2003 年 5 月 21 日
株式会社インターネットイニシアティブ
Tel. 03-5259-6500
Fax. 03-5259-6311
Email: ir@iij.ad.jp

本資料は日本の方々の便宜性のために作成した簡易版です。8 ページ目より正式決算発表資料（英文）が続きますので、そちらもあわせてご参照いただけますよう、お願い申し上げます。

2002 年度第 4 四半期（1 - 3 月）及び 2002 年度通期の決算発表（抄訳）
本決算発表に伴うカンファレンス・コールの模様を2003 年 5 月 21 日 22:00 よりインターネット上（URL: www.vcall.com）で公開しております。
2002 年度第 4 四半期（1-3 月）及び 2002 年度通期の決算発表 要約【2002 年度第 4 四半期】
・2002 年度第 4 四半期の売上高は 130 億円（前年同期比 7.7% 増、前期比 23.4% 増）で、第 3 四半期
時点での見込み（
125〜130 億円）を若干上回った。依然として景気低迷が続く中、IIJ 四半期決算としては、過去最高の売上高を計上し、好調に推移した。
・営業損失は 446 百万円と前四半期（営業損失 567 百万円）対比改善を示した（前年同期は営業利益
186 百万円）。今期の営業損失は、主として 2003 年 3 月に実施された IIJ グループの本社移転に関わる一時的な費用が原因であり、収益は順調に改善傾向にある。
・償却前営業利益（Adjusted EBITDA ）は 459 百万円と、対前年度比では 53.0 ％減少したが、前四半期
比では 32.0 ％増加。
【2002 年度通期】
・2002 年度通期の売上高は 440 億円と、第 3 四半期の予想通りの結果となった。対前年度比 10.3% 増
で IIJ の年度売上高としては過去最高となった。
・営業損失は 16 億円と対前年度比減少。
・償却前営業利益（Adjusted EBITDA ）は 18 億円で対前年度比減少。
【2003 年度の見通し】
・2003 年度通期の売上高は、前年度比 10% 以上の成長を見込んでおり、営業損益の黒字化を目指す。
・2003 年 6 月 6 日に向けて、財務基盤強化を目的とした第三者割当増資の実施を予定している。

概況
大規模案件の受注
法人ブロードバンド市場を狙ったサービス開発・マーケティング戦略が引き続き効を奏し、リコーグループ向けの大規模メールシステム運用、地方競馬レースのブロードバンド配信、競艇ブロー
ドバンドサイト「KYOTEI B.B.」の構築・運用等、大規模案件を順調に受注した。
IIJグループ横断の新組織の創設
2003年4月1日付でIIJグループ会社 4社（IIJ、クロスウェイブ コミュ
ニケーションズ、アイアイジェイテクノロジー、ネットケア）を横断する新組織「ネットワーク・インテグレーション部（NI 部）」を発足させた。NI 部では、垣根がなくなりつつあるシステムと通信の流れを捉え、IIJグループの培ってきた技術的ノウハウを結集し、企業システム及び通信にかかわる企画・開発から保守・運用までの一切について、迅速な開発と提供を行い、激化する市場環境の中で他社との差別化を図っていく。

（ご参考）統計値について
表 1. 契約数
IP サービス

64kbps – 128kbps
192kbps – 768kbps

1Mbps – 2Mbps
3Mbps – 1.2Gbps
インターネットデータセンター接続サービス契約数(*3)
その他 (*4)

4Q02
112
35
268
248
156
4,489
5,308

3Q02
130
37
279
212
139
3,922
4,719

4Q01
142
42
270
156
110
2,900
3,620

79,464450,320529,784

82,193
370,543452,736

89,213
171,363
260,576

専用線接続サービス 合計(*3)
インターネットデータセンター接続サービスに、ホスティングサービスは含まれていない。
(*4)
その他：IIJ FiberAccess/F、IIJ Ethernet Standard、IIJ DSL/F、IIJT1 スタンダード、IIJ エコノミー
IIJ4U (個人向けダイアルアップ接続サービス)
その他 ダイアルアップ接続サービス
ダイアルアップ接続サービス 合計
表 2. 専用線サービスの売上高内訳
IP サービス＋インターネットデーターセンター接続サービス
その他

(百万円)

4Q02
2,518
823

3Q02
2,548
856

表 3. 契約帯域数の総和
専用線接続サービス
インターネットデータセンター接続サービス
契約帯域合計(単位: Gbps)

4Q02
32.1
9.9
42.0

3Q02
23.3
7.0
30.3

表 4. バックボーンコスト
国際バックボーンコスト
国内バックボーンコスト

4Q01
9.4
2.0
11.4
(百万円)

4Q02
315
1,075

3Q02
432
902

表 5. その他
Adjusted EBITDA
設備投資（capitalized leases を含む）
減価償却費

4Q01
2,651
992

4Q01
443
836
( 百万円)

4Q02
459
936
933

3Q02
349
1,519
943

4Q01
968
913
812

注意事項：この資料には、1995 年米国民事証券訴訟改革法（
Private Securities Litigation Reform Act of 1995）の「セーフハーバー」
規定に定義する「将来性の見通しに関する記述（
forward-looking statements）」に該当する情報が記載されています。このプレゼンテーシ
ョン資料の記載のうち、過去または現在の事実に関するのも以外は、将来の見通しに関する記述に該当します。将来の見通しに関する記述は、現在入手可能な情報に基づくIIJ 経営陣の仮定および判断に基づくものであり、これには既知または未知のリスクおよび不確定性が内在しています。IIJ の実際の活動または業績は、今後、将来の見通しに関する記述に示されたところと大きく異なる可能性があります。投資家の皆様におかれましては、1934 年米国証券取引法（Securities Exchange Act of 1934）に基づく今後の報告書等において IIJ が行う開示をご参照ください。

株式会社 インターネットイニシアティブ
四半期連結損益計算書（米国会計基準未監査）

Appendix 1

2003年
年3月期、
月期、2002年
年3月期、月期、2002年
年12月期
月期
月期、
月期、
JPY/千円単位、
千円単位、USD/千米ドル単位
千米ドル単位 (1)千円単位、前年同四半期比較
2003年3月期
USD (1)
営業収益：
インターネット接続及び付加価値サービス収入：
専用線接続サービス(2)ダイヤルアップ接続サービス
付加価値サービス(2)その他
インターネット接続及び付加価値サービス収入合計

JPY

対営業収益
%

JPY

2002年3月期
対営業収益%

対前年同四半期%

JPY

前四半期比較
2002年12月期
対営業収益 対前四半期%%

28,299
6,479
7,887
3,229
45,895

3,341,255
764,958
931,399381,206
5,418,818

25.6%
5.9
7.3
2.9
41.6

3,643,141
844,279
823,137
533,191
5,843,748

30.1%
7.0
6.8
4.4
48.3

(8.3%)(9.4)
13.2(28.5)(7.3)

3,404,016
776,173
913,152
467,6295,560,970

32.2%
7.4
8.6
4.4
52.6

(1.8%)(1.4)
2.0(18.5)(2.6)

41,54722,971
110,413

4,905,429
2,712,192
13,036,439

37.6
20.8
100.0

5,331,986
934,040
12,109,774

44.0
7.7
100.0

(8.0)
190.4
7.7

3,683,978
1,318,630
10,563,578

34.9
12.5
100.0

33.2
105.7
23.4

42,63035,97622,344
100,951

5,033,266
4,247,690
2,638,334
11,919,290

38.6
32.6
20.2
91.4

5,110,291
4,734,363
865,354
10,710,008

42.2
39.1
7.1
88.4

(1.5)
(10.3)
204.9
11.3

5,179,920
3,173,211
1,254,073
9,607,204

49.0
30.0
11.9
90.9

(2.8)
33.9
110.4
24.1

6,684
5,603
956
114,194

789,234
661,502
112,845
13,482,871

5.9
5.1
0.9
103.4

665,204
480,376
68,09011,923,678

5.5
4.0
0.6
98.5

18.6
37.7
65.7
13.1

894,340
511,604
116,950
11,130,098

8.5
4.9
1.1
105.4

(11.8)
29.3
(3.5)
21.1

営業利益（損失）(3,781)(446,432)(3.4)

