SBS Business Report（Interim）

For the Six Months Ended June 30, 2012 (Security Code: 2384)

Business H i g h l i g h t s
SBS Business Report

SBS Group meets the various logistics needs withthe utmost quality.
Sales by Business Segment

Key Objectives and Strategies

Provide high value-added logistics andlogistics support service to meet the client
needs

Entry in Top 10 of the industry(Human resources,
Environment-related,
Marketing)

Logistics
93.0％

For the year ended December 31, 20112012 Forecast\127.0billionthe logistic functions in all directions

Other 5.1％

Property Management
1.9％

Net Sales

3PL Corporate Group which has

Operating
Income\2.9

Dividend per
Share

\30

billion

3 Strategies

Expand 3PL
and ensurestability (food)

Full-fledged
overseas businessdevelopment with
Asia as theprimary target

M&A anddevelopment oflogistics facilities

Business
StrategyInternational
Strategy

Investment
Strategy

Development ofGroup Management Structure
Low cost operation structure 〜
Environment to extract group synergies※ Dividend per share shown is calculated on the basis of stock split/share trading unit system we recently switched to.
Please refer to the notes on the last page for details about stock split and adoption of the share trading unit system.

Logistics
Business

General
Logistics●3PL ●International Logistics ●Warehouse Logistics●Distributive Processing ●Special Transportation●Logistics Consulting Others

Food
Logistics●Three-Temperature Nationwide Logistics ●3PL
●Distributive Processing ●Home Delivery●Logistics Consulting Others

Specialized●Same-day Delivery ●3PL
Logistics

Logistics Support
Business

Property
Management
Other

Others●Development and sale of logistic facilities

Others●Human resources ●Environment-related ●Marketing Others

Disclaimer: Forward-looking statements included in this report are based on information and assumptions consisting of uncertain
factors that may influence our performance available to the Company on the date of this report s publication. Due tovarious unforeseen circumstances, however, actual results may differ from such forecasts.

1

Message fr o m t h e P r e s i d e n t
SBS Business Report

Restructuring
the Company's domesticorganization and reinforcing
overseas bases.
These are the strategic moves
we have made to ensure
the future growth.
Representative Director and President: Masahiko Kamata

The SBS group is an integrated outsourcing

But although business environment is far

enterprise providing various services focus-

from favorable, the Group has actively

ing on logistics and covering the wholetaken its business to many new customers

supply chain of our customers. By providing

and was able to achieve an increase in

an environment, in which our customers

sales. We have also established a number

can concentrate their management re-of new 3PL business bases in Japan andsources on the core segments of their en-

launched restructuring of the overseas

terprises, we help them to enhance theirbases. Furthermore, we have established acompetitive power as well as the operating

low cost operation structure, ensured

efficiency.

stricter labor compliance, and made aWith the revival demand after the Great
East Japan Earthquakes and due to somenumber of other strategic moves laying
foundations for the further growth.

other factors, business conditions are cur-In the second half of the fiscal year, we

rently showing signs of recovery. Still, theshall strive to achieve positive business re-situation remains highly uncertain due to thesults by steadily increasing the number ofcurrent financial unrest in Europe, the con-customers that are using our services, put-cerns regarding slowdown of the economies

ting into effect the previously drawnof the emerging nations, the continuing

growth strategy, expanding the scale ofstrong yen and deflation. In the logistics

operations, and enhancing the corporate

industry, companies continue to reducevalue of our enterprise.

logistics costs, and the competition with

Finally I would like to take this opportu-

companies of the same industry is becoming

nity to ask all of our shareholders andtougher, keeping profitability more andinvestors for your continued support.

more difficult.
2Special Fea t u r e
SBS Business Report

Reinforce the SBS Group s management system
Aiming at a further expansion of the business scale, the SBS group is currently
implementing a number of measures to strengthen its management system both inJapan and overseas, reinforcing our business bases and reorganizing our subsidiaries.

Promoting integration of domestic subsidiaries
In order to reinforce the business structure oft h e i r operations and management resources,

our subsidiaries, the Group merged Izu Express

reinforcing their administrative structure, atTrucking Inc. into NIHON KAMOSTU KYUSO

the same time mobilizing the experience andCO., LTD., and TL Service Co., Ltd into TL Transport

know-how they have accumulated during theCo., Ltd.

long years. These steps shall enable the Group

By merging the companies with similar

to enrich and further develop the logistics

corporate structure, we aim to improve theirservices offered, aiming at the further growthbusiness results by revising and reformingof the companies comprising the Group.

