2014
Annual Report
For the year ended March 31, 2014

TONAMI HOLDINGS CO., LTD.

Capitalizing on expertise originally gained in the transportation business, the Tonami Group has long been a trailblazer in logistics.
We were among the first in the industry to introduce computer systems.
In recent years, we have taken systematized distribution services fully
utilizing IT to new heights. In particular, our third-party logistics (3PL),
offering companies the optimum solutions to their logistics needs, hasenabled us to cultivate a loyal and growing customer base.
Tonami Holdings Co., Ltd. is now strengthening the fundamentals of
the business as it embarks on a new round of development, bringing its
capabilities as a pure holding company into full play. Leveraging theaccumulated expertise and business know-how of the Tonami HoldingsGroup, we are sharpening our responsiveness to customer needs not onlyin the field of logistics but also in related businesses and new fields.
We strive to offer value-added services that transcend the traditional
conception of logistics. As a pioneer with strengths in information processing, we are committed to delivering value a stride ahead.
By deploying IT infrastructure attuned to the increasingly diverse andsophisticated needs of the era, we aim to maximize the corporate value of
the Tonami Holdings Group and be an enterprise needed
and respected by society.
We are taking a big stride toward realization of
our “More Than Transportation” vision.

We Want to Deliver Value a Stride Ahead

Contents
1 Consolidated Financial Highlights
2 To Our Shareholders and Investors
5 Corporate Governance
10 Corporate Social Responsibility Activities
11 Financial Section
41 Consolidated Subsidiaries
42 Board of Directors and Corporate Auditors
42 Corporate Data

Forward-Looking Statements
This annual report includes forward-looking statements that represent Tonami’s assumptions and expectations in light of currently available
information. These statements reflect industry trends, clients’ situations and other factors, and involve risks and uncertainties which may
cause actual performance results to differ from those discussed in the forward-looking statements in accordance with changes in thebusiness environment.

Consolidated Financial Highlights
TONAMI HOLDINGS CO., LTD.
AND CONSOLIDATED SUBSIDIARIES
Years ended March 31, 2014 and 2013
Thousands of
U.S. dollars(Note 1)Millions of yen
2014
2013

2014

FOR THE YEAR:
Operating revenues:¥121,129¥115,864$1,176,932

110,692

105,728

1,075,517

Information processing

3,059

2,633

29,723

Sales

6,616

6,717

64,287

Others

762

785

7,405

Operating income

3,240

2,767

31,488Net income

2,370

1,785

23,037

Comprehensive income

2,582

2,215

25,097

Logistics

PER SHARE (Yen and U.S. dollars):
Net income, basic

¥

26.13

Net income, diluted
Cash dividends

¥

19.67

$

0.2539

—

—

—

4.50

5.00

0.0437¥117,149¥117,189$1,138,262

49,29247,643478,944

AT YEAR-END:
Total assets
Total net assets

Notes: 1. U.S. dollar amounts presented herein are included solely for convenience. The rate of ¥102.92 = U.S.$1, prevailing on March 31,
2014, has been used for the translation into U.S. dollar amounts.
2. The computation of net income per share of common stock is based on the weighted average number of shares outstanding (which
represents the number of issued shares less treasury stock.) during each financial year.
3. Diluted net income per share is not presented for the years ended March 31, 2014 and 2013, since there were no residual securities.

Operating Revenues by
Business Segment
150(Billions of yen)

Operating Income

4

Net Income and
Net Income per Share, Basic(Billions of yen)

3.0

(Billions of yen)

(Yen)

30

3
100

2.0

20

1.0

10

2
50
1

0

’10

’11

’12

’13

’14

0

’10

’11

’12

’13

’14

0

’10

’11

’12

’13

’14

Net Income (Left scale)
Net Income per Share, Basic (Right scale)

Logistics
Information processing
Sales
Others01

0

To Our Shareholders and Investors

President, Katsusuke Watanuki

During the fiscal year ended March 31, 2014, the Japanese economy was on a modest recovery trackin line with the weakening of the yen and the rise in stock prices resulting from the Japanese government’s economic policies and the Bank of Japan’s monetary easing policy, as well as reflecting
improvement in certain aspects of personal consumption and recovery of the export environment.
On the other hand, in addition to concerns about the downward pressure on overseas economies,
notably the slowing pace of China’s economy and other emerging economies, there is anxiety about
deceleration of the Japanese economy owing to the growing costs of imported raw materials becauseof the weaker yen, rising oil prices, higher electricity costs, and a decline in consumption following
the consumption tax increase in April 2014. As a result, prospects remain unclear.
In the distribution industry, consumption-related freight volumes increased thanks to robust personal consumption and construction-related freight volumes were buoyant, reflecting the last-minute demand before the consumption tax increase and an expansion of public investment. However,the business environment for the distribution industry remained challenging as fuel costs remained
high and subcontractor fees are rising in line with the worsening shortage of truck drivers andtrucks.
In these circumstances, the Tonami Holdings Group strove to secure stable revenues from truck
transport and freight forwarding and to expand related businesses, including third-party logistics(3PL), the Group’s priority. As a result, operating revenues amounted to ¥121,129 million, an
increase of 4.5% or ¥5,265 million from the previous year.
With regard to profits, the progress of the structural reform of the business in accordance with theThree-year Medium-term Business Plan launched in April 2012 and revisions to freight charges andunit rates contributed to improved profitability. Meanwhile, benefitting from robust operating revenues from the third quarter onward, we worked to absorb higher fuel prices and an increase in
expenses for improving the business structure and for initiatives to maintain and improve transportation quality in order to respond to increasing freight volumes. As a result, operating income
increased 17.1% or ¥472 million from the previous year to ¥3,240 million.
Net income increased 32.8% or ¥585 million to ¥2,370 million.
In view of the robust financial performance, we increased the year-end ordinary dividend by ¥0.5
to ¥2.5 per share. With an interim dividend of ¥2 per share, total annual dividends for the year
ended March 2014 amounted to ¥4.5 per share.
Results by Segment

The Group promoted proposal-driven marketing in road haulage, freight forwarding, and 3PL services to meet customers’ needs for rationalization of logistics and for procurement logistics. Owing
to the expansion of demand reflected in freight volumes from the third quarter onward, operating
revenues from the logistics-related business increased 4.7% or ¥4,963 million from the previous
year to ¥110,692 million. Increased operating revenues and progress in structural reform of thebusiness contributed to segment income. Business expansion from the third quarter onward02

absorbed the factors pushing costs higher, such as the increased burden of fuel costs and increases
in subcontractor fees due to manpower shortages. As a result, segment income increased 21.1% or¥435 million to ¥2,493 million;
Operating revenues from the information processing business increased 16.2% or ¥425 million
from the previous year to ¥3,059 million, partly due to expansion of business with new and existingcustomers. Segment income was ¥250 million, an increase of 17.8% or ¥37 million.
Operating revenues from the sales business, which includes merchandising, consignment sales,
and a non-life insurance agency, amounted to ¥6,616 million, a decrease of 1.5% or ¥101 million
from the previous year. Segment income increased 49.8% or ¥143 million to ¥432 million.
Operating revenues from other businesses, which include automobile repair and direct mail service, amounted to ¥762 million, a decrease of 3.0% or ¥23 million from the previous year. Segment
income decreased 24.1% or ¥27 million to ¥85 million.
Outlook for the Year ending March 31, 2015

The Japanese economy is on a moderate recovery track, underpinned by a boost from last minutedemand in the run-up to the consumption tax hike, domestic demand with public investment andprivate-sector capital investment to the fore.
Although the business environment is expected to remain unclear in view of concerns about slowing economy from April onward following the consumption tax increase and hikes in prices of oiletc., the moderate recovery of the Japanese economy is expected to continue, supported by theJapanese government’s economic policies as the dip in demand in the aftermath of the last-minute
spike in demand prior to the consumption tax increase fades away.
In these circumstances, the Group is working to achieve further progress in the structural reformof the business, a key theme of the plan, to wrap up the second year of the Three-year MediumTerm Business Plan. We are also eyeing M&A and capital and business alliances with the aim ofachieving the financial performance targets for the final year of the plan.
We are striving to enhance our proposal-driven business capabilities in order to respond to customer needs for logistics cost reduction centering on the key 3PL services and actively conducting
promotional activities aimed at winning new orders. Furthermore, we are working to enhance operational efficiency of our existing distribution centers.
We aim to maximize corporate value by securing stable revenues and cash flows over the longterm.
In light of ongoing vigorous execution of the above-mentioned initiatives, the forecast of theGroup’s business results for the year ending March 31, 2015, is as follows:(an increase of 1.5% year on year)
Operating revenues ¥123,000 million
Operating income ¥3,700 million(an increase of 14.2% year on year)
Net income¥2,600 million(an increase of 9.7% year on year)
Note:	The forecast of consolidated business results presented above is based on certain assumptions that management
believes reasonable at the time of announcement and may be revised.

We will continue making a concerted effort to raise business performance so as to meet the expectations of our shareholders. In all our endeavors, we will be grateful for your continued support.
June 2014
Katsusuke Watanuki
President and Representative Director

03Operating Subsidiaries and Affiliates
Transportation business:

Group companies that support
business activities in Asia

Tonami Transportation
Tonami Transportation Shinetsu
Tonami Transportation Chugoku
and other companies

Group companies that support
domestic business operations

Warehousing business:

Tonami Transportation
Keishin Warehouse
Daiichi Warehouse and other companies

Tonami Logistics (Dalian)

IT System:

Keishin System Research
Client Focus

Financial Services

Tonami Business Service

Temporary Staffing
Tonami Staff Support

Hokkaido Tonami Transportation
Tonami (Thailand)

Tonami Computer Center
Anan Transportation
Gosei Tonami Transportation
Fukui Tonami Transportation
Ishikawa Tonami Transportation
Niigata Tonami Transportation
Zento Transportation
Takaoka Transportation
Takefu Transportation

Mahaporn Transport
H&R Forwarding

Kanto Tonami Transportation
Ibaraki Tonami Transportation
Tonami Shutoken Logistics
Tonami Global Logistics

Tonami Kinki Logistics
Chukyo Tonami Transportation
Touto Transportation

Tonami Trading, Toyo Gomu Hokuriku Hanbai,
Takaoka Cable Network, Shogawa Kanko, etc.

Tonami Logistics Solutions

Physical distribution
consulting functions

Physical distribution
network functions

Procurement logistics

Production logistics

Raw materials (Parts etc.)
manufacturers

Factories

Environmental
logistics

Consumers

Goods returned, repairs,
waste, etc.

In-house logistics

Warehouses, distribution
centers

Sales logistics
Destinations in Japan

Wholesalers, retailers
Overseas suppliers

ExportImportDestinations overseas

International logistics
Systematized distribution (3PL), information sharing
Supply chain management (SCM)

Information systemdevelopment functions

Operational functions04

Corporate Governance

At a meeting of the Board of Directors held on October 1, 2008, the Company passed a resolution concerning a basic policy for internal control systems. The Company, with the Internal
Control Committee in a central role, is implementing sound internal control systems in accordance with the policy, aiming to increase the corporate value of the Tonami Holdings Group.

(1) Corporate Governance System

1) Overview of the Corporate Governance System and Reason for Adopting the System
The Board of Directors of the Company is the organization responsible for important matters concerning business policy and business strategy. In accordance with the Board of Directors Regulations,
meetings of the Board of Directors are held, in principle, once a month, and as necessary, enabling
the directors to attain mutual understanding and engage in mutual supervision of the execution ofbusiness. The Board of Directors utilizes the services of outside experts as necessary to prevent violations of the law or the Articles of Incorporation.
The Company employs a corporate auditor system as part of its internal control framework. The
Board of Corporate Auditors consists of five corporate auditors (two standing corporate auditors andthree outside corporate auditors). The corporate auditors audit the legality of the directors’ actions
by attending meetings of the Board of Directors and other important meetings, by offering theiropinions, and by other means.
The corporate auditors, including the outside corporate auditors, audit the execution of businessby the directors in accordance with the auditing policy and task assignments decided by the Board of
Corporate Auditors.
In the event that a director discovers a violation of the law or the Articles of Incorporation on thepart of another director, the director is required to promptly report the violation to the corporate
auditors and the Board of Directors and a remedy will be sought. The Company has an internal
auditing unit, the Internal Audit Office, which is an organization independent of the business units.
Moreover, the Company has established the Tonami Group Employee Code of Conduct as thefoundation of the Group’s compliance system and the Internal Control Committee, chaired by thepresident, as the decision-making body. The Company’s effort to enhance its internal control systems
is led by an officer responsible for internal control.
The Compliance Committee is a compliance control organization, and the Internal Control Team
within the Internal Audit Office performs control, operation and training in order to maintain andenhance internal control systems.
To ensure the propriety of business operations of the Group’s operating subsidiaries, the Company
applies the Tonami Group Employee Code of Conduct and the Group Operation Regulations to all
operating subsidiaries of the Group, and each of the Group’s operating subsidiaries has established
its own regulations based on them.
With regard to administration of operating subsidiaries, the Group Company Administration
Procedures specify matters requiring approval by the headquarters and those to be reported.

