Brief report on the mid-term Financial Statements for the period
ending March, 2002 (consolidated)
Name of listed company:

DAI-DAN Co., Ltd.

Nov. 20, 2001

Listed stock exchanges: Tokyo and Osaka

Code No.:1980
Location of head office: Osaka Pref.
Inquiries to be addressed to: Toshikazu Ando, Managing Director and Manager of Operations
Tel. 06-6441-8231
Date of Director's meeting on mid-term closing of accounts: Nov. 20, 2001
Adoption of American Accounting Standards :No

1. Consolidated performance for the mid-term period ending Sept. 2001(From April 1, 2001 to Sept. 30, 2001)(1) Consolidated management performance (Note: Amounts are indicated with figures less than 1 million yen discanded
Sales amountOperating profit
Ordinary profit
Million yen
Mid-term period
ending Sept. 2001
Mid-term period
ending Sept. 2000
Period ending
March, 2001%

Million yen%

Million yen%

59,769-8.7-2,019－-2,071－

65,429－-1,832－-1,621－

178,589

1,065

1,317

Current net profit

Current net earnings per share

Current net earning per
share
after making potential(mid-term)
Million yen(mid-term)%

Yen SenYen SenMid-term period-1,600-34.84－－ending Sept. 2001
Mid-term period-5,302-115.46－－
ending Sept. 2000
Period ending-8,480-184.65－
March, 2001
Note:
①Investment profit or loss on equity method Mid-term Period ending September 2001: 16 million yen,
Mid-term Period ending September 2000: 5 million yen,
Period ending March 2001: -23 million yen②Mid‑term average number of shares (consolidated) Mid-term Period ending September 2001: 45,928,093 shares
Mid-term Period ending September 2000: 45,925,908 shares
Period ending March 2001: 45,925,606 shares③Changes in accounting procedures: none
④Percentage indication of sales amount, operating profit, ordinary profit, and mid-term (current) net profit show
increase or decrease compared with previous mid-term period(2) Consolidated financial condition
Total assets
Million yen

Shareholder's capitalMillion yen

Shareholder's capital rate Shareholder's capital per share%
Mid-term period
32.0
138,741
44,331965.19ending Sept. 2001
Mid-term period
153,816
49,65632.3
1,081.22
ending Sept. 2000
Period ending
162,430
46,29628.5
1,008.07
March, 2001
Note: Issued number of shares at the end of period (consolidated) Mid-term Period ending September 2001: 45,930,461 shares
Mid-term Period ending September 2000: 45,925,908 shares
Period ending March 2001:
45,925,725 shares

Yen Sen(3) Consolidated cash flow condition
Cash flow on sales
activities

Cash flow on investment
activities

Million yen
mid-term period
ending Sept. 2001
mid-term period
ending Sept. 2000
Period ending
March, 2001

Cash flow on financial Period end balance of cash
and equivalent items
activities

Million yen

Million yen

Million yen-4,472279-1,03027,867-1,819763-1,087

29,114

2,544

1,037

-1,79033,068(4) Consolidation scope and items relating to application of equity method
Numberof consolidated subsidiaries: 11, Number of non-consolidated subsidiaries with equity method applied: none
Number of affiliated companies with equity method applied: 1(5) Consolidation scope and situation on changes in equity method application
Consolidated(new): 1, (excluded): 1, Equity method(new): none, (excluded): none
2. Estimate of consolidated performance of period ending March 2002 (From April 1, 2001 to March 31, 2002)
Sales amount
Ordinary profit
Current net profit
Million yen

Total

164,000

Million yen

1,550(Reference) Estimated current net profit per share (for total period): 7.18yen

Million yen

330

1. Situation of the Corporate Group
Our corporate group consists of our company, 11 subsidiary companies and 1 affiliated company, mainly
engaged in the business of designing, supervising, and job execution of electrical, air conditioning, plumbing& sanitation. The position of our group relating to business and the systematic chart of our business are as
follows:(1) Position of our group relating to business
Facility job work
Electrical, air conditioning, and plumbing & sanitation
Part of the work of orders received by us is relegated to DAI-DAN Service Kanto Co., Ltd.,DAIDEN Koji Co, Ltd., DAIDEN Koji Corp., DAI-DAN Service Kansai Co., Ltd., Okayama
DAIDEN Setsubi Co., Ltd., Kyushu DAIDEN Setsubi Co., Ltd., Kumamoto DAIDEN Setsubi Co.,
Ltd., CNA ENGINEERS PTE LTD. and DAI-DAN PHILIPPINES, INC. To the MERINO O.D.D.
SDN BHD., we sell facilities and equipment and to THAI O.D.D. CO., LTD, we offer technicalassistance.
Gas piping work
Kyo Gas Co., Ltd. executes gas piping work for orders placed by Osaka Gas Co., Ltd. and orders
placed by our company are minimal.
(2) Systematic chart of business

Customers

Electrical, air conditioning,plumbing & sanitary work

Sales offacilities andequipment

Technical
assistance

Subsidiary company
THAI O.D.D.
CO.,LTD.

