May 14, 2009

Summary of Consolidated Financial Results for the Year Ended March 31, 2009
Company name:

SRA Holdings, Inc.
(URL: http://www.sra-hd.co.jp/)
Tokyo Stock Exchange

Stock listing:Code number:President:
For inquiries, please contact:
Tel:

3817
Toru Kashima
Shigeru Yoshimura, General Manager, Finance Department, Administrative Headquarters(03)-5979-2666
Date of ordinary general meeting of shareholders:
Scheduled commencement of dividend payment:
Scheduled date of submission of financial reports:

June 25, 2009
June 11, 2009
June 25, 2009

1. Consolidated Financial Results for Fiscal 2009 (from April 1, 2008 to March 31, 2009)(1) Consolidated Operating Results(All amounts rounded down, % change YoY)Net Sales

Fiscal 2009
Fiscal 2008

Operating Income

Ordinary Profit

Net Income

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

41,77745,058

(7.3)
22.6

3,820
4,102

(6.9)
44.0

3,894
4,181

(6.9)
43.0

2,041
2,224

(8.2)
10.4

Net Income
per Share

Ratio of Net Income
to Shareholders’Equity%Net Income per Shareafter Dilution

Yen
Fiscal 2009147.52
Fiscal 2008
160.74
Reference: Gain (loss) on equity method investments:
Fiscal 2009: —Fiscal 2008: —Yen—

Ratio of Ordinary
Profit to Total Assets

15.0
18.0

160.35

Ordinary Profit
Ratio

%

%

14.3
15.9

9.1
9.1

(2) Consolidated Financial Position
Millions of yen%

Shareholders’ Equity
per Share
Yen

14,164
13,22453.0
47.0

1,014.91
950.22

Cash Flows fromOperating Activities

Cash Flows from
Investing Activities

Cash Flows from
Financing Activities

Cash and Cash Equivalents
at the End of Period

Millions of yen

Millions of yen

Millions of yen

Millions of yen

2,194
2,025

(852)
(434)

(772)
(238)

11,753
11,265

Total Assets

Net Assets

Millions of yen
Fiscal 2009
26,519Fiscal 2008
27,967
Reference: Shareholders’ equity
Fiscal 2009: ¥14,046 million
Fiscal 2008: ¥13,150 million

Shareholders’ Equity Ratio(3) Consolidated Cash Flows

Fiscal 2009
Fiscal 2008

2. Dividends
Dividend per Share
Record dateFiscal 2008
Fiscal 2009
Fiscal 2010 (forecast)End of

End of

End ofFirst

SecondThird

Quarter

Quarter

QuarterYear-end

For theyear

Total
Dividends(for the year)

Dividend
Propensity(consolidated)

Net Assets to
Dividend
Ratio(consolidated)

Yen

Yen

Yen

Yen

Yen

Millions of yen

%

%

0.00
0.00
0.00

0.00
0.00
0.00

0.00
0.00
0.00

40.00
40.00
40.00

40.00
40.00
40.00

553
553
―

24.9
27.1
38.2

4.5
4.1
―

1

3. Consolidated Earnings Forecast for Fiscal 2010 (from April 1, 2009 to March 31, 2010)

Net Sales（% change YoY is for the fiscal year or for interim period）
Net Income
Ordinary Profit
Net Income
per Share

Operating Income

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

Yen

15,00032,600(22.8)(22.0)

1,000
2,740

(30.6)(28.3)

1,000
2,740

(31.3)(29.6)

530
1,450(25.5)(29.0)

38.30
104.77

Interim Period
Full Year

4. Others(1) Changes to significant subsidiaries during the term (changes in specified subsidiaries due to change in scope of
consolidation):No(2) Changes in accounting principles, methods or reporting procedures
1. Changes due to change in accounting standards:
Yes
2. Changes other than 1. (above):No(3) Number of outstanding shares (common shares)
1. Shares issued at the end of term (including own shares)
Fiscal 2009: 15,240,000 sharesFiscal 2008: 15,240,000 shares
2. Own shares at end of term
Fiscal 2009: 1,400,198 sharesFiscal 2008: 1,400,198 shares[Reference] Summary of non-consolidated financial results

1. Non-Consolidated Financial Results for Fiscal 2009 (from April 1, 2008 to March 31, 2009)(1) Non-Consolidated Operating Results
Net Sales

Fiscal 2009
Fiscal 2008

Fiscal 2009
Fiscal 2008(% change YoY)
Operating Income

Ordinary Profit

Net Income

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen

%

1,626
1,282

26.8
100.3

1,046
672

55.6
62.2

1,034
657

57.2
57.7

1,033
635

62.6
48.1

Net Income
per Share

Net Income per Shareafter Dilution

Yen

Yen

68.57
41.68

―
41.59

(2) Non-Consolidated Financial Position
Net Income

Net Assets

Millions of yen

Millions of yen%

Shareholders’ Equity
per Share
Yen

98.5
98.4

603.65591.00Shareholders’ Equity Ratio

9,207
9,156
9,150
9,058
Reference: Shareholders’ equity:
Fiscal 2009: ¥9,072 million
Fiscal 2008: ¥9,006 million
Fiscal 2009
Fiscal 2008

Note: Forecast performance is predicted by the Company based on information currently available at the time of theforecast. Actual financial results may differ due to a number of factors. For further information, please see page 5 of
the attached reference.

