Results for the Fiscal Year Ended March 31, 2006
Presentation Materials

May 19, 2006
COMSYS Holdings Corporation

Contents
I. Overview of Results for the Fiscal Year Ended March 31, 2006
1. Overview of Results (New Orders and Net Sales)

・・・・・・・・・・・・・

4

2. Overview of Results (Operating Income and Recurring Profit)・・・・・・・・・・・・・

5

3. Trends in Net Sales and Recurring Profit after Establishment of CHD・・・・・・・・・・・・・

7

1. Trends to the Present by Business in NTT and NTT DoCoMo Business and Future Development・・・・・・・・・・・・・

9

2. Transformation of NTT Group Business・・・・・・・・・・・・・

10

3. Trends to the Present by Business in Non-NTT Business and Future Development・・・・・・・・・・・・・

11

4. Non-NTT Business Growth Strategy and Principal Measures

・・・・・・・・・・・・・

12

5. Positioning of Fiscal 2006 Medium-term Management Plan

・・・・・・・・・・・・・

13

6. Net Sales and Operating Income and Medium-term Plan Values

・・・・・・・・・・・・・

14

7. Business Changes over Past One Year and Medium-term
Basic Stance for the Future

・・・・・・・・・・・・・

15

8. Business Plan for the Fiscal Year Ending March 31, 2007

・・・・・・・・・・・・・

16

1. Reforms in NTT Access Business・・・・・・・・・・・・・

18

2. Development of “COMSYS-style Kaizen”

・・・・・・・・・・・・・

19

・・・・・・・・・・・・・

20

II. Business Operations in the Fiscal Year Ended March 31, 2006

III. Approach to NTT Access Business

IV. Responding to Various Issues in CHD’s Operating Environment2

I. Overview of Results for theFiscal Year Ended March 31, 2006

１. Overview of Results (New Orders andNet Sales)
２. Overview of Results (Operating Incomeand Recurring Profit)
３. Trends in Net Sales and Recurring Profit
after Establishment of CHD

I-1. Overview of Results (New Orders and Net Sales)
Increased New Orders and Sales Compared with Previous Year and Plan

■ Attained B Flets sales plan
■ Increased capital investment
in response to number portability■ Expanded mobile facilities in NCC business

Steep rise in optical cable installation
Sharply increased construction to coverwider area and improve quality
Increased construction work by enhancing
nationwide sales/construction structures

New Orders

Net Sales±0+257（¥100 million）±0%

Mar. 2005

+2.5%

+6.1%

+9.0%

2,843

+74+178

3,100

3,100

Mar. 2006

Plan2,896

Mar. 2005（¥100 million）3,074

3,000Mar. 2006

PlanNote: The figures for the March 2005 term cover 12 months, with three months excluded for comparison purposes, as the settlement termof Nippon COMSYS’ consolidated subsidiaries was amended.
4I-2. Overview of Results (Operating Income and Recurring Profit)
Sharp Rises in Operating Income and Recurring Profit Compared with Previous Year

 Net sales exceed projections

Plan Reduced costs by steadily implementing
management efficiency measures

Attainment

 Improved construction revenues andexpenditures of consolidated subsidiaries

Operating IncomeRecurring Profit（¥100 million）（¥100 million）
Recurring profit
Recuring profit margin

Operating income
Operating margin+27+3+18.1%
5.3%+0.5 pt

163

4.8%

±0 pt

+3.9%

+16.9%+1.9%+25+75.3%

5.5%

6.0%

6.1%
+0.1 pt+0.6 pt

180
187

160
160

138
Mar. 2005

Mar. 2006

PlanMar. 2005

Mar. 2006

Note: The figures for the March 2005 term cover 12 months, with three months excluded for comparison purposes, as the settlement termof Nippon COMSYS’ consolidated subsidiaries was amended.
5PlanI-3. Trends in Net Sales and Recurring Profit after Establishment of CHD（¥100 million）

3,074

Net Sales
Recurring Profit

3,000

3,000

Actualresults

1/27/05

2,936

2,840
2,800
2,760

2,762

Initialplan

Actualresults

Initialplan0

Actualresults

2,930

Initialplan

Revisedplan

1/27/05

Revised
plan

180
171

187

163

145

120
104

92

2,500
Mar. 2004
Mar. 2004

92

Mar. 2005

Mar. 2006

145

180

Note: March 2004 results are the simple sum of the three Group companies (cover 12 months for SANCOM-G and TOSYS, including first half), on a full-year basis.