Electrical, air conditioning
facility work

Construction facility work

Subsidiary company
MERINO O.D.D.
SDN BHDElectrical, air conditioning,plumbing & sanitary work

DAI-DAN Co., Ltd.

Works execution,
manufacturing andsales of facilities
and equipment

Works execution

Electrical, air conditioning, plumbing& sanitary work
Subsidiary companies
DAI-DAN Service Kanto Co., Ltd.
DAI-DAN Service Kansai Co., Ltd.
Okayama DAIDEN Setsubi Co., Ltd.
Kyushu DAIDEN Setsubi Co., Ltd.
Kumamoto DAIDEN Setsubi Co., Ltd.
DAI-DAN PHILIPPINES，INC.

Affiliated company
CNA ENGINEERS
PTE LTD.

Works execution

Electrical facility workGas piping work

Subsidiary companies
DAIDEN Koji Co. Ltd.
DAIDEN Koji Corp.

Subsidiary company
Kyo Gas Co., Ltd.

DAI-DAN Service Kansai Co., Ltd., which was newly established in the current mid-term consolidated
accounting period, has been included in the consolidated subsidiary companies since the current
mid-term period consolidated accounting period.
Furthermore, DAIDEN Setsubi Koji Co., Ltd., which was wound up, has been excluded from theconsolidation scope12. Management Policies(1) Basic policy on management
Our company, as a general facility implementation company, pursues a basic management policy ofcontributing to society by offering a safe and easy to use, high quality environment by technology
which meets customer confidence and satisfaction and also contributes to environmental preservation.
Under such a management policy, based on planning and implementaion of electrical, air conditioning,plumbing & sanitation, etc., in order to respond sensitively to changes in the industrial structure andthe needs of the customers, the company boldly challenge to develop new technologies that
accompany new businesses, and aims to become a vigorous company.
As a management index, we aim for the Return on Equity of more than 5%.
(2) Basic policy on distribution of profits
Our basic, consistent policy is to endeavor to build a solid financial constitution and return profits
stably and continuously to our shareholders achieving their satisfaction possible.
(3) Corporate governanceIn order to respond immediately to drastically changing management environment, a management
council has been set up to discuss taking unerring countermeasures against important management
issues expeditiously, and to make the decision on the management and implementation policies byadopting opinions that are given from inside and outside the company and also on the basis of
opinions from a committee of young leaders toward a promising future. At the same time, proposals
are made to board of directors, thereby aiming to activate the board of directors.
The auditors hold their meeting before the meeting of the board of directors’ is held, and confirm theitems to be discussed by the board of directors and present the opinions of the auditors’ meeting to theboard of directors. This has become and established practice.
Furthermore, to unify the business and affairs of the entire company, a branch office managers’
meeting is being held every month, where not only management policies and measures are explained
but various problems in branch offices are discussed to solve them as quickly as possible.
(4) Management strategy for the mid and long term
Regarding the mid-term management plan, “Challenge NEW DAI-DAN 100”, which has been carriedout since April 2000, we review the progress every year in order to respond to changes in the
management environment, and urge concrete measures as follows.
? Sales aspects
Regarding the saving-energy technologies represented by co-generation system, we are focussing our concentration onthese technologies and making our positive sales promotion for them using an unified organization that covers
everything from planning to work execution and maintenance. Furthermore, we have embarked on the ESCO project
and will continue canalizing our energies into the LONWORKS.

We are also strongly promoting proposal-making type of sales activities that can suggest thedevelopment of new technologies or improvement of existing technologies not only in the field of
medical industry of our core field but also in the fields of pharmaceutical, food, and IT-relatedindustries.
In addition, we are actively promoting measures to increase orders of renewal construction, making
good use of practices for many years.

@ Development technology aspects
We are pursuing our research and development for new technologies by realizing changes in thesocial situation accurately to meet the growing needs of the market.
Furthermore, we have maintained to work on research and development to ensure the work execution
quality and increase the work efficiency.
A Work execution technology aspects
We are continuing to offer facilities with not only high quality but also high cost performance by
fully utilizing our work execution technology that we have accumulated over a hundred years of ourexperience.
In addition, we are intensifying our supervising department for the work execution technologies andpromoting to offer construction facilities that can meet the needs of the customers.
2

B Information Technology (IT) aspects
Establishing our Information Technology advancement section, we are proceeding with re-building
the information system in the entire company in order to achieve higher efficiency and speed ofoperations that will lead to sharing the information among individual departments. Some systems
have been already in operation
C ISO
We are now making an effort at acquiring the ISO14001 certification for the entire company in block.
In addition, we are also carrying out the work of meeting the standard of the year 2000 update evenfor the ISO 9000 series certification that we have already obtained.
D Personnel aspects
We are proceeding with the effective utilization of personnel and the activation of organizations inorder to establish the result-based performance remuneration using “New Target Management
Evaluation” and let the introduced “Competency Evaluation” take root in the company.
In addition to implementing the above type of measures in a concrete manner, the entire company isworking together to improve the corporate performance towards March 2003 when our company will
be celebrating our hundredth anniversary.