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SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

1. Business Results(1) Analysis of Business Results(Business results for the fiscal year)
Amid the global recession triggered by the worldwide financial crisis, the Japanese economy rapidly deteriorated in
the fiscal year ended March 31, 2009, owing to sluggish stock markets, a decrease in exports resulting from thestrong yen, and a decline in capital expenditures accompanying a worsening of corporate earnings.
In the information services industry, the business environment surrounding the SRA Holdings Group rapidly
worsened, especially from the third quarter as IT investments by customers were successively postponed, scaled
down, or frozen.
Under these conditions, the SRA Holdings Group strived to generate new orders and sales and raise profitability
to attain our fiscal year performance targets. Concurrently, as an urgent measure for raising profit levels, we also
focused on cutting selling, general and administrative (SG&A) expenses and other expenses. Additionally, with theview that the current harsh management environment provides excellent opportunities for reform, the entire SRA
Holdings Group worked in unison to implement reforms of its business structure with the aims of strengthening ourbusiness foundation and positioning the Company for future growth. Specifically, under these reforms we will work
to “raise our gross profit margin by establishing a cost management system,” “establish a structure for stable orders
backed by our solid customer base,” and “undertake a sweeping review our cost structure.”

The following is a brief overview of the reforms.

Raise our gross profit margin by establishing a cost management systemz

Raise productivity per employee
Raise productivity through automation and semi-automation by deploying an assortment of tools and promotereuse through componentization and sample codesz

Promote offshore development (India and China)z

Lower unit prices for orders placed and review ordering conditions by thoroughly monitoring our domestic
business partners

Establish a structure for stable orders backed by our solid customer base
(SRA)z

Industrial-related: We established the Industrial Sales Promotion Division and will work to increase orders andsales as well as expand and upgrade our customer base and strengthen relationships with our customers.

zFinancial-related: We will shift to a structure that can respond to changes in the business environment[strengthen relationships with existing customers and cultivate ties with peripheral customers (subsidiaries andother customers)].

z

System Operations and Infrastructure Development: We will make efforts to stabilize business in the System
Operations business and raise profitability in the Infrastructure Development business.

Undertake a sweeping review our cost structurez

We separated cost of sales and SG&A expenses into the categories of fixed costs and variable costs andformulated and implemented exhaustive cost-cutting measures that extend beyond conventional cost-reduction
3

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

measures.

Meanwhile, in keeping with efforts to “expand overseas business earnings opportunities,” which is a priority issue
under our medium-term management plan, we formed a business and capital alliance agreement with SJ Holdings Inc.
in February 2009. The business alliance provides complementary benefits by allowing the mutual use of each group’s
management resources, including human resources, technologies, know-how, and products, while strengthening the
profitability of both companies. At the same time, the alliance enables the companies to efficiently advance into thepromising Chinese market and thus create new corporate value.
Regarding the capital alliance, to enhance the effectiveness of the cooperative tie-up at the operational level, SRA
will also hold a portion of SJ Holdings’ shares.
Despite the implementation of the aforementioned measures, net sales and income declined from the previous
fiscal year, as shown in the table below. Nonetheless, our consolidated business results for the fiscal year exceeded
the figures in our revised forecast announced in November 2008.
Moreover, our consolidated business results for fiscal 2009 surpassed the results recorded up to the fiscal year
ended March 2007, and we believe that the SRA Holdings Group’s growth potential and rising profitability are being
sustained.
SRA Holdings recorded consolidated net sales of ¥41,777 million, a decline of 7.3% from the previous fiscal year.
This decrease mirrored a large decline in the Product Sales business at Software Research Associates (SRA), Inc., acore company, owing to curtailments of IT investments by customers, as well as a decrease in SRA’s Systems
Development business, mainly in financial-related sectors. Additionally, Advanced Integration Technology (AIT),
Inc., a principal subsidiary, posted a decrease in large-scale sales of devices to financial institutions.
At the profit level, SRA Holdings posted a 6.9% decline in operating income to ¥3,820 million and a 6.9%
decrease in ordinary profit to ¥3,894 million. These decreases resulted from a decline in SRA Holdings’ gross profit
accompanying lower net sales.
Despite the harsh business environment, we attained an operating profit margin of 9.1% and an ordinary profit
margin of 9.3%, thereby maintaining these margins at the same level as in the previous fiscal year.
SRA Holdings raised its gross profit margin due to the implementation of profit improvement measures at SRA,
including measures to strengthen the management of business partners in Japan, and an increase in the weighting ofbusinesses with high profit margins at AIT.
Net income declined 8.2% to ¥2,041 million, owing to a loss on evaluation of investment securities.

Trends in Consolidated Business Results

FY2005

FY2006(¥ million)

FY2007

FY2008FY2009
Most recent forecast
figures (announced
November 6)
41,500

ActualNet sales

34,25934,14536,76545,058Operating income

1,659

1,719

2,848

4,102

3,500

3,820

Ordinary profit

1,626

1,762

2,923

4,181

3,500

3,894

Net income

1,056

933

2,015

2,224

1,850

2,041

Note: The figures prior to FY2006 are consolidated figures for SRA.
4

41,777

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

A summary of business results for the fiscal year by business segment is shown below.

1) Systems Development
The Systems Development business faced an extremely severe operating environment and recorded a decline inorders from the financial sector, including financial securities businesses, as well from manufacturing industries. As aresult, net sales for the fiscal year amounted to ¥22,837 million, a decrease of 5.6% from the previous fiscal year.