186,0961.5(339.9)(566,520)(5.4)(21.2)

その他の費用

(3,052)(360,292)(2.8)(337,694)

(2.8)

6.7

(228,058)

(2.1)

58.0

税引前当期損失(6,833)(806,724)(6.2)(151,598)

(1.3)

432.1

(794,578)

(7.5)

1.5

法人税等、住民税及び事業税
少数株主損益持分法による投資損失823
181(10,620)

97,256
21,342(1,253,875)

0.9
0.2
(9.6)

(140,381)(8,849)(1,646,603)

(1.2)
(0.1)
(13.6)(169.3)(341.2)(23.9)

137,936
41,813(1,375,338)

1.3
0.4(13.0)(29.5)(49.0)(8.8)

当期損失(18,095)(2,136,513)(16.4%)(1,666,669)(13.8%)

28.2%(2,266,039)(21.4%)(5.7%)

システムインテグレーション
機器販売
営業収益合計営業費用：
インターネット接続及び付加価値サービス原価システムインテグレーション原価
機器販売原価
売上原価合計
販売費
一般管理費
研究開発費
営業費用合計

1株あたり当期損失
米国預託証券１単位あたり当期損失
期中平均発行済株式総数
期中平均発行済米国預託証券総数(95,041)(47.52)
22,48044,960,000(74,140)(37.07)22,48044,960,000(100,802)(50.40)22,48044,960,000

注記(1): 2003年3月期につきましては、米ドル換算レート118.07円=1米ドル(2003/3/31)にて参考表示しております。
注記(2): 2002年6月期よりIIJデータセンター接続サービス収入を付加価値サービスから専用線接続サービスに変更しております。2002年3月期についても現在の表示方法に合わせて組替えを行っており、その結果専用線接続サービス収入は組替前と比較し、257,599千円増加しております。

株式会社 インターネットイニシアティブ
連結損益計算書（米国会計基準未監査）

Appendix 2

2003年
年3月期通期、月期通期、2002年
年3月期通期
月期通期
月期通期、
JPY/千円単位、
千円単位、USD/千米ドル単位
千米ドル単位 (1)
千円単位、
前年比較

2003年3月期通期
USD (1)
営業収益：
インターネット接続及び付加価値サービス収入：
専用線接続サービス(2)ダイヤルアップ接続サービス
付加価値サービス(2)その他
インターネット接続及び付加価値サービス収入合計

JPY

2002年3月期通期
対営業収益
%

JPY

対営業収益
%

対前年通期
%

117,007
26,72330,514
14,616
188,860

13,814,977
3,155,137
3,602,847
1,725,736
22,298,697

31.4%
7.2
8.2
3.9
50.7

14,303,342
3,644,091
3,099,791
1,667,986
22,715,210

35.8%
9.1
7.8
4.2
56.9

(3.4%)(13.4)
16.2
3.5
(1.8)

127,150
56,799372,80915,012,633
6,706,231
44,017,561

34.1
15.2
100.0

14,355,325
2,834,078
39,904,613

36.0
7.1
100.0

4.6
136.6
10.3

172,668
110,868
54,345
337,881

20,386,887
13,090,220
6,416,525
39,893,632

46.3
29.7
14.6
90.6

19,799,402
12,314,158
2,540,089
34,653,649

49.6
30.9
6.4
86.9

3.0
6.3
152.6
15.1

26,901
18,671
3,508
386,961

3,176,165
2,204,504
414,149
45,688,450

7.2
5.0
1.1
103.8

3,038,412
1,839,525
319,370
39,850,956

7.6
4.6
0.8
99.9

4.5
19.8
29.7
14.6

営業利益（損失）(14,152)(1,670,889)(3.8)

53,6570.1(3,214.0)

その他の費用

(10,750)(1,269,433)(2.9)(943,142)

(2.3)

34.6

税引前当期損失(24,903)(2,940,322)(6.7)(889,485)

(2.2)

230.6

法人税等、住民税及び事業税
少数株主損益持分法による投資損失

7,719
1,298
(47,644)911,365
153,251(5,625,299)

2.1
0.5(12.8)

1,099,035
24,467(5,482,082)

2.8
0.1(13.8)(17.1)
526.4
2.6

当期損失

(78,968)(9,323,735)(21.2%)(7,446,135)(18.7%)

25.2%

システムインテグレーション
機器販売
営業収益合計営業費用：
インターネット接続及び付加価値サービス原価システムインテグレーション原価
機器販売原価
売上原価合計
販売費
一般管理費
研究開発費
営業費用合計

1株あたり当期損失
米国預託証券１単位あたり当期損失
期中平均発行済株式総数
期中平均発行済米国預託証券総数(414,757)(207.38)
22,48044,960,000(331,234)(165.62)
22,48044,960,000

注記(1): 2003年3月期につきましては、米ドル換算レート118.07円=1米ドル(2003/3/31)にて参考表示しております。
注記(2): 2002年6月期よりIIJデータセンター接続サービス収入を付加価値サービスから専用線接続サービスに変更しております。2002年3月期通期についても現在の表示方法に合わせて組替えを行っており、その結果専用線接続サービス収入は組替前と比較し、761,362千円増加しております。

株式会社 インターネットイニシアティブ
四半期連結貸借対照表（米国会計基準未監査）

Appendix 3

2003年
年3月期、
月期、2002年
年3月期、月期、2002年
年12月期
月期
月期、
月期、
JPY/千円単位、
千円単位、USD/千米ドル単位
千米ドル単位 (1)千円単位、USD (1)

2003年3月期
JPY

資産の部
流動資産：
現金及び現金同等物
売掛金
棚卸資産
前払費用
その他流動資産30,392
86,839
3,537
4,781
7,901

3,588,352
10,253,096
417,666
564,501
932,873

9.2%
26.1
1.1
1.4
2.4

11,045,919
8,981,912
620,409416,945
143,798

24.4%
19.9
1.4
0.9
0.3

4,270,613
7,305,169
813,863882,854
135,828

11.4%
19.5
2.2
2.4
0.4

流動資産合計133,450

15,756,488

40.2

21,208,983

46.9

13,408,327

35.9

関連会社投資等
その他投資
有形固定資産等
拘束預金
敷金保証金
その他資産

27,70425,74977,51042,34818,681
6,729

3,271,032
3,040,189
9,151,572
5,000,000
2,205,652
794,455

8.3
7.8
23.3
12.8
5.6
2.0

8,854,028
5,406,065
7,755,426
0
1,266,055
772,226

19.6
11.9
17.1
0.0
2.8
1.7

4,522,602
3,461,695
8,898,123
5,000,000
1,369,596
699,998

12.1
9.2
23.8
13.4
3.7
1.9

資産合計

332,171

39,219,388

100.0%

45,262,783

100.0%

37,360,341

100.0%

40,854
71,196
3,299
4,675
16,462
23,007

4,823,599
8,406,170
389,495
551,985
1,943,735
2,716,386

12.3%
21.4
1.0
1.4
5.0
6.9

3,820,232
7,085,579
247,606
506,797
1,400,000
1,973,769

8.4%
15.7
0.5
1.1
3.1
4.4

4,510,000
5,852,779
364,366
570,719
1,200,000
2,424,701

12.1%
15.7
1.0
1.5
3.2
6.5

159,493

18,831,370

48.0

15,033,983

33.2

14,922,565

40.0

長期借入金
転換社債
長期リース債務退職給付引当金
その他固定負債

29,273127,043
30,793683
1,569

3,456,265
15,000,000
3,635,780
80,601
185,201

8.8
38.2
9.3
0.2
0.5

3,400,000
15,000,000
2,861,556
100,841
108,376

7.5
33.2
6.3
0.2
0.2

3,400,000
15,000,000
3,463,132
75,047
184,847

9.1
40.1
9.3
0.2
0.5

負債合計

348,854

41,189,217

105.0

36,504,756

80.6

37,045,591

99.2

少数株主持分7,449

879,495

2.3

1,032,746

2.3

900,837

2.4

59,984
144,561(233,185)
4,508

7,082,336
17,068,353(27,532,204)
532,191

18.1
43.5(70.2)
1.3

7,082,336
17,068,353(18,208,469)
1,783,061

15.7
37.7
(40.2)
3.9

7,082,336
17,068,353(25,395,691)
658,91518.9
45.7(68.0)
1.8

資本合計(24,132)(2,849,324)(7.3)