33. Management Record(1) Outline of the current mid-term period
Although the economy of Japan for the current mid-term period showed increasing expectations of the structural reform by
the Japanese government, the recession of US economy and sharp letup in IT (Information Technology) related businessdue to a surfeit of expectation for IT industry that accompanied a decrease in private capital investment, increase in
unemployment, slump of stock prices, etc. intensified the economic recession and remained the personal consumption on alow level. Furthermore, the coincident multi terrorism of September in the United States elicited further invisible
economic conditions.
In the construction and facilities industry, public investment was hanging low through the period, and private capital
investment was continuously decreasing due to serious anxiety about the future business situation. Hence, the orderenvironments turned severe.
Under these economic conditions, our corporate group fully implemented the mid-term management plan as mentioned
above. However, the consolidated amount of work orders received was 66,912 million yen, a decrease of 12.1% over thatof the previous mid-term period. And the consolidated amount of work completed was 59,769 million yen, a decrease of
8.7% over that of the previous mid-term period.
As far as profits are concerned, since the works were concentrated to complete during the latter half of the period,
operating loss totaled 2,019 million yen (loss of 1,832 million yen for the previous mid-term period), and ordinary loss
totaled 2,071 million yen (loss of 1,621 million yen for the previous mid-term period). Furthermore, a 112million yen
evaluation loss on listed stock due to slump of stock prices, a 136 million yen evaluation loss on golf club membershiprights, etc. were accounted as special losses. As a result, the net loss for the mid-term period totaled 1,600 million yen (netloss of 5,302 million yen for the previous mid-term period).
Regarding stock dividends of our company, we paid an ordinary dividend of 5 yen per share in the current mid-term period
same as in the previous mid-term period based on our basic policy on distribution of profits.
(2) Forecast through the period
Regarding the future forecast, since the pressure slowing down the business situation is getting heavier due to social unrest
or slump of stock prices, etc. accompanied by the coincident multi terrorism in the United States, it is predicted that thebusiness situation remains invisible and unstable.
In the construction and facilities industry, it is predicted that severe order environments continue due to the restriction of
public investment and sluggish private capital investment.
To cope with such business situation, our corporate group will concentrate our effort en bloc to increase orders andenhance efficiency of work execution.
The consolidated amount of work orders 164,000 million yen, completed work of 164,000 million yen, ordinary profits of
1,550 million yen, and a current net profit of 330, 000 million yen are predicted through the period.

Regarding the term-end stock dividends, we plan to pay an ordinary dividend of 5 yen and a special
dividend of 6 yen per share, a total of 11 yen per share for the period. Since an ordinary dividend of 5
yen per share was paid for the mid-term period, the total dividend for the entire period will amount to
16 yen per share.

44. Mid-term period Consolidated Financial Statements, etc.
(1) Mid-term period Consolidated Balance Sheet(Unit: million yen)
By period

Accounts

At the end of the current
consolidated accounting
mid-term period(As of Sept. 30, 2001)

AmountAt the end of the previous
consolidated accounting
mid-term period(As of Sept. 30, 2000)

Component
ratio

Amount%(Assets)

Summary consolidatedbalance sheet of theprevious fiscal year forconsolidated accounting(As of March 31, 2001)

Component
ratio

Amount%Component
ratio%

Current assets
Cash on hand and in banks
Note receivables, completed work
accounts receivables
Securities

25,59824,93628,39940,47047,64765,498

2,626

4,377

4,872

Incomplete work expenditures

36,642

41,147

27,697

Others

6,260

5,608

8,325

Reserves for bad debts

- 400

- 245

- 357

Total current assets

111,19680.1

123,47180.3

134,435

82.8

Fixed assets

Tangible fixed assets

5,998

9,648

6,101

Intangible fixed assets

148

150

148

Investment securities

10,713

9,797

10,594

Others

11,403

10,983

11,792

Reserves for bad debts

- 719

- 234

- 641

Total investments

21,39820,546

21,745Investments

Total fixed assets

27,54419.9

30,34419.7

27,995

17.2

Total assets

138,741100.0

153,816100.0

162,430100.0

5

(Unit: million yen)
By period

At the end of the current
consolidated accounting
mid-term period(As of Sept. 30, 2001)

Summary consolidatedbalance sheet of theprevious fiscal year forconsolidated accounting

At the end of the previous
consolidated accounting
mid-term period(As of Sept. 30, 2000)(As of March 31, 2001)

Accounts

AmountComponent
ratio%(Liabilities)
Current liabilities
Notes payable, work accounts
payableShort term loans payable

