SBS Business Report
For the year ended December 31, 2010

(Security Code:2384)

SBS Holdings, Inc.

Business Highlights
SBS Business Report

SBS Group meets the various logistics needs withthe utmost quality.

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

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

Specialized●Same-day Delivery ●3PLLogistics

Logistics Support
BusinessOthers

Marketing●Advertising Agency ●Marketing Support ●Mail-Order Support

HumanResources●Personnel Dispatch ●Placement Service●Temporary to Placement Service Others

Financial●Real Estate Development ●Leasing●Asset Management Others

OtherOthers●Insurance Agency●Industrial Waste Management ●Recycling●Planning, Production and Management of Store Fixture and Fittings

OthersSales by Business Segment2010 Performance Target

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

Promote new market cultivation and offer
low cost and high quality logistics services

Logistics Support 10.2%
Marketing 15.5%

Logistics
SupportOther 5.2%

2011 Key Objectives●Fortify Business Strategy●Promote International Strategy●Achieve Investment Strategy●Enhance Management Infrastructure

Logistics

Financial 44.0%

Logistics 89.8%

Human Resources 35.4%
For the year ended December 31, 20102011 Forecast
Net Sales

Operating
IncomeOperatingMarginDividend perShare¥120.0 ¥3.5 2.9 ％ ¥3,000
billionbillionDisclaimer: Forward-looking statements included in this report are based on information and assumptions consisting of uncertain
factors that may influence our performance available to the Company on the date of this report s publication. Due tovarious unforeseen circumstances, however, actual results may differ from such forecasts.

1

Interview with the President
SBS Business Report

Laying solid foundations has
granted us the ability toadvance into the future withgreater speed and strength.
Representative Director: Masahiko Kamata

Q

Tell us about the results of the previous
year (ended December 31, 2010).

A

The first half of the year wentsmoothly for us, but the second half

Q

What are some of the currents trends
characterizing the logistics industry?

A

Against the background of the rise in
the yen and long-term deflation,

wasn t favorable as a result of the sharpcustomers have been requiring broad-scale

increase in the value of the yen. This affected

cost reductions. I expect this trend to

our operations quite a bit. However, thecontinue for some time. In addition to this,liquidation of our logistics facilities

competition among logistics companies has

contributed greatly to our group s overall

increased greatly in its intensity. As a result,success. We were able to achieve increased

the industry overall in 2010 saw a reduction

income and meet our profit goals. I believe

in its total number of logistics businessthat some of the contributing factors toplayers. From here on out, I believe that

this success were our group s ability toreorganization and strengthening ofstrengthen its business activities andalliances among companies will continue.

marketing as well as its ability to promote

It can also be thought that competition

cost reductions through increasing efficiency

among logistics companies will continue

in warehouse operations and other areas.

to intensify.

Overall, operating income was up 47.6%
over the previous year and net income
stands at an increase of 7.7%. I am pleased
to say that we were able to do all of thisunder some of the harshest of businessconditions.

2Interview with the President
SBS Business Report

our group. If we can ascertain that theQ

What kind of effects has this intensecompetition had on SBS Group?

AThis increase in competition cannot

in carrying out such a deal. So, in following

be seen as completely negative withthe two M&A deals that we completed last

regards to SBS Group. We believe that theyear, we plan to continue pursuing various

i n t e n se c o m p e t i t i o n a n d i n c r e a s e i nM&A deals again this year, regardless ofreorganization gives us a great opportunity

whether they be carried out domestically or

to expand our scale of business. From nowabroad.

synergy effects of carrying out an M&A deal
will be high, we would be quite comfortableon, it can be expected that the acquisitions
market for logistics subsidiaries will becomeQ

Are you also considering expanding
your business overseas?

a logistics company, being able to expand

AWe are considering areas within Asia.

your business scale is vitally connected toJapanese firms advancing in Asia andwinning the trust of your customers. So, weespecially China, and in order to become adefinitely don t want to miss out on thisgroup that can meet the needs of domestic

great opportunity facing our industry.

customers while surviving the intense

more dynamic and we are anticipating that
this should bring about some very favorable
conditions for us. From the point of view of

There are a considerable amount ofcompetition within our industry, we feel that3

it is necessary to strengthen our logistics

QSo, this should revitalize theM&A activities, right?