05

2) The Relationship between the Management Organization and Internal Control
General Meeting of Shareholders
Election

Election

Auditing

Attorney

Board of Directors(Representative directors)(Directors)

OpinionSupervision

Election

Board of Corporate Auditors(Corporate auditors)(Outside corporate auditors)
Reporting

Reporting

Independent auditors

Internal Audit Office
Auditing

ReportingBusiness Execution
Internal Control Committee(Internal Control Office)Internal auditing

Business Strategy OfficeBusiness Planning OfficeCompliance Committee

Human Resource
Management Group

Business Administration Group

Business Risk Management
Committee

Internal
controlInternal
controlPlanformulation,
reporting

Policypresentation,plan approvalGroup operating subsidiaries

3) Description of Management Organization and State of Development of Internal Control Systems
With regard to the design of its internal control systems, the Company has established a basic policy
concerning business risk management for the Tonami Holdings Group and is working to appropriately respond to various types of risk that might affect the operation of operating subsidiaries, inorder to stabilize the fundamentals of the Group and, should a business risk materialize, to minimize
the impact and as far as possible ensure that neither a business loss nor a social loss is incurred.
The Company recognizes the importance of legal compliance and has established the Compliance
Committee to ensure compliance. The Group’s operating subsidiaries have appointed compliancepromotion officers to inculcate corporate ethics and compliance among their officers and employees.
The compliance promotion officers conduct education and hold briefings concerning compliance.
Within the Company, activity plans etc. are required to be reported to the Compliance Committee
to enable potential violations in the course of business activities to be detected in advance and theiroccurrence prevented. This system enables swift correction of any violations that occur and implementation of measures to prevent recurrence.
The executive officers strive to promptly execute business in accordance with the basic policy
decided by the Board of Directors. The Board of Directors obtains and refers to advice from certified
public accountants, attorneys, and other specialists concerning compliance matters related to management, as necessary.

06

The Company has put in place a structure enabling a rapid response to changes in the businessenvironment and strives to ensure sound management. To this end, the Group’s operating subsidiaries have established their own regulations based on the Group Operation Regulations and theCompany conducts administration of the Group’s operating subsidiaries in accordance with theGroup Company Administration Procedures that specify matters requiring approval by the headquarters and those to be reported.
The Internal Audit Office conducts internal audits to verify whether business is executed appropriately and efficiently. It reports to the corporate auditors and the Board of Directors.

4) State of Internal Auditing and Auditing by Corporate Auditors
The Internal Audit Office (five personnel) of the Company is an internal auditing unit independentof the business units and its staff assists with the work of the corporate auditors. The Internal Audit
Office’s independence from the Board of Directors is ensured since decisions of the Board of
Directors on Internal Audit Office staff changes require approval of the Board of Corporate Auditors.
The Internal Audit Office conducts periodic and unscheduled internal audits of the Company’sbusiness, reports to the Board of Corporate Auditors and the Board of Directors, and requests
improvements.
The Company’s corporate auditors exchange information with the independent auditors, cooperate with the Internal Audit Office, conduct appropriate audits, and hold periodic meetings of theBoard of Corporate Auditors.
One standing corporate auditor and three outside corporate auditors possess significant expertise
concerning financial and accounting matters gained through their experience over many years.

5) Relationships between Outside Directors and Outside Corporate Auditors
No outside directors are appointed by the Company.
In accordance with the provisions of Paragraph 3, Article 335 of the Companies Act, five corporate
auditors, including standing and part-time corporate auditors, are appointed by the Company, threeof whom are outside corporate auditors, and therefore uninvolved in the execution of the business of
the Company, who conduct auditing from a third-party standpoint in order to strengthen the auditing function.
The Company considers that outside corporate auditors who do not execute business and are
independent are conducting appropriate auditing of the supervisory function of the Board of
Directors, which is the main function of the Board of Directors.
Three outside corporate auditors are appointed by the Company. Their function is to state appropriate opinions, as necessary, as experienced experts. The role of outside corporate auditors is tocontribute to enhancement of transparency and accountability of the Board of Directors throughauditing of the compliance of the directors by attending meetings of the Board of Directors and otherimportant meetings, by offering their opinions, and by other means.

07

The Company considers individuals who have no personal, capital, or business relationships with
the Company or other interests in the Company, possess expertise, and are capable of overseeing
management based on excellent insight to be suitable for election as outside corporate auditors.
None of the three outside corporate auditors have any of the above-mentioned relationships with
the Company. The Company appointed one of the three outside corporate auditors as an independent officer as required by the Tokyo Stock Exchange and has notified the Tokyo Stock Exchange
accordingly.
Although Outside Corporate Auditor Mr. Yohji Ishiguro, who is the independent officer appointed
by the Company, owns shares of the Company, the capital relationship between him and theCompany is negligible and he has no business relationships with the Company or other interests in
the Company.
Outside Corporate Auditors Mr. Shinichiro Inushima and Mr. Toshio Kaido have no capital or
business relationships with the Company or other interests in the Company.
The Company has concluded limited liability contracts with the outside corporate auditors. The
outside corporate auditor’s liability for damages is limited to the sum of compensation and other feesthat the outside corporate auditor received from the Company during his/her term of office or thesum of property benefits that he/she is to receive for each fiscal year, whichever the higher.
Internal structure as an alternative to a structure under which outside directors areelected and reasons for adopting such a structure
The Company has adopted a “company with auditors and with board of auditors” system as its corporate governance structure based on the judgment that management by the Board of Directors
consisting of internal directors who are well versed in the Company’s operations is suitable for theCompany, which is a logistics company. Meanwhile, the Company is enhancing the effectiveness of
the audit function of corporate auditors.
Regarding management transparency, the Company believes that a structure is in place that canfully function in terms of management supervision because the Company has appointed three independent outside corporate auditors.

08

(2) State of Development of the Risk Management Structure

In accordance with the Tonami Group Business Risk Management Regulations, the president serves
as the Chief Risk Management Officer, risk management officers are appointed for each type of risk,
and a risk management structure is established. In the event of unforeseen circumstances, in accordance with the Tonami Group Large-scale Disaster Response Regulations and the Tonami Group
Emergency Response Regulations, the Company will establish an Emergency Response
Headquarters, which will be headed by the president. The Company will mount a rapid and appropriate response in accordance with the regulations and put in place a structure to prevent the spreadof damage and minimize damage.
To ensure the propriety of business operations of the Group’s operating subsidiaries, the Company
has established the Tonami Group Employee Code of Conduct, consisting of action guidelines, and
the Group’s operating subsidiaries have established regulations based on the code of conduct.
With regard to administration of the Group’s operating subsidiaries, matters requiring approval by
the headquarters and those to be reported are specified in the Group Company Administration
Procedures and management of operations is in accordance with the Group Operation Regulations.
In the event that a director discovers a violation of the law or any other important matter related
to compliance in an operating subsidiary of the Group, the director is required to report the matterto a corporate auditor. In the event that an operating subsidiary of the Group finds that the administration by the Company or management instructions issued by the Company violate the law or
becomes aware of any other compliance-related problem, the subsidiary is required to report thematter to the Internal Audit Office. In such a case, the Internal Audit Office promptly reports thematter to a corporate auditor and the corporate auditor receiving the report may express an opinion
and request improvement measures.
The Company has established the Tonami Group Internal Reporting Regulations and operates aninternal reporting system concerning violations of the law and other matters related to compliancecovering the entire Tonami Holdings Group.
The Company will have no relationships with antisocial forces. The Company will take resoluteaction against any undue claims or actions by antisocial forces on the basis of cross-organizational
cooperation in close collaboration with the police and other external specialist organizations and will
never provide any benefit to antisocial forces.

09Corporate Social Responsibility Activities

Basic Policy on Corporate Social Responsibility
Adhering to the action principle “Ensure compliance throughout business activities,” the Tonami Holdings Groupendeavors to create value through the logistics business and fulfill its corporate social responsibility (CSR).
It is essential to ensure transportation safety, accord consideration to the environment, ensure legal compliance andcompliance with other rules, respect human rights, and contribute to local communities. As a logistics expert, we arecommitted to fulfilling these responsibilities by adhering to corporate ethics, ensuring compliance with laws and regulations, and enhancing corporate governance.
The Group is making a concerted effort involving all employees to minimize the waste of energy throughout its
business activities. This effort involves improved logistics efficiency, our initiative to promote environmentally friendly
driving through the introduction of digital tachographs, and joint delivery.
As the actions of human beings have environmental impacts, environmental protection, not least initiatives toreduce CO2 emissions, has risen to the top of the global agenda.
Constraints on electricity supply in the aftermath of the Great East Japan Earthquake spurred concerted efforts tominimize the consumption of electricity. Moreover, the disruption caused by the earthquake brought home theimportance of business continuity planning, prompting companies to construct back-up systems for their missioncritical information. The Group is working to enhance the information security of its Internet data center (IDC) business. An important milestone in that regard was the Group’s gaining of ISMS certification for its information security
management system.
We are reinforcing our commitment to CSR by executing socially responsible business activities in accordance with
our mission.
With an eye to the prosperity and quality of life of future generations, the Group endeavors to achieve sustainablegrowth of the business while minimizing environmental impacts. In this way, we are striving to fulfill our social
responsibility.
Principal CSR Initiatives and State of Implementation
Environmental Protection Activities
Recognizing that environmental protection is a crucially important theme
that concerns the maintenance of the ecosystem, adhering to our principle—“Contribute to society through transportation and strive to protect
the environment”—we will act in accordance with the following policies.
1. We will do the following to mitigate environmental pollution associatedwith transportation services:(a) We will introduce environmentally friendly vehicles.
This truck runs on natural gas(b) We will practice environmentally friendly driving.
(c)	We will create eco-friendly distribution systems through more efficient distribution.
(d) We will establish a recycling system to contribute to establishment of a recycling-based society.
Annual social and(e) We will promote development and provision of environmentally friendly products.
environmental report(f)	We will make continuous efforts to save resources and energy and to achieve improvements
every day.
2. We will ensure compliance with environment-related laws and regulations at the national and municipal levels and other requirements that the Company undertakes to fulfill in its efforts to protect theenvironment.
3. We will set specific environmental objectives and environmental goals, conduct periodic reviews, andwork to achieve continuous improvement of environmental management systems.
4. We will communicate these policies to all employees through internal environmental education andawareness-raising initiatives, and we will disclose these policies to the public. We will also vigorously
participate in environmental protection activities in local communities.

Encouraging local people to take up
badminton

Social Contributions
We are eager to contribute to local communities through various activities as a corporate citizen.
Our social contribution activities include participation involuntary clean-up campaigns, such as “neighborhood adoption” programs promoted by local government, and the donation of vehicles to social welfare facilities through theestablishment of the General Incorporated Association“Tonami Shozyukai.”A clean-up in progress
We transport relief supplies when natural disasters occur. The
Tonami Transportation Badminton Club offers badminton coaching as a local sports promotion activity.
10Financial Section

12

Consolidated Five-Year Summary

13

Consolidated Financial Review

16

Consolidated Balance Sheets

18

Consolidated Statements of Income and Consolidated Statements of Comprehensive Income

19

Consolidated Statements of Changes in Net Assets

20

Consolidated Statements of Cash Flows21

Notes to the Consolidated Financial Statements

11Consolidated Five-Year Summary
TONAMI HOLDINGS CO., LTD
AND CONSOLIDATED SUBSIDIARIES
Years ended March 31

2010

2011

2012

2013

2014

Thousands of
U.S. dollars
2014

Operating revenues¥113,601¥118,979¥117,710¥115,864¥121,129$1,176,932

Operating cost

106,522

111,355

110,069

106,908

111,651

1,084,841

6,345

6,425

6,237

6,188

6,237

60,603Operating income

734

1,199

1,404

2,767

3,240

31,488Net income

702

315

633

1,785

2,370

23,037

3,157

3,504

3,882

4,286

4,361

42,378¥7.73¥3.47¥6.97¥19.67¥26.13$0.2539

4.00

4.00

4.00

5.00

4.50

0.0437¥33,860¥35,723¥33,045¥33,538¥34,204$332,340

Net property and equipment

69,44770,037

71,597

71,856

70,837688,277

Total assets

115,502

117,412116,085

117,189

117,149

1,138,262

Total current liabilities

32,61733,98934,222

36,27937,480364,172

Long-term liabilities, excluding of current portion thereof

37,65638,47835,81733,26630,376295,146

Total net assets

45,22944,94546,04647,64349,292478,944

7,235

7,025

6,762

6,561

6,492

Millions of yen

RESULTS OF OPERATIONS:

Selling, general and administrative expenses

Depreciation expenses
PER SHARE (yen and U.S. dollars):
Net income
Cash dividends
YEAR-END FINANCIAL POSITION:
Total current assets

OTHER YEAR-END DATA:
Number of employees

12Consolidated Financial Review

Forward-looking statements in the discussion below represent the best judgment of the Tonami HoldingsGroup as of the end of the fiscal year under review.