7,725,281

17.1(586,087)(1.6)

負債、少数株主持分及び資本合計

332,171

39,219,388

100.0%

45,262,783

100.0%

37,360,341

100.0%

負債及び資本の部
流動負債：
短期借入金
買掛金及び未払金
未払費用
その他流動負債
1年以内に期限到来の長期借入金
短期リース債務
流動負債合計

資本：
資本金
資本準備金
欠損金
その他有価証券評価差額金等

2002年3月期
JPY%%

注記(1): 2003年3月期につきましては、米ドル換算レート118.07円=1米ドル(2003/3/31)にて参考表示しております。

2002年12月期
JPY%

株式会社 インターネットイニシアティブ
四半期連結キャッシュフロー計算書（米国会計基準未監査）

Appendix 4

2003年
年3月期、
月期、2002年
年3月期、月期、2002年
年12月期
月期
月期、
月期、
JPY/千円単位、
千円単位、USD/千米ドル単位
千米ドル単位 (1)千円単位、
2003年3月期
USD (1)
JPY

2002年3月期

2002年12月期

JPY

JPY

(1,666,669)(2,266,039)

営業活動によるキャッシュフロー：当期損失(18,095)(2,136,513)

減価償却費等

7,905

933,374

811,652

942,854

持分法による投資損失

10,6201,253,875

1,646,603

1,375,338

少数株主損益(181)(21,342)8,849(41,813)

為替差損

1,264

149,262

3,990

32,834

投資有価証券評価損等

1,565

184,723

104,700

売掛金の減少（増加）額(25,267)(2,983,254)(3,183,806)

493,961

買掛金及び未払金の増加額

18,6362,200,392

3,696,329

1,033,939

棚卸資産の減少（増加）額

3,321

392,051(398,876)(398,092)

771

91,033(145,560)

132,230

法人税等調整額

-

その他

3,614

426,737

214,793(52,956)

営業活動によるキャッシュフロー

4,153

490,338

1,092,005

1,252,256

有形固定資産等の取得による支出(1,385)(163,592)(501,667)(505,169)

セールスリースバックによる収入

567

66,940

投資活動によるキャッシュフロー：-関連会社への投資および貸付

-

-

-

(24,123)---(350,000)(28,377)(11,749)(1,387,210)(2,007)22,972

51

6,057

22,299(30,506)(12,516)(1,477,805)(855,498)(541,080)

長期借入金による収入

16,9392,000,000--

長期借入金の返済による支出(10,164)(1,200,000)-(200,000)

リース債務の元本返済による支出(5,558)(656,238)(535,906)(651,546)

短期借入金の純増減額

2,650

312,854

120,018(322,254)

財務活動によるキャッシュフロー

3,867

456,616(415,888)(1,173,800)

現金及び現金同等物に係る換算差額(1,282)(151,410)

59,223(39,516)

現金及び現金同等物の減少額(5,778)(682,261)(120,158)(502,140)

現金及び現金同等物の期首残高

36,1704,270,613

11,166,077

4,772,753

現金及び現金同等物の期末残高

30,392

3,588,352

11,045,919

4,270,613

その他投資の取得による支出
敷金保証金の返還（支出）その他
投資活動によるキャッシュフロー
財務活動によるキャッシュフロー：注記(1): 2003年3月期につきましては、米ドル換算レート118.07円=1米ドル(2003/3/31)にて参考表示しております。

株式会社 インターネットイニシアティブ
連結キャッシュフロー計算書（米国会計基準未監査）

Appendix 5

2003年
年3月期通期、月期通期、2002年
年3月期通期
月期通期
月期通期、
JPY/千円単位、
千円単位、USD/千米ドル単位
千米ドル単位 (1)千円単位、
2002年3月期

2003年3月期
USD (1)
JPY

JPY

営業活動によるキャッシュフロー：当期損失(78,968)(9,323,735)(7,446,135)

減価償却費等

30,3233,580,212

3,027,587

持分法による投資損失

47,644

5,625,299

5,482,082

少数株主損益(1,298)(153,251)(24,467)

為替差損（差益）

2,353

277,856(219,524)

投資有価証券評価損等

2,348

277,162

432,952

売掛金の増加額(11,446)(1,351,380)(3,559,335)

買掛金及び未払金の増加額

10,5481,245,431

2,808,704

棚卸資産の減少（増加）額

1,682

198,597(671,177)

法人税等調整額

7,498

885,331

1,081,241

その他

2,712

320,170249,285

営業活動によるキャッシュフロー

13,396

1,581,692

1,161,213(11,141)(1,315,390)(1,237,434)

投資活動によるキャッシュフロー：有形固定資産等の取得による支出
セールスリースバックによる収入

567

66,940-関連会社への投資および貸付(476)(56,250)(362,714)(437)(51,671)(399,600)

拘束預金への預け入れ(42,348)(5,000,000)-

敷金保証金の支出(12,602)(1,487,911)(430,455)

その他投資の取得による支出

その他
投資活動によるキャッシュフロー(285)(33,639)(26,995)(66,722)(7,877,921)(2,457,198)

2,000,000

財務活動によるキャッシュフロー：長期借入金による収入

16,9392,000,000

長期借入金の返済による支出(11,857)(1,400,000)-

リース債務の元本返済による支出(20,966)(2,475,433)(2,037,133)

8,498

1,003,367(1,799,768)

短期借入金の純増減額--

375,000

財務活動によるキャッシュフロー(7,386)(872,066)(1,461,901)

現金及び現金同等物に係る換算差額(2,450)(289,272)

233,098

現金及び現金同等物の減少額(63,162)(7,457,567)(2,524,788)

現金及び現金同等物の期首残高

93,554

11,045,919

13,570,707

現金及び現金同等物の期末残高

30,392

3,588,352

11,045,919

少数株主の増資引受けによる払込額

注記(1): 2003年3月期につきましては、米ドル換算レート118.07円=1米ドル(2003/3/31)にて参考表示しております。

Internet Initiative Japan Inc.
May 20, 2003
Page 1For Immediate Release
For inquiries please contact:
Akari Sato / Hiroaki Tsuno
IIJ Investor Relations Office
ir@iij.ad.jp or +81-3-5259-6500(Tel)

IIJ Announces 4th Quarter and Full Fiscal Year 2002 Results– Record quarterly and annual revenues surpass expectations –Expected continued revenue growth and positive operating margin in 2003
Tokyo, May 21, 2003 / New York , May 20, 2003 – Internet Initiative Japan Inc. (Nasdaq: IIJI) (IIJ), one ofJapan’s leading Internet access and comprehensive network solutions providers, today announced its financial
results for the 4th quarter and full fiscal year 2002, ending March 31, 2003 (“fiscal 2002”). On May 21 at 9:00
am (EST), the Company will host a conference call to discuss the results and its outlook. There will be asimultaneous webcast available at www.vcall.com. A replay will also be available at the same URL.