AFor the past several years, large

foreign businesses and making strategic

companies with net sales of over 100

alliances. As we gaze into a future thatbillion yen have been busy strengthening

looks set to continue its growth incompliance factors and replenishing

globalization, our group is making themanagement systems. This has resulted innecessary plans to advance forward. There

fewer M&A deals. However, the time has

can be no doubt about there being

finally arrived for a reemergence in the M&A

increasing development and growth inmarket. Our group is taking a serious look

China. However, in addition to the Chineseat possible M&A deals. We are considering

market, we are setting our sights onand trying to discern whether or not thebusinesses in India and in the ASEAN

management policies and concepts of somecountries as we see the markets in theseof our partner companies will fit well withcountries also expanding greatly.

business overseas. In order to do this, weare creating bridgeheads by taking over

Interview with the President
SBS Business Report

corporate social responsibility (CSR)

Q

Lastly, could you say a few words
for your shareholders?

A

Our group has been working very

for protecting the environment. We are

hard now for about 3 years tostriving hard to further increase ourstrengthen our management infrastructure.

shareholders value and we plan to return thisWith this just about completed, we feel wellto all of our shareholders through higher

prepared for the future and we are goingshare prices and increased dividends.

forward with both speed and strength.

We are looking forward to our shareholders

We are aiming at establishing a third-party

continued support as we walk together

logistics (3PL) business group that possesses

toward a very bright future.

operations through the implementationof enhanced safety measures and activities

logistics functions in all directions. In orderto do this, we are promoting the trainingof talented people who can carry out 3PL
proposals and sales as well as creatingstructures and systems that can provide
full-scale low-cost operations. In addition,
as we work on expanding our businessscale, we are carefully making financiallysound and well-balanced investments
through effective M&A deals and facility
development. We carry out all of ourbusiness activities with deep consideration
given to the preservation of a stablefinancial standing. Furthermore, as abusiness group that has gained a high-levelof social trust, we are strengthening our4

Special Feature Articles
SBS Business Report

SBS Group Topics for 2010
April

July

Expanding into the Electronics Manufacturing
Logistics Sphere through M&A

M&A Activities Pick Up a Customs Clearance
Specialty Company for the Group as Part ofIts Strategic Move toward International
Logistics Expansion（TL LOGICOM）

With Victor Companyof Japan, Limited slogistics subsidiary
Victor Logistics Inc.
becoming a part ofour group, we continue
to aim at the expansion of our logistics
functions in the electronics manufacturingindustry.

（TL LOGICOM）

AC System Corporation, a company thatspecializes in import and export customs
clearance procedures, has become part of thegroup, furthering thegroup s international
logistics expansion
activities.

May
Completion of the Transportation of
the New Model Skyliner Train Cars

（TL LOGICOM）

We completed thetransportation of
Keisei Electric
Railway Co., Ltd. s
new model Skyliner
train cars over athree month period from February to April. The
transportation consisted of transporting 24
cars in 3 arrangements. Keisei Electric Railway
is using the cars for its Narita Sky Access Line
which is scheduled to start operations in July.

June
SBS Group Wins the Logistics Rationalization
Award for the Third Year in a Row
TL LOGICOM was awarded the Logistics
Rationalization Award in the 2010 All-Japan
Convention for Logistics
Improvement CaseStudies. SBS Group is
the first to win thesame award threeyears in a row.

July
VL Loginet New Center starts to operate
and initiates 3PL of Kenwood Corporation(VL Loginet)

Victor Logistics Inc.
has changed its brandname to VL Loginet
Inc. and is operating
its new center in
Higashi-Ohgishima.
Also, it initiated 3PL of Kenwood Corporation in
addition to that of Victor Company.

JulyLogistics Operations Begin in the New
Members Oﬃce Building of the Upper House(TL LOGICOM)

A delivery center has
been opened at theNew Members
Office Building ofthe Upper House.
Logistics operations
inside the center
have begun in order to unify management
and combine the collection and delivery ofgoods that are collected and delivered.

5Special Feature Articles
SBS Business Report

September

December

Introduction of Employee StockOwnership Trust (ESOP)A stock-sharing plan (Japanese version of ESOP)for employees in the structure of a trust wasintroduced. We are aiming at raising employee
morale with theexpansion of ourwelfare programsand benefits.

