TO OUR SHAREHOLDERS

The Japanese economy has begun

this network we are adding layers ofto show some encouraging signs ofservices and systems that make life

improvement, despite muted personal

more secure, convenient and comfort-

consumption, as exports and private-able. Rather than providing services

sector capital investment picked up.

individually, we offer them in compre-

Against this backdrop, the SECOM

hensive packages that increase security

Group is forging ahead with measuresand convenience. We are committed toto take the Social System Industry toensuring SECOM is a company tothe next level.

which people can turn with confidence
to meet a wide range of needs.

In the year ended March 31, 2004,

To this end, we are communicating

we concentrated on enhancing existing
services while developing and offering
new services and products to satisfy

with customers to learn what would

Makoto Iida
Founderemerging needs. We also strove to capitalize on Grouphelp them in their daily lives, and using

their perspectives to develop creative new offerings.

synergies to create innovative service packages. These

As society’s needs diversify, we have responded byefforts resulted in a 3.3% increase in consolidated rev-expanding from security services, our starting point, toenue and other income, to ¥537.9 billion. Net income

encompass medical, insurance, information, GIS and edu-

amounted to ¥23.5 billion, owing to such factors as ancation services. Now we are devoting our full energies

impairment loss on property, plant and equipment andinto tapping the synergies of the emerging Social Systema revision of our pension plans. Net income per share

Industry to achieve further growth. New products andwas ¥104.32.

services must be competitive and unique, and must com-Calculated using Japanese GAAP, SECOM recorded
consolidated revenue of ¥527.4 billion, an increase ofplement the Group’s existing offerings to contribute tothe provision of peace of mind to customers.

0.8%; operating profit and ordinary profit of ¥81.3 billionand ¥76.2 billion—both record highs; and net income ofService Differentiation and Packaging¥41.1 billion, an increase of 15.5%. Net income per share

During the period under review, we continued to use

was ¥181.40. Cash dividends per share of ¥45.00, anour accumulated expertise and leading-edge technologies

increase of ¥5.00, were proposed and approved at thein the security services segment to offer distinctive

general shareholders’ meeting on June 29, 2004.

product and service packages. We provided security
services for commercial establishments by stepping up

Taking the Social System Industry to
the Next Levelefforts to market centralized systems SECOM AX and

The vision of the SECOM Group is to help build a society

SECOM DX, a centralized system that features monitor-that is free from concerns about safety and security,

ing functions; and the fully digital D-CCTV surveillancethrough the establishment of the Social System Industry.

camera system.

The foundation of the Social System Industry is the network we have created to deliver our security services. To

2SECOM IX, which employ advanced image monitoring;

In the home security area, we made real progress
toward evolving SECOM Home Security into a

SECOM—Social System Industry

comprehensive residential system that

Medical institutions are also the target

provides peace of mind. We augmented

market for a medical personnel solutions

our home security lineup by releasing

service, as well as Medical Risk

such physical safeguards as SECOMManagement System, a new system thatAnshin Glass, a high-impact window

helps analyze risks associated withglass with built-in sensors, and theproviding medical care.

SECURIFACE intercom system, which

Insurance is another area in which

employs face detection technologies towe are capitalizing on synergies between

alert occupants to unauthorized visitors.

multiple fields to offer precedent-setting

We also launched Tomahawk Jet Alpha,products. Our insurance services lineup

an automated fire extinguishing system
for home kitchens; SECOM Medical Club,

Toshitaka Sugimachi
Chairman

includes New SECOM Anshin My Car, acomprehensive automobile insurance pol-a membership-based service for homeicy; Security Discount Fire Policy for com-security subscribers that offers access tomercial users of security systems; SECOM

the latest preventive treatments andAnshin My Home for residential security

health care-related services; and SECOM

system subscribers; and MEDCOM, an

Anshin My Home, a comprehensive fireunrestricted cancer treatment policy.
Our information and communication

insurance policy that offers a discount for

related and other services segment

home security subscribers.

includes cyber security and otherWe began selling SECOM MS-3, asecurity system for condominiums that

information-related services, GIS services,can be used for buildings of various

education services, real estate sales andtypes and sizes as a retrofit or a newreal estate leasing. To enhance our infor-installation. In addition, we added asafety-confirmation function to COCOSECOM with Emergency Call, which

Shohei Kimura
President andRepresentative Director

mation product lineup, we launched salesof a noncontact integrated circuit (IC)card-based security system that combines

helped to expand our menu of COCO-SECOM mobile

office access control with cyber security using the same

security services.

card. We also augmented our Secure Data Center, which

In our medical services segment, we focused on mak-offers high-level security for both the physical and cybering our core home medical care services more efficient,realms, by launching a new service that prevents cus-launched SECOM Medical Club as noted above, and intomer information and insider information leaks. In theMay 2004 began offering adult day services for seniorarea of GIS services, we promoted sales of packaged sys-citizens. We continued to expand sales of the SECOM

tems to the private sector. We also used the concept ofUbiquitous Electronic Medical Report (EMR) system for

packaging products and services together in our real

medical institutions. This system combines our medical,

estate sales, offering attractive condominiums that

information security and IT expertise to secure and effi-include security systems, management services andciently manage large volumes of medical report data.

telephone-based home-related consulting services.

3

TO OUR SHAREHOLDERS

A New Executive System and Enhanced
Compliancephilosophy. We firmly believe in breaking throughAt its meeting on May 13, 2004, the Board of Directors ofnurturing radical new business ideas, while also asking,

SECOM passed a resolution to adopt an executive officer“Is this good for society?” This philosophy and these highsystem, a move that will clarify administrative responsibil-standards of conduct, universal among our personnel,

ities and authority, thereby strengthening the Company’s

have made it possible for SECOM to create the services

management structure and ultimately improving cus-and systems that solve problems in society that weretomer services. In addition, we established a Compliancepreviously considered intractable.

stereotypes, shedding old practices and continually

Division to oversee compliance issues throughout theAs security and peace of mind professionals, theSECOM Group. We also produced and distributed thefuture is bright for the SECOM Group. We will continue

SECOM Group Compliance Manual, which sets out inter-to grow our various business segments by seeking newnal guidelines for employee conduct, and set up a hotline

synergies among them and developing integrated pack-to handle queries and provide information and advice onages that inspire customers to turn to us for solutions torelated issues.

a wide range of problems.
Our pledge is to accurately grasp the diverse needs ofSecurity and Peace of Mind Professionals

society, swiftly roll out services that satisfy those needs,

The SECOM Group has entered various business areas—

and in doing so, continue to create value for our share-including security, medical, insurance, information, GIS

holders. We ask for your continued understanding andand education services—in pursuit of its vision of con-support as we transform our vision into reality.

tributing to a society in which all people can live safely
and with peace of mind. The principal factor binding
these disparate disciplines is the unwavering SECOM

Makoto IidaFounder4

July 31, 2004

Toshitaka Sugimachi
Chairman

Shohei Kimura
President and Representative Director