Significant Accounting Policies and Estimates

The consolidated financial statements of the Tonami Holdings Group have been prepared in accordance withaccounting principles generally accepted in Japan. Estimates used in the preparation of the consolidated financial statements that may affect the reported amounts of assets and liabilities on the closing date and the reported revenues and expenses for the reporting period are principally deferred tax assets, the allowance for
doubtful accounts, net defined benefit liability, and income taxes. These estimates are subject to continuous,
reasonable assessment.
Estimates, judgments, and assessments are made on the basis of factors that are deemed reasonable in lightof past performance and conditions. However, since estimates invariably involve uncertainties, actual results
may differ from the estimates.

Analysis of Consolidated Operating Results
Operating Revenues

During the fiscal year ended March 31, 2014, operating revenues increased 4.5% year on year to ¥121,129
million. This result also reflected the Group’s efforts to ensure an appropriate level of freight charges and unit
rates for the mainstay road haulage and freight forwarding operations and for the 3PL services. The last-minute increase in demand before the consumption tax increase also had a positive effect on operating revenues.
Composition of Operating Revenues
Percentage pointchange from theprevious year

Composition

Logistics:
Road haulage operations and freight forwarding operations
Warehousing operations
Harbor transport operations
Information processing business
Sales businesses
Other businesses

+0.2
+0.7
+0.2
−0.7
+0.2
−0.3
−0.1

91.4%
70.3
16.7
4.4
2.5
5.5
0.6

Operating Cost

Operating cost increased 4.4% year on year to ¥111,651 million. As a result, the ratio of operating cost to operating revenues decreased 0.1 percentage points from the previous year to 92.2%. Although there were factors
increasing costs, such as rising prices of diesel oil and raw materials, the Group’s efforts to improve operational
efficiency and reduce facilities costs resulted in enhanced profitability.
Selling, General and Administrative Expenses

Selling, general and administrative expenses increased 0.8% year on year to ¥6,237 million. The ratio of selling,
general and administrative expenses to operating revenues decreased 0.2 percentage points from the previous
year.
As a result, operating income increased 17.1% year on year to ¥3,240 million. The ratio of operating income
to operating revenues was 2.7%, an increase of 0.3 percentage points from the previous year.

Sales of Logistics

Operating Revenues

150(Billions of yen)

150

Sales of Information
Processing Business(Billions of yen)

4

(Billions of yen)

3
100

100

2
50

50

1

0

’10

’11

’12

’13

’14

0

’10

13

’11

’12

’13

’14

0

’10

’11

’12

’13

’14

Net Income

Income before income taxes and minority interests was ¥3,896 million, up 25.1% year on year. Net income rose
32.8% year on year to ¥2,370 million.

Analysis of Cash Flows

Cash and cash equivalents on a consolidated basis for the year under review decreased ¥406 million from theprevious year to ¥9,238 million as a result of net cash provided by operating activities amounting to ¥6,023 million, net cash used in investing activities amounting to ¥2,517 million, and net cash used in financing activities
amounting to ¥3,912 million.
Cash Flows from Operating Activities

Net cash provided by operating activities totaled ¥6,023 million, an increase of ¥386 million from the previous
year.
Principal items were income before income taxes and minority interests amounting to ¥3,896 million anddepreciation and amortization amounting to ¥4,361 million.
Cash Flows from Investing Activities

Net cash used in investing activities totaled ¥2,517 million, a decrease of ¥393 million from the previous year.
The principal item was payments of ¥2,602 million for the purchase of property and equipment.
Cash Flows from Financing Activities

Net cash used in financing activities totaled ¥3,912 million, an increase of ¥2,240 million from the previous
year.
Cash outflows included repayment of long-term debt amounting to ¥3,104 million and redemption of bonds
amounting to ¥3,000 million, and repayment of lease obligations amounting to ¥2,096 million, whereas anincrease in short-term bank loans amounted to ¥2,550 million and proceeds from long-term debt amounted to¥2,200 million.

Analysis of the Financial Position
AssetsCurrent assets were ¥34,204 million, an increase of 2.0% from the previous fiscal year-end. This increase wasmainly attributable to a ¥1,011 million increase in trade accounts receivable despite a ¥404 million decrease in
cash and time deposits.
Non-current assets amounted to ¥82,945 million, a decrease of 0.8% from the previous fiscal year-end. Thisdecrease was mainly attributable to a ¥622 million decrease in buildings and structures and a ¥399 million
decrease in land.
As a result, total assets amounted to ¥117,149 million, virtually unchanged from the previous fiscal year-end.
Liabilities

Current liabilities were ¥37,480 million, an increase of 3.3% from the previous fiscal year-end. This increase wasmainly due to a ¥409 million increase in trade accounts payable, a ¥2,550 million increase in short-term bankloans, and a ¥464 million increase in current portion of long-term debt, whereas current portion of bonds
decreased ¥3,000 million.
Long-term liabilities were ¥30,376 million, a decrease of 8.7% from the previous fiscal year-end. Thisdecrease was mainly attributable to a ¥1,368 million decrease in long-term debt.
As a result, total liabilities amounted to ¥67,857 million, a decrease of 2.4% from the previous fiscal year-end.
Net assets

Net assets amounted to ¥49,292 million, an increase of 3.5% from the previous fiscal year-end. The main factors
were a ¥2,207 million increase in retained earnings as a result of recording net income of ¥2,370 million.

Sales of Other Business

1.5(Billions of yen)

Net Income

Operating Cost andOperating Income
200(Billions of yen)

4

150(Billions of yen)

3
2.0

1.0
100

2

50

1

1.0

0.5

0

3.0

’10

’11

’12

’13

’14

0

’10

’11

’12

’13

Operating cost (Left scale)Operating income (Right scale)

14

’14

0

0

’10

’11

’12

’13

’14

Risk Factors

The principal business of the Tonami Holdings Group is the logistics-related business centering on road haulage
operations and freight forwarding operations. The Group’s business is subject to impacts of fluctuation of theJapanese economy and the world economy, customers’ streamlining of logistics, restructuring, and deteriorationof business results, and suspension of business transactions with customers. The business environment in which
the Group operates entails the risk of difficulty in absorbing cost increases due to such factors as sharp increases
in the price of crude oil and interest rate increases that exceed expectations.
In the event of the occurrence of a major disaster, such as an earthquake, in the regions where the Group
operates, there is a risk that damage to facilities may greatly affect the Group’s business operations.
In the event that the retention, development and recruitment of human resources indispensable for businessexpansion do not progress as envisaged in the plan, strategic tie-ups including acquisitions and capital partnerships do not develop as planned, or that social risks materialize with respect to the Group’s overseas businessexpansion, there may be an adverse impact on the Group’s business activities and business results.
The Group handles a huge amount of customer information and strives to appropriately manage such information. However, in the event of leakage of information owing to trouble concerning safekeeping, the credibilityof the Group may be undermined and claims may be made for damages against the Group. In the event of trouble concerning IT systems caused by a natural disaster, computer virus infection, etc., there may be an adverse
impact on the Group’s business results and financial condition.
There is also a possibility of cost increases due to the strengthening of environmental regulations and for
ensuring compliance with stricter safety regulations, and the increased burden may have an adverse impact on
the Group’s business results and financial condition.
In the event of the occurrence of a serious problem, such as a vehicle accident, there is a risk of loss of customer confidence and public trust that could have an adverse impact on the Group’s business results and financial position.
In the event that impairment becomes necessary in accordance with the impairment accounting applicable to
fixed assets for business use or there is a great change in the estimates of future taxable income and reversal ofdeferred tax assets is required, there may be an adverse impact on the Group’s business results and financial
position.

Strategic Position and Outlook

The Japanese economy is on a moderate recovery track, underpinned by a boost from last-minute demand in
the run-up to the consumption tax hike, domestic demand with public investment and private-sector capital
investment to the fore.
Although the business environment is expected to remain unclear in view of concerns about the slowing
economy owing to the dip in demand in the aftermath of the last-minute spike in demand prior to the consumption tax increase and hikes in prices of oil etc., the moderate recovery of the Japanese economy is expected
to continue, supported by the Japanese government’s economic policies.
In these circumstances, the Group is working to achieve further progress in the structural reform of the business, a key theme of the plan, to wrap up the second year of the Three-year Medium-Term Business Plan as theGroup approaches the final year. We are also eyeing M&A and capital and business alliances with the aim ofachieving the financial performance targets for the final year of the plan.
We are striving to enhance our proposal-driven business capabilities in order to respond to customer needs
for logistics cost reduction centering on the key 3PL services and actively conducting promotional activities
aimed at winning new orders. Furthermore, we are working to enhance operational efficiency of our existing
distribution centers.
We aim to maximize corporate value by securing stable revenues and cash flows over the long term.

Net Cash Used in Investing
Activities

Net Cash Provided byOperating Activities
7(Billions of yen)

0(Billions of yen)

Total Assets andTotal Net Assets
150(Billions of yen)

6
-1

5

100

4
-2
3
50

2

-3

1
0

’10

’11

’12

’13

’14

-4

’10

’11

’12

’13

’14

0

’10

’11

Total assets
Total net assets

15

’12

’13

’14

Consolidated Balance Sheets
TONAMI HOLDINGS CO., LTD.
AND CONSOLIDATED SUBSIDIARIESAs of March 31, 2014 and 2013ASSETS

Thousands of
U.S. dollars(Note 1)
2014

Millions of yen
2014
2013

Current assets:
Cash and time deposits (Notes 10 and 12)¥9,297¥9,701$90,338

Trade receivables:
Notes and accounts (Notes 5 and 12)

21,313

20,191207,084

Less: allowance for doubtful accounts

(75)

(65)

(729)

Investments in lease assets

117

241

1,145

Inventories

613

546

5,956

Deferred tax assets (Note 17)

567

527

5,518

2,370

2,394

23,02834,20433,538332,340Land

40,68641,085395,324

Buildings and structures

21,061

21,684

204,641

Machinery and vehicles

2,134

2,130

20,735

Leased assets

5,792

6,095

56,284

Construction in progress

373

72

3,624

Other

789

787

7,669

70,837

71,856688,277

6,911

6,551

67,149

14

19

143

5,182

5,224

50,353

12,108

11,795

117,645¥117,149¥117,189$1,138,262

Other current assets
Total current assets

Property and equipment (Notes 3, 4 and 6):

Total property and equipment

Investments and other assets:
Investments in securities (Note 13)
Good will
Other
Total investments and other assets
Total assets
The accompanying Notes are an integral part of these statements.

