settlement date, and charges thetranslation difference to income as again or loss.
6. Accounting standards for(1) Allowance for doubtful accounts(1) Allowance for doubtful accounts

allowances and reserves
To provide for losses on doubtfulSame as at left

accounts such as accounts receivable,
the Company charges to income anamountbasedonactualloss

experience for normal accounts, plusanamountunrecoverableforamounts

projected
based

on

assessments of individual accounts.
(2) Accrued bonuses to employees(2) Accrued bonuses to employees

To fully provide for expenditures ofSame as at left

bonuses the Company will pay toemployees, an amount is appropriatedto the reserve during the fiscal year
based upon a salary estimate amount.
(3) Allowance for disaster losses
To provide for repair costs anddisposal costs for assets damaged or
destroyed by the Great East Japan
Earthquake, the Company charged theestimated amount of such costs toincome at the end of the current fiscal
year.
(4) Accrued employees retirement(4) Accrued employees retirement

benefitsThe

benefits
Company

employees’

providesaccruedfor

The Company provides for corporate

retirement

officers’ accrued retirement benefits

benefits based upon the projectedbasedamounts of the liability for accrued

appropriatedemployees retirement benefits and the

proportionately at the end of the fiscal

value of pension assets at the end ofyear based upon length of service.

upon

pertinent
to

the

rules

and

account

the fiscal year. At the end of each fiscal
year, the Company appropriates anamount to the reserve to provide forthe liability recognized during theperiod.
The difference based on an actuarial
calculationischargedtoincomebeginning in the fiscal year following
the year in which incurred, with theamounts

allocated

proportionately

using the straight-line method, basedon a specified number of years (10years) that is less than the averageremaining period of employment for
employees at the time the difference
arises.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 74

(Change in accounting policy)
Beginning from the fiscal year underreview, the Company has adopted thePartial Amendments to the AccountingStandard for Retirement Benefits (Part3) (Accounting Standards Board ofJapan Statement No. 19 dated July 31,2008).
The

effectof

thischangeonoperating income, ordinary income
and income before income taxes is notmaterial.
(Supplemental information)
On October 1, 2011 the Company
transferreditsretirement

benefits

system for employees from a defined
benefit corporate pension plan to adefined contribution corporate pension
plan, and has applied the Accounting
for the Transfer Between Retirement
Benefit Plans (Financial AccountingStandards Implementation GuidanceNo. 1).
The Company accounted for the¥1,465,200,000 effect accompanying
this transfer as a “gain on terminationofretirement

benefitplan”

inextraordinary profits.
(5) Retirement allowances to directors(5) Retirement allowances to directors

and auditors

and auditors

The

Company

providesfor

Same as at left

retirement allowances to directors andauditors based upon pertinent rules
and appropriated to the account at theend of the fiscal year proportionately
based upon length of service.
(6) Reserve for investment losses
The Company provides for losses(6) Reserve for investment losses
Same as at leftfrom the decline in real prices of assets
such

as

the

stock

of

subsidiarycompanies that are subject to asset
impairment accounting by applying
internally established standards that
take

into

consideration

subsidiarycompany operating results and asset
quality.
(7) Provision for loss on guarantees
To provide for losses resulting fromthefutureexecutionof(7) Provision for loss on guarantees
Same as at left

liability

guarantees, the Company charges toincome a reasonably estimated loss
amount based on the outstanding
amount of guarantees.
7. Accounting standards forprincipal income andexpenses

Accounting standards for amount ofcompleted works and cost of completed
construction works

Accounting standards for amount ofcompleted works and cost of completed
construction works

Financial Statements Bulletin, FY Ended October 31, 2011P. 75

a. Construction works for which thea. Construction works for which theportion of the works completed by the

portion of the works completed by theend of the year can be reliably

end of the year can be reliably

determined

determined

Percentage-of-completion method(progressin

construction

works

Same as at leftisestimated using the cost comparison
method)b. Other construction works

b. Other construction works

Completed-contract method

Same as at left

(Change in accounting method)
The Company traditionally reported
revenues and costs of construction
contracts

byapplying

thecompleted-contract method. Beginningfrom the fiscal year under review, theCompany will apply the AccountingStandard for Construction Contracts(Accounting Standards Board of Japan
Statement No. 15, December 27, 2007)
and

the

Guidanceon

AccountingStandard for Construction Contracts(Accounting Standards Board of Japan
Implementation

GuidanceNo.