2) System Operations and Infrastructure Development
Although school-related orders remained level with those of the previous year, the System Operations andInfrastructure Development business recorded an increase in company orders. Moreover, in addition to achieving
favorable business results in the System Operations business, we also focused on our high profit margin network
creation business. Therefore, net sales amounted to ¥5,078 million, an increase of 8.9% from the previous fiscal year.

3) Product Sales
SRA posted sluggish results while AIT recorded a decrease in large-scale sales of devices to financial institutions. As
a result, net sales for the fiscal year amounted to ¥13,861 million, a decline of 14.4% from the previous fiscal year.

Outlook for the Next Fiscal YearIn the next fiscal year, the Japanese economy is expected to post negative real growth and difficult conditions will
likely continue.
In the information services industry, IT investments by customers, mainly manufacturing industries and financial
institutions, are expected to be curtailed as the environment for securing new orders becomes increasingly harsh anduncertainties about the future persist.
Under these conditions, the SRA Holdings Group will focus on selectiveness in accepting orders by further
upgrading the precision of project information management in building a structure for reliably obtaining
high-certainty orders for projects, while not accepting orders that have a risk of being unprofitable. For project ordersthat we accept, we will also strive to raise profitability by increasing productivity in addition to assuring quality andstringently adhering to delivery dates through appropriate project management.
To achieve a significant increase in our future business results when the business environment eventually
improves, we will continue to promote our structural reforms under which we will “raise our gross profit margin byestablishing a cost management system,” “establish a structure for stable orders backed by our solid customer base,”and “undertake a sweeping review our cost structure.”
Regarding our business alliance with SJ Holdings, we will focus on expanding orders for offshore development
in China and on building business models in the education and electric power fields in China.
For the fiscal year ending March 31, 2010, we are forecasting consolidated net sales of ¥32,600 million,
consolidated operating income of ¥2,740 million, consolidated ordinary profit of ¥2,740 million, and consolidated net
income of ¥1,450 million. Because the timing of a recovery in the business environment is uncertain under the harsheconomic circumstances, the profit targets in this consolidated forecast have been formulated based on the current
business environment.
5

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

The reasons underlying the expected ¥9,177 million, or 22.0%, decline in net sales in fiscal 2010 are as follows.
Net sales are projected to decline 21.1% to ¥4,881 million due to the scaling down anduncertain timing of IT investments by such principal customers as manufacturingindustries and financial institutions.
Although activities to secure orders are continuing, there were no large-scale orders
AIT
expected for device sales (¥2,654 million recorded in fiscal 2009) at the time the sales
plan was formulated. Net sales are thus projected to decline 33.9% to ¥3,855 million.
Domestic
Principal customers (semiconductor companies, automakers, and manufacturers) aredevelopment expected to curtail IT investments and net sales are forecast to decline 16.1% to ¥749
subsidiaries million.
Overseas
Sales are expected to remain virtually level with the previous year.
subsidiaries
SRA(2) Analysis of Financial Position
Cash and cash equivalents on a consolidated basis at the end of the fiscal year increased ¥487 million to ¥11,753
million compared with at the previous fiscal year-end.

Cash Flows from Operating Activities
Net cash provided by operating activities amounted to ¥2,194 million. This consisted mainly of such cash inflows asincome before income taxes and minority interests of ¥3,784 million, a decrease in accounts and notes
receivable—trade of ¥1,245 million, and a decrease in inventories of ¥609 million. Cash outflows were primarily
income taxes paid and refunded of ¥2,718 million and a decrease in accounts and notes payable—trade of ¥740
million.

Cash Flows from Investing Activities
Net cash used in investing activities amounted to ¥852 million. This was due mainly to the outflows of ¥588 million
for purchases of investment securities and ¥232 million for purchases of fixed assets.

Cash Flows from Financing Activities
Net cash used in financing activities amounted to ¥772 million. This was due mainly to such cash outflows as ¥553
million in cash dividends paid and a ¥196 million decrease in short-term loans.

Trends in Cash Flows Indicators

Shareholders’ equity ratio (%)
Shareholders’ equity ratio at
market value (%)
Debt redemption years to cash
flow (years)
Interest coverage ratio (times)

FY2007

FY2008FY2009

47.2

47.0

53.0

105.4

93.9

37.3

1.0

1.4

1.2

68.5

38.2

41.4

Notes:
Shareholders’ equity ratio: Shareholders’ equity/total assets
Shareholders’ equity ratio at market value: Market capitalization/total assets
6

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

Debt redemption years to cash flow: Interest-bearing debt/operating cash flow
Interest coverage ratio: Operating cash flow/interest expense

1. All indicators were calculated using consolidated financial figures.
2. Market capitalization is calculated using the total number of shares outstanding at the end of the fiscal period
excluding treasury shares.
3. Cash flows from operating activities is used for cash flow.
4. Interest-bearing debt includes all debt that pays interest as listed on the Consolidated Balance Sheets.

(3) Basic Policy on Profit Allocation and Dividends for the Fiscal Year under Review and the Next Fiscal Year
The Company’s basic policy regarding the allocation of profits is to enhance the redistribution of profits toshareholders in accordance with the state of its earnings, while also retaining earnings for R&D and the establishmentof a development environment for responding to the rapid and revolutionary technological advances within theindustry as well as to prepare for future business development.
The Company aims to allocate profits with a consolidated dividend payout ratio of 20%. Moreover, at theOrdinary General Meeting of Shareholders held on September 20, 2006, the Articles of Incorporation were changed
to allow for a flexible distribution of retained earnings as dividends based on resolutions by the Board of Directors.
Regarding dividends for the fiscal year ended March 31, 2009, in accordance with our dividend policy of striving
to realize a consolidated payout ratio of 20% while considering various factors, the Company will pay regular cash
dividends per share of ¥40.00.
Concerning dividends for the fiscal year ending March 31, 2010, although our basic dividend policy is to “strive
to realize a consolidated payout ratio of 20%,” we plan to pay cash dividends per share of ¥40.00 for the reasonsdetailed below based on our recognition that the decline in business results in fiscal 2009 was temporary and that theCompany will return to a path of growth when the business environment eventually improves. Thus, assuming the¥40.00 per share dividend is paid, the payout ratio will be 38.2%.