16

LIABILITIES AND NET ASSETS

Thousands of
U.S. dollars(Note 1)
2014

Millions of yen
2014
2013

Current liabilities:
Short-term bank loans (Notes 7 and 12)
Current portion of long-term debt (Notes 4, 7, 12 and 14)
Current portion of bonds (Note 4)
Trade notes and accounts payable (Note 12)
Lease obligations (Note 12)
Income taxes payable
Other current liabilities
Total current liabilities
Long-term liabilities:
Long-term debt, less current portion thereof (Notes 4, 7, 12 and 14)
Lease obligations (Note 12)
Deferred tax liability (Note 17)
Deferred tax liabilities from revaluation reserve for land (Note 6)
Employees’ severance and retirement benefits (Note 15)
Retirement benefits for directors and corporate auditors
Net defined benefit liability (Note 15)
Negative goodwill
Other long-term liabilities
Total long-term liabilities
Total liabilities
Net assets
Shareholders’ equity (Note 16):
Common stock:
Authorized: 299,200,000 shares in 2014
299,200,000 shares in 2013
Issued: 97,610,118 shares in 2014
97,610,118 shares in 2013
Capital surplus
Retained earnings
Treasury stock, at cost: 6,872,859 shares in 2014
6,857,237 shares in 2013
Total shareholders’ equity
Other comprehensive income
Unrealized gain on other securities
Revaluation reserve for landRemeasurements of defined benefit plans (Notes 2 and 15)
Accumulated other comprehensive income (Note 9)
Minority interests:
Minority interests
Total net assets
Total liabilities and net assets

17¥12,940
3,568—
11,773
1,919
870
6,408
37,480¥ 10,390
3,104
3,000
11,341
2,137
607
5,698
36,279$125,729
34,677—
114,399
18,646
8,457
62,264364,172

8,111
4,445
631
4,534
—
113
9,030
76
3,432
30,37667,857

9,480
4,793
317
4,694
12,817
117—892
33,26669,54678,81543,1906,134
44,063—
1,104
87,740745
33,354295,146
659,318

14,182
11,682
18,724

14,182
11,682
16,516

137,803
113,507
181,931(2,021)
42,567(2,018)40,363(19,641)
413,599

1,040
6,035
(461)
6,614

846
6,326
—
7,172

10,11158,643(4,483)64,272

110
49,292¥117,149

107
47,643¥117,189

1,073
478,944$1,138,262

153

Consolidated Statements of Income and Consolidated Statements of Comprehensive Income
TONAMI HOLDINGS CO., LTD.
AND CONSOLIDATED SUBSIDIARIESFor the years ended March 31, 2014 and 2013
Thousands of
U.S. dollars(Note 1)
2014

Millions of yen
2014
2013

Operating revenues (Note 20):
¥121,129¥115,864$1,176,932

121,129

115,864

1,176,932

111,651

106,908

1,084,841

6,237

6,188

60,603

117,889

113,096

1,145,444

3,240

2,767

31,488Interest and dividend income

296

326

2,884

Equity in earnings of unconsolidated subsidiaries and affiliates

68

59

665

Loss on sale of property and equipment, net

101

70

983

Interest expenses

(361)

(487)

(3,513)

Impairment losses (Note 8)

(449)

(61)

(4,368)Gain on negative goodwill

—

117

—

Settlement package

—

(113)

—

Gain on transfer to a defined contribution pension plan (Notes 2 and 15)

792

—

7,697

Other, net

208

436

2,021

655

347

6,370

3,896

3,115

37,858Current

1,243

985

12,082

Deferred

264

334

2,567

1,507

1,319

14,648

2,388

1,794

23,210Operating revenues
Operating costs and selling, general and administrative expenses:
Operating cost (Note 18)
Selling, general and administrative expenses (Note 18)
Operating income (Note 20)
Other income and expenses:

Income before income taxes and minority interests
Income taxes (Note 17):

Net income before minority interests
Minority interests
Net income
Minority interests
Net income before minority interests

17

9

173

¥2,370¥1,785$23,037

17

9

173

2,388

1,794

23,210

194

416

1,885

0

3

2

Other comprehensive income (Note 9):
Valuation difference on other securities
Share of other comprehensive income (loss) of associates accounting for using the equity method
Total other comprehensive income
Total comprehensive income for the year

194

420

1,887

¥2,582¥2,215$25,097¥2,565¥2,205$24,923

17

10

173

Total comprehensive income attributable to:
Owners of the parent
Minority interests
The accompanying Notes are an integral part of these statements.

18

Consolidated Statements of Changes in Net Assets
TONAMI HOLDINGS CO., LTD.
AND CONSOLIDATED SUBSIDIARIESFor the years ended March 31, 2014 and 2013

Millions of yen
Shares ofcommonstock(thousands)

Balance as at April 1, 2012

Cash dividends applicable tothe year (¥4.00 per share)
Net income
Reversal of Revaluation reserve for land
Treasury stock
Net changes in items other thanshareholders’ equity

Balance as at March 31, 2013
Balance as at April 1, 2013

Cash dividends applicable tothe year (¥5.00 per share)
Net income
Reversal of Revaluation reserve for land
Treasury stock
Net changes in items other thanshareholders’ equity

Balance as at March 31, 2014

Commonstock

CapitalsurplusRetainedearnings

Accumulated
Total
Unrealized Revaluation Remeasurements other comof defined prehensive
shareholders’ gain on other reserveincomeequitysecurities
for land benefit plans

Treasurystock

97,610 ¥14,182 ¥11,682 ¥15,007 ¥(2,016) ¥38,855
(363)
1,785
87

(2)

(3)

¥6,413¥—¥6,840

(363)
1,785
87
(2)
419
¥846
¥846

(87)
¥6,326¥6,326

—
¥—
¥—

332
¥7,172¥7,172(242)
90¥107 ¥47,643¥107 ¥47,643

(453)
2,370
290
(3)

—
97,610 ¥14,182 ¥11,682 ¥18,724 ¥(2,021) ¥42,567

Total
net assets¥349 ¥46,045

(363)
1,785
87
(2)

—
97,610 ¥14,182 ¥11,682 ¥16,516 ¥(2,018) ¥40,363
97,610 ¥14,182 ¥11,682 ¥16,516 ¥(2,018) ¥40,363
(453)
2,370
290

¥426

Minority
interests

(453)
2,370
290
(3)
194
¥1,040(290)¥6,035(461)(557)¥(461) ¥6,6142(554)¥110 ¥49,292

Thousands of U.S. dollars (Note 1)
Commonstock

Balance as at April 1, 2013

Cash dividends applicable tothe year ($0.0486 per share)
Net income
Reversal of Revaluation reserve for land
Treasury stock
Net changes in items other thanshareholders’ equity

Balance as at March 31, 2014

CapitalsurplusRetainedearnings

Treasurystock

Accumulated
Total
Unrealized Revaluation Remeasurements other comshareholders’ gain on other reserveof defined prehensive
equitysecurities
for land benefit plansincome$137,803 $113,507 $160,481 $(19,610) $392,181 $ 8,225 $61,466 $
(4,410)23,037
2,823(4,410)23,037
2,823
(32)
(32)

— $69,691

Minority
interests

Total
net assets$1,046 $462,918(4,410)23,037
2,823
(32)

—
1,886 (2,823) (4,483) (5,420)
27 (5,392)$137,803 $113,507 $181,931 $(19,641) $413,599 $10,111 $58,643 $(4,483) $64,272 $1,073 $478,944

The accompanying Notes are an integral part of these statements.

19

Consolidated Statements of Cash FlowsTONAMI HOLDINGS CO., LTD.
AND CONSOLIDATED SUBSIDIARIESFor the years ended March 31, 2014 and 2013

Millions of yen
2014
2013

Cash flows from operating activities:
Income before income taxes and minority interests
Depreciation and amortization
Impairment losses
Gain on disposal of property and equipment
Gain on sales of investments in securities
Loss on devaluation of investments in securities
Loss on devaluation of golf club memberships
Gain on transfer to a defined contribution pension plan
Amortization of goodwill
Gain on negative goodwill
Equity in earnings of unconsolidated subsidiaries and affiliates
Increase in allowance for doubtful accounts
Decrease in net defined benefit liability
Decrease in employees’ severance and retirement benefits
Decrease in directors’ and corporate auditors’ retirement benefits
Increase (decrease) in accrued bonuses to employees
Interest and dividend income
Interest expenses
Increase in trade receivables
Decrease (increase) in inventories
Increase in accounts payable
Increase in accrued consumption taxes
Other, net
SubtotalInterest and dividends received
Interest paid
Income taxes paid
Net cash provided by operating activities

Thousands of
U.S. dollars(Note 1)
2014

¥3,896
4,361
449
(101)
—
4
18
(792)
(58)
—
(68)
149
(562)
—
(3)
109
(296)
361
(1,074)
(66)
387
3
353
7,071
297
(358)
(987)
6,023

¥3,115
4,286
61
(70)
(0)
5
3
—
4
(117)
(59)
54
—
(1,261)
(37)
(9)
(326)
487
(172)
59
413
287
(85)
6,638
326
(516)
(811)
5,637

$37,858
42,378
4,368
(983)
—
39
177
(7,697)
(565)
—
(665)
1,449
(5,465)
—
(37)
1,067
(2,884)
3,513(10,439)
(647)
3,770
32
3,437
68,707
2,892(3,480)(9,593)58,526

Cash flows from investing activities:
Purchase of time deposits
Proceeds from redemption of time deposits
Purchase of property and equipment
Proceeds from sales of property and equipment
Purchase of investments in securities
Proceeds from sales of investments in securities
Purchase of investments in subsidiaries
Proceeds from purchase of shares of subsidiaries resulting in change in scope of consolidation
Investments in loans receivable
Proceeds from collection of loans receivable
Other, net
Net cash used in investing activities(42)
40(2,602)
262
(167)
—
(11)
6
(209)
191
14
(2,517)(34)
22(3,310)
717
(173)
1
(201)
—
(199)
240
25
(2,911)(414)
389(25,288)
2,554(1,631)—(107)
66(2,035)1,860
143(24,465)

Cash flows from financing activities:
Net increase (decrease) in short-term loans
Proceeds from long-term debt
Repayment of long-term debt
Proceeds from bond issuance
Redemption of bonds
Repayments of lease obligations
Purchase of treasury stock
Dividends paid
Dividends paid to minority interests
Net cash used in financing activities

2,550
2,200
(3,104)—(3,000)(2,096)
(3)
(453)
(4)
(3,912)(3,100)165(1,240)5,000—(2,127)
(2)
(363)
(3)
(1,671)

24,777
21,376(30,162)—(29,149)(20,369)(32)(4,410)(43)(38,012)

(406)
9,645
¥9,238

1,053
8,591
¥9,645(3,951)
93,719$89,768

Net (decrease) increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year (Note 10)
The accompanying Notes are an integral part of these statements.

20Notes to the Consolidated Financial Statements
TONAMI HOLDINGS CO., LTD.
AND CONSOLIDATED SUBSIDIARIES

1 Basis of presenting financial statements
The accompanying consolidated financial statements have been prepared based on the accounts maintainedby Tonami Holdings Co., Ltd. (the “Company”) and consolidated subsidiaries in accordance with accounting
principles generally accepted in Japan, which differ in certain respects as to the application and disclosure
requirements of International Financial Reporting Standards.
In preparing these consolidated financial statements, certain reclassifications and rearrangements havebeen made to the Company’s consolidated financial statements issued domestically in order to present themin a format which is more familiar to readers outside Japan. In addition, certain reclassifications have been
made in the 2013 financial statements to conform to the classifications used in 2014.
The consolidated financial statements are stated in Japanese yen, the currency of the country in which theCompany is incorporated and operates. The translations of Japanese yen amounts into U.S. dollar amounts
are included solely for the convenience of readers outside Japan and have been made at the rate of ¥102.92 to
U.S.$1, the approximate rate of exchange at March 31, 2014. Such translations should not be construed as
representations that the Japanese yen amounts could be converted into U.S. dollars at that or any other rate.

2 Summary of significant accounting policies(a) Consolidation

The accompanying consolidated financial statements as of March 31, 2014 include the accounts of theCompany and its 25 (27 in 2013) consolidated subsidiaries and 7 (7 in 2013) affiliates accounted for by theequity method.
Under the control or influence concept, those companies in which the Company, directly or indirectly, isable to exercise control over operations are fully consolidated, and those companies over which the Company
has the ability to exercise significant influence are accounted for by the equity method. Four subsidiaries andone affiliate considered insignificant in view of total assets, operating revenues, net income and retained earnings are excluded from the scope of consolidation and not accounted for by the equity method.
The difference between the cost of an acquisition and the fair value of the net assets of the acquired subsidiary at the date of acquisition is being equally amortized over a period of 5 years after incurred. However, if theamount is immaterial, it is fully charged to income at the date of acquisition.
All significant intercompany balances and transactions have been eliminated in consolidation.
(b) Marketable securities and investments in securities

Securities, except for investments in unconsolidated subsidiaries and affiliates, are classified as trading securities, held-to-maturity securities or other securities. Trading securities are carried at fair value. Held-to-maturity
securities are carried at amortized cost. Marketable securities classified as other securities are carried at fairvalue with any unrealized gain or loss reported as a separate component of net assets, net of taxes.
Non-marketable securities classified as other securities are carried at cost determined by the moving-averagemethod.
Cost of securities sold is determined principally by the moving average method.
(c) Inventories

Inventories are stated at the lower of cost, determined principally by the last purchase price method or partiallyby the specific identification method, or net selling value.
(d) Derivatives

Derivative financial instruments are stated at fair value.
Interest-rate swaps which meet specific matching criteria and qualify for hedge accounting treatment are not
re-measured at market value; however, the differentials paid or received under the respective swap agreements
are recognized and included as interest expense or income.
(e) Property and equipment and intangible assets

Property and equipment are stated at cost. However, under Japanese tax law, capital gains arisen from disposals
and other similar transactions are deducted from the cost of the property and equipment acquired in
substitution.
Depreciation of property and equipment, except for leased assets, is computed by the declining balancemethod over the useful life of the assets as determined by law, except for buildings and structures, which are
depreciated by the straight-line method.
21

The ranges of useful lives of principal property and equipment are as follows:
Buildings and structures 2–67 years
Machinery and vehicles 2–17 years
Leased assets under the finance lease arrangements which do not transfer ownership of the leased assets tothe lessee are depreciated by the straight-line method over the respective lease periods without residual values.
However, if the guaranteed salvage value is specified in the lease contracts, they are depreciated by thestraight-line method considering such salvage value.
(f) Allowance for doubtful accounts