6II. Business Operations in the Fiscal Year Ended
March 31, 2006
1.
1. TrendsTrends toto thethe Present
Present byby BusinessBusiness inin NTT
NTT andand NTT
NTT DoCoMo
DoCoMo BusinessBusinessandand Future
Future Development
Development
2.
2. Transformation
Transformation ofof NTT
NTT GroupGroup BusinessBusiness3.
3. Trends
Trends toto thethe Present
Present byby BusinessBusiness inin Non-NTT
Non-NTT BusinessBusiness andand Future
FutureDevelopment
Development
4.
4. Non-NTT
Non-NTT BusinessBusiness Growth
Growth Strategy
Strategy andand Principal
Principal Measures
Measures5.
5. Positioning
Positioning ofof Fiscal
Fiscal 2006
2006 Medium-term
Medium-term Management
Management PlanPlan
6.
6. NetNet Sales
Sales andand Operating
Operating Income
Income andand Medium-term
Medium-term Plan
Plan Values
Values7.
7. BusinessBusiness Changes
Changes overover Past
Past OneOne YearYear andand Medium-term
Medium-term Basic
Basic StanceStanceinin thethe Future
Future8.
8. BusinessBusiness Plan
Plan forfor thethe Fiscal
Fiscal Year
Year Ending
Ending March
March 31,31, 2007
2007

II-1. Trends to the Present by Business in NTT and NTT DoCoMo Businessand Future Development
Net Sales (¥100 million)
Second-generation （ＰＤＣ）

Third-generation （ＦＯＭＡ）

ＩＳＤＮ

B Flets

ＡＤＳＬMobile

Enter business formaintenance andNGN construction

Increased construction
for number portability
Rapid increase intower construction

Expand maintenance,
agency and ubiquitousbusiness

Access500
Intra-officeEnter business for building
NGNs（Vendor domain)）Enter maintenancebusiness

New nodes

Infrastructure
CHD management
integration

NTT becomes aholding company

Maintenance proposals forinfrastructure facilities

0'96

'98

'00

'02

Figures for Nippon Comsys only

'04

82006

(Mar. 2006)'08(Mar. 2008)

CHD consolidated figures

2010(Mar. 2010)

II-2. Transformation of NTT Group Business
Expand Infrastructure and Peripheral Businesses to the FullestNet Sales(¥ 100 million)

Mar. 06 Mar. 07

Mar. 09◆Secure quick-decision structure in gearing up for 30◆Enter domain for building NGN （vendor domain）

NTT◆Establish a structure for maintenance of existing facilities(Establish receptacle structure for the 2007 problem)◆FMC (integration of fixed and mobile communications)◆Proactive entry into agency business◆Proactive initiatives toward ubiquitous businesses

DoCoMoNTT Group Businessmillion optical cable subscribers

Total Net Sales of NTT Business

9760

1,841

1,850 1,850

II-3. Trends to the Present by Business for Non-NTT Business andFuture Development
Ｃ・Ｃ・ＢＯＸ and other regular civil engineering business

ＮＣＣ Infrastructure

Net sales (\100 million)
Construction
Business････ Results for March 2006 period666････ Numerical targets of fiscal 2006
medium-term management plan650

IT Solutions
Business

600

400

ＮＣＣ

350
307
270260

Ｓ Ｉ

200
145
130 Maintenance

10260
Overseas

0'96

'98

NTT becomes a holdingcompany

'00

'02

Figures for Nippon Comsys only

CHD management
integration

'04

10

2006

(Mar. 06)

'08

‘09

2010

(Mar. 08) (Mar.09) (Mar. 10)

CHD consolidated figures（ Re-list）
IT Solutions BusinessＮ Ｉ

II-4. Non-NTT Business Growth Strategy and Principal Measures
Attain Non-NTT Net Sales of ¥160 Billion by the Fiscal Year Ending March 31, 2009
Net Sales