1. One of the Company’s management targets is to “achieve and maintain double-digit consolidated ROE” and we
aim to carry out management that emphasizes the efficient use of shareholders’ equity.

2. Therefore, we are implementing a policy of making proactive investments (such as investments for M&A) in our
main businesses in working to ensure the Group’s growth.

3. At the same time, we also continually consider “redistributing profits to shareholders” from the perspective ofefficient use of shareholders’ equity.

4. Taking into consideration our ample liquidity in hand at present, as part of efforts to contribute to the efficientutilization of assets and capital, we have decided that “redistributing profits to shareholders” is a high priority andin the fiscal year ending March 31, 2010, we thus plan to maintain cash dividends per share of ¥40.00.
We also regard the acquisition of treasury shares as an effective means of redistributing profits to shareholders.
Accordingly, we make such acquisitions appropriately while considering such factors as our stock price trends and
7

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

financial condition.

(4) Business and Other Risks
The following principal risks could have an impact on the business results and financial condition of the Company as
the Group’s controlling company.
“Forward-looking” statements contained in this report represent judgments by the Group based on information
currently available to management as of the end of the fiscal period.

[1] Risk of fluctuations in business results of Group companies
An abrupt fluctuation in business results of Group companies due to various factors could have an adverse impact on
the Company’s business results.

[2] Maintaining confidentiality of customer information
In addition to being aware that it is an information processing company with numerous opportunities for handlingpersonal information, the SRA Holdings Group also sufficiently recognizes the critical nature of protecting personal
information, and thus, has established an internal monitoring structure. Concurrently, the SRA Holdings Group
provides education for its Group employees and business partners and makes efforts to protect personal information.
However, in the event of the unexpected leakage of information, besides losing the trust of business partners, the SRA
Holdings Group could become liable for payment of compensatory damages, which could have an effect on theGroup’s business results.
In addition to the above, the Company comprehensively incurs business and other risks of SRA, a main
subsidiary.

<SRA>* The below-mentioned “SRA Holdings Group” consists of Software Research Associates (SRA), Inc., and its
subsidiaries. The following principal risks could have an impact on the business results and financial condition of the
SRA Holdings Group.

[1] Securing business partners during times of expansion of production volume
In the Systems Development and the System Operations and Infrastructure Development businesses, besides its own
in-house engineers, the SRA Holdings Group utilizes business partners for the planned augmentation of its staff ofin-house engineers and expansion of business, as well as to augment those areas where it does not possess
technologies and to respond flexibly to changes in production volumes during peak production.
The SRA Holdings Group also utilizes business partners as one means of reducing production costs.
Nonetheless, the inability to sufficiently secure business partners possessing requisite skills could have an impact
on the Group’s business results.
The utilization of business partners accounted for 54.4% of manufacturing costs as of the end of the fiscal period.

[2] Project profitability in Systems Development
In the core Systems Development business, the SRA Holdings Group concludes bulk subcontracting contracts
8

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

whereby it handles the entire system development and is responsible to its customers for completion. There are also
projects during which more than one year elapses from the time the order is obtained to system completion andhandover. Therefore, even for projects for which a certain amount of income is expected at the time the order isreceived, there are instances when profitability worsens because of such factors as customer requests for specification
changes after commencing development activities or a work process that exceeds the initial estimate. Moreover, theincurrence of additional expenses such as those related to defect guarantees after the confirmation of sales could
ultimately result in an unprofitable project.
To prevent the occurrence of unprofitable projects, the Group reviews risk factors at the time an order is received
and works to improve the precision of its estimates while strengthening its project management structure in an
organized manner. Nevertheless, any project incurring a large loss could have an effect on the Group’s businessresults.

[3] Maintaining confidentiality of customer information
Along with being aware that it is an information processing company with numerous opportunities for handlingpersonal information, the Group also sufficiently recognizes the critical nature of personal information, and thus, hasestablished an internal monitoring structure. Concurrently, as a company that has acquired Privacy Mark certification,
the SRA Holdings Group provides education for its Group employees and outsourced staff and makes efforts toprotect personal information. However, in the event of the unexpected leakage of information, besides losing the trustof business partners, the SRA Holdings Group could become liable for payment of compensatory damages, which
could have an effect on the Group’s business results.

2. Management Policy(1) The Company’s Basic Management Policy
The SRA Holdings Group adheres to a basic management policy of maximizing user satisfaction through IT based on
its management principle of “contributing to the future of humanity through professional practice that fosters progressin the fields of computer science,” which has been our guiding principle since the founding of SRA. In accordancewith this basic management policy, amid a rapidly changing business environment, we will strive to meet the
expectations of the information services industry while raising profits for shareholders and increasing corporate value
by pursuing profitability and growth.
Regarding the management of the SRA Holdings Group, under our holding company structure centering on SRA
Holdings, we will strengthen the Group’s operating structure while taking concrete measures, such as implementing
M&A, and raise the overall capabilities of the Group with the aim of enhancing corporate value.