Allowance for doubtful accounts is provided in an amount sufficient to cover possible losses on collection. Saidamount is computed by applying the rate of actual losses on collection experienced in the past with respect togeneral trade receivables and by individually reviewing their collectibility with respect to certain doubtfulreceivables.
(g) Retirement benefits for directors and corporate auditors

Some consolidated subsidiaries provide necessary payments to directors and corporate auditors at the end of
the fiscal year determined according to internal company rules to a reserve for retirement benefits for directors
and corporate auditors.
(h) Accounting method for retirement benefits

Full-time employees of the Company and its consolidated subsidiaries are entitled to a lump-sum payment
upon retirement or severance of employment. In order to provide for the employees’ severance and retirement
benefits, the Company and its consolidated subsidiaries record a net defined benefit liability, which is includedin the liability section of the consolidated balance sheet, based on the estimated amounts of projected benefit
obligation and plan assets at the balance sheet dates. In calculating the retirement benefit obligations, thestraight-line basis is used in determining the amount of the expected retirement benefit obligation attributed toservice performed up to the end of the current fiscal year.
Past service costs are recognized in expenses using the straight-line method over 9 years (a period notexceeding the employees average remaining service years) commencing with the year incurred.
Actuarial gains and losses are recognized in expenses using the straight-line method over 9 years (a period
not exceeding the employees’ average remaining service years) commencing with the year following theiroccurrence.
Certain consolidated subsidiaries use the simplified method whereby the amount that would be required tobe paid if all their eligible employees voluntarily terminated their employment as of the balance sheet date istreated as projected benefit obligation for the calculation of net defined benefit liability and retirement benefit
cost.
Additional information
The Company and certain consolidated subsidiaries transferred part of the lump-sum payment plans to defined
contribution pension plans. ASBJ Guidance No. 1 Guidance on Accounting for Transfer between Retirement
Benefit Plans issued by ASBJ in January 2002 is applied for this transfer. The impact of this change amounting
to ¥792 million is recorded as “Gain on transfer to defined contribution pension plan” in non-operating
expenses.
(i) Foreign currency translation

All monetary assets and liabilities denominated in foreign currencies are translated into yen at the current
exchange rates at the balance sheet date, and any gain or loss on translation is credited or charged to income.
(j) Income taxes

Income taxes consist of corporate income tax, inhabitant taxes and enterprise tax.
The Company and its consolidated subsidiaries recognize tax effects of temporary differences between the
carrying amounts of assets and liabilities for tax and financial reporting.
(k) Cash equivalents

Cash equivalents include deposits placed with banks on demand and highly liquid investments with insignificant risk of changes in value which have maturities of three months or less when purchased.
22

(l) Net income per share

Basic income per share is computed using the weighted-average number of shares of common stock outstanding, which represents the number of issued shares less treasury stock, during each year.
Changes in accounting policies
Effective from the end of the fiscal year ended March 31, 2014, the Company has applied ASBJ Statement No.
26 Accounting Standard for Retirement Benefits and ASBJ Guidance No. 25 Guidance on Accounting Standard
for Retirement Benefits issued in May 2012 (excluding the provisions in Paragraph 35 of the AccountingStandard for Retirement Benefits and in Paragraph 67 of the Guidance on Accounting Standard for Retirement
Benefits). The Company adopted the method of deducting the amount of plan assets from the retirement benefit obligation and recording the difference as net defined benefit liability and recorded unrecognized actuarial
gain or loss in net defined benefit liability.
For application of the standard, the Company followed the transitional treatment specified in Paragraph 37of the Accounting Standard for Retirement Benefits and recorded the effect of the change as remeasurement ofdefined benefit plans in accumulated other comprehensive income for the fiscal year ended March 31, 2014.
As a result, at the end of the fiscal year ended March 31, 2014, ¥9,030 million was recorded in net defined
benefit liability and accumulated other comprehensive income decreased by ¥461 million. Net assets per sharedecreased by ¥5.09.
Additional information
Regarding ASBJ Statement No. 26 Accounting Standard for Retirement Benefits issued in May 2012 and ASBJ
Guidance No. 25 Guidance on Accounting Standard for Retirement Benefits, the Company intends to apply theamendments relating to determination of retirement benefit obligations and current service costs effective fromthe beginning of the fiscal year ending March 31, 2015.
Due to application of this accounting standard, the amount of retained earnings at the beginning of the fiscal
year ending March 31, 2015 is expected to increase by ¥551 million, and both operating income and income
before income taxes are expected to decrease by ¥45 million.

3 Property and equipment
Property and equipment are stated at the net book value in the consolidated balance sheets. The amounts ofaccumulated depreciation were ¥55,544 million ($539,683 thousand) and ¥55,043 million on March 31,
2014 and 2013, respectively.
Capital gains resulting from disposals and other similar transactions are deducted from the cost of property
and equipment acquired in substitution. The amounts deducted from the cost of property and equipment were¥180 million ($1,750 thousand) and ¥180 million on March 31, 2014 and 2013, respectively.

4 Short-term bank loans and long-term debt(a) Short-term bank loans

Short-term bank loans as at March 31, 2014 and 2013 were as follows:—
Millions of yen
2014
2013

SecuredUnsecured¥2,920
10,020Interest rates range from 0.928% to 1.165%.

23¥3,020
7,370

Thousands of
U.S. dollars
2014$ 28,372
97,357

(b) Long-term debt

Long-term debt as at March 31, 2014 and 2013 was as follows:—
Millions of yen
2014
2013

2.11% ¥3.0 billion unsecured straight bonds due 2013
1.01% ¥5.0 billion unsecured straight bonds due 2016
0.600%-2.520% loans from financial institutions due 2014 to 2018
and thereafter:
SecuredUnsecured
Total
Less: amount due within one year

Thousands of
U.S. dollars
2014

—
5,000

¥3,000
5,000$—48,581

954
5,726
11,6803,568¥8,111

1,052
6,532
15,584
6,104¥9,480

9,272
55,639113,492
34,677$78,815¥

The maturity date of the ¥5.0 billion 1.01% unsecured straight bonds, issued in March 2013 is March 22,
2016.
The annual maturities of long-term debt outstanding as at March 31, 2014 are as follows:—
Year ending March 31,

Millions ofyen

Thousands of
U.S. dollars

2015
2016
2017
2018
2019

¥ 3,568
5,647
2,177
169
117

$ 34,677
54,871
21,155
1,649
1,141(c) Pledged assets

Property and equipment having a net value of ¥13,317 million ($129,399 thousand) was pledged as collateralfor short-term bank loans and long-term debt as at March 31, 2014.

5 Contingent liabilities
As at March 31, 2014, the Company was contingently liable as follows:—
Notes endorsed
OthersMillions ofyen

Thousands of
U.S. dollars

¥17
195

$175
1,898

6 Revaluation reserve for land
In accordance with the Law concerning Revaluation of Land enacted on March 31, 1998, the Company has
revaluated its owned land used for business operations as at March 31, 2000 and reported a revaluation reserve
for land under “Net assets.”
The revaluated book value of land was determined based on the value of land registered on the cadastres ortheir supplementary records, which are provided by the Local Tax Law under the Law Concerning Revaluationof Land, after making reasonable adjustments.
Difference between the fair market value of revalued land at March 31, 2014
and the revalued book value

24

Millions ofyen

Thousands of
U.S. dollars¥11,989$116,495

7 Restrictive financial covenants(1) 	The Company has entered into overdraft facility and credit line commitment agreements (term of contractof three years) with ten banks for the purpose of efficient procurement of working capital.
		 Outstanding balance of unused credit concerning overdraft facility and credit line commitment agreements at March 31, 2014, was as follows:
Maximum credit line of overdraft facility and commitment agreement
Used credit
Total

Millions ofyen

Thousands of
U.S. dollars¥3,000
2,000¥1,000$29,149
19,433$9,716

	The agreements include restrictive financial covenants requiring net assets as of the fiscal year end to exceed
predetermined amount.
(2)	Of borrowings of the Company and certain subsidiaries, syndicated loan agreements (outstanding balance
at March 31, 2014: ¥3,660 million ($35,562 thousand)) include restrictive financial covenants requiring
assets at a fiscal year-end to exceed the predetermined amount.

8 Impairment losses
The Group recorded impairment losses on the asset groups stated below.
Fiscal year ended March 31, 2013
As a comprehensive logistics enterprise, the Group employs management accounting at offices that belong toroad haulage business or other business groups.
The Group’s business sites nationwide are the Group’s bases for offering services as a comprehensive logistics
enterprise to customers and, in many cases, offices of two or more business groups are located at a business site
to respond to customers.
Offices of business groups complement one another and a business site is a unit that generates cash flows.
Thus, the aggregate of assets of business groups’ offices located at a business site constitutes an asset group.
Regarding the asset group for which an impairment loss was recorded, the sum of estimated future cash
flows from the asset group in question is less than its book value owing to an increase in payables to subcontractors and a rise of fuel costs because of increasing crude oil prices. Thus, the book value of the asset group
was reduced to the recoverable amount and the difference amounting to ¥61 million was recognized as impairment losses and reported under other expenses.
The amounts of impairment losses for land and buildings were ¥11 million and ¥50 million, respectively.
For the land and buildings in the asset group in question, the recoverable amount is measured by means of
the net sale value. The net sale value is assessed principally based on the appraisal value quoted by a real-estateappraiser. For immaterial assets, the net sale value is assessed based on the residual book value.
Fiscal year ended March 31, 2014
As a comprehensive logistics enterprise, the Group employs management accounting at offices that belong toroad haulage business or other business groups.
The Group’s business sites nationwide are the Group’s bases for offering services as a comprehensive logistics
enterprise to customers and, in many cases, offices of two or more business groups are located at a business site
to respond to customers.
Offices of business groups complement one another and a business site is a unit that generates cash flows.
Thus, the aggregate of assets of business groups’ offices located at a business site constitutes an asset group.
On the other hand, each idle asset constitutes an asset group.
During the year ended March 31, 2014, the book value of the idle assets was reduced to the recoverable
amount and the decreased amount was recognized as an impairment loss for land amounting to ¥449 million($4,368 thousand) and reported under other expenses.
The recoverable amount is measured by means of the net sale value, which is assessed principally based on
the appraisal value quoted by a real-estate appraiser and the estimated sales amount.

25

9 Consolidated statement of comprehensive income
Reclassification adjustments and tax effects relating to other comprehensive income
Millions of yen
2014
2013

Valuation difference on other securities:
Amount arising during the year
Reclassification adjustment
Before tax-effect adjustment
Tax effect
Valuation difference on other securities
Share of other comprehensive income of affiliates accounted for using equity method:Amount arising during the year
Total other comprehensive income

Thousands of
U.S. dollars
2014¥ 298
—
298
(104)
194

¥ 628
5
633
(216)
416

$2,904—
2,904(1,019)1,885

0¥ 1943¥ 4202$1,887

10 Cash flow statements
Reconciliation of cash and time deposits shown in the consolidated balance sheets and cash and cash equivalents shown in the consolidated statements of cash flows as at March 31, 2014 and 2013 are as follows:—
Millions of yen
2014
2013

Cash and time deposits
Time deposits with maturities exceeding three months
Cash and cash equivalents¥9,297(58)¥9,238¥9,701(56)¥9,645

Thousands of
U.S. dollars
2014$90,338(569)$89,768

11 Leases(a) Finance leases other than those which are deemed to transfer the ownership of the leased assets to the lesseeContents of leased assets:
Tangible fixed assets (mainly, machinery, equipment and vehicles for distribution related business)
Depreciation method:
Leased assets are depreciated by the straight-line method over the respective lease periods without residual
values. However, if the guaranteed salvage value is specified in the lease contracts, they are depreciated by
the straight-line method considering such salvage value.
(b) Finance lease transactions which commenced prior to April 1, 2008 and do not transfer ownership of theleased assets to the lessee are accounted for as operating lease transactions as before.
The following are pro forma amounts of the acquisition costs, accumulated depreciation, accumulated
impairment losses and net book value of leased property if they were capitalized as of March 31, 2014 and2013 for finance leases accounted for as operating leases:—Millions of yen
2014
2013

Acquisition costs:
Machinery and tools
Buildings
Accumulated depreciation:
Machinery and tools
Buildings
Accumulated impairment losses:
Machinery and tools
Buildings

¥ 16
5,833
¥5,850¥2,4735,833¥8,307

$

¥15
2,720
¥2,735¥2,2492,473¥4,723

$

¥

¥—
756
¥756

$

—
756
¥ 756

26

Thousands of
U.S. dollars
2014

163
56,684$56,847
147
26,433$26,580—
7,347$ 7,347

Net book value:
Machinery and tools
Buildings

¥
1
2,357
¥2,358

¥223
2,603
¥2,827$

16
22,904$22,920

Amounts of depreciation expense equivalents and interest expense equivalents for the years ended March 31,
2014 and 2013 are as follows:—
Millions of yen
2014
2013