18,

December 27, 2007). Beginning fromworks contracts for which construction
activity was begun during the fiscal
year under review, the Company will
apply the percentage of completion
method

for

works

for

which

the

outcome of the construction activity isdeemed certain by the end of the fiscal
year under review (with the estimate of
the percentage of completion based on
the cost incurred as a percentage of
estimated total cost), and will apply thecompleted-contract

methodforallother works.
The effect of this change on earnings
is not material.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 76

8. Hedge transactions(1) Hedge transactions
The

Company’s(1) Hedge transactions
interest

swap

Same as at lefttransactions fulfill the requirements
for special rule accounting, and theCompany has elected to use this toreport its hedge transactions.
(2) Hedge methods and hedged(2) Hedge methods and hedgedtransactionstransactions

The Company uses interest swaps toSame as at left

avoid interest rate fluctuation risk
related to interest on bank borrowing.
(3) Hedging policies
The Company’s use of derivative(3) Hedging policies
Same as at lefttransactions is limited to hedging risk
within the scope of the Company’s
assets and liabilities subject to market
fluctuation risk.
(4) Method for evaluating the(4) Method for evaluating theeffectiveness of hedges
The

Company’s

effectiveness of hedges
interest

swap

Same as at lefttransactions fulfill the requirements
for special rule accounting, and theCompany has elected to use this inplace of an evaluation of effectiveness.
9. Other significant mattersfor preparation of the fiscal
year financial statements

Accounting treatment of consumption tax
Consumption tax is taken out of all
StatementofIncomeitems

Accounting treatment of consumption tax
Same as at left

andBalance Sheet items, except mainly
for receivables and payables.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 77

(6) Changes in Accounting Method
Current fiscal year
From November 1, 2010
to October 31, 2011

Prior fiscal year
From November 1, 2009
to October 31, 2010
(Application of the Accounting Standard for Business(Application

Combinations Etc.)

Retirement Obligations Etc.)

of

the

AccountingStandard

for

Asset

In conjunction with the application of the AccountingStandard for Business Combinations (AccountingStandards Board of Japan Statement No. 21, December
26, 2008, the Partial Amendments to the AccountingStandard for Research and Development Costs(Accounting Standards Board of Japan Statement No. 23,
December 26, 2008), the Accounting Standard forBusiness Divestitures (Accounting Standards Board ofJapan Statement No. 7, December 26, 2008) and the
Revised Guidance on the Accounting Standard forBusiness Combinations and Accounting Standard forBusiness Divestitures (Accounting Standards Board ofJapan Guidance No. 10, December 26, 2008) beginningfrom the first business combination and businessseparation that is implemented on or after April 1, 2010,
beginning from the fiscal year under review the Company
will apply these accounting standards for businesscombinations and business divestitures implemented on
or after April 1, 2010.

Beginning from the current fiscal year, the Company
has adopted the Accounting Standard for Asset
Retirement Obligations (Accounting Standards Board ofJapan Statement No. 18 dated March 31, 2008 and the
Guidance on Accounting Standard for Asset Retirement
Obligations (Accounting Standards Board of Japan
Guidance No. 21 dated March 31, 2008).
As a result, operating income and ordinary income were
¥5,470,000 lower, respectively, and income before taxes
was ¥88,492,000 lower, than they otherwise would havebeen had the accounting standards used in past periods
been applied.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 78