AmountComponent
ratio

Amount%%42,741

52,176

67,913

11,731

12,98812,26822,847

22,846

17,81035

62

54

Others

6,171

5,920

7,391

Total current liabilities

83,526

Incomplete work amount received
Incomplete job compensation
reserves

60.2

93,994

61.1

Component
ratio

105,438

64.9

Fixed liabilities
Long term loans payable
Accrued pension and severance
costs

5,122

4,861

5,112

5,024

4,554

4,716

Directors’ retirement allowance
reserve

404

459

496

Liability guarantee loss reserve

210

230

210

Others4229

42

Total Fixed liabilities

10,803

7.8

10,134

6.6

10,578

6.5

94,32968.0

104,12967.7

116,016

71.4

79

0.0

30

0.0

117

0.1

Capital stock

4,479

3.2

4,479

2.9

4,479

2.8

Capital reserves

4,716

3.4

4,716

3.1

4,716

2.9

Consolidated reserves

35,00625.2

40,52026.3

37,11322.8

Evaluation difference of othersecurities

102

0.1

−

−

−

−

Foreign exchange adjustment
account

40

0.0

- 43

- 0.0

4

0.0

-0

- 0.0

-0

- 0.0

-0

- 0.0

- 14

- 0.0

- 15

- 0.0

- 15

- 0.0

44,33132.0

49,65632.3

46,296

28.5

138,741100.0

153.816100.0

162,430

100.0

Total liabilities(Minority interest equity)
Minority interest equity(Shareholders' equity)

Treasury stock
Stocks of parent company owned
by subsidiary companies

Total Capital
Total liabilities, minority interest
equity and shareholders' equity6(2) Mid-term period Consolidated Profit and Loss Statement(Unit: million yen)
By period

Accounts
Completed work amountCompleted work costCompleted work gross profit
Selling expenses and generaladministrative expenses
Operating profit (-: Loss)
Non-operating revenue
Interests received
Dividends received
Consolidated adjustment accountdepreciation
Investment profit by equity
methodOthersNon-operating expenses
Interest payable
Investment loss by equity method
OthersOrdinary profits (-: Loss)
Special profits
Profit on sales of fixed assets
Loss on sales of investments insecurities
Reimbursement profit of reserves
for liability guarantee loss
Profits from retirement allowancein trust
Profits from return of reserves forbad debts
Special losses
Loss on sales of fixed assets
Loss on retirement of fixed assets
Loss on sales of investments insecurities
Evaluation loss on investments insecurities
Evaluation loss on golf clubmembership rights
Evaluation loss on investments

The current consolidated
accounting mid-term period
From April 1, 2001
to Sept. 30, 2001

The previous consolidated
accounting mid-term period
From April 1, 2000
to Sept. 30, 2000

The previous fiscal year forconsolidated accounting

AmountPercentage

AmountPercentage

AmountPercentage

59,76956,147
3,622

%
100.0
93.9
6.1

65,42961,834
3,595

%
100.0
94.5
5.5

178,589
166,634
11,954

%
100.0
93.3
6.7

5,641

9.4

5,428

8.3

10,8896.1- 2,019
(172)
32
37

- 3.4
0.3

- 1,832
(454)
58
96

- 2.8
0.7

1,065
(835)
123
137

0.6
0.4

From April 1, 2000
to March. 31, 2001

3

1

5

16

5

−

82
(224)
149
−
74
- 2,071
(9)
9

0.4

- 3.5
0.0

293
(243)
169
−
73
- 1,621(4,753)
692

0.4

- 2.5
7.3

569
(584)
338
23
222
1,317
(4,803)
692

0.3

0.7
2.7

0

−

39

−

−

20

−

4,051

4,051

−

9

−

(257)
1
6

0.4 (11,700)
0
19

−

−

77

112

199

158

136

71

588

−

5

6

−

11,213

11,213

Evaluation loss on real estate
Loss due to extraordinary
construction settlement
Evaluation loss on real property
trust
Depreciation of completed work
accounts receivables

−

−

3,431

−

−

3,115

−

189

189

−

−

545

Mid-term period (current) net profit
before adjustment for taxes, etc.(-: Loss)- 2,319- 3.9- 8,568- 13.1-13,232

- 7.4

104

0.2

118

0.1

237

0.1

- 795

- 1.3

- 3,091- 4.7- 4,784

- 2.7

- 27

- 0.0

- 293

- 0.4

- 206

- 0.1

- 1,600- 2.7- 5,302- 8.1- 8,480- 4.7

Depreciation of difference at thetime of changing the severance
costs accounting basis

Corporate tax, residence tax andbusiness tax
Adjustment amounts such as forcorporate taxes
Profit of minority interests (-: Loss)
Mid-term period (Current) net
profit (-: Loss)

7

17.9

(19,353)
0
27

10.8

(3) Statement of Mid-term period Consolidated Earned Surplus(Unit: million yen)
By period

Accounts
Consolidated surplus balance at
beginning of period
Consolidated surplus decreased
amountShareholders' dividend
Directors bonus(Out of which auditors' portion)
Mid-term period (Current) net
profit (-: Loss)
Consolidated surplus balance atthe end of the mid-term period(term end)

The current consolidated
accounting mid-term period
From April 1, 2001
to Sept. 30, 2001

The previous consolidated
accounting mid-term period
From April 1, 2000
to Sept. 30, 2000