Depreciation expense
Interest expense

¥246
92

¥521
106

Thousands of
U.S. dollars
2014$2,396902

Lease payments relating to finance leases accounted for as operating leases amounted to ¥427 million ($4,149 thousands) and ¥735 million, which were equal to the depreciation expense of the leased assets computed by thestraight-line method over the lease terms, for the years ended March 31, 2014 and 2013, respectively.
In the year ended March 31, 2006, impairment losses on leased assets amounting to ¥756 million were recorded.
Since these leased assets are off-balance-sheet, the equivalent amount is included in “Other long-term liabilities”.
Impairment losses on leased assets is realized over the lease term. Reversal of impairment losses on leased assets
recorded in the fiscal year ended March 31, 2014 and 2013, amounted to ¥42 million ($408 thousand) and ¥42
million, respectively.
Future minimum lease payments (including the interest portion thereon) and the balance of impairment losses
on leased assets as at March 31, 2014 and 2013 for finance leases accounted for as operating leases are summarized
as follows:—
Millions of yen
2014
2013

Due within one year
Due over one year
Total

¥283
2,778
¥3,062¥378

Impairment losses on leased assets

¥283
3,053
¥3,337¥420

Thousands of
U.S. dollars
2014$2,756
26,995$29,752$3,674(c) Operating leases
Millions of yen
2014
2013

Due within one year
Due over one year
Total

¥269
2,493
¥2,762

¥273
2,753
¥3,026

Thousands of
U.S. dollars
2014$2,615
24,223$26,838

12 Financial instruments and related disclosures(a) Financial instruments
The Group invests cash surplus, if any, in low risk financial assets and raises funds for short-term working
fund by bank borrowings. For capital investment, the Group raises necessary funds in light of capital investment plan by bank borrowings or issuance of corporate bonds. Derivatives are employed to mitigate the riskof fluctuations in interest rates, and not used for speculative purposes.
Trade receivables such as notes and accounts are exposed to customer credit risk. For such credit risk, theGroup has established the risk management system to monitor and control payment term and balances ofcustomers.
Investments in securities such as equity securities are exposed to the market risk of fluctuation in market
prices, but major components are equity securities issued by the business partners and their fair values are
periodically reported to the in-charge directors.
Almost all the trade payables such as notes and accounts payable are due within one year.
Of borrowings, short-term bank loans are used mainly to procure funds for operating transactions andlong-term debt and corporate bonds are used to procure funds for capital investment. For floating-rate debt,
derivative transactions (interest rate swaps) are used as hedges to avoid the risk of interest rate fluctuations
and fix interest payments.
27

The Company executes and manages derivative transactions in accordance with internal rules that specify
transaction authority, and since large borrowings are subject to the decision of the board of directors, theboard of directors also decides whether to enter into a corresponding swap agreements. Moreover, theCompany enters into derivative transactions only with financial institutions with high credit ratings to mitigate counterparty default risk.
Trade payables and loans are exposed to the liquidity risk, but the Group controls such liquidity risk by
the monthly cash management plans prepared by each company.
(b) Fair value of financial instruments
The carrying amount, fair value and the related difference of the financial instruments as of March 31, 2014
and 2013 are as follows:
Financial instruments whose fair values are extremely difficult to determine are not included in the following tables.
Carrying
amountMillions of yen
Fair
value

¥9,297
3,458
17,8544,416¥35,027¥9,297
3,458
17,8544,416¥35,027

¥—
—
—
—
¥—

¥958
10,815
12,940
5,000
6,680
6,364
¥42,758—¥958
10,815
12,940
5,000
6,737
6,595
¥43,046
—

¥—
—
—
0
57
230
¥288
—

Carrying
amountMillions of yen
Fair
value

¥9,701
3,349
16,842
4,102¥33,996¥9,701
3,349
16,842
4,102¥33,996

¥ —
—
—
—
¥ —

¥936
10,405
10,390
8,000
7,584
6,930
¥44,247—¥936
10,405
10,390
7,989
7,663
7,317
¥44,702
—

¥ —
—
—
(10)
79
386
¥455
—

For the year ended March 31, 2014

Assets:Cash and time deposits
Trade receivables – notes
Trade receivables – accounts
Investments in securities (other securities)
Total assets
Liabilities:
Trade notes payable
Trade accounts payable
Short-term bank loans
Bonds
Long-term debt
Lease obligations
Total liabilities
Derivatives
For the year ended March 31, 2013

Assets:Cash and time deposits
Trade receivables – notes
Trade receivables – accounts
Investments in securities (other securities)
Total assets
Liabilities:
Trade notes payable
Trade accounts payable
Short-term bank loans
Bonds
Long-term debt
Lease obligations
Total liabilities
Derivatives

28

Difference

DifferenceThousands of U.S. dollars
Carrying
Fair
Difference
amountvalue

For the year ended March 31, 2014

Assets:Cash and time deposits
Trade receivables – notes
Trade receivables – accounts
Investments in securities (other securities)
Total assets
Liabilities:
Trade notes payable
Trade accounts payable
Short-term bank loans
Bonds
Long-term debt
Lease obligations
Total liabilities
Derivatives$ 90,338
33,606
173,478
42,913$340,335$ 90,338
33,606
173,478
42,913$340,335$ 9,314
105,085
125,729
48,58164,911
61,836$415,456—$ 9,314
105,085
125,729
48,581
65,46664,079$418,255
—

$

$

—
—
—
—
—

$

—
—
—
0
555
2,243
$2,799—

For cash and time deposits, trade notes receivable and trade accounts receivable, the carrying amount is presented as the fair value since the fair value approximates the carrying amount because of the short maturity ofthese instruments.
For investments in securities, the fair value of equity securities is determined using the quoted price of thestock exchanges. Unlisted equity securities whose fair value is extremely difficult to identify in the carrying
amount of ¥2,545 million ($24,728 thousand) are not included in the above table. The unlisted equity securities were restated at fair value and related loss on impairment amounting to ¥104 million ($1,019 thousand)was charged to income for the year ended March 31, 2014.
For trade notes payable, trade accounts payable and short-term bank loans, the carrying amount is presented
as the fair value since the fair value approximates the carrying amount because of the short maturity of these
instruments.
For bonds, lease obligations and long-term debt, the fair value is determined using the present value of
aggregated principal and interest discounted at a rate assumed if the new loans or lease arrangements weremade.
For derivatives, please see Note 14 “Derivative transactions”.
(c) Information about maturities of financial instruments
Annual maturities of monetary receivables and other securities with contractual maturities as of March 31,
2014 and 2013 are as follows:
Millions of yen

For the year ended March 31, 2014

Time deposits
Trade notes receivable
Trade accounts receivable
Investments in securities (other securities with contractual maturities)
Total

Due in one
year

Due after one
year throughfive years

Due after five
years throughten years¥ 9,272
3,458
17,85450¥30,635

¥—
—
—
10
¥10

¥—
—
—
—
¥—

Due in one
year

Due after one
year throughfive years

Due after five
years throughten years¥9,680
3,349
16,842—¥29,872

¥—
—
—
61
¥61

¥—
—
—
—
¥—

Due after
ten years

¥—
—
—
—
¥—

Millions of yen

For the year ended March 31, 2013

Time deposits
Trade notes receivable
Trade accounts receivable
Investments in securities (other securities with contractual maturities)
Total

29

Due after
ten years

¥—
—
—
—
¥—

For the year ended March 31, 2014
Due in one
year

Time deposits
Trade notes receivable
Trade accounts receivable
Investments in securities (other securities with contractual maturities)
Total

Thousands of U.S. dollars
Due after one Due after five
year through years throughfive years
ten years$90,096
33,606
173,478486$297,666

$—
—
—
97
$97

$—
—
—
—
$—

Due after
ten years

$—
—
—
—
$—

Annual maturities of bonds, long-term debt, lease obligations, and other interest-bearing debts as of March 31, 2014
and 2013 are as follows:
Millions of yen

For the year ended March 31, 2014

Short-term debt
Bonds
Long-term debt
Lease obligations
Total

Due in one
year

Due after one
year throughtwo years¥12,940
—
3,568
1,919
¥18,427

¥—
5,000
647
1,554
¥7,202

Due in one
year

Due after one
year throughtwo years¥10,390
3,000
3,104
2,137
¥18,631

¥—
—
3,508
1,461
¥4,969

Due in one
year

Due after one
year throughtwo years$125,729—
34,677
18,646$179,051$—
48,581
6,289
15,108$69,978

¥—
—
169
888
¥1,057

¥—
—
117
444
¥562

Due after
five years

¥—
—
—
300
¥300

Due after two Due after three
years through years throughthree years
four years

¥—
5,000
626
1,124
¥6,750

¥—
—
98
781
¥880

Due after four
years throughfive years

¥—
—
53
398
¥452

Due after
five years

¥—
—
193
1,026
¥1,219

Thousands of U.S. dollars

For the year ended March 31, 2014

Short-term debt
Bonds
Long-term debt
Lease obligations
Total

¥—
—
2,177
1,256
¥3,434

Due after four
years throughfive years

Millions of yen

For the year ended March 31, 2013

Short-term debt
Bonds
Long-term debt
Lease obligations
Total

Due after two Due after three
years through years throughthree years
four years

Due after two Due after three
years through years throughthree years
four years$——
21,155
12,213$33,368

$—
—
1,649
8,630
$10,279

Due after four
years throughfive years

$—
—
1,141
4,320
$5,461

Due after
five years

$—
—
—
2,920
$2,92013 Marketable securities and investments in securities
No trading securities or held-to-maturity securities were held at March 31, 2014 or 2013. Securities classified
as other securities are included in “marketable securities” and “investments in securities” in the accompanying
consolidated balance sheets.
The components of unrealized gain or loss on marketable securities classified as other securities at March
31, 2014 and 2013 are summarized as follows:—
Carrying
value

Millions of yen
2014
Acquisition
costs¥3,784—50¥2,126—50¥1,658—0571—
9¥4,416704—
10¥2,890(132)—(0)¥1,526At March 31, 2014

Unrealized gain:
StocksBonds
Other
Unrealized loss:
Stocks
Bonds
Other
Total

30

Unrealized
gain (loss)

At March 31, 2013
Carrying
value

Unrealized gain:
StocksBonds
Other
Unrealized loss:
Stocks
Bonds
Other
Total

Millions of yen
2013
Acquisition
costs

Unrealized
gain (loss)¥3,209—51¥1,856—50¥1,352—
1

832—
9¥4,102958—
10¥2,874

(125)
—
(0)
¥1,227

Thousands of U.S. dollars
2014
Carrying
Acquisition
Unrealized
value
costs
gain (loss)

At March 31, 2014

Unrealized gain:
StocksBonds
Other
Unrealized loss:
Stocks
Bonds
Other
Total

$36,771—492$20,659—486$16,112
—
6

5,554
—
96
$42,913

6,841
—
97
$28,082(1,286)—(1)$14,831

Equity securities with fair value, classified as other securities, were restated at the fair value and related loss on
impairment in an amount of ¥5 million was charged to income for the year ended March 31, 2013. There was
no impairment for the year ended March 31, 2014.
Equity securities whose fair value is 50% or less than the acquisition cost are necessarily restated at fair value
and those whose fair value is between 50% and 30% of the acquisition cost are restated at fair value, if they are
judged to be unrecoverable considering the trend of the market value for the past certain period and performances of the issuers.
Other securities sold during the year ended March 31, 2013 amounted to ¥1 million, of which a gain on
sales amounted to ¥0 million. There were no such securities during the year ended March 31, 2014.

14 Derivative transactions(a) Derivative transactions to which hedge accounting is not applied
There is no applicable transaction.
(b) Derivative transactions to which hedge accounting is applied
Hedge accounting method: Special treatment for interest rate swaps
Type of transactions: Interest rate swaps:
Fixed rate payment/Floating rate receipt
Major hedged item: Long-term debt
Millions of yen
2014
2013

Contract amount:Contract amount Total
Due after one year
Fair value¥3,660400*¥6,400
3,660*

Thousands of
U.S. dollars
2014$35,5623,887**The fair value is regarded to be included in the fair value of the long-term debt as hedged instruments, since
the interest rate swaps which qualify for hedge accounting and meet specific criteria are not remeasured atmarket value, but the differentials paid or received under the swap agreements are recognized and included ininterest expenses or income (special treatment).