(2) Management Indicator Targets
The SRA Holdings Group has adopted “ordinary profit margin” as a representative indicator of the Company’s
overall earnings power and has set the medium- and long-term numerical target of quickly attaining and maintaining
an ordinary profit margin of 10% or higher.”Also, the SRA Holdings Group continues to use return on equity (ROE) as an indictor of efficient deployment ofshareholders’ equity. The Group has established the numerical target of “attaining and maintaining double-digit
consolidated ROE.”
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SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

The Group’s consolidated ordinary profit margin and ROE are as shown below.

Consolidated ordinary profit margin

Consolidated ROE

FY2006 (actual)

5.2%

10.1%

FY2007 (actual)

8.0%

18.8%

FY2008 (actual)

9.3%

18.0%

FY2009 (actual)

9.3%

15.0%

FY2010 target

8.4% (plan)

10.0% (plan)

Note: The results for FY2006 are the consolidated results for SRA.

(3) Medium- and Long-term Management Strategy
The Group implemented its three-year management plan in fiscal 2009, the plan’s first year.
Under this plan, we aim to establish a position in the industry as an independent company that provides truly
optimal choices from a neutral standpoint without bias toward any specific vendors and manufacturers and tostrengthen our business strategies and business structures to achieve continual development. At the same time, wewill lay the cornerstone for advancing the Group’s business capabilities with a focus on the future.

1. Establish a position as an independent company[1] Attain the corporate size of a prime contractor[2] Raise the constitution of management for the purpose of strengthening our corporate competitiveness (steadilyraise important management indicators)

2. Strengthen our business strategies and business structures to achieve continual development[1] Strengthen business strategies by rebuilding business segmentszSystems Development business: Shift weighting toward promising markets (financial, embedded systems,
education, and others)zSystem Operations and Infrastructure Development business: Shift weighting toward such high-profit businesses
as building server systemsz

Product Sales business: Undertake an exhaustive review of product and sales structures with the aim of
expanding markets and achieving a large improvement in profit ratios (strengthen the solutions business andproduct business as well as bolster sales structures)z

Promote the lifecycle businessz

Rebuild the production structure (employees, offshore, and domestic business partners) and strengthen the
production management system[2] Strengthen our business structure by realizing Group synergieszStrategically carry out business in the embedded systems, education, product sales, and electric power fields aswell as in China through “virtual” organizations

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SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

3. Lay the cornerstone for advancing the SRA Holdings Group’s business capabilities over the medium- andlong-term[1] Strengthen our business portfolio through initiatives focused on the “product business”[2] Realize SRA’s strengths by “establishing business models for leading-edge technologies”[3] Expand overseas business earnings opportunities by upgrading and expanding business in Europe and the UnitedStates and building a foundation for growth in Asia

(4) Issues to Be Addressed by the Company
In accordance with its medium- and long-term management strategy, the SRA Holdings Group will execute thefollowing tasks to improve and strengthen the Group’s business capabilities as it strives for further growth anddevelopment.

1. Secure orders and raise profitability
The SRA Holdings Group will focus on selectiveness in accepting orders by further upgrading the precision of project
information management in building a structure for reliably obtaining high-certainty orders for projects, while notaccepting orders that have a risk of being unprofitable.
For projects that we accept, we will also work to raise profitability by increasing productivity in addition toassuring quality and stringently adhering to delivery dates by carrying out appropriate project management.

2. Promote structural reforms
Additionally, to ensure that we can achieve a significant increase in our business results in the future when thebusiness environment improves, we will continue to promote our structural reforms under which we will “raise ourgross profit margin by establishing a cost management system,” “establish a structure for stable orders backed by oursolid customer base,” and “undertake a sweeping review our cost structure.”

The following is a brief overview of the reforms.

Raise our gross profit margin by establishing a cost management systemz

Raise productivity per employee
Raise productivity through automation and semi-automation by deploying an assortment of tools and promotereuse through componentization and sample codesz

Promote offshore development (India and China)z

Lower unit prices for orders placed and review ordering conditions by thoroughly monitoring our domestic
business partners

Establish a structure for stable orders backed by our solid customer base
(SRA)z

Industrial-related: We established the Industrial Sales Promotion Division and will work to increase orders and
11

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

sales as well as expand and upgrade our customer base and strengthen relationships with our customers.
zFinancial-related: We will shift to a structure that can respond to changes in the business environment[strengthen relationships with existing customers and cultivate ties with peripheral customers (subsidiaries andother customers)].

z

System Operations and Infrastructure Development: We will make efforts to stabilize business in the System
Operations business and raise profitability in the Infrastructure Development business.

Undertake a sweeping review of our cost structurez

We separated cost of sales and SG&A expenses into the categories of fixed costs and variable costs andformulated and implemented exhaustive cost-cutting measures that extend beyond conventional cost-reduction
measures.

3. Concretely Promote the Business Alliance with SJ Holdings
Through our business alliance with SJ Holdings, we will expand offshore development orders in China and build
business models in education, electric power-related, and other fields in China.

