Detailed Financial Results for Fiscal Year Ended March 31, 2005

May 25, 2005

Yoshihiro Mimata
Director, General Manager of Finance & Accounting Department

CONTENTS

1. Consolidated Financial Results for Fiscal Year Ended March 31, 2005

3~4

2. Consolidated Statements of Income (Year-on-year, simple total)5(Reference) Consolidated Statements of Income by Company

6

3. Breakdown of Net Sales by Company and Business Category (Year-on-year, simple total)

7

4. Effect of Management Improvement Measures and Business Integration Measures

85. Main Non-operating and Extraordinary Accounts (Consolidated)

9

6. Consolidated Balance Sheets

107. Consolidated Cash Flows

118-1. Changes in Main Financial Indicators (COMSYS Holdings)

128-2. Changes in Main Financial Indicators (Nippon COMSYS Non-consolidated)131. Consolidated Financial Results for Fiscal Year Ended March 31, 2005
(1) Effect of Change in Settlement Period for Consolidated Subsidiaries of Nippon COMSYS([DecemberMarch]
15-month Accounting Period)
Year Ended March 31, 2005
Figures in Financial Results

Category(Unit: ¥100 million)
Net Sales

Effect of three months of financial
results for subsidiaries(included in figures for 15 month)Figures for 15 months
Figures for 12 months

40
2,936

Recurring Profit
11150

2,896

(Reference)
Simple totals for Each Company

Operating Income

Net Income
10171

138

683

16077

(Offset difference)

2,953

138

For comparison with
forecast for fiscal year
ending March 31, 2006

16088

(12 months)(Gain on sale ofCOMSYS Holdings
shares by Nippon
COMSYS)For comparison with
year-on-year figures(2) Figures in Financial Results and Simple Totals for Each Company for Fiscal Year Ended March 31, 2004
(Figures in financial results do not include first half figures for SANWA group and TOSYS group.)(Unit: ¥100 million)

Category
Year Ended March 31, 2004

Figures in Financial Results

Net Sales
2,489First half figures for twocompanies (included in simpletotals for each company)

Simple totals for Each Company

Operating Income
107
262

2,762

Recurring Profit(Offset difference)

114-698

Net Income
65
-7104

-847
(Consolidation adjustment difference
at time of integration)3(3) Effect from Reorganizing NTT Business(Inter-company Effect on Net Sales for Fiscal Year Ended March 31, 2005)
Nippon COMSYSSANWA ELECTOSYSTransfer
NTT Business+¥1.8 billion-¥1.8 billion-¥0.1billion
Total Effect¥1.7 billion+¥0.1billion-¥1.8 billion¥0.1 billion(Reference: Inter-company Effect on Forecast Net Sales for Fiscal Year Ending March 31, 2006)
Nippon COMSYS+¥8.5 billion

SANWA COMSYS(formerly SANWA ELEC)

TOSYS-¥8.5 billion

NTT Business-¥1.4 billion
NCC business-¥12.5 billion

Non-NTT business-¥0.5billion

Total Effect-¥5.9 billion+¥1.4 billion+¥12.5 billion+¥0.5billion¥4.0 billion¥1.9 billion
42. Consolidated Statements of Income*(Year-on-year, simple total)* 12 months for consolidated subsidiaries of Nippon COMSYS* Previous fiscal year’s results for SANWA group and TOSYS group include first half results(Unit: ¥100 million)
Simple totals for FY3/04 and FY3/05
Item

Main reasons for increase/decrease
FY3/04 Results

FY3/05 Results

Net Sales

2,762

2,953

191

Cost of Sales

2,451

2,610

159 • Cost of sales ratio (88.8% —> 88.4%)

Gross Profits

31034333 • Gross profit margin (11.2% —> 11.6%)

Selling, General and Administrative Expenses

211

204

-7 • Cost cutting, reduction of overtime, and reduction in retirement benefit expenses

Operating Income

98138

40 • Operating margin (3.6% —> 4.7%)

Other Income

1324

11 • Amortization of other consolidation adjustments (10 Tokyo Tsuken Corporation, Nitto Tsuken Inc., etc.)

