ANNUAL REPORT 2007 - Mitsubishi Logistics · Currently, the Company handles about 1.7 million units...

ANNUAL REPORT 2007Year ended March 31, 2007

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To Our Shareholders

Historical Highlights of Mitsubishi Logistics' 120 Years

Topics

Overview of the Mitsubishi Logistics Group

Independent Auditor’s Report

Consolidated Balance Sheets

Consolidated Statements Of Operations

Consolidated Statements Of Changes In Net Assets

Consolidated Statements Of Cash Flows

Notes To Consolidated Financial Statements

Company Profile

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To Our Shareholders

Historical Highlights of Mitsubishi Logistics' 120 Years

Topics

Overview of the Mitsubishi Logistics Group

Independent Auditor’s Report






Company Profile

1

I am pleased to hereby report the business overview of theMitsubishi Logistics Group for the 204th fiscal term, the yearended March 31, 2007.

During the year under review, the Asian economiesincluding China maintained high growth rates and the U.S. andEuropean economies remained firm. Meanwhile, the Japaneseeconomy continued a gradual recovery as consumer spendingand exports were steady and private-sector capital investmentcontinued to expand.

In these economic conditions, the business environmentsurrounding the Group was relatively positive in our mainstaybusiness segments, “Logistics” and “Real Estate.” For Logistics,freight volumes handled by the warehousing and port and harboroperations tended to increase despite the adverse effects oflogistics rationalization among customers and intensifiedcompetition. For Real Estate, the vacancy rate improved and therent level even increased in several urban areas for the rental ofoffice buildings and commercial facilities.

Under these circumstances, the Mitsubishi Logistics Grouppromoted aggressive marketing activities. In Logistics, wemainly strove to extend distribution center operations forpharmaceuticals and foodstuffs, improve operational efficiencyat the container terminals and enhance sales systems andimprove operational bases in the United States. In Real Estate,we completed and started operation of the Yokohama BayQuarter with commercial complex buildings for lease as part of alarge-scale development project (first stage) in the YokohamaPortside Area, and focused our efforts on securing good tenantsvia renovation of core facilities and enhanced early sales oflarge-scale condominiums in the Yokohama Portside Area.Meanwhile, we endeavored to further improve businessperformance via thorough cost management and efficiencyimprovement of diverse business operations.

As a result, revenue from operations increased for both theLogistics and Real Estate segments over the previous fiscal year,reaching a combined ¥190,111 million, an increase of ¥23,572million, or 14.2%, from the previous fiscal year. Operatingexpenses on the whole increased ¥18,119 million, or 12.1%, yearover year to ¥168,369 million, principally due to an increase ofoperational costs in Logistics and increases in the cost ofproperty for sale in Real Estate. Selling, general andadministrative expenses increased ¥780 million, or 15.0%, yearover year to ¥5,992 million, reflecting an increase in the numberof consolidated subsidiaries.

As a consequence, operating income rose ¥4,672 million, or42.2%, year over year to ¥15,749 million reflecting the increasedrevenue for both the Logistics and Real Estate segments, andordinary income rose ¥4,815 million, or 40.3%, to ¥16,764million, partly due to an improved financial account balance, ona consolidated basis. Consolidated net income surged ¥6,667million, or 86.2%, to ¥14,404 million, from the previous fiscalyear owing to extraordinary gains of ¥4,460 million incompensation money from the cancellation of major tenants at acommercial complex for rent in Kobe and a ¥2,936 million gainon disposal of fixed assets due to the replacement of awarehousing site in Nagoya.

In the coming year, the global economy is anticipated tomaintain stable growth mainly in Europe and Asia despite the

uncertainty of the U.S. economy. The Japanese economy is alsoexpected to remain firm, supported by the increase in capitalinvestment and steady consumer spending despite the concern ofa decline in exports.

In this economic climate, the business conditions of theGroup will likely remain unchanged only with slightimprovements in view of the effects of logistics rationalizationdespite the expected growth in volume in the warehousing andport and harbor operations business and the intensifying marketcompetition in the Real Estate business despite several signs ofan improved supply-demand relationship.

Under these circumstances, the Mitsubishi Logistics Groupwill strive to increase operating income in Logistics andmaintain and improve the growth potential in Real Estate bypromoting redevelopment projects, in line with the five-yearmedium-term management plan that becomes effective in theyear ended March 31, 2007 (FY 2006).

As for the distribution of profits of Mitsubishi Logistics forthe year ended March 31, 2007, we intend to distribute a year-end dividend of ¥7 per share, taking into account operatingresults for the year and including a commemorative dividend of¥2 per share in memory of the Company’s 120th anniversary onApril 15, 2007. As a result, the annual dividend per shareincluding the interim dividend per share totals ¥12, an increaseof ¥2 from the previous year.

For the year ending March 31, 2008, we will follow the basicpolicy of ensuring stable dividends in view of the profit levelalthough net income for the next fiscal year is expected to belower than that for the year under review, when it increasedconsiderably due to temporary factors. Accordingly, unlessexceptional circumstances occur, we intend to distribute anannual dividend per share of ¥12, which is equal to the yearunder review and will consist of an interim dividend per share of¥6 and a year-end dividend per share of ¥6.