The 4th Quarter and full fiscal year 2002 Results Summary
4th Quarter 2002:
・ Revenues totaled JPY 13 billion ($ 110 million), an increase of 7.7% compared to 4Q01 and23.4% from 3Q02. Despite the lethargic Japanese economy, IIJ was able to maintain its steady
growth, surpass guidance and achieve the highest total revenue amount in the Company’s
history.
・ Operating loss narrowed to JPY 446 million ($ 3.8 million) from JPY 567 million in 3Q02. This
compares to a profit of JPY 186 million in 4Q01. The 4Q02 results include a non-recurring
expense related to the IIJ Group’s move to its new headquarters in March.
(1)・ Adjusted EBITDA was JPY 459 million ($ 3.9 million), a decrease of 52.6% compared to
4Q01 and an increase of 31.5% from 3Q02.
Full fiscal year 2002:
・ Revenues increased to JPY 44 billion ($ 373 million), a 10.3% increase from the previous year
which was in line with our guidance.
・ Operating loss was JPY 1.7 billion ($ 14 million).
・ Adjusted EBITDA was JPY 1.8 billion ($ 15 million).
Outlook:・ For the 2003 fiscal year, IIJ expects total revenues to grow by more than 10% compared to fiscal
2002. The Company also anticipates that operating margins will move into positive territory.
・ IIJ expects to raise additional equity capital on June 6, 2003. We believe that the equity capitalfinancing in a private placement will provide IIJ with the financial means to continue theimplementation of its growth strategy.
(1)

Adjusted EBITDA represents operating income (loss) plus depreciation and amortization. Adjusted EBITDA is provided because it is ameasure commonly used by investors to analyze and compare companies on the basis of operating performance. Adjusted EBITDA is nota measurement of financial performance under generally accepted accounting principles and should not be construed as a substitute for
operating income, net income or cash flows from operating activities for purposes of analyzing our operating performance, financial
position and cash flows. Our adjusted EBITDA is not necessarily comparable with similarly titled measures for other companies.
Note: Translations of Japanese yen amounts into US dollars are solely for the convenience of readers outside of Japan and have been
made at the rate of JPY118.07 = US$1, the approximate exchange rate on March 31, 2003.

Internet Initiative Japan Inc.
May 20, 2003
Page 2
Overview of 4Q02 and full fiscal year 2002 Results and Business Outlook
Overview “Despite a difficult economic climate in fiscal 2002, IIJ has continued to implement its
strategy for achieving greater shareholder value,” said Koichi Suzuki, President and CEO of IIJ. “Ourstrategy for the Japanese corporate market has been validated with the addition of several large-scale
contracts, including the Ricoh Group, and we have achieved a record level of revenues. In fiscal 2002,
we invested heavily in new services that will enable us to increase overall revenues in fiscal 2003 andbeyond. We also worked hard to control our international and domestic backbone expenses throughcontract renegotiations and the rationalization of our infrastructure; we expect the full benefit of these
efforts to generate significant cost reductions in 2003 and beyond. Furthermore, we believe that the
recent establishment of our Network Integration Division will increase our penetration in the corporate
sector, stimulate corporate network outsourcing demand and help improve our cross-selling efforts.
Finally, we will soon complete a capital increase that will strengthen the Company’s financial base.
We are confident that these measures and our increased focus on high margin products will position IIJ
for operating and financial success in 2003.”
Operating Profitability IIJ’s revenues for the fourth quarter were the highest in IIJ’s history andsurpassed the Company’s guidance. Despite the non-recurring expenses that were caused by the moveto the new headquarters in March, the operating loss in the fourth quarter improved from the previous
quarter’s loss, but was worse than the operating profit achieved in the same quarter of the previous
fiscal year. The moving expenses are considered an operating cost under US GAAP.
Revenue from the full 2002 fiscal year also marked the highest annual amount in the company’s
history. “Unfortunately, this was not sufficient to deliver a full year operating profit. An increase incertain connectivity services revenues was not sufficient to offset a loss of connectivity service
revenues. This was the result of contract cancellations by the telecom service arm of regional electric
power company and by the shift of several smaller corporate clients from the IIJ T1 Standard Service
and the IIJ Economy Service to cheaper services. We do not expect a repeat of such revenue losses andwe believe that we will continue to expand our connectivity revenues as has been the case for many
years. To make up for the loss of revenues, IIJ launched the OEM service through the CDN (Content
Delivery Network) platform and IIJ VPN Standard, a VPN (Virtual Private Network) service in thefiscal 2002 year. Though it will take some time to acquire new customers, we believe that these newservices will contribute to make IIJ more profitable in fiscal year 2003. We expect total revenues togrow by more than 10% compared to fiscal 2002,” said Yasuhiro Nishi, CFO of IIJ. In addition, we
expect to continue to increase the number of CATV customers. About fifty CATV operators wereconnected to IIJ, which represents more than 60% of Japan’s CATV Internet market in the 2002 fiscal
year.
Capital Improvement Plan IIJ is planning to issue 8,400 new shares of common stock at a price ofJPY418,200 in a private placement to third parties. The subscription and payment date for the newshares is expected to be June 6, 2003. We believe that the capital improvement will secure the financial
means to allow IIJ to continue the implementation of its growth strategy. "Demonstrating a significant
vote of confidence in IIJ's strategy, several major Japanese institutions will increase their financial
commitment to IIJ while others will contribute capital for the first time," commented Yasuhiro Nishi.
Details for the plan will be announced when finalized.
Strategies for Enterprise Markets IIJ’s focus on the enterprise market, which is based on the
Company’s Systems Integration(SI) business and is further supported by company-wide cross-selling
efforts, contributed to the Company’s steady growth in fiscal year 2002. Revenue from the SI businessincreased 33% sequentially as a result of strong demand for network solutions, equipment sales thatwere directed to the enterprise market.

Internet Initiative Japan Inc.
May 20, 2003
Page 3
Cross–selling IIJ has continued to successfully cross-sell its Value-added, Systems Integration andData Center Services to existing users of its Dedicated Access Services. “With a strategic marketing
focus on Data Center Services and a base of 6,000 corporate customers that value the quality of ourtechnology and support services, IIJ is well positioned to further increase our cross-selling rates in
2003,” said Yasuhiro Nishi, CFO of IIJ. In fiscal year 2002, revenues from IIJ’s top 150 customers
accounted for approximately half of the Company’s total revenues. Cross-selling rates for thesecustomers in fiscal 2002 year are detailed in the following table.
Approximate Cross-selling rates among Top 150 Customers in fiscal 2002
The following table shows the percentage of Dedicated Access Service customers who also use our Value-added
Service, our System Integrations Service and our Data Center Service.

Dedicated Access Service

Value-added Service
2001
2002
69.7%
70.6%

System Integration
2001
2002
49.2%
58.2%

Data Center Service
2001
2002
30.4%
35.3%

Change in the Organizational Structure In an effort to continuously maintain our competitive
advantage, IIJ brought together parts of IIJ, Crosswave Communications, IIJ Technology and NetCarein order to create a new division called the “Network Integration (NI) Division,” as of April 1, 2003.
This division groups all technology and information platforms, from the planning and development to
the maintenance and operation of various services. This division will make it possible to rapidly
respond to demand in the construction of network communication systems for enterprises
Status of Overview and Business Outlook
This Overview and Business Outlook contains forward-looking statements and projections, such as statements
regarding future total revenues and operating profitability, that are subject to known and unknown risks anduncertainties that could cause actual results to differ materially from those expressed or implied by these statements.
These risks and uncertainties include, but are not limited to, the factors noted at the end of this release and to the risk
factors and other information contained in IIJ’s filings on Form 20-F and Form 6-K, as well as other filings anddocuments furnished to the Securities and Exchange Commission. IIJ plans to keep this press release publicly
available on its Web site (www.iij.ad.jp), but may discontinue this practice at any time.