Continuous Expansion to Ensure Management Stability

firmly maintain industry no. 1 share for NCC◇Expand and strengthen nationwide structure for construction◇Maintain safety and quality
telecommunications construction◇Expand sales by strengthening sales structure for brand products◇Establish nationwide maintenance structure◇Secure profits◇Government sector: Establish business model that responds, from e-Japan to U-Japan◇Electrical facilities: Proactively respond to demand for building renovation, mainly in private
sector (Integrated electric/information construction)◇Building/eco: Develop models that enable accumulation of business know-howConstruction

MatureBusinesses◆New responses to mature businesses

IT Solutions◆As a new pillar, secure acclaim as a systems integrator inMar. 06 Mar. 07

NCC

Growth Businesses◆Expand orders through carrier free and area free andTotal sales of non-NTT business11(¥ 100 million)

260

290
265

Mar. 09

350

600
440
307

650
666

570

1,233 1,300 1,600

II-5. Positioning of Fiscal 2006 Medium-term Management Plan
Because of sharp growth in NTT DoCoMo-related business supported by favorable results in B Flets/MNP, we annually reevaluate the numericaltargets of our management plan for each fiscal year based on assumptions about the shape of the company three years into the future.
■Fiscal 2006 medium-term management plan■
Principal targets to be attained by year ending
March 31, 2009 ( fiscal 2009)■Fiscal 2005 （second）medium-term management plan■
Principal targets to be attained by year ending
March 31, 2008 (fiscal 2008)◇Net sales: ¥345.0 billion◇ Proportion of Non-NTT sales: 46%◇ Operating margin: 5.8% Recurring profit margin: 6.2%

◇Net sales: ¥320.0 billion◇Proportion of Non-NTT sales: 50%◇Operating margin: 5.5% Recurring profit margin: 6.0%

Mar. 2006（¥100 million）

FY2005(second)plan

ActualMar. 2007
Difference

Mar. 2008

FY2005(second)plan

FY2006
plan

Difference

FY2005(second)plan

FY2006plan

Mar. 2009
Difference

FY2006plan

New orders

2,950 3,100+150

3,100

3,200+100

3,220

3,330 +110

3,450

Net sales

2,930 3,074+144

3,050

3,150+100

3,200

3,300 +1003,450

Operating income(Operating income margin)

Recurring profit(Recurring profit margin)
Net income(Net profit margin)

145

163

+18155170+15175185+10200(4.9%)(5.3%)+0.4p(5.1%)(5.4%)+0.3p(5.5%)(5.6%)+0.1p(5.8%)

163

187

+24

170

190

+20190205+15215(5.6%)(6.1%)+0.5p(5.6%)(6.0%)+0.4p(6.0%)(6.2%)+0.2p(6.2%)

85

100

+1595

110

+15105115+10120(2.9%)(3.3%)+0.4p(3.1%)(3.5%)+0.4p(3.3%)(3.5%)+0.2p(3.5%)

12

II-6. Net Sales and Operating Income and Medium-term Plan Values
3,450【FY2006 medium-term
management plan target values】+150

3,300+150

3,150
3,074

【Actual results】+76

3,200+178

Net sales(¥100 million)+134【First (FY2004) medium-term
management plan target values】+7200
170+15185+15175145
155140110

Mar. 04

163+251389883【FY2006 medium-term
management plan target values】

2,800【Actual results】
Operating Income(¥100 million)+40【Second (FY2005) medium-term
management plan values】

2,900

2,762
2,760

3,050

2,9302,896【Second (F2005) medium-term management
plan target values 】【First (FY 04) medium-term management planvalues (】Mar. 05

Mar. 06

Mar. 07

13Mar. 08

Mar. 09

II-7. Business Changes over Past One Year and Medium-term Business
Stance in the Future
Abrupt changes
・Sharp rise in B Flets construction

2,000
1 ,8 4 1・Acceleration of construction to
respond to MNPNet sales inNTT
DoCoMobusiness