Working on building a network of business bases in the ASEAN area
On acquiring in October of last year an

SALHD is to take charge of the logistics

international logistics company Atlas Logistics

business in Singapore, and also control the(hereinafter referred to as "Atlas") located inbusiness activities in each of the ASEAN

India, the Group has launched preparations forcountries. Furthermore, the Group made aoverseas expansion.

financial contribution via SALHD to Atlas Express

Firstly, in May of the year, we have established in

Logistics, a company affiliated to Atlas andS ingapore a w h o l l y - o w n e d s u b s i d i a r y SBS

located in Thailand, changing the company

Logistics RHQ (hereinafter referred to as

name into SBS Atlas Logistics. We have also

"SLRHQ"), which shall control the total businesssubmitted applications to change the names ofactivities of the Group in Asia. After having thus

two more companies affiliated to Atlas andcreated an organization, which can control thelocated respectively in Vietnam and Malaysia into

Group s companies located in the countries ofthe same name.

the area, from June, we launched development

In the future, we shall advance with furtherof business bases in the ASEAN area, which alsomeasures to reinforce our logistics bases locatedmeant reorganization of the companies affiliatedin the countries of the ASEAN, thus creating an

to Atlas located in the area.

organization that in addition to the forwarding

The Company made an additional investment

enterprise of the Atlas Group shall offer the total

into a l o c a l s u b s i d i a r y o f A t l a s l o c a t e d i nlogistics solution, which is the strong point of theSingapore via the SLRHQ and changed the name

SBS Group.

of the subsidiary into SBS Atlas Logistics Holdings(hereinafter referred to as "SALHD").

3

Special Fea t u r e
SBS Business Report■Current situation with reorganization of subsidiaries
Merger of Izu Express Trucking into NIHON KAMOSTU KYUSO (July, 1)
NIHON KAMOSTU KYUSO
Number of employees

383

Number of bases

16

Number of vehicles

451

Izu Express Trucking
Number of employees+NEW

NIHON KAMOSTU KYUSO

80

Number of bases

6

Number of vehicles

62

Number of employees⇒

Number of bases

20

Number of vehicles

500

Merger of TL Service into TL Transport (July, 1)

Number of employeesNEW

TL Service

TL Transport

255

Number of bases

14

Number of vehicles

160

Number of employees+

464

TL Transport

31

Number of bases

2

Number of vehicles

22

Number of employees⇒

281

Number of bases

14

Number of vehicles

155■Current status of bases in the ASEAN area
Note: figures marked with "%" show the Group s ownership percentage
SBS Holdings

100％
SBS Logistics RHQ(Singapore)80％
Atlas Logistics(India)

87.1％
6.7％

SBS Atlas Logistics Holdings(Singapore)}

Establishment of controllingcompany for the Group's
overseas business in Singapore}

Investment in the company
affiliated to Atlas located in
Singapore and change of its
company name}

Investment in the company
affiliated to Atlas located in
Thailand and change of its
company name}Submission of applications
to change names of two
companies affiliated to Atlas
located respectively in
Vietnam and Malaysia

Entered the Group in October, 2011

49％

60％

100％

SBS Atlas Logistics (Thailand)

SBS Atlas Logistics (Vietnam)

SBS Atlas Logistics (Malaysia)

4Topics
SBS Business Report

Current initiatives of the SBS Group
Establishment of a businessbase in the Yokohama Portfor the purpose of customs
clearance work

Launch of construction
work of Noda Yoshiharu
Logistics Center (tentative)（TL Logicom）(AC System Corporation, (hereinafter referred to as "AC system"))January

January

AC System, a company engaged
in customs clearance work,
established its Yokohama
office in the Yokohama PortInternational Cargo Center. A
shipping branch of TL
Logicom is also located in thisfacility, and the Group shall use this advantage toreinforce the international logistics function
through cooperation between the two offices.

TL Logicom has started
construction work for Noda
Yoshiharu Logistics Center.
This facility that is due to becompleted by the end of
September is an environment-friendly center, all buildings ofwhich are equipped with LED lighting, photovoltaic
power generation equipment, offering many otherenvironmentally-conscious solutions.