4th Quarter and full fiscal year 2002 Operating Highlights
Large-Scale Contracts
Several major Japanese companies awarded large-scale contracts to IIJ during the 4 th quarter, including
the Ricoh Group and Japan Leisure Channel. In February 2003, IIJ won a large-scale outsourcing
contract for email gateway solutions, “IIJ Mail Gateway service,” from the Ricoh Group, one of theworld’s leading suppliers of office automation equipment. In March, the Japan Leisure Channel Co.
Ltd. (JLC) chose the IIJ Group to build and operate a large-scale broadband motorboat racing site
called “Kyotei B.B. ” where IIJ “CDN JAPAN” service has been utilized.
Additionally, IIJ launched “IIJ Web Gateway Service,” a new security service that will be provided incooperation with IIJ Technology Inc. (IIJ-Tech), our 64.1% owned subsidiary. The service meets avariety of enterprise needs by providing proxy-caching server operation and management functions
that boost Web access efficiency.
Service Development
IIJ has continued to develop new services. In 4Q02, IIJ developed the IIJ SEIL Management
Framework system (IIJ SMF), the world’s first network service operating system that enables
corporations to substantially automate network configuration, and realize “plug-n-join” network
services to control all networking processes, including network construction and operation. Customers

Internet Initiative Japan Inc.
May 20, 2003
Page 4can enjoy large cost reductions for the construction of network configurations by using this system. In
addition, IIJ recently launched a new outsourcing solution of web-access filtering, “IIJ URL Filtering
Service,” to enable corporate customers to block access from their internal network to undesirable web
sites in order to improve their productivity. IIJ’s subsidiary, Net Care, Inc., launched a new IP (Internet
Protocol) telephony solution service for enterprises. The new service provides a comprehensive VoIP
(Voice over IP) solution that seamlessly integrates the operation of telephone and data networks. The
service includes consulting, equipment selection, system construction and implementation,
supervision, operation and maintenance.
Data Center
In January 2003, Crosswave Communications Inc. (a company which IIJ owns 37.9%) opened new
data centers in Yokohama and Saitama. Unlike conventional data centers, these two new data centersoffer a full range of integrated network and SI (Systems Integration) services that use the IIJ Group’s
extensive range of network, system and engineering resources. The two new data centers are linked toother IIJ Group data centers nationwide, which help in dispersing capacity while provid ing further
system back-up.
Network Infrastructure Development
In 4Q02, IIJ increased the capacity of seven of its domestic backbone network lines. IIJ also upgradedits US backbone network that runs between Los Angeles, California and Ashburn, Virginia.
R&D (IPv6)
In March 2003, IIJ launched a new IPv6 (Internet Protocol Version 6) service called “IPv6 Gateway
Service”. The new service will target leading companies in a variety of different industries. Besides
offering IPv6 connectivity through IIJ’s network, the service provides approximately 3 x 1026 IP
addresses (a block of /40) per contract, which enables customers to roll out their own IPv6 services byassigning an IP address to each of their products or services. Hitachi Ltd. has already contracted thisservice from IIJ.
Appointment of IIJ Engineers as IESG & IAB Members
In March 2003, two of IIJ’s engineers were appointed as Members of IESG* (Internet Engineering
Steering Group) and IAB* (Internet Architecture Board). Mr. Randy Bush, Chief Scientist of IIJ
America, has become a Member and Area Director of IESG and is responsible for the Operations &Management area. Dr. Jun- ichiro Itojun Hagino, a senior researcher in the IIJ Laboratory, is serving as
a Member of IAB. The assignments are two-year terms and are effective from March 2003 until
February 2005.
*IESG and IAB are organizations which are part of the IETF(Internet Engineering Task Force), which is a large open
international community of network designers, operators, vendors, and researchers who are concerned with theevolution of the Internet`s architecture and the smooth overall operation of the Internet. The IETF activities aregrouped into eight areas, which are administered by the IESG Area Directors. The IAB is an internationalorganization that provides architectural oversight and adjudicates appeals of complaints.

4th Quarter of FY2002 Financial Results
Revenues
Revenue in 4Q02 totaled JPY13,036 million, an increase of 7.7% compared to 4Q01, and an increaseof 23.4% compared to 3Q02.
Connectivity and value-added services revenue was JPY5,419 million in 4Q02, a decrease of 7.3%
compared to 4Q01 and a decrease of 2.6% compared to 3Q02.

Internet Initiative Japan Inc.
May 20, 2003
Page 5
Dedicated access services revenues were JPY3,341 million in 4Q02, a decrease of 8.3% compared to
4Q01 and a decrease of 1.8% compared to 3Q02. The decrease in year-over-year comparison was
mainly due to the cancellation by the telecom service arm of a regional electric power company, but insequential comparison, the downward trend in dedicated access services is being compensated by the
rapid revenue growth of IIJ FiberAccess/F service(10-100Mbps) and the steady growth of Data center
connectivity service.
Dial-up access service revenues were JPY765 million in 4Q02, a decrease of 9.4% compared to 4Q01
and a decrease of 1.4% compared to 3Q02. The revenues of IIJ’s various OEM services, which include
NTT’s regional L-mode service and other network services that use the CDN platform, increased
steadily, which offset the decline of IIJ4U service and other dial-up services for corporate customers.
Value-added services revenues increased 13.2% to JPY931 million in 4Q02 compared to 4Q01 and
2.0% compared to 3Q02. These increases were mainly due to the revenue growth of security related
services.
Systems integration service revenues decreased 8.0% to JPY4,905 million in 4Q02 compared to
4Q01, but increased 33.2% compared to 3Q02.
Equipment sales revenues were JPY2,712 million in 4Q02, an increase of 190.4% compared to 4Q01
and an increase of 105.7% compared to 3Q02. These revenues included sales of network equipment for
the educational industries and governmental agencies, which we expect to develop as significant
clients for our SI business.
Table 1. Number of Contracts
Internet Access Services
IP Service

64kbps – 128kbps
192kbps – 768kbps
1Mbps – 2Mbps
3Mbps – 1.2Gbps
Internet Data Center Connectivity Services (2)Others(3)Total Dedicated Access Services Contracts
(2)
(3)

4Q02
112
35
268
248
156
4,489
5,308

3Q02
130
37
279
212
139
3,922
4,719

4Q01
142
42
270
156
110
2,900
3,620

The figures of Internet data center connectivity services do not include contracts for data center housing services.
Others include, IIJ FiberAccess/F, IIJ Ethernet Standard, IIJ DSL/F, IIJT1 Standard and IIJ Economy.