SBS Group

Information regarding the2010 Publication of theCSR Report
SBS Group is fully
aware of theimportance ofbeing sociallyresponsible andis l e a d i n g t h e

September

way as a logistics

Promotion of a Sound Financial Standing
through the Liquidation of Logistics
Facilities(A-Max)The logistics facilities in Saitama and Chiba
were sold off to a Singapore governmentbased REIT company as part of our liquidation
strategy. The funds collected from the sale
are furthering ourpush towards asounder financialstanding.

company that canbear society s infrastructure. SBS Groupis committed to creating a rich andwonderful society through the steadypromotion of its CSR activities.
In order to help convey the social
activities that our group is involved in,
we started publishing the Environment
Report in the year 2009. In 2010, thereport s second year, we published it
under the name CSR Report.
This year s issue introduces and explainssome specific and easy to understandNovember
Expansion in Group-wide Activities that
Include Eco Cap Collections
By collecting thecaps of PET bottles
for recycling, we areexpanding ourgroup-wide efforts
to contribute tohelping the childrenof the world receive vaccines. In one year, wecollected 170,000 caps.

examples of how our group is trying tofulfill its social responsibilities. Someof the topics include

Corporate

Governance , Measures toward Safety ,Connections with the Environment , andConnections with Society.
● The CSR Report can be downloaded offof the SBS Holdings website. Feel freeto refer to it.
http://www.sbs-group.co.jp/eco/img/eco2010.pdf

6Consolidated Financial Highlights
SBS Business Report

We were successful in increasing proﬁts even during the severest of businessconditions as a result of cost cutting activities and our eﬀorts to expand our businessbase by cultivating new customer markets. In addition, our company is involved in a
number of very important growth strategies. Among these, the result of our M&A
deals has brought about an increase in sales when compared with the same term of
the previous year. Thorough cost reduction measures have also been a contributing
factor to our success as we secured growth in operating income, ordinary income, andnet income.

■ Net Sales■ Operating Income(Millions of yen)

(Millions of yen)
150,000

142,643

147,097

YOY Change

139,405

3.6%up115,710 119,824

120,000

YOY Change

8,000

6,000

47.6%up

6,794

7,000

5,949

5,000

90,000

4,262

4,000
60,000

3,325

3,000

2,888

2,000

30,000

1,000
02006

2007

2008

2009

2010

02006

■ Ordinary Income■ Net Income(Millions of yen)

(Millions of yen)

8,000

7,911

7,901

YOY Change

14.5%up

7,000

5,000

3,995

4,000

3,748

4,291

2008

4,073

2,000

2010

7.7%up

4,054

3,000

1,988

2,000

3,000

2009

YOY Change

5,000

4,000

6,000

2007

2,140960

1,000

1,000
072006

2007

2008

2009

2010

02006

2007

2008

2009

2010

Consolidaated Financial Statements
SBS Business Report■ Sales by Segment
Logistics

Logistics Support Business(Millions of yen)

(Millions of yen)

120,000

112,177

116,346 114,522

2010
104,801 107,655

Net Sales Operating Net Sales Operating
IncomeIncome100,000［Logistics Business］

80,00030,466 30,750

24,88320,000006/12

07/12

08/12

10,90912,168

09/12

10/12

2,699

1,880

423,572

31

Human Resources

4,303

20

5,045

147

Financial

5,348

1,199

1,670

403

Other635△ 14620△ 45Total

12,1681,376 10,909

189

Total（after elimination）119,824

4,262 115,710

2,888

Sales by Segment
Cash Outflow

Cash Inflow

Balance(Millions of yen)

1,901
Operating
Activities

the basis of recovery and expansion
activities related to the movement ofgoods in the first half of the year. In

7,939
Operating
Activities

20,00011
Investing
Activities● Logistics Business：Business operationsin this segment saw increased sales on

3,059Investing
Activities

addition, sales were also strengthenedby the start of the 3PL operations ofsome of our new customers.

14,821
15,000● Logistics Support Business： In the

Balance at Beginning of Termfinancial services segment, sales
increases were made as the result of thesell-off of some liquidable assets that

10,455
7,382△14,071
Financing
Activities
FY2010

Balance at
End of Term

FY2009were held for investment and sales.