Implementation ofloading work of railway cars

Completion of large-sizedtransfer work for city oﬃces（TL Logicom）（TL Logicom）

FebruaryMarch

TL Logicom conductedloading work at the Daikoku
Wharf in Yokohama loading
old railway cars that had
previously been used on the
Keio Lines and are to be
used from now on on the
Iyo Railway in Shikoku. The work had to be donein difficult conditions in strong wind, but wascompleted with all six cars safely loaded onto
two ships.

TL Logicom received anorder for transfer / remodelingwork accompanying the"Remodeling Project for
Increase of Comfort in theWard Offices" conducted by
Kawasaki City Office. The
company managed to complete a large amountof work that entailed 7 ward offices and 4 local
offices in just nine days.

Seminar on the Revised
Temporary Staﬃng Services
Law heldResin treatment plantestablished in Shanghai,China（Sogo Butsuryu System）（SBS Staff）

April
Revision of the Temporary
Staffing Services Law has
been made with its
enactment scheduled for
October. SBS Staff held aseminar for the customers
worrying about the impactof this revision, explaining the points of importancein the content of revision and the measures thatneed to be implemented after the enactment.

5

Operations-related initiatives

July
Sogo Butsuryu Systemestablished "Shanghai
Qingyaliu Plastic Processing
Co.,Ltd", a plant for processing
acrylic resins in Shanghai,
China.
Manufacture/processing of
furnishings and sales promotion of fixtures forstores has been launched here in August.

Topics
SBS Business Report

CSR-related initiatives

The Group was awarded lettersof appreciation for the support
we oﬀered to the areas
devastated by the earthquake
and tsunami
March, May（SBS Logitem）（TL Logicom、SBS Logitem）

TL Logicom and SBS
Logitem were awarded
letters of appreciationfrom the Kanto District
Transport Bureau forthe support the twocompanies had provided
to the areas stricken by the Great East Japan
Earthquake last year.

CO₂

Saving powerwith smart clocks

Five companies of
the SBS Group apply for
new Tokyo CO₂ Emission
Reduction Program

SBS Logitem introduced to its
offices new "smart clocks",
which show the current
amount of the electricity
used on the edge of theclock, warning the staff withcolors and audible alarm
when too much power is used. This initiative
allows the company to implement power saving
using the force of all of the members of the staff.

Reinforcement ofcompliance education（SBS Group）

June
Five companies of the SBSGroup, namely, TL Logicom,
Zentsu, TL Transport, Wing
Transport, and Nippon Record
Center have applied forparticipation in the new"Tokyo Freight Transportation
Appraisal System" that sums
up and evaluates fuelconsumption for every truck,with a view to reduce CO₂
emissions.

April

First half

TL Logicom has become
the first enterprise to be
accepted for participation

The Group has conducted anumber of training sessions
centering on the complianceissues. Transportation
safety management
seminar (February, March),
Compliance training(April, May), and Sales training (June, July)tailored to match the occupational area, position
and rank of the participating staff wereconducted with a view to increase the awarenessamong the employees of the respective issues.

Total CO₂ emissions of the SBS Group for the 2011 ﬁscal year
Below is the collected environmental data of the SBSGroup for the 2011 fiscal year. The amount of emissions of
CO₂ with vehicles and facilities combined was 71,180t,

ＣＯ₂emissions(tons)

down 6,477t or 8% of the CO₂ emissions of the last fiscal
year. One of the factors contributing to the reduction was

Vehiclesthe scale of the power saving measures conductedfollowing the reduction of available electricity after thedisaster. Another factor is the ecological

Facilities

with the vehicles used by the Group,
resulting in favorable environmental results.

Total

Amount of Improvement Number of Amount of Number ofratevehicles emissions vehicles
emissions

57,895

9.3%

Electric
12,610power

6.1%

13,438

675

−

375

71,180

8.3％

Other

drive initiative that has taken firm roots

2010

2011

3,118

3,118

63,84477,657

Remarks

3,210

Gas,
water,
etc.

3,210

6

Consolidated Financial Statement
SBS Business Report

Although economic environment continues to be quite severe, there are already signs ofnormalization in the amount of cargo handled. A number of measures was conducted by
the Group to expand its operations, which together with the full-year contribution to thesales made by the companies transformed into owned subsidiaries last year resulted in an
increase posted by the Group in net sales as compared to the corresponding period of lastyear. Moreover, the eﬀorts made to reform and improve enterprises with low proﬁtability
bore fruit, resulting in increases in both operating income and ordinary income. Also,
during this year there has been no extraordinary loss from disaster posted in thecorresponding period of last year, and net income have turned into the black.