(5) Other Important Management Matters
None

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SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

3. Consolidated Financial Statements(1) Consolidated Balance Sheets(Millions of Yen)
FY2008FY2009(as of March 31, 2008)(as of March 31, 2009)ASSETS
Current assets:
Cash and deposits

9,351

10,335

Notes and accounts receivable-trade

8,940

7,613

Short-term investment securities

2,003

1,503

Inventories

1,740

−

Merchandise and finished goods−

558

Work in process−

571

Deferred tax assets

471

461

Other

657

591

Allowance for doubtful accounts

(22)

(37)

23,143

21,599Buildings

240

254

Accumulated depreciation

(136)

(157)

Buildings, net

103

97

Machinery, equipment and vehicles

736

717

Accumulated depreciation

(645)

(646)

Machinery, equipment and vehicles, net

91

71

Land

0

0

Other

97

100

Accumulated depreciation

(64)

(66)

Other, net

32

33

Total property, plant and equipment

228

202

Other

440

429

Total intangible assets

440

429

Investment securities

1,510

1,314

Deferred tax assets

1,318

1,677

Guarantee deposits

553

531

Other

889

882

Allowance for doubtful accounts

(10)

(10)

Allowance for investment loss

(107)

(107)

Total current assets
Noncurrent assets:
Property, plant and equipment

Intangible assets

Investments and other assets

13

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

Total investments and other assets
Total noncurrent assets
Total assets

14

4,155

4,287

4,824

4,920

27,967

26,519

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

(Millions of Yen)
FY2008FY2009(as of March 31, 2008)(as of March 31, 2009)

LIABILITIESCurrent liabilities:
Accounts payable-trade

3,502

2,702

Short-term loans payable

2,554

2,358

Current portion of long-term loans payable

2210

Current portion of bonds

300−

Accrued expenses

963

658

1,640

743

Accrued consumption taxes

392

414

Provision for bonuses

653

568

Provision for directors’ bonuses

74

0

Other

798

542

10,901

7,999

Bonds payable−300

Long-term loans payable

10

−

3,412

3,620

Provision for directors’ retirement benefits

400

422

Negative goodwill

19

13

3,842

4,356

14,743

12,355

Capital stock

1,000

1,000

Capital surplus

4,519

4,483

Retained earnings

8,029

9,518

Treasury stock

(894)

(894)

Total shareholders’ equity

12,654

14,107

Valuation difference on available-for-sales securities

480

60

Foreign currency translation adjustment

15

(121)

Total valuation and translation adjustments

495

(61)

Subscription rights to shares

52

83

Minority interests

21

34

Total net assets

13,224

14,164

Total liabilities and net assets

27,967

26,519

Income taxes payable

Total current liabilities
Noncurrent liabilities:

Provision for retirement benefits

Total noncurrent liabilities
Total liabilities
NET ASSETS
Shareholders’ equity

Valuation and translation adjustments

15

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

(2) Consolidated Statements of Income(Millions of Yen)
FY2008FY2009(April 1, 2007-(April 1, 2008-

March 31, 2008)

March 31, 2009)

Net sales

45,05841,777

Cost of sales

36,31133,430Gross profit

8,747

8,346

Selling, general and administrative expenses

4,645

4,525

Operating income

4,102

3,820

Interest received

36

34

Dividends received

14

15

Technical guidance fee

99Sales reward

25

48

Gain on sales of securities

−

5

Other

68

40

Total non-operating income

154

153

Interest expenses

53

52

Transfer agent processing fee

15

15

Other

7

11

Total non-operating expenses

75

79

4,181

3,894

Gain on sale of investment securities

7−

Gain on prior period adjustments

13−

Total extraordinary income

21−

Loss on sale of noncurrent assets

0−Loss on retirement of noncurrent assets

5

1

Provision of allowance for investment loss

57−

Loss on valuation of investment securities−

70

Loss on valuation of stocks of subsidiaries and affiliates−

10

Loss on valuation of memberships

−

27

Other

0

−

Total extraordinary loss

63

110

Income before income taxes and minority interests

4,139

3,784

Income taxes-current

2,123

1,810

Income taxes-deferred

(217)

(81)

Non-operating income

Non-operating expenses

Ordinary profit
Extraordinary income

Extraordinary loss

16

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

Total income taxes
Minority interests in income
Net income

17

1,905

1,729

9

13

2,224

2,041

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

(3) Consolidated Statements of Changes in Net Assets(Millions of Yen)
FY2008FY2009(April 1, 2007-(April 1, 2008-

March 31, 2008)

March 31, 2009)

Shareholders’ equity
Capital stock
Balance at end of previous period

1,000

1,000

Total change during the period−−

Balance at end of current period

1,000

1,000

4,519

4,519

−

(35)

−

(35)

4,519

4,483

6,151

8,029

Dividends from surplus

(345)

(553)

Net income

2,224

2,041

Total change of items during the period

1,878

1,488

Balance at the end of period

8,029

9,518

(894)

(894)

−

−

(894)

(894)

10,776

12,654

Dividends from surplus

(345)

(553)

Net income

2,224

2,041

−

(35)

Total change during the period

1,878

1,452

Balance at the end of period

12,654

14,107

Changes of items during the period

Capital surplus
Balance at end of previous period
Changes of items during the period
Decrease due to purchase of treasury stockfrom consolidated subsidiaries
Total change of items during the period
Balance at the end of period
Retained earnings
Balance at the end of previous period
Changes of items during the period

Treasury stock
Balance at the end of previous period
Changes of items during the period
Total change of items during the period
Balance at end of current period
Total shareholders’ equity
Balance at the end of previous period
Changes of items during the period

Decrease due to purchases of treasury stock fromconsolidated subsidiary18

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

Valuation and translation adjustments
Valuation difference on available-for-salesecurities
Balance at the end of previous period

796

480

(316)

(420)

Total change of items during the period

(316)

(420)

Balance at the end of current period

480

60

37

15

(22)

(137)

Total change of items during the period

(22)