The previous fiscal year forconsolidated accounting

AmountAmountAmount37,113

505
0
（0）

505

From April 1, 2000
to March. 31, 2001

46,441

505
113
（10）

618

46,441

734
113
（10）

848

- 1,600- 5,302- 8,480

35,00640,52037,1138

(4) Statement of Mid-term period Consolidated Cash Flow
(Unit: million yen)
By period
Accounts
Cash flow on sales activities
Current net profit before adjustment for
tax (-: Loss)
Depreciation expenses
Consolidated adjustment accountdepreciation amount
Increased or decreased amount ofreserves for bad debts
Increased or decreased amount ofreserves for severance costs and reserves
for Director’s retirement allowance
Amount set for severance costs in trust
Profits from severance costs in trust
Increased or decreased amount ofreserves for liability guarantee loss
Earned interest and dividends received
Interest paid
Investment loss by equity method
Evaluation loss on investments insecurities
Profit or loss on sales of investments insecurities
Profit or loss on sales of tangible fixed
assetsLoss on sales of retirement of tangible
fixed assets
Evaluation loss on golf club membershiprights
Evaluation loss on real estate
Paid amount of Director’s bonus
Increased or decreased amount of sales
credits
Increased or decreased amount ofincomplete work expenditures
Other increased or decreased amounts ofcurrent assets
Increased or decreased amount ofprocurement credits
Increased or decreased amount ofincomplete work received amount
Other increased or decreased amounts ofcurrent liabilities
Sub-total
Received amount of interests anddividends
Paid interest amountPaid amount of corporate tax, etc.
Cash Flow on Sales Activities
II. Cash flow on investment activities
Expenditures by depositing of time
deposits
Revenue by pay back of time deposits
Expenditures by acquiring of securities
Revenue by sales of securities
Expenditures by acquiring of tangible
fixed assets
Revenue by sales of tangible fixed assets
Expenditures by acquiring of investment
securities
Revenue by sales of investment securities
Expenditures by acquiring of shares ofsubsidiary companies
Expenditures by loans
Revenue by recovery of loans
Expenditures by acquiring of other fixed
assets
Revenue by sales of other fixed assets
Cash Flow on Investment Activities
III. Cash flow on financial activities
Revenue by short term loans
Expenditures by return of short term
loans
Revenue by long term loans
Expenditures by return of long term loans

The current consolidated
accounting mid-term period
From April 1, 2001
to Sept. 30, 2001

The previous consolidated
accounting mid-term period
From April 1, 2000
to Sept. 30, 2000

The previous fiscal year forconsolidated accounting

AmountAmountAmount- 2,319- 8,568- 13,232

98

143

288

- 3

- 1

12

121

36

554

215

1,433

1,632

−
−

9,221
- 4,051

9,221- 4,051

From April 1, 2000
to March. 31, 2001

I.

−

−

- 20

- 70
149
- 16

- 155
169
- 5

- 260
338
23

112

199

158

- 0

−

38

- 7

- 692

- 692

6

19

27

28

202

334

−
- 1

−
- 116

3,431
- 116

25,07913,906- 3,935- 8,944- 10,253

3,209

2,627

- 728

- 3,841- 25,171- 5,684

10,034

5,036

4,558

- 477

- 1,221

176

1,665

- 4,281

- 191

4,339

73

154

258

- 144
- 120
- 4,472- 174- 1,608- 1,819- 340- 1,713
2,544

- 2

−

- 13

−
- 49
99

20
- 199
350

20
- 249
399

- 42

- 52

- 80

51

743

738

- 225

- 272

- 411

0

−

442

- 5

−

−

- 10
25

- 18
14

- 195
27

- 430

- 275

- 497

868
279

454
763

856
1,037

5,600

8,199

16,217- 5,798- 7,810- 16,676

3,180- 3,508

2,533- 3,502

6,633- 7,2249Expenditures by acquiring of treasury
stock
Revenue by sales of treasury stock
Revenue by sales of shares of parent
company owned by subsidiary company
Paid amount of dividends
Paid dividend to minority interests
Other financial activity cash flow
Cash Flow on Financial Activities
IV. Conversion difference relating to cash
and cash equivalent items
V. Increased or decreased amount of cash
and cash equivalent items
VI. Balance at beginning of period of cash
and cash equivalent items
VII. Balance of cash and cash equivalent
items at the end of mid-term period(term end)