IIJ4U (dialup services for individuals)
OthersTotal Dial-up Access Services Contracts

79,464450,320529,784

Table 2. Revenue Breakdown in Dedicated Access Services
4Q02
Total IP Service + DC connectivity
2,518
Others823
Table 3. Contracted Bandwidth
Dedicated Access Services
Internet Data Center Connectivity Service
Total Contracted Bandwidth

4Q02
32.1
9.9
42.0

82,193
370,543452,736

89,213
171,363
260,576(JPY in millions)
3Q02
4Q01
2,548
2,651
856
992
(Unit: Giga bits per second)
3Q02
4Q01
23.3
9.4
7.0
2.0
30.3
11.4

Internet Initiative Japan Inc.
May 20, 2003
Page 6
Cost and expenses
Cost of total revenues was JPY11,919 million in 4Q02, an increase of 11.3% compared to 4Q01, andan increase of 24.1% compared to 3Q02.
Backbone Costs
International backbone costs were JPY315 million, a decrease of 28.8% compared to 4Q01 and adecrease of 27.0% compared to 3Q02.
Domestic backbone costs were JPY1,075 million, an increase of 28.6% compared to 4Q01 and anincrease of 19.2% compared to 3Q02. These increases were a result of an increase in connection feeswith NTT’s regional access networks (FLET’S).
Table 4. Backbone Costs
International Backbone Costs
Domestic Backbone Costs

4Q02
315
1,075

3Q02

(JPY in millions)
4Q01
432
443
902
836

Cost of SI (Systems Integration) revenues
Cost of SI revenues was JPY 4,248 million in 4Q02, a decrease of 10.3% compared to 4Q01 and anincrease of 33.9% compared to 3Q02. The gross margin ratio for SI improved to 13.4% in 4Q02
compared to 11.2% in 4Q01, and was almost flat compared to 3Q02.
Sales and Marketing Expenses
Sales and marketing expenses were JPY789 million in 4Q02, an increase of 5.5% compared to 4Q01
and a decrease of 11.8% compared to 3Q02.
General and administrative expenses
General and administrative expenses were JPY662 million in 4Q02, an increase of 37.7% compared to
4Q01 and an increase of 29.3% compared to 3Q02. General and administrative expenses for 4Q02
included the cost of the move to new office.
Operating loss
The operating loss was JPY446 million in 4Q02 as compared to the operating income of JPY186
million in 4Q01 and a loss of JPY567 million in 3Q02. The operating loss for 4Q02, net of the cost of
the move to the new headquarters, improved considerably from the previous quarter due mainly to thesteady growth of our SI business. The operating income (loss)-to-revenue ratio for 4Q02 was (-)3.4%,
compared to 1.5% in 4Q01, and to (-)5.4% in 3Q02.
Other expenses
Other expenses for 4Q02 were JPY360 million, compared to JPY338 million in 4Q01 and JPY228
million in 3Q02. Other expenses for 4Q02 were mainly composed of a JPY175 million impairment
loss on certain equity security investment s and a JPY190 million interest payment.
Equity in net loss of equity method investees
Equity in net loss of equity method investees amounted to JPY1,254 million in 4Q02, compared to
JPY1,647 million in 4Q01, and JPY1,375 million in 3Q02. This is mostly attributed to the equity loss
in Crosswave.
Net loss
Net loss was JPY2,137 million in 4Q02, compared to JPY1,667 million in 4Q01 and JPY2,266 million
in 3Q02. Basic net loss per ADS equivalent was JPY(-)47.52 in 4Q02, compared to JPY(-)37.07 in
4Q01 and JPY(-)50.40 in 3Q02.

Internet Initiative Japan Inc.
May 20, 2003
Page 7
Table 5. Other Financial Statistics
4Q02
459
936
933

3Q02
349
1519
943

(JPY in millions)
4Q01
968
913
812

Adjusted EBITDA
CAPEX, including capitalized leases
Depreciation and amortization
Reconciliation of Non-GAAP Financial Measures
The following table summarizes the reconciliation of adjusted EBITDA to operating income (loss) per
the consolidated statements of operations prepared and presented in accordance with the U.S.
generally accepted accounting principles in Appendices 1 and 2:(JPY in millions)
Adjusted EBITDA
Depreciation and amortization(4)Operating income(loss)

4Q02
459
-905
-446

3Q02
349
-916
-567

4Q01
968
-782
186

FY2002
1,799-3,470-1,671

FY2001
2,960-2,90654(4)

Depreciation and amortization excludes amortization of issuance cost of convertible notes and of goodwill that were
presented as other expenses.

The following table summarizes the reconciliation of capital expenditures to purchase of property andequipment per the consolidated statements of cash flows prepared and presented in accordance with
the U.S. generally accepted accounting principles in Appendices 4 and 5:(JPY in millions)
Capital expenditures
Acquisition of assets by entering into capital leases
Purchase of property and equipment

4Q02
936
772
164

3Q02
1,519
1,014
505

4Q01
913
411
502

Company Information
Founded in 1992, Internet Initiative Japan Inc. (IIJ, NASDAQ: IIJI) is Japan's leading Internet-access andcomprehensive network solutions provider. The company has built one of the largest Internet backbone
networks in Japan, and between Japan and the United States. IIJ and its group of companies provide total
network solutions that mainly cater to high-end corporate customers. Services range from the delivery of new
generation network services over an optical-fiber infrastructure that is optimized for data communications, tothe construction of pan-Asian IP backbone networks. The company also offers high-quality systems integrationand security services, internet access, hosting/housing, and content design.
Statements made in this press release regarding IIJ’s or management’s intentions, beliefs, expectations, orpredictions for the future are forward-looking statements that are based on IIJ’s and managements’ current
expectations, assumptions, estimates and projections about its business and the industry. These forward-looking
statements, such as statements regarding 4Q02 and fiscal year 2002 total revenues and operating profitability, aresubject to various risks, uncertainties and other factors that could cause IIJ’s actual results to differ materially fromthose contained in any forward-looking statement. These risks, uncertainties and other factors include: IIJ’s
expectation that net losses will continue; IIJ’s ability to raise additional capital to cover its accumulated deficit; IIJ’s
ability to continue to increase subscribers to its connectivity services, particularly at higher bandwidths; IIJ’s ability
to generate significant revenues from its other services such as systems integration; the success of IIJ’s investments in
Crosswave; the ability to compete in a rapidly evolving and competitive marketplace; the impact of technologicalchanges in its industry; and other risks referred to from time to time in IIJ’s filings on Form 20F of its annual reportand other filings with the United States Securities and Exchange Commission.

Tables to follow

INTERNET INITIATIVE JAPAN INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)Appendix 1

For the Three Months Ended Mar 31, 2003, Mar 31, 2002 and Dec 31, 2002
(Expressed in Thousands of Japanese Yen (JPY) and U.S. Dollars (USD) Except for Per Share and ADS Data) (1)Year-over-year Comparison
Mar 31, 2003
USD (1)
Revenues:
Connectivity and value-added services:
Dedicated access services (2)Dial-up access services
Value-added services (2)Other
Total connectivity and value-added services

JPY

% of
Total
RevenuesJPY

Mar 31, 2002
% of
Total
Revenues

YOY
Chg %

Sequential Comparison
Dec 31, 2002
% of
Total
QOQ
JPY
RevenuesChg %28,299
6,479
7,888
3,229
45,895

3,341,255
764,958
931,399381,206
5,418,818

25.6%
5.9
7.2
2.9
41.6

3,643,141
844,279
823,137
533,191
5,843,748

30.1%
7.0
6.8
4.4
48.3

(8.3%)(9.4)
13.2(28.5)(7.3)

3,404,016
776,173
913,152
467,6295,560,970

32.2%
7.4
8.6
4.4
52.6

(1.8%)(1.4)
2.0(18.5)(2.6)

41,54722,971
110,413

4,905,429
2,712,192
13,036,439

37.6
20.8
100.0

5,331,986
934,040
12,109,774

44.0
7.7
100.0

(8.0)
190.4
7.7

3,683,978
1,318,630
10,563,578

34.9
12.5
100.0

33.2
105.7
23.4

Costs and expenses:
Cost of connectivity and value-added services
Cost of systems integration revenues
Cost of equipment sales
Total costs

42,63035,97622,345100,951

5,033,266
4,247,690
2,638,334
11,919,290

38.6
32.6
20.2
91.4

5,110,291
4,734,363
865,354
10,710,008

42.2
39.1
7.1
88.4

(1.5)
(10.3)
204.9
11.3

5,179,920
3,173,211
1,254,073
9,607,204

49.0
30.0
11.9
90.9

(2.8)
33.9
110.4
24.1

Sales and marketing
General and administrative
Research and development
Total costs and expenses