Other Expenses

83-5 • Foreign exchange losses (-2), Amortization of business start-up expendituresr (-2)

10416056 • Recurring profit margin (3.8% —> 5.4%)

1615-1 • FY3/04: Gain on transfer of substitutional portion of contributory pension plan (11),Recurring Profit
Extraordinary ProfitChange• COMSYS group (167) TOSYS group (25)
• NTT (B Flet’s), DoCoMo (FOMA), Non-NTT (NCC) all increased

Extraordinary Loss

32364

Income before Income Taxes

8813951

FY3/05: Gain on sale of COMSYS Holdings shares, etc. (13)• Allowance for doubtful receivables (6), Special payments on employees’ retirement (3),Write-down of investments in securities (-6)• Pre-tax profit margin (3.2% —> 4.7%)

Income Taxes

415110—Net Income478841 • Net profit margin (1.7% —> 3.0%)

5

(Reference) Consolidated Statementsof Income by Company** 12 months for consolidated subsidiaries of Nippon COMSYS* Previous fiscal year’s results for SANWA group and TOSYS group include first half results(Unit: ¥100 million)
COMSYS group (12 months)
Item

SANWA group

TOSYS group

FY3/04
Results

FY3/05Results

ChangeFY3/04
Results

FY3/05Results

ChangeFY3/04
Results

FY3/05Results

ChangeNet Sales

2,065

2,232

167

443

442-1253

278

25

Cost of Sales

1,827

1,958

131

402

406

4221

245

24

Gross Profits

237274374035-53233

1Selling, General and Administrative Expenses

157150-73130-123230

Operating Income79124

4594-5990Other Income

11211021-1011

Other Expenses

20-2

52-300088

14557

64-29101

Extraordinary Profit1314

120-200-0

Extraordinary Loss

19278128-400-0

Income (Loss) before Income Taxes

83

132

49-3-3-0

9101

Income Taxes

37

46

9-1-0

155-0Net Income (Loss)

4586

41-1-3-2

352

Recurring Profit

63. Breakdown of Net Sales by Company and Business Category** 12 months for consolidated subsidiaries of Nippon COMSYS(Year-on-year, simple total)* Previous fiscal year’s results for SANWA group and TOSYS group include first half results
COMSYS. HD(Unit: ¥100 million)

2,953+191

2,762

NTT Information
Communications Engineering

+157

1,686

1,529

Telecommunications Engineering +70743

673
274
284

IT Solutions+2Social Systems

-38

276
246

FY3/04 Results(12 months)

FY3/05 Results(12-month simple aggregate figures)
COMSYS group

By Company, by Business Category(12 months)

SANWA group

FY3/05 Results

Year-on-year

FY3/05 Results

NTT Information Communications Engineering

1,411+140117

Telecommunications Engineering413+69IT Solutions

225

Social Systems
TotalTOSYS group

Year-on-year

FY3/05 Results

Year-on-year-4

158+22272+1057-9+317+134-1183-4334-828+132,232+167442-1278+257

4. Effect of Management Improvement Measures
and Business Integration Measures(Unit: ¥ billion)
Category

1. Results of past management improvement measures

Measures(Achievement rate)

50%

Personnel rationalization¥1.1 billion

Material cost rationalization—Outsourcing cost rationalization¥1.5 billion

Other cost rationalization

TotalPlan

2. Result of business integration measures

100%(92%)

50%(Achievement rate)

Total (1 + 2)

Plan

100%

Plan

ActualAchievement rate

1.2

¥0.4 billion

(67%)

0.6

1.8

1.5

83%

0.0

¥0.6 billion(120%)

0.5

0.5

0.6

120%

(94%)

1.6

¥0.1 billion

(50%)

0.2

1.8

1.6

89%

¥0.3 billion(100%)

0.3¥0.8 billion(4 times)

0.2

0.5

1.1

220%

¥2.9 billion

(94%)

3.1

¥1.9 billion

1.5

4.6

4.8

104%

(127%)

Note: Figures in parentheses indicate rate of achievement of plan.

85. Main Non-operating and Extraordinary Accounts (Consolidated)
Non-operating Accounts
Breakdown of main items

Other Income(Unit: ¥100 million)
FY3/04 Results

FY3/05 Results

Interest and dividend income

1.9

2.6

Amortization of other consolidation adjustments

5.9

16.2

Foreign exchange losses

1.7—Interest expenses

1.4

1.6

(Tokyo Tsuken Corporation, Nitto Tsuken Inc., etc.)
Other Expenses

Extraordinary Accounts
Breakdown of main items

Extraordinary Profit

Extraordinary Loss

(Unit: ¥100 million)
FY3/04 Results

FY3/05 Results

Gain on transfer of substitutional portion of contributory pension plan

11.0

—

Amortization of other consolidation adjustments (Business integration)

8.8—

Gain on sales of property, plant and equipment—

4.3

Write-down of investments in securities

10.7

4.8

Impairment loss (impairment of loan assets)—

4.2

Allowance for doubtful receivables (Mainly overseas losses)

5.4

11.4

Special payments on employees’ retirement (Transfer and reassignment lump sums)