−

- 0

0

0

0

1

−

−

- 504
- 1
−
- 1,030

- 505
- 2
−
- 1,087

- 736
- 2
- 1
- 1,790

24

- 12

5

- 5,200- 2,157

1,796

33,06831,271

31,271

27,867

29,11433,06810- 0

(5) Basic items for preparing mid-term period consolidated financial statements
1. Items relating to scope of consolidation
Number of consolidated subsidiaries:
11 companies
Names of major consolidated subsidiary companies:
Will be abbreviated here as they have been given in “1. Status of corporate group”.
DAI-DAN Service Kansai Co., Ltd., which was newly established in the current mid-term
period consolidated accounting period, has been included in the consolidated subsidiarycompanies since the current mid-term period consolidated accounting period.
Furthermore, DAIDEN Setsubi Koji Co., Ltd., which was wound up, has been excluded fromthe consolidation scope
2. Items relating to application of the equity method
Number of affiliated companies using the share cross-holdings method: 1 company
Company Name:
CNA ENGINEERS Pte LTD.
The account closing date of the above affiliated company is different from the mid-term period
account closing date, but the financial tables for the fiscal year of this company have been used.
3. Items Related to Mid-term period Account Closing Date of Consolidated Subsidiaries
Out of the consolidated subsidiary companies, the mid-term accounts closing date of MERINO O.D.D.
SDN. BHD, Thai O.D.D. CO.,LTD. and DAI-DAN PHILIPPINES, INC. is June 30.
In the preparation of various financial statement of consolidated accounting, the financial statementsof that date have been used and necessary adjustments have been made in consolidating regarding theimportant transactions that were generated between that date and the date of account closing.
4. Items relating to accounting procedure standards(1) Evaluation standards and methods for important assets
1) Stocks and bonds
Bonds held up to the maturing date: Depreciation cost method.
Other securities
With current market valueMarket price method based on the market price of the
mid-term period account closing date
(Evaluation differences are treated according to fullcapital direct accounting method , and sale cost is
calculated according to the movable average method.)
Without current market value
Cost method based on the movable average method
2) Derivative:
Market price method
3) Inventory assets
Incomplete work expenditures
Cost method based on actual cost method
Materials and stored goods
Lower of cost or market method(2) Method of depreciation of important depreciated assets
Tangible fixed assets
Straight line method in regard to buildings (excluding equipment) and fixed percentage method inregard to others are adopted. However the straight line method is adopted for overseas subsidiarycompanies.
Depreciable life and salvage value in our company and domestic consolidated subsidiaries are
set in accordance with the same standards as prescribed in the corporate tax law.
(3) Basis for recording important reserves
1) Reserves for bad debts
To cope with losses due to completed work accounts receivables and bad debts, generalbonds are based on the past record of bad debt ratio, while for particular bonds including
bonds likely to become bad debts, estimated unrecoverable amount is accounted byconsidering the possibility of recovery individually.
2) Reserves for completed work compensation
This is set with the object of warranting defects of completed work, accounted with consideration
given for future compensation predictions, basing on past records for the object work subject tocompensation.

113) Severance costs reserve
In order to prepare for the severance costs of employees, the severance costs obligation at
the end of this current consolidated accounting mid-term period and the estimated pension
asset amount are taken as the basis and the amount considered to have become due forpayment at the end of this accounting is carried over in the books.
Differences on the mathematical calculation start to be processed in the next consolidated
fiscal year in accordance with the straight-line method based on the given number of years(10 years) within average residual service years of employees at the time of occurrence,
while the past service liabilities are processed in a lump in the year of occurrence.
4) Reserves for Directors' retirement allowance
To provide for retirement allowance of Directors', the company has accounted reserves foramounts required to be paid at the end of the mid-term period, based on in-house regulations.
5) Reserves for liability warrantee loss
To provide for losses relating to warranting of liabilities, an estimated loss amount has beenaccounted with consideration given to the financial condition of the warranted party.
(4) Standard for converting important assets or liabilities held in foreign currency into Japanese Yen
The financial assets and liabilities held in foreign currency are converted into Japanese Yen at
the direct exchange rate on the day of the mid-term period account closing, and the difference
amount on the account closing date has been processed as profit or loss. Further, the assets andliabilities of foreign subsidiaries are converted into Japanese Yen at the direct exchange rate on
the day of the mid-term period account closing, and the difference amount on the accountclosing date has been included in the exchange rate conversion adjustment account and minority
interest equity.
(5) Treatment of important lease transactions
Finance lease transactions other than those for which transfer of ownership rights of the leased object
to the lessee is recognized, are accounted, basing on method relating to normal lease transactions.
(6) Method of important hedge accounting
1) Method of hedge accounting
2) Hedge means and hedge targets• Hedge means:• Hedge targets:

We are using the postponement hedge processing
method.
Interest swap transactions
long term borrowings

3) Hedge policy
In order to avoid changes in the interest rate risk on long term borrowings, we are using
derivative transactions.
Further, we have a policy of not carrying out derivative transactions for investment
purposes.
4) Evaluation method of hedge availability
Hedge availability is evaluated by means of analyzing the ratio between the total of the
cash flow for hedge targets and the total of cash flow for hedge means.
(7) Different important items for the mid-term period consolidated financial statements
1) Standard for accounting amount of completed works
This is based on the standard for accounting completed works. The standard of work
progress is used for foreign subsidiaries.
2) Accounting of consumption tax, etc.
Based on tax exclusion method.

12

5. Scope of funds in the mid-term consolidated cash flow statement
Funds (cash and equivalent) in the mid-term consolidated cash flow statement consist of cash on hand,deposits payable upon demand, time deposits for which maturity is within 3 months after acquiring or
readily convertible into cash without maturity date or redemption date.