6,684
5,603
956
114,194

789,234
661,502
112,845
13,482,871

6.0
5.1
0.9
103.4

665,204
480,376
68,09011,923,678

5.5
4.0
0.6
98.5

18.6
37.7
65.7
13.1

894,340
511,604
116,950
11,130,098

8.5
4.9
1.1
105.4

(11.8)
29.3
(3.5)
21.1

Operating income (loss)(3,781)(446,432)(3.4)

186,0961.5(339.9)(566,520)(5.4)(21.2)

Other expenses(3,052)(360,292)(2.8)(337,694)

(2.8)

6.7

(228,058)

(2.1)

58.0

Loss before income tax expense(benefit)(6,833)(806,724)(6.2)(151,598)

(1.3)

432.1

(794,578)

(7.5)

1.5

Income tax expense(benefit)
Minority interests in consolidated subsidiaries
Equity in net loss of equity method investees

823
181(10,620)

97,256
21,342(1,253,875)

0.8
0.2
(9.6)

(140,381)(8,849)(1,646,603)

(1.2)
(0.1)
(13.6)(169.3)(341.2)(23.9)

137,936
41,813(1,375,338)

1.3
0.4(13.0)(29.5)(49.0)(8.8)

Net loss(18,095)(2,136,513)(16.4%)(1,666,669)(13.8%)

28.2%(2,266,039)(21.4%)(5.7%)

Systems integration revenues
Equipment sales
Total revenues

Basic Net Loss Per Share
Basic Net Loss Per ADS Equivalent
Weighted Average Number of Shares
Weighted Average Number of ADS Equivalents(95,041)(47.52)
22,48044,960,000(74,140)(37.07)22,48044,960,000(100,802)(50.40)22,48044,960,000

Note (1):The translations of Japanese yen amounts into US dollar amounts with respect to the three months ended Mar 31, 2003 are included solely for the convenience of readers outside Japa
and have been made at the rate of JPY 118.07 =$1, the approximate rate of exchange on Mar 31, 2003.
Note (2):IIJ datacenter connectivity services revenues have been reclassified from value added services revenues into dedicated access services revenues since the 1st quarter of FY200
The 4th quarter of FY2001 presented has been reclassified to conform to the current presentation and such reclassification resulted in an increase of dedicated access services revenue
by Y257,599, as compared to the previous classification method.

Appendix 2

INTERNET INITIATIVE JAPAN INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)For the Years Ended Dec 31, 2003 and Mar 31, 2002
(Expressed in Thousands of Japanese Yen (JPY) and U.S. Dollars (USD) Except for Per Share and ADS Data) (1)Year-over-year Comparison
Mar 31, 2003

Mar 31, 2002
% of

% of
USD (1)
Revenues:
Connectivity and value-added services:
Dedicated access services(2)Dial-up access services
Value-added services(2)Other
Total connectivity and value-added services

JPY

Total
Revenues

JPY

Total
Revenues

YoY
Chg %

117,007
26,72330,514
14,616
188,860

13,814,977
3,155,137
3,602,847
1,725,736
22,298,697

31.4%
7.2
8.2
3.9
50.7

14,303,342
3,644,091
3,099,791
1,667,986
22,715,210

35.8%
9.1
7.8
4.2
56.9

(3.4%)(13.4)
16.2
3.5
(1.8)

127,150
56,799372,80915,012,633
6,706,231
44,017,561

34.1
15.2
100.0

14,355,325
2,834,078
39,904,613

36.0
7.1
100.0

4.6
136.6
10.3

Costs and expenses:
Cost of connectivity and value-added services
Cost of systems integration revenues
Cost of other equipment sales
Total costs

172,668
110,868
54,345
337,881

20,386,887
13,090,220
6,416,525
39,893,632

46.3
29.7
14.6
90.6

19,799,402
12,314,158
2,540,089
34,653,649

49.6
30.9
6.4
86.9

3.0
6.3
152.6
15.1

Sales and marketing
General and administrative
Research and development
Total costs and expenses

26,901
18,671
3,508
386,961

3,176,165
2,204,504
414,149
45,688,450

7.2
5.0
1.0
103.8

3,038,412
1,839,525
319,370
39,850,956

7.6
4.6
0.8
99.9

4.5
19.8
29.7
14.6

Operating income(loss)(14,152)(1,670,889)(3.8)

53,6570.1(3,214.0)

Other expenses(10,751)(1,269,433)(2.9)(943,142)

(2.3)

34.6

Loss before income tax expense(24,903)(2,940,322)(6.7)(889,485)

(2.2)

230.6

Income tax expense
Minority interests in consolidated subsidiaries
Equity in net loss of affiliated companies

7,719
1,298
(47,644)911,365
153,251(5,625,299)

2.1
0.4(12.8)

1,099,035
24,467(5,482,082)

2.8
0.1(13.8)(17.1)
526.4
2.6

Net loss(78,968)(9,323,735)(21.2%)(7,446,135)(18.7%)

25.2%

Systems integration revenues
Equipment sales
Total revenues

Basic Net Loss Per Share
Basic Net Loss Per ADS Equivalent
Weighted Average Number of Shares
Weighted Average Number of ADS Equivalents(414,757)(207.38)
22,48044,960,000(331,234)(165.62)
22,48044,960,000

Note (1):The translations of Japanese yen amounts into US dollar amounts with respect to the year ended Mar 31, 2003 are included solely for the convenience of readers outside Japanand have been made at the rate of JPY 118.07 =$1, the approximate rate of exchange on Mar 31, 2003.
Note (2):IIJ datacenter connectivity services revenues have been reclassified from value added services revenues into dedicated access services revenues since the 1st quarter of FY2002.
The 4th quarter of FY2001 presented has been reclassified to conform to the current presentation and such reclassification resulted in an increase of dedicated access services revenues
by Y761,362, as compared to the previous classification method.

INTERNET INITIATIVE JAPAN INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)Appendix 3

As of Mar 31, 2003, Mar 31, 2002 and Dec 31, 2002
(Expressed in Thousands of Japanese Yen (JPY) and U.S. Dollars (USD)) (1)USD (1)ASSETS
Current Assets:
Cash
Accounts receivable, net
Inventories
Prepaid expenses
Other current assets

Mar 31, 2003
JPY%

Mar 31, 2002
JPY%

Dec 31, 2002
JPY%

30,392
86,839
3,537
4,781
7,901

3,588,352
10,253,096
417,666
564,501
932,873

9.2%
26.1
1.1
1.4
2.4

11,045,919
8,981,912
620,409416,945
143,798

24.4%
19.9
1.4
0.9
0.3

4,270,613
7,305,169
813,863882,854
135,828

11.4%
19.5
2.2
2.4
0.4

133,450

15,756,488

40.2

21,208,983

46.9

13,408,327

35.9

27,70425,74977,51042,34818,681
6,729

3,271,032
3,040,189
9,151,572
5,000,000
2,205,652
794,455

8.3
7.8
23.3
12.8
5.6
2.0

8,854,028
5,406,065
7,755,426
0
1,266,055
772,226

19.6
11.9
17.1
0.0
2.8
1.7

4,522,602
3,461,695
8,898,123
5,000,000
1,369,596
699,998

12.1
9.2
23.8
13.4
3.7
1.9

332,171

39,219,388

100.0%

45,262,783

100.0%

37,360,341

100.0%

Short-term borrowings
Accounts payable
Accrued expenses
Other current liabilities
Long-term borrowings-current portion
Capital lease obligations-current portion