■ Net Sales

1st Half■ Operating Income

YOY Change

139,405
115,710 119,824

8.3％UP
121,148

5,000

71,46760,000YOY Change

4,000

3,000

58,145 55,918 58,022 62,846

2008

2009

2010

■ Ordinary Income

2011

3,995

2012

1st Half(Millions of yen)
5,000

4,000

Full Year

YOY Change

3,748

2,138

0

2009

1,653

2010

1,332

1,183
519
2008

2009

2010

2011

1,422

1,000

2011

0
2012

1,140

2,140

2,522

1,367
829
（476）

（28）
2008

Full Year

Restoreprofitability

1,988

960

2012

1st Half(Millions of yen)
4,000

2,000

2,161
1,604

2008

1,677

3,000

290

7

2,177

1,690

■ Net Income

1,000

0

2,888

390.1％UP

4,291

3,000

2,000

2,000

1,000

30,0000

Full Year

156.4％UP

4,262
3,325

90,000

1st Half(Millions of yen)

(Millions of yen)
150,000

120,000

Full Year

2009

2010

2011

2012

Consolidated Financial Statements
SBS Business Report■ Sales by Segment(Millions of yen)

1st Half of FY2012

1st Half of FY2011

Net Sales

Operating Income

Net Sales

Logistics

58,734683

54,07981

Property Management

1,209

594

1,203

644

Other

3,191

24

3,164

（219）

Adjustment

△289

29

（424）

13

Total

62,846

1,332

58,022

519

Operating Income● Logistics business posted an increase in net sales. This is due to a number of factors, such as anincrease in the amount of cargo that had decreased as a consequence of the Great East Japan
Earthquake, the fact that business results of the two companies that newly became members of
the Group have been added to the total figures, and the increased activity in the food-related
cargo movement. Also, by making improvements to the unprofitable areas of operations, theGroup managed to increase its operating income.
● Logistics Support Business: as there have been no new operations or sales in the property

management business, net sales remained at the same level. In Other business, on the other
hand, the environment-related business turned profitable with operating income swinging into
the black.

■ Total Assets / Net Debt /Net Debt to Equity Ratio
Total Assets

Net Debt■ Net Assets / Equity Ratio

Net Debt to Equity Ratio(Millions of yen)
120,000

90,000108,488（％）
300

107,201
96,408242％

Net Assets(Millions of yen)223％

25,06525,00020,00026,570 （％）

22,616

100,747 102,439250

Equity Ratio

18,59820,23840

15,00060,00045,884

46,25137,287165％

30,000

0

200

08/12

09/12

10/12

39,090

157％

11/12

10,00037,342
150

142％
12/06

100

5,000

0

16.8％

08/12

18.6％

09/12

23.2％

10/12

24.5％ 25.6％

11/12

12/06

20

0

8

Consolidated Financial Statements
SBS Business Report

Basic Policies regarding the Profit Distribution and Per-Share Dividend■ ■ Dividend per Share
Basic Policies regarding the Profit Distribution

（yen）
35

30.0

30
25

23.0

30.0

30.0

SBS Group regards the return of proﬁts to allshareholders to be one of its most importantbusiness policies. Based on our group s business

23.0

achievement and ﬁnancial situations, we will20

address for the stable shareholder return through15

our eﬀorts to further strengthen our managementbase and to increase in return on equity.

10

For the year ending December, 2012, we intend
to pay dividend of 30 yen per share. The Group50adopted the share trading unit system as of
2008

2009

2010

2011

2012
(Forecast)※Dividend per share shown is calculated on the basis of stock
split‑share trading unit system we recently switched to.

January 1, 2012, splitting every share into 100
shares, but for every share trading unit (100shares)the dividend is 3,000 yen, which is thesame amount it was during the current term.
＊Pleaes refer to the notes on the last page for details about
stock split and adoption of the share trading unit system.

■ Performance Forecast for the Year Ending December 31, 2012 (By Segment)(Millions of yen)

Logistics

Property
Management

Other

Adjustment

Total

117,700

2,300

7,000

‑

127,000

4.4％

‑3.8％

15.6％

‑

4.8％

Operating
Income

1,776

1,060

70

（6）

2,900

YOY Change

40.4％

‑3.7％

‑

‑

33.2％

OperatingMargin

1.5％

46.1％

1.0％

‑

2.3％

Net Sales
YOY Change※ Figures of the earnings forecast contain the proceeds of internal sales between segments.