31

15 Employees’ severance and retirement benefits
For the year ended March 31, 2014(a) Outline of retirement benefit plans
In order to provide for the employees’ severance and retirement benefits, the Company and its consolidated
subsidiaries have funded and unfunded defined benefit plans and defined contribution plans.
Under the defined benefit corporate pension plans (all of which are funded plans), a lump sum or a pension based on the salary and the service years are paid. However, the Company and certain consolidated
subsidiaries have introduced cash balance plans for the defined benefit corporate pension plans. In theseplans, hypothetical individual employee accounts correspond to the funded amount and the principal of thepension amount for each participant. In each hypothetical individual employee account, the contributions
based on the salary standard and interest amount based principally on the market interest rates are accumulated.
Under the lump-sum payment plans (all of which are unfunded plans), a lump sum based on the salaryand service years are paid as retirement benefits. The Company and certain consolidated subsidiaries transferred part of the lump-sum payment plans to the defined contribution plans.
In the defined benefit corporate pension plans and lump-sum payment plans of certain consolidated subsidiaries, net defined benefit liability and retirement benefit cost are calculated by the simplified method.
(b) Defined benefit plans
Reconciliation of beginning and ending balances of retirement benefit obligation (excluding the plan forwhich the simplified method is applied)
Millions of
yen
2014

Retirement benefit obligation at beginning of year
Service cost
Interest cost
Actuarial gain or loss
Payment of retirement benefits
Decrease due to transfer of to defined contribution pension plan
Retirement benefit obligation at end of year

¥18,376
817
238
(103)
(1,350)(4,061)¥13,918

Thousands of
U.S. dollars
2014$178,551
7,944
2,321
(1,003)(13,118)(39,459)$135,235

Reconciliation of beginning and ending balances of plan assets (excluding the plan for which the simplified
method is applied)
Millions of
yen
2014

Plan assets at beginning of year
Expected return on plan assets
Actuarial gain or loss
Contributions by the Company
Employee contributions
Payment of retirement benefits
Plan assets at end of year

¥4,954
123
206
839
69
(457)
¥5,737

Thousands of
U.S. dollars
2014$48,143
1,204
2,009
8,156
680
(4,441)$55,751

Reconciliation of beginning and ending balances of net defined benefit liability for which the simplified
method is applied
Millions of
yen
2014

Net defined benefit liability at beginning of year
Retirement benefit costs
Payment of retirement benefits
Contributions to the plan
Net defined benefit liability at end of year

32

¥840
90
(72)
(9)
¥849

Thousands of
U.S. dollars
2014$8,168
881
(702)
(91)
$8,256

Reconciliation of ending balances of retirement benefit obligation and plan assets and the net defined benefit liability/asset on consolidated balance sheet
Millions of
yen
2014

Funded retirement benefit obligation
Pension assets
Unfunded retirement benefit obligation
Net amount of liability (asset) on consolidated balance sheet
Net defined benefit liability
Net defined benefit asset
Net amount of liability (asset) on consolidated balance sheet¥ 7,596(5,877)
1,719
7,311
9,030
9,030
—
¥ 9,030

Thousands of
U.S. dollars
2014$ 73,809(57,106)
16,704
71,03787,74087,740—$ 87,740

Note: Including the plans for which the simplified method is applied
Retirement benefit costs and breakdown
Millions of
yen
2014

Service cost (Note 1)
Interest cost
Expected return on plan assets
Amortization of actuarial gain or loss
Amortization of prior service cost
Retirement benefit costs calculated by the simplified method
Retirement benefit costs for defined benefit plans
Loss due to transfer to defined contribution plan (Note 2)

¥ 747
238
(123)
410
(112)
90
1,251
(¥ 792)Thousands of
U.S. dollars
2014$ 7,264
2,321(1,204)
3,993(1,093)881
12,163($ 7,697)(Note 1) Employee contributions to the corporate pension fund are not included in the amounts shown.
(Note 2) Recorded in non-operating expenses
Items recorded in other comprehensive income
Breakdown of items recorded in remeasurements of defined benefit plans (before tax effect deduction)

Unrecognized actuarial gain or loss
Total

Millions of
yen
2014

Thousands of
U.S. dollars
2014

¥716
¥716

$6,959$6,959Plan assets
Plan asset components as a percentage of total plan assets
2014

Bonds
StocksInsurance company general accounts
Cash and time deposits
Other
Total

48.6%
26.8
12.5
2.9
9.2
100.0%

Long-term expected rate of return on plan assets is determined considering the pension asset allocation andlong-term expected return on plan assets composed of various types of assets, at the present and in the
future.
Basis of actuarial calculation
2014

Discount rateLong-term expected return on plan assets

1.3%
2.5%
33

(c) Defined contribution plan

Required contributions to the defined contribution pension plan

Millions of
yen
2014

Thousands of
U.S. dollars
2014

¥96

$939

(d) Other items related to retirement benefits
The impact of the partial transfer from the lump-sum payment plan to the defined contribution plan
(before tax effect deduction) was as follows:

Decrease in retirement benefit obligation
Unrecognized actuarial gain or loss

Millions of
yen
2014

Thousands of
U.S. dollars
2014¥4,061
119$39,459
1,165

The amount of assets to be transferred to the defined contribution pension plan is ¥3,149 million ($30,597
thousand), which is to be transferred in eight years.
The assets that have not been transferred to the defined contribution pension plan at March 31, 2014
amounting to ¥3,149 million ($30,597 thousand) were recorded as accounts payable-other (other current liabilities) and long-term accounts payable (other long-term liabilities).
For the year ended March 31, 2013(a) Outline of retirement benefit plans
In order to provide for the employees’ severance and retirement benefits, the Company and its consolidated
subsidiaries have funded and unfunded defined benefit plans and defined contribution plans.
Under the defined benefit corporate pension plans (all of which are funded plans), a lump sum or a pension based on the salary and the service years are paid. However, the Company and certain consolidated
subsidiaries have introduced cash balance plans for the defined benefit corporate pension plans. In theseplans, hypothetical individual employee accounts correspond to the funded amount and the principal of thepension amount for each participant. In each hypothetical individual employee account, the contributions
based on the salary standard and interest amount based principally on the market interest rates are accumulated.
Under the lump-sum payment plans (all of which are unfunded plans), a lump sum based on the salaryand service years are paid as retirement benefits.
In the defined benefit corporate pension plans and lump-sum payment plans of certain consolidated subsidiaries, net defined benefit liability and retirement benefit cost are calculated by the simplified method.
(b) Projected benefit obligation and the funded status of the plans
Millions of yen
2013

Projected benefit obligation
Plan assets
Net unrecognized amount
Employees’ severance and retirement benefits(Note) Including the plans for which the simplified method is applied

34¥(19,355)
5,093
1,444
¥(12,817)

The net unrecognized amounts were as follows:—
Millions of yen
2013

Unrecognized benefit obligation:
Adjustment for actuarial assumptions
Past service cost
Net unrecognized amounts¥1,557(112)¥1,444(c)	Components of net periodic pension and severance costs excluding the employees’ contributory portion
Millions of yen
2013

Service cost
Interest cost on projected benefit obligation
Expected return on plan assets
Amortization of adjustment for actuarial assumptions
Amortization of past service cost
Net periodic pension and severance costs

¥856
241
(96)
256
(674)
¥582

(Note 1) Employee contributions to the corporate pension fund are not included in the amounts shown.
(Note 2)	Retirement benefit expenses of consolidated subsidiaries that use the simplified method are recorded
in “service cost.”(d) Assumptions used
2013

Discount rate
Expected rate of return on plan assets

1.3%
2.5%

16 Net assets
The Company Law provides that an amount equal to at least 10% of the aggregate amount to be distributed as
cash dividends or cash appropriations must be transferred to the legal reserve until the additional paid-in capital, which is part of the capital surplus account, and the legal reserve, which is part of retained earnings, equals
25% of the common stock account.
Transfers from the legal reserve to common stock, additional paid-in capital, and other reserves may be madeby resolution of the shareholders.
Under the Company Law, distributions of reserves to shareholders may be made at any time by resolution of
the shareholders.
The Company’s Articles of Incorporation also provide that the Board of Directors may make distributions toshareholders based on a resolution of the Board of Directors, provided that such distributions are limited toonce per fiscal year.
Information concerning changes in net assets

Treasury stock
Class of shares

Common stock (shares)

At March 31, 2013

Increase

Decrease

At March 31, 2014

6,857,237

15,622—

6,872,859

Reason for the change:
The increase attributable to the purchase of shares less than one unit: 15,622 shares

17 Income taxes
As described in Note 2(j), the Company and its consolidated subsidiaries recognizes tax effects of temporary
differences between the carrying amounts of assets and liabilities for tax and financial reporting.
Significant components of deferred tax assets and liabilities were as follows:—

35

Millions of yen
2014
2013

Deferred tax assets:
Provision for bonuses
Provision for retirement benefits
Net defined benefit liability
Accounts payable upon transfer to defined contribution pension
Accumulated loss on impairment of property and equipment
Accumulated loss on impairment of leased assets
Other
Gross deferred tax assets
Valuation allowance
Total deferred tax assets
Deferred tax liabilities:
Unrealized gain on other securities
Reserve under Special Taxation Measures Law
Total deferred tax liabilities
Net deferred tax assets

Thousands of
U.S. dollars
2014

¥424
—
2,991
1,120
2,637
133
1,182
8,489
(3,806)
4,683

¥411
4,618
—
—
2,692
150
1,171
9,043
(4,114)4,929$4,122—29,067
10,88525,624
1,300
11,48682,485(36,981)
45,504(483)(4,263)(4,746)¥(63)(378)(4,341)(4,719)¥ 209(4,694)(41,426)(46,120)$(616)

Income taxes applicable to the Company consist of corporate income tax, inhabitant taxes and enterprise tax.
Significant differences between the statutory tax rate and the Company’s effective tax rate after applying thedeferred tax accounting for the years ended March 31, 2014 and 2013 were as follows:—

Statutory tax rate:
Increase (reduction) in tax resulting from:
Nondeductible expenses including entertainment, etc.
Nontaxable income including dividends received deduction, etc.
Per capita portion of inhabitant taxes
Equity in earnings of affiliates
Elimination of dividends received from consolidated subsidiaries, etc.
Gain on negative goodwill
Change in valuation allowance related to deferred tax assets
Adjustment of deferred tax assets following a change in statutory tax rates
Other
Effective tax rate

2014

2013

37.75%

37.75%

1.74(3.86)
6.11(0.66)
3.43—(6.15)
1.81(1.48)
38.69%

1.95(3.93)
7.45(0.72)
3.52(1.42)(1.63)—(0.57)
42.40%

18 Supplementary income information
Supplementary income information for the years ended March 31, 2014 and 2013 is as follows:—
Millions of yen
2014
2013

Depreciation expenses
Lease and rental

Thousands of
U.S. dollars
2014¥4,286
4,911¥4,361
5,093$42,378
49,48619 Amounts per share
Amounts per share of common stock for the years ended March 31, 2014 and 2013 were as follows:—
Yen

Net income per share:
Basic
DilutedCash dividends
Net assets per share:

36

2014

2013

¥ 26.13—
4.50¥542.03¥ 19.67—
5.00¥523.80

U.S. dollars
2014

0.2539—0.0437$5.2665

Basis for the calculation of net assets per share for the years ended March 31, 2014 and 2013 were as follows:—
Thousands of
U.S. dollars
2014

Millions of yen
2014
2013

Total net assets as reported on the consolidated balance sheets
Deduction from total net assets:
Minority interests
Adjusted net assets allocated in common stock
Number of shares of common stock outstanding at the end ofyear on which net assets per share is calculated (shares)¥49,292¥47,643$478,944

110¥49,182

107¥47,535

1,073$477,871

90,737,259

90,752,881

Basis for the calculation of basic and diluted net income per share for the years ended March 31, 2014 and2013 was as follows:—
Thousands of
U.S. dollars
2014

Millions of yen
2014
2013

Net income
Net income not available to shareholders of common stock
Net income available to shareholders of common stock
Weighted-average number of shares of common stock outstanding (shares)¥2,370—¥2,37090,748,092¥1,785—¥1,78590,759,737$23,037—$23,037

20 Segment information(1)	Overview of reportable segments
	The Company’s segments are the Group’s components for which discrete financial information is available
and whose operating results are regularly reviewed by the Company’s board of directors to make decisions
on the allocation of resources to the segments and to assess their performance.
		 The Group, in doing business, classifies business models of operating companies, which are under theCompany (pure holding company), according to the nature of services and formulates comprehensive strategies for individual business models.
		 Therefore, the Group consists of segments according to services based on these business models and theGroup’s reportable segments are: Logistics, Information Processing, and Sales.
		 Principal services of the Logistics segment are road haulage, freight forwarding, warehousing, and harbortransport. The principal service of the Information Processing segment is information processing. Principal
services of the Sales segment are merchandising, consignment sales, and a non-life insurance agency.
(2)	Methods of calculating operating revenues, income/loss, assets/liabilities, and other items byreportable segment
	Accounting procedures applied to the reported operating segments are the same as those described in the“Basis of Presenting Consolidated Financial Statements.” Income of reportable segments is on an operating
income basis. Intersegment revenues and transfers are based on market prices.
(3)	Information on operating revenues, income/loss, assets/liabilities, and other items by reportable segment
For the year ended March 31, 2014