Balance at
Beginning of Term

△6,341
Financing
Activities

5,000
02,886 104,801

Marketing■ Cash Flows Status

10,000107,655

Logistics［Logistics Support Business］

60,00040,0002009

Balance at
End ofTerm

Consolidated Cash Flows
Operating cash ﬂow reached 7,939
million yen as the result of favorable
business activities. However, the eﬀects
of actively reducing interest-bearing debt
in order to facilitate a sound ﬁnancial
standing resulted in cash and cash
equivalents at the end of the consolidated
accounting year to be 7,382 million yen.

8Consolidated Financial Highlights
SBS Business Report■ Net Income per Share■ Net Assets / Equity Ratio(yen)
35,000(Millions of yen)
25,00031,371 31,07230,000

18,59820,23840

15,44620,00016,273

17,51415,00015,00010,00010,000

7,712

5,000

5,000
0

Equity Ratio（％）

22,616
19,43420,00025,000Net Assets

2006

20072008

2009

2010

015.2％

06/12

18.1％ 16.8％

18.6％

07/12

09/12

08/12

23.2％

10/12

Basic Policies regarding the Profit Distribution■ Dividend per Share

Basic Policies regarding the Profit Distribution
SBS Group regards the return of proﬁts to all(yen)
3,500

3,000

3,000
2,500

2,300

2,300

3,000

business policies. Based on our group sbusiness achievements and ﬁnancial

2,300situations, we were able to raise our per-share

2,000dividend 700 yen, from 2,300 yen announced

1,500

at the beginning of the year to 3,000 yen atthe end. This result was due to our eﬀorts to1,000

further strengthen our management baseand promote an increase in return on equity.

50009shareholders to be one of its most important

We are expecting our dividend to remain
20072008

2009

2010

2011
（予想）

steady at 3,000 yen per share for the year
ending December 2011.

200

Corporate Profile & Stock Information
SBS Business Report

Corporate ProﬁleCompany name(As of December 31, 2010)

SBS Holdings, Inc.

Representative
director and president

Masahiko Kamata

FoundedDecember 16, 1987

Paid-in Capital¥3,833.93 million

Net sales¥119.8 billion (for the year ended December 31, 2010)

Head oﬃce

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

Stock Information(As of December 31, 2010)

Number of shares authorized

515,684 shares

Number of shares issued

130,684 shares

Share trading unit

None

Number of shareholders

3,911

Major Shareholders(As of December 31, 2010)

Shareholder Name

Number ofshares held(shares)

Ratio ofshare held(%)

Foods Lec Co., Ltd.

Masahiko Kamata

64,128

50.16

Zentsu Co., Ltd.

Japan Trustee Services Bank, Ltd. (Trust account)

7,482

5.85

SBS Logitem Co., Ltd.

Hiroshi Date

4,348

3.40

Forward Co., Ltd.

SBS Holdings Employee Share Ownership
Association

3,619

2.83

SBS Staﬀ Co., Ltd.

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

3,348

2.61

A-MAX Co., Ltd.

Junichi Ouchi

3,094

2.42

The Master Trust Bank of Japan, Ltd.

3,026

2.36

Hiroyuki Yoshioka

1,889

1.47

3E Corporation

1,560

1.22

The Nomura Trust and Banking Co., Ltd.
(Investment trust account)

1,055

0.82

Lines of Business

Logistics, marketing, personnel placement, etc.

Major consolidated
subsidiaries

TL LOGICOM Co., Ltd.

PAM, Co., Ltd.

SBS Finance Co., Ltd.
Sogo Butsuryu System Co., Ltd.

Board of Directors and Auditors(As of March 25, 2011)

Representative director and president

Masahiko Kamata

Managing director

Kenichi Iriyama

Directors

Fumiaki Miyasaka

The ratio of share held are calculated based on the number ofshares excluding treasury shares. Treasury shares does not include
5,388 shares held by our employee share ownership association.

Shin-ichiro Watanabe
Full-time auditor

Tamio Wakabayashi

Auditors

Shigetaka Shomatsumoto
Masato Takeda
Jiro Iwasaki

The auditors Shigetaka Shomatsumoto, Masato Takeda and Jiro Iwasaki
are the external auditors.

Distribution of Shares by Shareholder Type(As of December 31, 2010)

Japanese Corporations
4,082shares（3.12％）

Treasury stock
2,856shares（2.19％）

Non-Japanese Corporation
5,587shares（4.28％）

Securities ﬁrms

861shares（0.66％）

Financial institutions

13,826shares（10.58％）

Individuals and others

103,472shares（79.18％）10