9Corporate Profile & Stock Information
SBS Business Report

Corporate Proﬁle

Stock Information(As of June 30, 2012)

51,568,400 shares
13,068,400 shares（including 285,641 treasury shares）

Company nameSBS Holdings, Inc.

Representative
director and president

Masahiko Kamata

FoundedDecember 16, 1987

Paid-in Capital¥3,833.93 million

Net sales¥121.1 billion (for the year ended December 31, 2011)

Head oﬃce

4-1-3 Taihei, Sumida-ku, Tokyo 130-0012, Japan
Tel: +81-3-3829-2222(main)
Fax: +81-3-3829-2822

Lines of Business
Major consolidated
subsidiaries(As of June 30, 2012)

Number of shares authorized
Number of shares issued
Share trading unit

100 shares

Number of shareholders

Major Shareholders

3,591(As of June 30, 2012)

Shareholder Name

Number of
Ratio ofshares held share held
(hundred shares) (%)

Logistics, property management, marketing,Masahiko Kamata

6,412,800

50.16

human resources, etc.

SBS Holdings Employee Share Ownership
Association

497,600

3.89

Japan Trustee Services Bank, Ltd. (Trust account)

446,800

Hiroshi Date

434,800

3.49
3.40

The Chase Manhattan Bank, N. A.
London Secs Lending Omnibus Account334,800

2.61

Junichi Ouchi

309,400

2.42

MELLON BANK, N. A. TREATY CLIENTOMNIBUS

200,000

1.56

Hiroyuki Yoshioka

188,900

1.47

3E Corporation

156,000

1.22

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

124,200

0.97

TL LOGICOM Co., Ltd.
Foods Lec Co., Ltd.
Zentsu Co., Ltd.
SBS Logitem Co., Ltd.
SBS Staﬀ Co., Ltd.
Atlas Logistics Private Limited
Sogo Butsuryu System Co., Ltd.
SBS Finance Co., Ltd.
A-MAX Co., Ltd.
Marketing Partner Co., Ltd.
Forward
PAM Co., Ltd.

Board of Directors and Auditors (As of June 30, 2012)
Representative director and president

Masahiko Kamata

Managing director

Kenichi Iriyama

Directors

Fumiaki Miyasaka

The ratio of share held are calculated based on the number ofshares excluding 285,641 of treasury shares. Japan Trustee
Services Bank, Ltd. (Trust account) is a re-trusted employee shareownership association and the number of shares its trust accountholds includes 359,900 of our shares.

Distribution of Shares by Shareholder Type
Number of share issued: 13,068,400 shares

Shin-ichiro Watanabe(As of June 30, 2012)

Japanese Corporations

Treasury stock

426,400 shares（3.26％）

285,641 shares（2.19％）

Non-Japanese Corporation

Full-time auditor

Tamio Wakabayashi

Auditors

Shigetaka Shomatsumoto
Masato Takeda

Securities ﬁrms

694,100 shares（5.31％）

137,018shares（1.05％）

Financial institutions

940,700 shares（7.20％）Jiro Iwasaki
The auditors Shigetaka Shomatsumoto, Masato Takeda and Jiro Iwasaki
are the external auditors.

Individuals and others

10,584,541 shares（80.99％）Note Regarding Adoption of the Stock Split/Unit Stock System
In accordance with the Action Plan for the Consolidation of Trading Units announced by Japanese Stock Exchanges Conference on November 27, 2007,
our company divided its shares and adopted the unit stock system deﬁning 100 shares as one unit. There will be no actual impact of the shareholders
due to the adoption of the stock split/unit stock system.

● Brief outline of the system● Impact on the shareholders: no actual changes made.

Record date: December 31, 2011
Eﬀective date: January 1, 2012

【Investment unit】
If the stock price is ¥100,000【Amount of dividend received】
If the dividend is ¥3,000 per share

Up to now :1 shareUp to now :¥100,000 x 1 share = ¥100,000¥3,000 x 1 share = ¥3,000

After adoptionof the stock split/
unit stock system :100 shares(one unit)

After adoptionof the stock split/
unit stock system :¥1,000 x 100 shares (one unit) = ¥100,000¥30 x 100 shares (one unit) = ¥3,00010