Logistics

Operating revenues:
Revenues from outside customers
Intersegment revenues or transfers
Total
Segment income
Segment assets
Other items:
Depreciation
Amortization of
goodwill
Impairment losses

Millions of yen
Reportable segment
Information
processing
Sales

Total

Others(Note 1)

Total

Adjustment(Note 2)

Consolidated(Note 3)

¥110,692¥3,059¥6,616¥120,367¥762¥121,129¥—¥121,12932
110,724¥2,493¥104,991

283
3,342
¥250
¥2,002

5,261
11,878¥432¥9,480

5,577
125,945¥3,176¥116,474

719
1,481
¥85
¥10,969

6,297
127,427¥3,261¥127,443(6,297)(6,297)¥(21)¥(10,293)—
121,129¥3,240¥117,149¥3,896

¥386

¥43

¥4,326¥23¥4,350¥11¥4,361

¥0
¥449

¥18
¥—

¥—
¥—

¥18
¥
449

¥—
¥—

¥18
¥449

¥—
¥—

¥18
¥449

37

Increases in property
and equipment andintangible fixed assets¥4,267

¥387

¥161

For the year ended March 31, 2013

Other items:
Depreciation
Amortization of
goodwill
Gain on negative
goodwill
Impairment losses
Increases in property
and equipment andintangible fixed assets

Reportable segment
Information
processing
Sales¥4,850¥5¥4,855

Total

Others(Note 1)

Total

Adjustment(Note 2)

Consolidated(Note 3)

¥105,728¥2,633¥6,717¥115,079¥785¥115,864¥—¥115,864

36
105,764

281
2,915

4,896
11,614

5,214
120,294

828
1,613

6,043
121,907(6,043)(6,043)—
115,864¥2,058

¥212

¥288

¥2,559¥113¥2,672¥95¥2,767¥105,100¥1,698¥9,409¥116,207¥11,158¥127,366¥(10,176)¥117,189¥3,776

¥431

¥43

¥4,251¥24¥4,275¥10¥4,286

¥

66

¥

14

¥—

¥80

¥—

¥

80

¥

—

¥

¥—
¥
61

¥
¥

—
—

¥117
¥—

¥117
¥61

¥—
¥—

¥
117
¥61

¥
¥

—
—

¥117
¥61

¥5,098

¥127

¥30

¥5,255¥12¥5,268¥9¥5,277

Total

Adjustment(Note 2)

Consolidated(Note 3)For the year ended March 31, 2014

Logistics

Operating revenues:
Revenues from outside customers
Intersegment revenues or transfers
Total
Segment income
Segment assets¥33

Millions of yen

Logistics

Operating revenues:
Revenues from outside customers
Intersegment revenues or transfers
Total
Segment income
Segment assets¥4,816

80

Thousands of U.S. dollars
Reportable segment
Information
processing
Sales

Total

$1,075,517$29,723

316
1,075,833

2,754
32,478$24,225$2,434$4,201 $30,860$833 $31,694$(205) $31,488$1,020,128$19,457$92,115 $1,131,700$106,581 $1,238,281$(100,019) $1,138,262$3,755$422 $42,040$230 $42,270$108 $42,378

$176
$—

$— $180$— $4,368$— $180$— $4,368$— $180$— $4,368$3,769$1,570 $46,799$327 $47,126$54 $47,180

Other items:$37,863
Depreciation
Amortization of$4
goodwill$4,368
Impairment losses
Increases in property
and equipment andintangible fixed assets $41,460$64,287 $1,169,528

Others(Note 1)

51,125
115,41254,195
1,223,723$7,405 $1,176,932
6,993
14,39861,1881,238,120$— $1,176,932(61,188)(61,188)—
1,176,932

Notes:
1. “Others” corresponds to operating segments that are not included in the reported operating segments
and includes automobile repair and direct mail service.
2. Adjustments are as follows:(1) Adjustments of segment income
For the fiscal year ended March 31, 2014 and 2013, adjustments of segment income amounted to¥(21) million ($(205) thousand) and ¥95 million, respectively. Adjustments include intersegment
eliminations and corporate expenses not allocated to any reportable segments.
For the fiscal year ended March 31, 2014 and 2013, the above-mentioned intersegment eliminations amounted to ¥711 million ($6,909 thousand) and ¥720 million, respectively, and corporate
expenses not allocated to any reportable segments amounted to ¥(732) million ($(7,114) thousand)and ¥(625) million, respectively. Corporate expenses are mainly expenses of the Company’s operations that do not belong to any reportable segments.
(2) Adjustments of segment assets
For the fiscal year ended March 31, 2014 and 2013, adjustments of segment assets amounted to38¥(10,293) million ($(100,019) thousand) and ¥(10,176) million, respectively. Adjustments include
intersegment eliminations and corporate assets not allocated to any reportable segments.
For the fiscal year ended March 31, 2014 and 2013, the above-mentioned intersegment eliminations amounted to ¥(20,511) million ($(199,293) thousand) and ¥(19,960) million, respectively,
and corporate assets not allocated to any reportable segments amounted to ¥10,217 million($99,274 thousand) and ¥9,783 million, respectively. Corporate assets are mainly cash and time
deposits and investments in securities of the head office that does not belong to any reportable segments.
(3) Adjustments of increases in property and equipment and intangible fixed assets
For the fiscal year ended March 31, 2014 and 2013, adjustments of increases in property andequipment and intangible fixed assets amounted to ¥5 million ($54 thousand) and ¥9 million,
respectively. Adjustments include intersegment eliminations and corporate assets not allocated to
any reportable segments.
For the fiscal year ended March 31, 2014 and 2013, the above-mentioned intersegment eliminations amounted to ¥(8) million ($(79) thousand) and ¥(3) million, respectively, and corporate
assets not allocated to any reportable segments amounted to ¥13 million ($133 thousand) and ¥12
million, respectively.
3. Segment income is adjusted to operating income in the consolidated financial statements.
(4) Related information
For the year ended March 31, 2014:
1) Information by product and service
Information by product and service is omitted because similar information is presented in the segment
information.
2) Information by geographical area
Not applicable for operating revenues because there are no operating revenues from outside customers
other than those in Japan.
Not applicable for property and equipment because there is no property and equipment located inplaces other than Japan.
3) Information by major customer
Not applicable because, concerning operating revenues from outside customers, no outside customer
accounts for 10% or more of operating revenues in the consolidated financial statements.
For the year ended March 31, 2013:
1) Information by product and service
Information by product and service is omitted because similar information is presented in the segment
information.
2) Information by geographical area
Not applicable for operating revenues because there are no operating revenues from outside customers
other than those in Japan.
Not applicable for property and equipment because there is no property and equipment located inplaces other than Japan.
3) Information by major customer
Not applicable because, concerning operating revenues from outside customers, no outside customer
accounts for 10% or more of operating revenues in the consolidated financial statements.
(5) Information on fixed asset impairment losses by reportable segment
For the year ended March 31, 2014:
Information on fixed asset impairment losses by reportable segment is omitted because similar information
is presented in the segment information.
For the year ended March 31, 2013:
Information on fixed asset impairment losses by reportable segment is omitted because similar information
is presented in the segment information.

39

(6) Information on amortization of goodwill and unamortized balance by reportable segment
For the year ended March 31, 2014

Millions of yen

Logistics

Goodwill:
Amortization
Balance at end of year
Negative goodwill:
Amortization
Balance at end of year

Reportable segment
Information
processing
Sales

Adjustment

Total

¥18

¥—

¥18

¥—

¥—

¥18

¥—

¥ 14

¥—

¥ 14

¥—

¥—

¥ 14

¥76

¥—

¥—

¥ 76

¥—

¥—

¥ 76

¥76

¥—

¥—

¥76

¥—

¥—

¥76

Total

OthersAdjustment

Total

Millions of yen

Logistics

Reportable segment
Information
processing
Sales

¥66

¥14

¥—

¥80

¥—

¥—

¥80

¥—

¥19

¥—

¥ 19

¥—

¥—

¥ 19

¥76

¥—

¥—

¥ 76

¥—

¥—

¥ 76

¥153

¥—

¥—

¥153

¥—

¥—

¥153

OthersAdjustment

Total

For the year ended March 31, 2014
Logistics

Goodwill:
Amortization
Balance at end of year
Negative goodwill:
Amortization
Balance at end of year

Others¥0

For the year ended March 31, 2013

Goodwill:
Amortization
Balance at end of year
Negative goodwill:
Amortization
Balance at end of year

Total

Thousands of U.S. dollars
Reportable segment
Information
processing
Sales
Total

$4

$176

$—

$180

$—

$—

$180

$—

$143

$—

$143

$—

$—

$143

$745

$—

$—

$745

$—

$—

$745

$745

$—

$—

$745

$—

$—

$745

(7) Information on gain on negative goodwill by reportable segment
For the year ended March 31, 2014:
Not applicable
For the year ended March 31, 2013:
In the Sales Segment, consolidated subsidiary Toyo Gomu Hokuriku Hanbai Co., Ltd. became a wholly
owned subsidiary as a result of additional acquisition of its shares by the Company.
Accordingly, a gain on negative goodwill amounting to ¥117 million was recorded in the fiscal year ended
March 31, 2013.

21 Subsequent events
Cash dividends

The annual shareholders’ meeting of the Company, which was held on June 27, 2014, duly approved the payment of dividends as follows:
Cash dividends (¥2.50 per share)

40

Millions ofyen

Thousands of
U.S. dollars¥226$2,204

Consolidated Subsidiaries

Logistics
Company NameBusiness Line

Tonami Transportation Co., Ltd.

Road haulage

Tonami Transportation Shinetsu Co., Ltd.

Road haulage

Tonami Transportation Chugoku Co., Ltd.

Road haulage

Kanto Tonami Transportation Co., Ltd.

Road haulage

Gosei Tonami Transportation Co., Ltd.

Road haulage

Tonami Shutoken Logistics Co., Ltd.

Road haulage

Tonami Kinki Logistics Co., Ltd.

Road haulage

Zento Transportation Co., Ltd.

Road haulage

Ishikawa Tonami Transportation Co., Ltd.

Road haulage

Ibaraki Tonami Transportation Co., Ltd.

Road haulage

Chukyo Tonami Transportation Co., Ltd.

Road haulage

Fukui Tonami Transportation Co., Ltd.

Road haulage

Niigata Tonami Transportation Co., Ltd.

Road haulage

Takefu Transportation Co., Ltd.

Road haulage

Anan Transportation Co., Ltd.

Road haulage

Tonami Global Logistics Co., Ltd.

Harbor transport service

Keishin Warehouse Co., Ltd.

Warehousing

Daiichi Warehouse Co., Ltd.

Warehousing

Information Processing and Others
Company NameBusiness Line

Tonami Trading Co., Ltd.

Trading Company

Toyo Gomu Hokuriku Hanbai Co., Ltd.

Sale of tires

Keishin System Research Co., Ltd.

Development and sale of software

Client Focus Co., Ltd.

Development and sale of software

Tonami Business Service Co., Ltd.

Financial service

Tonami Staff Support Co., Ltd.

Temporary Staffing

Tonami Automobile Technology Research Institute Co., Ltd.

Automobile technology R&D

41

Board of Directors and Corporate Auditors

President and Representative Director
Katsusuke Watanuki
Managing Director
Yasuo Terabayashi

Standing Corporate Auditors
Mitsuo Matsuda
Masafumi Takebe
Corporate Auditors
Shinichiro Inushima
Yohji Ishiguro
Toshio Kaido

Directors
Shigeki Sakamoto
Shigeyuki Okada
Yoshimi Nagahara
Kazuo Takata
Shinichi Izumi
Mitsuharu Wadachi(As of June 27, 2014)

Corporate Data

Head Office2-12, Showa-machi 3-chome, Takaoka,
Toyama Prefecture 933-8788, Japan
Phone: (0766) 32-1073
Fax: (0766) 32-1077

Common Stock¥14,183 million

Tokyo Office8-4, Nihonbashihoridome-cho 2-chome, Chuo-ku,
Tokyo 103-0012, Japan
Phone: (03) 3664-5403
Fax: (03) 3664-5405

Shareholders
6,772

Issued and Outstanding Shares
97,610,118 shares

Date of Established
June 1943

Employees
66(As of March 31, 2014)42

TONAMI HOLDINGS CO., LTD.
URL: http://www.tonamiholdings.co.jp/

Printed in Japan on recycled paper