1,600
1,653

1,500

1,640

【Second (FY2005) medium-termmanagement
plan target values 】

Net sales(¥100 million) Ｎet sales
in nonNTTbusiness

1,850

1 ,8 5 01,600

1,850【(FY2006 medium-term
management plantarget values 】

1 ,6 0 0

1,410
1 ,4 5 0

1,277
1 ,3 0 0
1 ,2 3 3・NCC-related business favorable
・Government sector, private sector, and IT solutions businessstruggled amid worse-than-expected intensifying competition

1,000
NTT DoCoMo business ：Strive to take full advantage of favorable conditions of NTT DoCoMorelated business
Non-NTT business

1. Further acceleration of net sales in NCC business（firmly held industry
No. 1 share）
2. IT Solutions business to maintain high sales growth and emphasize profits

500
Mar. 2006

Mar. 2007

Mar. 2008

14

Mar. 2009

II-8. Business Plan for the Fiscal Year Ending March 31, 2007
Medium-term management policies

Fiscal 2006 management policies

1. Be the No.1 company in infrastructurebuilding

1. Strive to ensure that COMSYS HD is acclaimedby all stakeholders

2. Aim to be a systems integrator with expertisein telecommunications construction

2. Make efforts to create new work in all business categories
3. Aim to raise productivity in all business categories

3. Maximize effects of management integration◆ Make total response to increased demand by maximizing construction capabilities◆ Strive to continually raise profitability via ongoing “kaizen” (improvement)（¥100 million）

Mar. 2007
Business Plan

Mar. 2006
New orders
Net sales
Operating income(Operating income margin)
Recurring profit(Recurring profit margin)
Net income (Net profit margin)

3,100
3,074
163

（5.3%）

3,200
3,150
170

187

（6.1%）

100（3.3%）
15

Change% Change（5.4%）+100+76+7+3.2%
+2.5%
+4.3%

190

（6.0%）+3+1.6%110（3.5%）+10+10.0%

III. Approach to NTT Access Business1. Changes in NTT Access Business2. Development of “COMSYS-style Kaizen”

III-1. Reforms in NTT Access BusinessWe will realize three “reforms” in the NTT Access Business and change theculture that shaped this business to the present, and grow this business as asource of profits for the COMSYS HD Group.
◆Given that the NTT Access Business is closely interwoven with local
communities, we will thus position this business as a pillar for the Company’ssocial contributions and will proactively undertake our CSR.

◆We will utilize “COMSYS-style Kaizen” to create new ways of doing work inthe construction business.

◆We will cultivate new markets to realize ubiquitous businesses and strive tobecome the most trusted partner of our customers.

17III-2. Development of “COMSYS-style Kaizen”
Transform the construction business into a manufacturing businesswithin the world of virtual reality◇Create new construction business management◇

Ⅰ

Visualization ofapportionment of work
among companies

Ⅱ

Visualization of workplaces ◇Real-time schedule management of work parties◆Fostering a highly realistic sense of being present between thethat are distant or that move(Real-time management)

work party and person in charge of construction◆Speedier implementation of flexible ad-hoc steps◆Collection of a wide range of management indicators

ⅢEliminate waste at worksites and ensure that “kaizen” DNA is firmly in place
18

Rectify work flow

(Data flow systems)◆Customer unit
◆Integrated management from order receipt to payment
collection◆Parties taking on work share information equally

IV. Responding to Various Issues in CHD’s Operating Environment■Setting up an advisory board and undertaking operations that utilize theholding company framework(Implemented from April 2006)

Promote corporate social responsibility (CSR)

Expand M&A and alliances to transformbusiness formats and expand operations◇ Establish CSR Committee

Adhere strictly to compliance◇ Strict adherence to laws (strengthen preventivemeasures)◇ Strengthen internal operation audits and legal
checksStrengthen risk management◇ Establishment of Risk ManagementCommittee◇ Establishment of TOB countermeasureproject◇ Tie-ups with IT companies

COMSYS Group◇ Upgrade environmental and social contribution
activities

Establish internal control system

Raise productivity throughcost reductions◇ Thoroughly implement “COMSYS-styleKaizen”◇ Promote management improvement
measures

Implement safety measures thoroughly◇ Elevate safety awareness◇ Set up internal control deliberation project◇ Formulate “Basic Policies for Building Internal
Control System”◇ Utilize treasury stock and cash

◇ Carry out basic actions thoroughly191