(137)

Balance at the end of current period

15

(121)

834

495

(338)

(557)

Total change of items during the period

(338)

(557)

Balance at the end of current period

495

(61)

9

52

42

31

Total change of items during the period

42

31

Balance at end of current period

52

83

11

21

9

13

Total change of items during the period

913Balance at the end of current period

21

34

11,632

13,224

Changes of items during the period
Net change of items other thanshareholders’ equity

Foreign currency translation adjustment
Balance at the end of previous period
Changes of items during the period
Net change of items other thanshareholders’ equity

Total valuation and translation adjustments
Balance at end of previous period
Changes of items during the period
Net change of items other thanshareholders’ equity

Subscription rights to shares
Balance at end of previous period
Changes of items during the period
Net change of items other thanshareholders’ equity

Minority interests
Balance at end of previous period
Changes during the period
Net change of items other thanshareholders’ equity

Total net assets
Balance at end of previous period
19

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

Changes of items during the period
Dividends from surplus

(345)

(553)

Net income

2,224

2,041

−

(35)

(287)

(512)

Total change of items during the period

1,591

939

Balance at end of current period

13,224

14,164

Decrease due to purchase of treasury shares fromconsolidated subsidiary
Net change of items other thanshareholders’ equity

20

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

(4) Consolidated Statements of Cash Flows(Millions of Yen)
FY2008FY2009(April 1, 2007-(April 1, 2008-

March 31, 2008)

March 31, 2009)

Net cash provided by (used in) operating activities:
Income before income taxes and minority interests

4,139

3,784

Depreciation and amortization

306

258

Loss on valuation of memberships−

27

Increase (decrease) in provision for retirement benefits

246

201

Increase (decrease) in provision

25

21

Increase (decrease) in provision for bonuses

(25)

(84)

Increase (decrease) in provision for directors’ bonuses

20

(73)

Increase (decrease) in allowance for doubtful accounts

19

14

Increase (decrease) in allowance for investments loss

57−

Interest and dividend income

(51)

(49)

Interest expense

53

52

Loss (gain) on valuation of investment securities−

81

Loss (gain) on sales of investment securities(7)−

Loss (gain) on sale of noncurrent assets

0−Loss on retirement of noncurrent assets

5

1(1,172)

1,245

Decrease (increase) in inventories

(895)

609

Increase (decrease) in notes and accounts payable-trade

481

(740)

Increase (decrease) in other liabilities

(105)

(552)

Increase (decrease) in accrued consumption taxes

29

21

Other, net

996

Subtotal

3,136

4,915

Interest and dividends income received

51

49

Interest expenses paid

(53)

(53)

Income taxes paid

(1,110)(2,718)Net cash provided by (used in) operating activities

2,025

2,194

(64)

(57)

0

0

Purchases of intangible assets

(144)

(174)

Purchases of investment securities

(108)

(588)

Proceeds from sales of investment securities

120

Payments for loans receivable

(56)

(48)

for directors’ retirement benefits

Decrease (increase) in notes and accounts receivable-trade

Net cash provided by (used in) investing activities:
Purchases of property, plant and equipment
Proceeds from sale of property, plant and equipment

21

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

Collection of loans receivable

42

47

Payment into time deposits

(100)

(105)

Proceeds from withdrawal of term deposits−

105

Payment for guarantee deposited

(5)

(10)

Proceeds from collection of guarantee deposited

7

3

Other, net

(16)

(23)

Net cash provided by (used in) investing activities

(434)

(852)

Net increase (decrease) in short-term loans payable

148

(196)

Repayments of long-term loans payable

(40)

(22)

Proceeds from the issue of bonds−

300

Redemption of bonds

−

(300)

Cash dividends paid

(345)

(553)

Net cash provided by (used in) financing activities

(238)

(772)

(6)

(82)

Net increase (decrease) in cash and cash equivalents

1,346

487

Cash and cash equivalents at beginning of period

9,919

11,265

Cash and cash equivalents at end of period

11,265

11,753

Net cash provided by (used in) financing activities:

Effect of exchange rate change on cash and cash equivalents

22

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

Segment Informationa. Segment Information by Type of Business
Fiscal 2008 (from April 1, 2007 to March 31, 2008)(Millions of yen)

SystemDevelopment

Network &Systems
Services

Consulting& Other
Services

24,205

4,664

16,18963

383

Total sales

24,268Operatingexpenses

I Net Sales,
Operating Income
and Expenses
Sales(1) Sales tocustomers(2) Intersegment
sales ortransfers

Operating income
II Assets,
depreciation
expenses andcapital-related
expenditures
AssetsDepreciation
expensesCapital-related
expenditures

Eliminations/
Corporate

Consolidated

45,058−45,058

480

926

(926)

−

5,047

16,66945,985(926)

45,05820,156

3,918

15,37539,451

1,504

40,956

4,111

1,128

1,293

6,533

(2,431)

4,102

9,241

1,971

5,002

16,215

11,752

27,967

188

29

87

305

1

306

96

12

106

215

7

223

Total

Notes:
1.

Businesses are classified into segments according to similarities that include the types and characteristics of services.