(Additional information)
Accounting of financial instruments

From the current mid-term period consolidated accounting period, regarding the evaluation method ofother securities having current market value, the accounting standards related to financial instruments(“Opinions on the establishment of accounting standards related to financial instruments” – Corporate
Accounting Evaluation Committee, January 22, 1999) was applied. In view of this application, in themain, the evaluation method of other securities was changed from Cost Method based on the movableaverage method to Market Price Method based on the market price of the mid-term period
consolidated account closing date. (The evaluation differences were treated according to full capital
direct accounting method, and the sale cost was calculated according to the movable average method.)
As a result, the evaluation difference amount of other securities was accounted by 102 million yen,and deferred tax assets decreased by 74 million yen.

13

Remarks[Those relating to mid-term consolidated balance sheet](Unit: million yen)

1. Accumulated amount of depreciation of tangible fixed assets
2. Transferred amount by endorsed notes receivable

Current
mid-term forconsolidated
accounting

Previous
mid-term forconsolidated
accounting

Previous
fiscal year forconsolidated
accounting

5,109

4,937

5,061

150

46

35

1,473

1,519

1,455

611
239

1,178
650

874
223

3. Pledged assets and liabilities with pledge(1) Assets placed as collateral
Investment securities(2) Liabilities for the above
Short term borrowings(Transfer from long-term borrowings)
Long term borrowings

4. Method of accounting promissory notes becoming mature at the end of the mid-term period consolidated accounting period
Regarding the method of accounting promissory notes that are becoming mature on the last date of theconsolidated fiscal year, the settlement processing is being done on the date of exchanging the promissory
note. Further, since the last date of the current was a holiday for financial institutions, the promissory
notes becoming mature on the last date of the next fiscal year have been included in the balance at the endof the this period consolidated accounting term.
(Unit: million yen)

Notes receivable

1,326

Notes payable

3,294[Regarding mid-term consolidated profit and loss statement]
1. The important expense items and amount of sales expenses and general management expenses and theiramounts are as follows.
(Unit: million yen)

Salaries and allowances to employees
Severance costs

Current
mid-term forconsolidated
accounting

Previous
mid-term forconsolidated
accounting

Previous
fiscal year forconsolidated
accounting

1,996

2,078

4,062

469

183

358

Amount of deferred reserves of directors’ retirement
allowance
Amounts of computers

38

43

80

337

311

734

Communication and transportation expenses

538

526

1,068

Amounts transferred reserves for bad debts

68

3

60

Depreciation expenses

84

124

250

14

2. Seasonal variation in the amount of completed works
In the sales amount of our company’s group, since the share of works completed during the second half ofthe fiscal year is more than that during the first half as normal characteristics of our sales patterns, thesales amount during the first half of the fiscal year for consolidated accounting differs substantially fromthe sales amount during the second half of the fiscal year. And hence it should be noted that there is aseasonal variation in the performance during the first and second halves of the fiscal year.
The amount of completed works for 1 year until the end of the mid-term period consolidated accounting
year is as follows.
Second half of the previous consolidated fiscal year
113,159 million yen
Current mid-term period consolidated accounting period
59,769 million yen
Total
172,929 million yen
3. Transferred reserves for bad debts of 108 million yen is included in evaluation loss on golf clubmembership rights.
4. Paid amount of taxes and adjustment amount such as for corporate taxes for the mid-term period
consolidated accounting period were accounted by the amount for the current mid-term period
consolidated accounting period presuming that reserves for reduction on fixed assets are reversed by thedisposal of predetermined profits in the current fiscal year for consolidated accounting.
[Those relating to consolidated cash flow statement]
Mid-term period end balance of cash and cash equivalent objects and relation to the amount and accountstated in the mid-term period consolidated balance sheet(Unit: million yen)
Current
mid-term forconsolidated
accounting

Previous
mid-term forconsolidated
accounting

Previous
fiscal year forconsolidated
accounting

Cash and deposit accounts

25,59824,93628,399Securities account

2,626

4,377

4,872

Total

28,22429,31333,272

- 56

- 49

- 54

- 300

- 149

- 149

27,867

29,11433,068Time deposits with time period more than 3 months
Securities other than additional type public bonds
investment trusts
Cash and cash equivalent objects

15

[Those relating to lease transactions]
Finance lease transactions other than those for which ownership rights of the leased object transfers to thelessee1. Amount equivalent to acquired amount of the leased object, amount equivalent to accumulated
depreciation amount, and amount equivalent to balance at end of the mid-term period.
(Unit: million yen)
Current
mid-term forconsolidated
accounting

Previous
mid-term forconsolidated
accounting

1,573

−

1,537

Amount equivalent to accumulated depreciation amount

841

−

819

Amount equivalent to balance at end of mid-term period

731

−

717

Tools and equipment, fixtures
Amount equivalent to acquired amountPrevious
fiscal year forconsolidated
accounting(Note) Amount equivalent to acquired amount was calculated from the previous consolidated fiscal yearby the interest payable exclusive method because the ratio of unexpired lease charge balance at theend of the previous consolidated fiscal year in the term end balance of tangible fixed assets, etc.
became more important.
However, the amounts calculated according to the interest payable inclusive method are as
follows.
(Unit: million yen)
Current
mid-term forconsolidated
accounting