We look forward to your continued support andencouragement.

June 2007

Naoshi Ban, President

To Our Shareholders

2

Historical Highlights of Mitsubishi Logistics’ 120 Years

a new era. The Company quicklystarted handling containers atcontainer terminals at the Tokyo andKobe ports.

Currently, the Company handlesabout 1.7 million units (conversion interms of 20-feet containers) at itscontainer terminals annually.

Responses to InternationalizationIn response to the internationaliza-tion of the national economy, theCompany has long promoted freightforwarding services worldwide, forexample, by starting marine cargotransportation in 1968 andinternational air transportation in1971.

As for an overseas presence, theCompany proactively establishedlocal affiliated overseas companies or representative offices inthe United States in 1970, Europe in 1972, East Asia in 1981 andChina in 1986 to expand the global network for internationaldistribution.

Presence in the Real Estate BusinessIn 1969, the Company showed asubstantial presence in the RealEstate business. The Company aimedto effectively utilize land forwarehouses from the viewpoint ofbusinessdiversificationin view of theprogress of

urbanization. Starting with a rentalbuilding for a computer-processing center,the Company has promoted theconstruction of multipurpose rentalbuildings for office and commercial usesand condominiums for sale or rental.

The Company’s total area of realestate for rental/lease as of March 31,2007, was approximately 920,000 m2.

Full-Scale Presence in the Cold Storage WarehousingBusinessThe Company constructed a largecold storage warehouse at Ohi Wharfin Tokyo in 1999 and a similar one atRokko Wharf in Kobe in 2002 (eachin the 30,000-ton storage class), bothof which have become operational asdistribution centers for consumablegoods such as frozen foods andfrozen fruit juices.

Our 120th AnniversaryGiven the incessant progress of globalization and IT innovations,the Company and the Mitsubishi Logistics Group aim to be acorporate group worthy of the company name in the pursuit offurther development by optimizing our accumulated logisticsknow-how and supplying high-quality services in the Logisticssegment. Meanwhile, we strive to strengthen our managementfoundation and increase the corporate value of the Groupthrough positive investments taking advantage of ownedproperties in the Real Estate segment.

Shanghai Linghua LogisticsCo., Ltd.

Tokyo Dia Building

Rendering of theCommercial complex,housing building and

business-use building atthe Yokohama Portside

Ohi Cold Storage Warehouse in Tokyo

Minami-Honmoku Terminalin Yokohama

The Company celebrated its120th anniversary on April 15,2007.

Warehousing Business StartedMitsubishi Logistics Corporationwas established as Tokyo WarehouseLimited Company by taking over thewarehousing business of MitsubishiKawase-ten (predecessor of thecurrent Bank of Tokyo-MitsubishiUFJ, Ltd., and the Company) onApril 15, 1887, in Fukagawa, Tokyo.The initial warehousing area totaledapproximately 5,400 m2.

Thereafter, the Company opened branches in Osaka in 1892,in Kobe in 1902 and then in Tokyo and Yokohama in the TaishoEra. Since then, the Company has endeavored to extend andenhance the warehousing business by addressing thesophistication of the warehousing function to cope with changesin logistics including the new construction of harbors and theextended automobile road network. The Company’s warehousesand other logistics facilities in Japan totaled approximately870,000 m2 as of March 31, 2007.

Construction of Port Warehousing Facilities Completewith Links to Rail TransportIn 1908, the Company built the Wada Terminal, Japan’s firstport warehousing facilities complete with links to rail transport,at the Wada Cape in Kobe (a large-scale one-story building of10,000 m2 and a large landing pier to load/unload goods from/toa berthed large ocean vessel were constructed together withrailroad siding), as the first step in the warehousing and port andharbor operations.

In 1914, the Company completed the Takahama Terminal(currently a part of the KOBE HARBORLAND commercialcomplex), a large warehouse of approximately 30,000 m2 inTakahama, Kobe, and constructed a quay that cansimultaneously accommodate three 10,000-ton-class oceanvessels with the installation of an auxiliary, exclusive-use, in-premises railroad.

Trunk Room Business StartedIn 1931, the Company commencedJapan’s first trunk room business atthe Edobashi Warehouse in Tokyo,which had been completed in 1930.The so-called trunk room was aninnovative service that was featuredin U.S. magazines, and its generaluse expanded after World War II.

Presence in the Truck Transportation BusinessAlong with the rapid extension of a road network after the war,the Company began offering truck transportation services around1955 using several affiliated companies. In 1966, thesecompanies were integrated into a newly established subsidiary,Ryoso Transportation Co., Ltd., to develop a full-fledgedpresence nationwide in the truck transportation business(separate corporations still operate in the Kyushu and Tohokuregions).