2. Principal contents of business in each segment.
Business segment

Content of businessz

Integrated system development ranging from defining requirements todevelopment and maintenance of mainframe-based large systemsz

System integration covering system planning, development, andintroduction of open systemsz

Solutions business offering business tools that utilize various products
and toolszOpen source business that offers technical support for systems
through open source software
Operation management of computer systems and network systems

System DevelopmentzzOverall operation that includes data management and facilities
managementz

Building of network systemszz

Outsourcing services
Sales of packaged software that includes licensingz

Sales of system devices, centering on servers, in integration services

Network & Systems
Services

Consulting& Other Services

23

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009zConsulting services related to the introduction of IT

3. Unallocatable operating expenses in Eliminations/Corporate amounted to ¥2,431 million for the fiscal year. These
consisted mainly of R&D expenses and expenses related to the Group’s management divisions.

4. Total Company assets in Eliminations/Corporate amounted to ¥11,930 million for the fiscal year. These consisted mainlyof the Group’s surplus operating assets (cash, deposits, and marketable securities), long-term invested assets (investment
securities), and deferred tax assets.

5. Depreciation expenses and capital-related expenditures included depreciation and additions to long-term prepaid
expenses, respectively.

Fiscal 2009 (from April 1, 2008 to March 31, 2009)(Millions of yen)

Systems
Development

SystemOperations
andInfrastructure
Development

22,837

5,078

13,861

77

323

Total sales

22,915

Operatingexpenses

I Net Sales,
Operating Income
and Expenses
Sales(1) Sales tocustomers(2) Intersegment
sales ortransfers

Operating income
II Assets,
depreciation
expenses andcapital-related
expenditures
AssetsDepreciation
expensesCapital-related
expenditures

Product
Sales

Eliminations/
Corporate

Consolidated

41,777−

41,777

497

897

(897)

−

5,401

14,35842,675(897)

41,777

18,988

4,122

13,24736,358

1,597

37,956

3,926

1,279

1,110

6,316

(2,495)

3,820

8,077

1,829

4,719

14,626

11,893

26,519

164

28

64

256

1

258

129

40

52

222

0

222

Total

Notes:
1.

Change in the Names of Business Segments

Previously, the Company expressed its business segments as “System Development,” “Network & Systems Services,” and“Consulting & Other Services.” From fiscal 2009, the Company changed the names of these business segments to the“Systems Development,” “System Operations and Infrastructure Development,” and “Product Sales” segments,
respectively. This change had no impact on business segment information.
24

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

2. Principal contents of business in each segment.
Business segment

Content of businessz

Integrated system development ranging from defining requirements todevelopment and maintenance of mainframe-based large systemsz

System integration covering system planning, development, andintroduction of open systemsz

Solutions business offering business tools that utilize various products
and toolszOpen source business that offers technical support for systems
through open source software
Operation management of computer systems and network systems

Systems DevelopmentzzOverall operation that includes data management and facilities
managementz

Building of network systemszz

Outsourcing services
Sales of packaged software that includes licensingz

Sales of system devices, centering on servers, in integration serviceszConsulting services related to the introduction of IT

System Operations andInfrastructure Development

Product
Sales

3. Unallocatable operating expenses in Eliminations/Corporate amounted to ¥2,495 million for the fiscal year. These
consisted mainly of R&D expenses and expenses related to the Group’s management divisions.

4. Total Company assets in Eliminations/Corporate amounted to ¥12,075 million for the fiscal year. These consisted mainlyof the Group’s surplus operating assets (cash, deposits, and marketable securities), long-term invested assets (investment
securities), and deferred tax assets.

5. Depreciation expenses and capital-related expenditures included depreciation and additions to long-term prepaid
expenses, respectively.

b. Geographical Segments
Fiscal 2008 (from April 1, 2007 to March 31, 2008)
The amounts of net sales and assets in Japan exceed 90% of total sales and total assets for all segments and thus
geographical segment information is omitted.

Fiscal 2009 (from April 1, 2008 to March 31, 2009)(Millions of yen)Japan

Other Regions

I Net Sales, Operating
Income and Expenses

25

Total

Eliminations/
Corporate

Consolidated

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2009

Sales
(1) Sales to customers(2) Intersegment sales ortransfers

38,2603,516

41,777−

41,777

113

43

156

(156)

−

Total sales

38,373

3,559

41,933(156)

41,777

Operating expenses

34,3403,231

37,572384

37,956

Operating income

4,033

328

4,361

(540)

3,820

II

24,5701,019

25,589929

26,519Assets

Notes:
1. Countries and regions are categorized based on geographic proximity.
2. Because only small amounts of net sales were recorded in each country and region outside Japan, these countries andregions are aggregated under Other Regions.
Principal countries included in Other Regions are the United States and the Netherlands.
3. Overseas sales accounted for more than 10% of total consolidated sales during the first quarter and thus geographic
segment information has been included from the first quarter of the current fiscal year.

c. Overseas Sales
Fiscal 2008 (from April 1, 2007 to March 31, 2008)
Overseas net sales account for less than 10% of total consolidated net sales and are thus omitted.

Fiscal 2009 (from April 1, 2008 to March 31, 2009)(Millions of yen)
Other Regions

Total

3,518

3,518

Consolidated net sales−

41,777

Overseas sales as a percentage ofconsolidated net sales (%)

8.4

8.4

I

Overseas Sales

II
III

Notes:
1. Countries and regions are categorized based on geographic proximity.
2. Because only small amounts of net sales were recorded in each country and region outside Japan, these countries andregions are aggregated under Other Regions.
Principal countries included in Other Regions are the United States and the Netherlands.
3. Overseas sales are those recorded by the Company and its consolidated subsidiaries in countries and regions outside
Japan.
4. Overseas sales accounted for more than 10% of total consolidated sales in the first quarter of the current fiscal year andthus overseas sales are included in segment information from first quarter of the current fiscal year.

26