40,854
71,196
3,299
4,675
16,462
23,007

4,823,599
8,406,170
389,495
551,985
1,943,735
2,716,386

12.3%
21.4
1.0
1.4
5.0
6.9

3,820,232
7,085,579
247,606
506,797
1,400,000
1,973,769

8.4%
15.7
0.5
1.1
3.1
4.4

4,510,000
5,852,779
364,366
570,719
1,200,000
2,424,701

12.1%
15.7
1.0
1.5
3.2
6.5

Total current liabilities

159,493

18,831,370

48.0

15,033,983

33.2

14,922,565

40.0Long-term Borrowings
Convertible Notes
Capital Lease Obligations-Noncurrent
Accrued Retirement and Pension Costs
Other Noncurrent Liabilities

29,273127,043
30,793683
1,569

3,456,265
15,000,000
3,635,780
80,601
185,201

8.8
38.2
9.3
0.2
0.5

3,400,000
15,000,000
2,861,556
100,841
108,376

7.5
33.2
6.3
0.2
0.2

3,400,000
15,000,000
3,463,132
75,047
184,847

9.1
40.1
9.3
0.2
0.5

348,854

41,189,217

105.0

36,504,756

80.6

37,045,591

99.2

7,449

879,495

2.3

1,032,746

2.3

900,837

2.4

Shareholders' Equity:
Common stock
Additional paid-in capital
Accumulated deficit
Accumulated other comprehensive income

59,984
144,561(233,185)
4,508

7,082,336
17,068,353(27,532,204)
532,191

18.1
43.5(70.2)
1.3

7,082,336
17,068,353(18,208,469)
1,783,061

15.7
37.7
(40.2)
3.9

7,082,336
17,068,353(25,395,691)
658,91518.9
45.7(68.0)
1.8

Total shareholders' equity(24,132)(2,849,324)(7.3)

7,725,281

17.1(586,087)(1.6)

Total liabilities and shareholders' equity

332,171

39,219,388

100.0%

45,262,783

100.0%

37,360,341

100.0%

Total current assets
Investments in and Advances to Equity Method Investees
Other Investments
Property and Equipment, net
Restricted Cash
Guarantee Deposits
Other Assets
Total assets
LIABILITIES ANDSHAREHOLDERS' EQUITYCurrent Liabilities:

Total liabilities
Minority Interest

Note (1): The translations of Japanese yen amounts into US dollar amounts with respect to Mar 31, 2003 are included solely for the convenience of readers outside Japanand have been made at the rate of JPY118.07 =$1, the approximate rate of exchange on Mar 31, 2003.

INTERNET INITIATIVE JAPAN INC.

Appendix 4

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)For the Three Months Ended Marach 31, 2003, March 31, 2002 and Dec 31, 2002
(Expressed in Thousands of Japanese Yen (JPY) and U.S. Dollars (USD)) (1)March 31, 2003
USD (1)March 31, 2002

Dec 31, 2002

JPY

JPY

JPY

Operating Activities:
Net loss(18,095)(2,136,513)(1,666,669)(2,266,039)

Depreciation and amortization

7,905

933,374

811,652

942,854

Equity in net loss of equity method investees

10,6201,253,875

1,646,603

1,375,338

Minority interests in net (loss) income of consolidated subsidiaries(181)(21,342)8,849(41,813)

Foreign exchange losses

1,264

149,262

3,990

32,834Losses on other investments

1,565

184,723

104,700

Decrease (increase) in accounts receivable(25,267)(2,983,254)(3,183,806)

493,961

Increase in accounts payable

18,6362,200,392

3,696,329

1,033,939

Decrease (increase) in inventories

3,321

392,051(398,876)(398,092)

771

91,033(145,560)

132,230

Deferred income taxes

-

Other

3,614

426,737

214,793(52,956)

Net cash provided by operating activities

4,153

490,338

1,092,005

1,252,256(1,385)(163,592)(501,667)(505,169)

567

66,940Investing Activities:
Purchase of property and equipment
Proceeds from sale-leaseback--

Investments in and advances to equity method investees--(24,123)-

Purchase of other investments--(350,000)(28,377)(11,749)(1,387,210)(2,007)22,972

51

6,057

22,299(30,506)(12,516)(1,477,805)(855,498)(541,080)(Payment) refund of guarantee deposits-net
Other
Net cash used in investing activities
Financing Activities:
Proceeds from long-term borrowings

16,9392,000,000--

Repayments of long-term borrowings(10,164)(1,200,000)-(200,000)

Principal payments under capital leases(5,558)(656,238)(535,906)(651,546)

Net increase (decrease) in short-term borrowings

2,650

312,854

120,018(322,254)

Net cash provided by (used in) financing activities

3,867

456,616(415,888)(1,173,800)

Effect of Exchange Rate Changes on Cash

(1,282)(151,410)

59,223(39,516)

Net Decrease in Cash

(5,778)(682,261)(120,158)(502,140)

Cash, Beginning of Period

36,1704,270,613

11,166,077

4,772,753

Cash, End of Period

30,392

3,588,352

11,045,919

4,270,613

Note (1): The translations of Japanese yen amounts into US dollar amounts with respect to the three months ended Mar 31, 2003 are included
solely for the convenience of readers outside Japan and have been made at the rate of JPY118.07 =$1, the approximate rate ofexchange on Mar 31, 2003.

INTERNET INITIATIVE JAPAN INC.

Appendix 5

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)For the Year Ended Marach 31, 2003, March 31, 2002
(Expressed in Thousands of Japanese Yen (JPY) and U.S. Dollars (USD)) (1)March 31, 2003
USD (1)March 31, 2002

JPY

JPY

Operating Activities:
Net loss(78,968)(9,323,735)(7,446,135)

Depreciation and amortization

30,3233,580,212

3,027,587

Equity in net loss of equity method investees

47,644

5,625,299

5,482,082

Minority interests in net loss of consolidated subsidiaries(1,298)(153,251)(24,467)

Foreign exchange losses (gains)

2,353

277,856(219,524)

Losses on other investments

2,348

277,162

432,952

Increase in accounts receivable(11,446)(1,351,380)(3,559,335)

Increase in accounts payable

10,5481,245,431

2,808,704

Decrease (increase) in inventories

1,682

198,597(671,177)

Deferred income taxes

7,498

885,331

1,081,241

Other

2,712

320,170249,285

Net cash provided by operating activities

13,396

1,581,692

1,161,213(11,141)(1,315,390)(1,237,434)

Investing Activities:
Purchase of property and equipment
Proceeds from sale-leaseback

567

66,940-Investments in and advances to equity method investees(476)(56,250)(362,714)

Purchase of other investments(437)(51,671)(399,600)

Deposit to restricted cash

(42,348)(5,000,000)-

Payment of guarantee deposits-net(12,602)(1,487,911)(430,455)

Other

(285)

(33,639)(26,995)(66,722)(7,877,921)(2,457,198)

Proceeds from long-term borrowings

16,9392,000,000

2,000,000

Repayments of long-term borrowings(11,857)(1,400,000)-

Principal payments under capital leases(20,966)(2,475,433)(2,037,133)

8,498

1,003,367(1,799,768)

Net cash used in investing activities
Financing Activities:

Net increase (decrease) in short-term borrowings
Proceeds from issuance of common stock of a subsidiary--

375,000

Net cash used in financing activities(7,386)(872,066)(1,461,901)

Effect of Exchange Rate Changes on Cash

(2,450)(289,272)

233,098

Net Decrease in Cash

(63,162)(7,457,567)(2,524,788)

Cash, Beginning of Period

93,554

11,045,919

13,570,707

Cash, End of Period

30,392

3,588,352

11,045,919

Note (1): The translations of Japanese yen amounts into US dollar amounts with respect to the year ended Mar 31, 2003 are included
solely for the convenience of readers outside Japan and have been made at the rate of JPY118.07 =$1, the approximate rate ofexchange on Mar 31, 2003.