(7) Notes to the Company Financial Statements(Notes to the Balance Sheets)(Unit: Thousands of yen)
Prior Fiscal Year(As of October 31, 2010)
1. Contingent liabilities

Current Fiscal Year(As of October 31, 2011)
1. Contingent liabilities

Joint and several guarantees ofbank loans to employees (Bankof Tokyo-Mitsubishi UFJ, others)

34,788

Joint and several guarantees ofbank loans to employees (Bankof Tokyo-Mitsubishi UFJ, others)

32,486

Guarantee of borrowing liabilities
of Kanki Corporation, a
consolidated subsidiary (after
deduction of provision for loss on
guarantees)

447,726

388,937

Guarantee of borrowing liabilities
of Flowtechno Corporation, a
non-consolidated subsidiarycompany

Guarantee of borrowing liabilities
of Kanki Corporation, a
consolidated subsidiary (after
deduction of provision for loss on
guarantees)

100,000

Guarantee of borrowing liabilities
of Flowtechno Corporation, a
non-consolidated subsidiarycompany

100,000

Guarantee of installment
payment liabilities of SJ Rental,
Inc., a non-consolidated
subsidiary company
Guarantee of borrowing liabilitiesof Shanghai Jinheyuan
Equipment Rental Co., Ltd., aconsolidated subsidiary company
Guarantee of finance leaseliabilities of Shanghai Jinheyuan
Equipment Rental Co., Ltd., aconsolidated subsidiary company
Guarantee of borrowing liabilitiesof Shanghai Jinheyuan
Engineering Construction Co.,
Ltd., a consolidated subsidiarycompany
Guarantee of finance leaseliabilities of Shanghai Jinheyuan
Engineering Construction Co.,
Ltd., a consolidated subsidiarycompany

US$1,503,000(121,627)

28,572,000 yuan
(345,149)

128,066,000 yuan
(1,547,046)

49,144,000 yuan(593,659)

115,990,000 yuan
(1,401,169)

Guarantee of borrowing liabilities
of KG Machinery Co., Ltd., a
non-consolidated subsidiarycompany

15,010

Guarantee of installment
payment liabilities of KG
Machinery Co., Ltd., a
non-consolidated subsidiarycompany

52,693

2. Liquidation of receivables based on receivables transfer
facility

Guarantee of borrowing liabilitiesof Shanghai Jinheyuan
Equipment Rental Co., Ltd., aconsolidated subsidiary company
Guarantee of finance leaseliabilities of Shanghai Jinheyuan
Engineering Construction Co.,
Ltd., a consolidated subsidiarycompany

US$5,199,000(404,247)

66,784,000 yuan
(820,107)

249,090,000 yuan
3,058,836)

Guarantee of borrowing liabilities
of KG Machinery Co., Ltd., a
non-consolidated subsidiarycompany

970

Guarantee of installment
payment liabilities of KG
Machinery Co., Ltd., a
non-consolidated subsidiarycompany
Guarantee of borrowing liabilities
of KANAMOTO (HK) CO., LTD., a
non-consolidated subsidiarycompany

38,947

HK$15,500,000

Guarantee of borrowing liabilities
of KANAMOTO (HK) CO., LTD., a
non-consolidated subsidiarycompany(155,155)

US$155,000(12,051)

2. Liquidation of receivables based on receivables transfer
facility

The Company liquidates receivables based on areceivables transfer facility agreement.
Notes receivable, trade

Guarantee of installment
payment liabilities of SJ Rental,
Inc., a consolidated subsidiarycompany

The Company liquidates receivables based on areceivables transfer facility agreement.