2.8

6.1

Allowance for structural reforms (Shinetsu region, reassignment lump sums)

—

1.8

9

6. Consolidated Balance Sheets
ASSETSLIABILITIES AND SHAREHOLDERS’ EQUITY(Unit: ¥100 million)

2,117(Unit: ¥100 million)

2,117-30

-30

2,086

2,086
Current Liabilities(-53)

Current Assets

671

1,422

1,420(-2)• Cash and cash equivalents+42• Accumulated costof construction in progress-40• Accounts receivable–trade-5• Short-term bank loans-41• Current portion of long-term debt

-13

Long-Term Liabilities

233

618(-45)• Long-term debt

-13

• Consolidation adjustments account-14• Accrued severance indemnities

-13

188

1,280
Shareholders’ Equity

Fixed Assets
694(-28)• Sale of land-13• Depreciation of buildings-16

As of March 31, 2004

666

As of March 31, 2005

1,213

As of March 31, 2004(+67)

• Profit+80• Dividends-16

As of March 31, 2005

10

7. Consolidated Cash Flows(Unit: ¥ billion)

+14.7

-4.8
Cash Flows from
Investing Activities

Cash Flows fromOperating Activities• Acquisitions of fixed assets• Increase in time deposits

-7.4
-3.2
-1.9

32.8

As of March 31, 2004

35.2

• Decrease in long-term and short-term debt -5.6
• Cash dividends paid-1.6• Income before income taxes
and other adjustments to net income 14.1

Cash and Cash Equivalents
at Beginning of Year

Cash Flows fromFinancing Activities+2.4 billion

Cash and Cash Equivalents
at End of YearAs of March 31, 200511

8-1. Changes in Main Financial Indicators (COMSYS Holdings)
Stability(¥100 million)(%)

Equity Ratio

ROE[COMSYS. HD]

Interest-Bearing Debt

150

65

1. Net Profit Margin (%)

(-68)

57.3

46500

2005/3

2.6

2.8

1.6
1.3

1.7
1.4

3. Financial leverage(total assets/shareholders’ equity) (times)

20
2004/3(+1.0)

461.4(+4.1)

55

6.7

5.7

10060

ROE (%)(1 x 2 x 3)

6114

[COMSYS. HD]

2.Turnover of Total Assets (times)

0
2004/3

Stock-related Indicators

2005/3

2004/3

2005/3

Consolidated Dividend
Payout Ratio[COMSYS. HD]

Percentage of Stock
Held by Foreigners[COMSYS. HD]

PER(Price/Earnings Ratio)[2005/3][2004/3]

15.4 times

18.6 times

x EPS

= PBR

(Primary Earnings per Share) (Price/Book Value Ratio)¥58(¥48)*¥46(¥36)*

1.0 times

BPS(Book Value per Share)¥907

CommonStock Price

DividendYield(March 31)(March 31)¥899[COMSYS. HD]

(%)
28(%)

30

26

2026.926.1

1.67%(-0.6)

25.7(+8.5)(+1.5)

16.9
24

1.0 times*Figures in parentheses exclude consolidation adjustment account.

ROA(1 x 2 )

¥859

¥855

18.4

10
*Japanese company average 21%

1.40%

00

2004/3

2005/3

2004/3

2004/92005/312

8-2. Changes in Main Financial Indicators (Nippon COMSYS Non-consolidated)
Productivity and Profitability[Nippon COMSYS Non-consolidated](%)(¥ million)(¥ million)

70

65

Net Sales per Employee

90

Operating Expenses per Employee

Break-even Point Ratio

65
8560
60

63(+6)

5555

84(+4)

6057(-6)
Improvement

80

56

78002004/3

2005/302004/3

2005/3

Cost Efficiency [Nippon COMSYS Non-consolidated](%)

75

Outsourcing expenses ratio

60.6

75

60.3

0

Outsourcing expenses ratio

Points
-0.1

67.7

67.8

50

5025

Ratio of Expenses to Cost of Sales

100

Points-0.3

2005/3*Year-on-year (Net sales growth rate 8.3%) (Cost of sales growth rate 7.5%)(%)

Ratio of Expenses to Net Sales

100

2004/3

10.5

Materials expenses ratio

+0.8

11.3

11.9
6.5
7.0

Personnel expenses ratio-0.8

Other expenses ratio
SG&A expenses ratio

-0.3
-0.8

11.1
6.2
6.2

2004/3(*Includes information business costs)

2005/3250

11.7

Materials expenses ratio

+1.0

12.7

13.3

Personnel expenses ratio

-0.8

12.5

Other expenses ratio

-0.3

7.0

7.3
2004/3(*Includes information business costs)

2005/313