Previous
mid-term forconsolidated
accounting

Previous
fiscal year forconsolidated
accounting

1,763

1,747

1,685

Amount equivalent to accumulated depreciation amount

946

831

862

Amount equivalent to balance at end of mid-term period

817

917

823

Tools and equipment, fixtures
Amount equivalent to acquired amount

2. Amount equivalent to unexpired lease charge balance at end of the mid-term period.
(Unit: million yen)
Current
mid-term forconsolidated
accounting

Previous
mid-term forconsolidated
accounting

Within 1 year

349

−

334

Over 1 year

406

−

401

Tools and equipment, fixtures

Previous
fiscal year forconsolidated
accounting

Total
755
736
−
(Note) Amount equivalent to unexpired lease charge at the end of mid-term period was calculated fromthe previous consolidated fiscal year by the interest payable exclusive method because the ratio of
unexpired lease charge balance at the end of the previous consolidated fiscal year in the term end
balance of tangible fixed assets, etc. became more important.
However, the amounts calculated according to the interest payable inclusive method are as follows.
(Unit: million yen)
Current
mid-term forconsolidated
accounting

Previous
mid-term forconsolidated
accounting

Within 1 year

388

392

373

Over 1 year

430

524

449

Total

818

917

823

Tools and equipment, fixtures

16

Previous
fiscal year forconsolidated
accounting3. Payable lease charges, amount equivalent to depreciation expenses and amount equivalent to interest
payable(Unit: million yen)
Current
mid-term forconsolidated
accounting

Previous
mid-term forconsolidated
accounting

Payable lease charges

199

216

429

Amount equivalent to depreciation expenseses

184

216

396

Amount equivalent to interest payable

14

−

41

Tools and equipment, fixtures

Previous
fiscal year forconsolidated
accounting

4. Calculation method of amount equivalent to depreciation expenses
Calculation was made by the straight line method with lease period set as the service life and residual
value set at zero.
5. Calculation method of amount equivalent to interest
Amount equivalent to interest is defined as a difference between total of lease charge and the amountequivalent to acquisition prices for the lease property. The method of allocation to each period is based on
the interest law.

17

5. Relating to Securities
The current mid-term consolidated period (as of to Sept. 30, 2001)
1. Bonds with current market value and intended to be held until maturity date
(Unit: million yen)Amount in the mid-term
consolidated balance sheet

Corporate bonds
Total

Current value

Difference amount

700

700

0

700

700

0

2. Other securities with current market value(Unit: million yen)Amount in the
mid-term
consolidatedbalance sheet

Acquired cost(1) Shares

Difference amount

8,368

8,683

314

2

3

0

302

164

- 138

8,674

8,850

176

(2) Bonds
Corporate bonds(3) Others
Total

3. Contents of main securities without current market value(Unit: million yen)Amount in the mid-term
consolidated balance sheet(1) Bonds intended to be held until
maturity
Discount bank debentures99

Non-public domestic bonds

2

Unlisted foreign bonds

0
102

Total

(2) Other securities
Money management fundMid term government bond
fund
Unlisted shares (excluding
over-the-counter sold shares)
Total

1,471
855
866
3,192

18

Remarks

(Note) In the previous mid-term period consolidated accounting period and the previous consolidated
fiscal year, other securities with current market value were not evaluated according to the current
market value. However, the amounts for other securities in the mid-term period consolidatedbalance sheet (consolidated balance sheet) accounted according to Finance Ministerial Ordinanceof 2000, vol. 11, Supplementary provisions vol.3 (vol. 9, Supplementary provisions vol. 3) are as
follows.

Previous mid-term forconsolidated accounting
Amount in the mid-term
consolidated balance sheet
Current value
Amount equivalent toevaluation difference
Amount equivalent to deferred
tax liability(Unit: million yen)Previous fiscal year forconsolidated accounting

7,174

8,561

9,579

9,592

1,394

597

1,010

432

19

6. Relating to Derivative Transactions
Although our company is conducting interest rate swap transactions, we are applying hedge accounting.
Accordingly, notes are omitted

7. Segment Information
1. Segment information by type of business
The current mid-term consolidated period (April 1, 2001 to September 30, 2001) ,the previous mid-term consolidated period (April 1, 2000 to September 30, 2000) andthe previous consolidated fiscal year (April 1, 2000 to March 31, 2001)
Since our corporate group is engaged in facility construction works, there are no business types otherthan this. Accordingly, segment information by business type is not described.
2. Segment information by location
The current mid-term consolidated period (April 1, 2001 to September 30, 2001) ,the previous mid-term consolidated period (April 1, 2000 to September 30, 2000) andthe previous consolidated fiscal year (April 1, 2000 to March 31, 2001)
Since the total sales amount of all segments of "Japan" exceeds 90%, description of segment
information by location is omitted.
3. Overseas sales amountThe current mid-term consolidated period (April 1, 2001 to September 30, 2001) ,the previous mid-term consolidated period (April 1, 2000 to September 30, 2000) andthe previous consolidated fiscal year (April 1, 2000 to March 31, 2001)
Since overseas sales amount is less than 10% of the total consolidated sales, description of overseas
sales is omitted.

20