4,732,008

Notes receivable, trade

5,000,559

Liquidated claims bearing a right of recourse to the

Liquidated claims bearing a right of recourse to theCompany and included in the balance of transferred

Company and included in the balance of transferrednotes receivable, trade total ¥1,046,075.

notes receivable, trade total ¥1,054,898.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 79

3. Notes and bills maturing at the end of the fiscal year
Notes and bills maturing on the last day of the fiscal
year are settled and processed on the note and billclearing date. Because the last day of the Company’s
current fiscal year was a financial institution holiday,
notes and bills maturing on the final day of thefollowing fiscal year are included in the fiscal year-end
balance.
Notes receivable, trade
Notes payable, trade
Equipment notes payable

30,8691,118,555
12,658Financial Statements Bulletin, FY Ended October 31, 2011
P. 80

(Notes to the Statements of Income)(Unit: Thousands of yen)
Current fiscal year
(From November 1, 2010
to October 31, 2011)
1. Transactions with affiliates

Prior fiscal year
(From November 1, 2009
to October 31, 2010)
1. Transactions with affiliates
Seconded employees’ salaries

35,885

Seconded employees’ salaries

27,396

Rents received

125,778

Rents received

138,187

2. Balance in other accounts transferred to cost of rental

2. Balance in other accounts transferred to cost of rental

equipment assets and construction equipment that has

equipment assets and construction equipment that has

been soldbeen sold

Rental equipment assets

662,673

Rental equipment assets

273,206

Construction equipment

517

Construction equipment

1,453

Total

663,191

3. Gain on sale or retirement of fixed assets

Total

274,660

3. Gain on sale or retirement of fixed assets

Building

2,426

Building

Tools, furniture and fixtures

1,355

Tools, furniture and fixtures

3,781

Vehicles and delivery equipment

Total

381

Total
4. Loss on sale or retirement of fixed assets

925
11,022

4. Loss on sale or retirement of fixed assets(Loss on sale of fixed assets)
Buildings

9,715(Loss on sale of fixed assets)
266

Buildings

8,637

Structures

130

Structures

1,344

Tools, furnishings and fixtures

200

Machinery and equipment

81

Tools, furnishings and fixtures

40

Land

10,344(Loss on retirement of fixed assets)(Loss on retirement of fixed assets)

Rental equipment assets

33,171

Rental equipment assets

28,737

Buildings

16,549Buildings

3,395

Structures

3,660

Structures

Machinery and equipment

1,399

Machinery an

30,219equipment

1,900

Vehicles and delivery equipment

360

Vehicles and delivery equipment

66

Tools, furnishings and fixtures

1,162

Tools, furnishings and fixtures

844

Other
Total

0
67,245

Other
Total

9
75,277

Financial Statements Bulletin, FY Ended October 31, 2011
P. 81

Current fiscal year
(From November 1, 2010
to October 31, 2011)

Prior fiscal year
(From November 1, 2009
to October 31, 2010)

5. Loss from disaster
The Company charged the losses incurred as aresult of the Great East Japan Earthquake on March
11, 2011 to income as a “Loss from disaster.”At the end of the current fiscal year, the Company
appropriated to the allowance for disaster losses anestimated amount for losses related to the Great East
Japan Earthquake, and included the transfer of¥289,850 to the allowance for disaster losses was in“Loss from disaster.”
The principal amounts are provided below.
Cost to restore fixed assets etc. to224,515

their original condition
Destruction loss of fixed assets etc.

444,118

Other

169,253

Total

837,886

Financial Statements Bulletin, FY Ended October 31, 2011
P. 82

(Notes to Statements of Changes in Net Assets)
Prior fiscal year (From November 1, 2009 to October 31, 2010)
Class of treasury stock and number of shares(Thousands of shares)
Number of shares Increase in number Decrease in number Number of shares at
at end of prior fiscal of shares during the of shares during the end of the current
current fiscal year
year
current fiscal year
fiscal year
Treasury stock
Common stock(Note)

Total

34

2

－

36

34

2

－

36

(Note) The number of treasury stock shares of common stock increased by 2,000 shares through purchasesof shares comprising less than one investment unit.

