Fiscal Year ending October 31, 2004

Third Quarter Financial Statements Bulletin (Consolidated)

September 3, 2004

Listed Company Name

Kanamoto Company, Ltd.

Company Code Number 9678
Listing Exchanges(URLTokyo Stock Exchange, Sapporo Stock Exchange

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

1. Matters Related to Preparation of the Quarterly Financial Statements Bulletin
1. Are there any differences between the statement methods used and the accounting procedures
applied for the most recent consolidated fiscal year?

No

2. Are there any changes in the scope of consolidation and application of the equity method?

No

2. Summary of Operating Results for the Third Quarter of the Fiscal Year EndingOctober 31, 2004 (November 1, 2003 – July 31, 2004)(1) Revenues (Consolidated)(Amounts less than one million yen omitted)
Millions of yen

Fiscal Year Ending October 31, 2004:
Nine Months ended July 31, 2004
Fiscal Year Ended October 31, 2003:
Nine Months ended July 31, 2003
(Reference) Fiscal Year Ended October 31, 2003
(Notes)％44,478（―）―（―）

63,686

1. Revenues are cumulative totals through the end of the third quarter.
2. Kanamoto Company did not disclose quarterly operating results during the fiscal
year ended October 31, 2003. Accordingly, the percentage increase or decrease
compared with the same period of the prior fiscal year has been omitted.

[Supplementary Explanation Concerning Third Quarter Revenues]<Business Environment>
During the third quarter under review, Japan’s economy began to show signs of a business recovery asbusiness sentiments for Japan overall reflected the business performance of certain firms and regions.
The large gulf between the recovery of corporate operating results and the employment situation,
however, remained marked with continued sharp differences in business sentiments between large
and small firms and between major metropolitan areas and local regions. For construction-related
businesses in particular, the unrelenting severity of business conditions was conspicuous in many of
the regions where private sector demand is weak and firms rely on public works.
<Trends in the Company’s Main Businesses>
Based on its new long-range management plan “Metamorphose,” Kanamoto strengthened its new
FY Ending October 31, 2004 3Q Consolidated Operating Results
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market development efforts in sectors such as equipment rentals for construction and maintenanceworks, while continuing to increase the percentage of highly profitable equipment models in its
portfolio. This enabled the Company to maximize the advantages of its equipment line-up featuring thelatest state-of-the-art equipment, including a broad selection of environmentally-friendly equipment,that is unrivalled by any other company in the construction equipment rental business. At the sametime, the Company concentrated on focused marketing efforts throughout the entire Kanamoto Groupfor products such temporary scaffolding, safety products, and furniture and fixtures used atconstruction sites. In certain regions the Company also sought to ensure earnings and dominate
competition through alliances with leading local firms.
As a result, during the quarter under review, the Company steadily achieved inroads into private
sector demand in the Tokyo metropolitan area and in the Kinki-Chubu Region, including the Tokai area,
despite the fact the third quarter in the construction industry is an off season with few public works
orders. In areas where public works cutbacks continued, on the other hand, and in the Tohoku andHokkaido regions, the Company faced a challenging situation as orders lagged for construction
projects other than disaster relief work.
<Notable Business Development Efforts and Status of Branch Network Modifications>
The alliance group Kanamoto has been constructing as part of its growth strategy produced positive
results, and is advancing to the next stage.
During the third quarter under review, Kanamoto effected the transfer of the high level construction
equipment rental business of Kanaya Lease Co., Ltd. (Head office: Urayasu, Chiba Prefecture) on June
1, which the Company began operating as its Tokyo Metropolitan Area High Level Equipment Branch.
On July 2, Kanamoto also took over the construction equipment rental operations of Nakano Motors
Co., Ltd. (Head office: Ikutahara, Monbetsu-gun, Hokkaido), a company that has enjoyed closebusiness relations with Kanamoto in the Doto Region of Hokkaido. Kanamoto is developing thisbusiness as its Engaru office.
In addition to the actions described above, shortly after the close of the quarter under review
Kanamoto will convert Kanki Corporation (Head office: Suma-ku, Kobe, Japan), the leading
construction equipment rental company in Hyogo Prefecture, into a subsidiary company. Although theeffects of this step and the above-mentioned changes on the Company’s operating results will be minor
during the fiscal year ending on October 31, 2004, management expects these actions to contribute togrowth of the Company’s rental business beginning from the next fiscal year.
Other actions taken by the Company included opening the Shin-Kiba Branch, located on 5,627m2 ofland (including the site for the Shutoken Aerial Equipment Branch) and positioned as Kanamoto’s
construction equipment branch for the Tokyo metropolitan area, and closing the Kurobe sub-branch(Kurobe, Toyama Prefecture) and the Toda Branch (Toda, Saitama Prefecture). As a result, during thefirst nine months of the fiscal year ending October 31, 2004 the Company established five newbranches and closed seven branches. In addition, as part of its alliance with Komatsu, the Companybegan joint management operations of the Monbetsu Equipment Center, which will seek orders for theHidaka disaster recovery works in Monbetsu-cho, Hokkaido.
As a result of the above, consolidated revenues for the first nine months of the fiscal year ending
October 31, 2004 were 44,478 million yen.

FY Ending October 31, 2004 3Q Consolidated Operating Results
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(2) Events Having a Material Affect on the Financial Position and Operating Results ofKanamoto’s Corporate Group During the Quarter Under Review
There were no pertinent matters to report.

3. Fiscal Year ending October 31, 2004 Projected Full-year Consolidated OperatingResults (November 1, 2003 - October 31, 2004)
Projected

Projectedoperating

ordinary

incomeincomeMillions of yen

Millions of yen

Millions of yen

60,780

1,850

1,700

950

31.81

58,730

1,820

1,740

1,020

34.15

Projected
revenues

Consolidated
fiscal year

Projected net
incomeProjected net
income pershare

Millions of yen

Yen(Reference)Non-consolidated
fiscal year
Qualitative Information Concerning Projected Operating Results and other Matters
The projected operating results described above were prepared by revising projected values
previously released by the Company (June 10, 2004).
These projections were prepared on the basis of information available to management as of the datethese reference materials were released and other factors, including assumptions concerning thefuture economic environment, and entail various risks and uncertainty factors.
Actual operating results may differ from the projected values for the monetary amounts describedabove because of various future factors, including the economic circumstances surrounding theCompany, market trends, and competitive conditions.
EndFY Ending October 31, 2004 3Q Consolidated Operating Results
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