Current fiscal year (From November 1, 2010 to October 31, 2011)
Class of treasury stock and number of shares(Thousands of shares)
Number of shares Increase in number Decrease in number Number of shares at
at end of prior fiscal of shares during the of shares during the end of the current
current fiscal year
year
current fiscal year
fiscal year
Treasury stock
Common stock(Note)

Total

36

1

0

37

36

1

0

37

(Note) The number of treasury stock shares of common stock increased by 1,000 shares through purchasesof shares comprising less than one investment unit.

Financial Statements Bulletin, FY Ended October 31, 2011
P. 83

(Notes for Lease Transactions)(Unit: Thousands of yen)
Prior Fiscal Year
(From November 1, 2009
to October 31, 2010)

Current Fiscal Year
(From November 1, 2010
to October 31, 2011)

1. Finance lease transactions (Lessor)

1. Finance lease transactions (Lessor)

Finance lease transactions except for leases that

Finance lease transactions except for leases thattransfer ownership of the property to the lesseetransfer ownership of the property to the lesseea) Lease assetsa) Lease assets

Tangible fixed assets

Tangible fixed assets

Construction-related business rental assets and tools,

Same as at left

furnishings and fixturesb) Method of depreciation for lease assetsb) Method of depreciation for lease assets

Lease assets are depreciated according to the method

Same as at left

described in “4. Depreciation methods for principal
depreciable assets” in the significant accounting policies.
The Company accounts for finance lease transactions
except for leases that transfer ownership of the property
for which the lease start date is before October 31, 2008
by applying accounting treatment based on the method
applied for ordinary rental transactions. Details areprovided below.
(1) Amounts corresponding to lease property(1) Amounts corresponding to lease property

acquisition price, accumulated depreciation andacquisition price, accumulated depreciation andoutstanding balances at the end of the fiscal year

outstanding balances at the end of the fiscal year

Acquisition
price

Accumulated Outstanding
depreciation
balanceAcquisition
price

Accumulated Outstanding
depreciation
balance

Rental assets

17,080,348

8,938,093

8,142,254

Rental assets

13,005,004

7,598,325

5,406,678

Total

17,080,348

8,938,093

8,142,254

Total

13,005,004

7,598,325

5,406,678(2) Outstanding balance of future lease payments at
the end of the fiscal year(2) Outstanding balance of future lease payments at
the end of the fiscal year

Within one year

2,762,381

Within one year

2,179,782

After one year

5,830, 29

After one year

3,585,423

Total

8,592,710(3) Amount of lease payments, depreciation expense
and interest expense

Total

5,765,206(3) Amount of lease payments, depreciation expense
and interest expense

Lease payments

3,613,452

Lease payments

2,606,511

Depreciation expense

2,440,470

Depreciation expense

1,964,098

Interest expense

282,560(4) Accounting method for amount equivalent todepreciation expense

Interest expense

196,597(4) Accounting method for amount equivalent todepreciation expense

Straight-line depreciation using the lease term as theSame as at leftdepreciable life and zero residual value.
(5) Accounting method for amount equivalent tointerest expense(5) Accounting method for amount equivalent tointerest expense

Interest method using the difference between total

Same as at left

lease payments and the acquisition price of the leaseproperty as the amount equivalent to interest, allocatedto each year.
2. Operating leases

2. Operating leases

Financial Statements Bulletin, FY Ended October 31, 2011
P. 84

Prepaid lease payments pertaining to non-cancellable
operating lease transactions
Within one year
After one year
Total

Prepaid lease payments pertaining to non-cancellable
operating lease transactions

1,541,889

Within on

3,576,530

After one year

5,118,419

Total

year

1,908,634
4,927,927
6,836,562

Financial Statements Bulletin, FY Ended October 31, 2011
P. 85

6. Other(1) Changes to Directors
a. Changes to representative directors
There are no pertinent items.
b. Changes to other directors
Directors scheduled to be newly appointed
Director

Kazunori Hashiguchi (currently Advisor, Business Coordination Headquarters)

Planned date of new appointments and retirements
January 27, 2012

Financial Statements Bulletin, FY Ended October 31, 2011
P. 86