Container Terminal Operations StartedIn 1967, ocean freight container transportation using full-container vessels started and international transportation entered

Ohi Warehouse in Tokyo

Edobashi Warehouse in Tokyo(Headquarters Building)

Large-Scale Commercial Complex “Ha•Re” Fully Openedat the KOBE HARBORLAND

The solicitation of new tenants

had been in progress since the

cancellation of previous major

tenants as of July 31, 2006, at the

KOBE HARBORLAND (North

Annex), a large commercial

complex owned by the Company.

The renamed “Ha•Re” commercial complex was fully opened

on March 30, 2007 with new tenants.

“Ha•Re” is an abbreviation of “Harborland Renaissance”

that expresses our strong toward revitalization and has an

implied meaning of a commercial complex defined by fine

weather or the sentiment of pleasure and smiles.

Green Management Certification Acquired at AllDomestic Offices for the Warehousing Business

The Mitsubishi Logistics Group recognizes

the load on the global environment caused by

its business operations and strives to promote

environmental preservation activities such as

the reduction of consumption energy and

exhaust waste and the implementation of

environment-friendly equipment.

As part of these environmental programs,

in March 2007 the Company acquired the Green Management

Certification, which certifies our initiative to environmental

conservation activities and is issued by the EcoMo Foundation

authorized by the Ministry of Land, Infrastructure and Transport,

for all six branches and 22 offices throughout the country. Each

office acquired the certification jointly with subsidiaries and

other operator companies that are in charge of storage, retrieval

and warehousing for the reduction of environmental load

through the overall operation of warehouses.

With the certification as an impetus, the Group intends to

further restrict environmental impact through the i) efficient

utilization of resources and energy, which are essential to

business operations; ii) introduction of more environment-

friendly distribution equipment and facilities; iii) purchases of

environment-friendly merchandise and iv) enhanced reduction of

industrial waste and recycling.

3

Topics

Osaka Sakurajima No. 3 Distribution Center to BeConstructed

The Company will construct the

Osaka Sakurajima No. 3

Distribution Center (four stories

with a total floor area of

approximately 23,000 m2) in

Sakurajima, Osaka, to expand its

pharmaceutical distribution center

operations.

The new Distribution Center, which is only 1 km from the

Hanshin Expressway Universal City Interchange in Sakurajima

Area near central Osaka, will be equipped with the latest

distribution equipment including logistics information systems

such as the Distribution Center System and a Flow Rack with a

picking support system for more efficient unified management of

ordering/order reception, storage of goods, warehousing and

distribution operations. The construction of the Distribution

Center will start in June 2007 with operations scheduled to begin

in April 2008.

Construction of the Tobishima Distribution Center andConsolidation of the Ocean Freight ContainerHandling Facilities in Nagoya Decided

The Company decided to sell the

relevant land and buildings of the

Ohe Warehouse and purchase a

replacement site, which is better

situated in the Tobishima Area

adjacent to the Isewangan

Expressway Tobishima

Interchange from the viewpoint of reorganizing the warehousing

and port and harbor operations of the overall Nagoya district. Its

site area is twice that of the Ohe Warehouse. The Company

intends to construct a new warehouse (the Tobishima

Distribution Center) on the new site and consolidate ocean

freight container handling facilities.

The construction of the Tobishima Distribution Center (five

stories with a total floor area of approximately 27,000 m2 in a

seismic isolation structure) will start in September 2007 and the

Distribution Center is scheduled to become operational in

October 2008.

Rendering of the Osaka SakurajimaNo. 3 Distribution Center

Rendering of the TobishimaDistribution Center

Ribbon-cutting Opening Ceremony

4

Mitsubishi Logistics Corporation

Logistics

Consolidated Subsidiaries (23 companies)

Subsidiaries and Affiliates Accounted for by the Equity Method (10 companies)

Real Estate

Tohoku Ryoso Transportation Co., Ltd.Tokyo Dia Service Co., Ltd.Ryoso Transportation Co., Ltd. Unitrans Ltd.Keihin Naigai Forwarding Co., Ltd.Chubu Trade Warehousing Co., Ltd.Kyokuryo Warehouse Co., Ltd.Shinryo Koun Co., Ltd.Naigai Forwarding Co., Ltd.Kyushu Ryoso Transportation Co., Ltd.Monryo Transport CorporationMitsubishi Logistics America CorporationMitsubishi Warehouse California CorporationShanghai Linghua Logistics Co., Ltd.*Mitsubishi Logistics Thailand Co., Ltd.*P.T. Mitsubishi Logistics Indonesia*

Dia Buil-Tech Co., Ltd.Yokohama Dia Building Management Corporation*Chubo Kaihatsu Co., Ltd.Nagoya Dia Buil-Tech Co., Ltd.Osaka Dia Buil-Tech Co., Ltd.Kobe Dia Service Co., Ltd.Kobe Dia Maintenance Co., Ltd.

Dia Systems CorporationTouryo Kigyo Co., Ltd.Sairyo Service Co., Ltd.Kinko Service Co., Ltd.Meiryo Kigyo Co., Ltd.Ryoyo Transportation Co., Ltd.Hanryo Kigyo Co., Ltd.Hakuryo Koun Co., Ltd.Nippon Container Terminals Co., Ltd.Kusatsu Soko Co., Ltd.

Note: Effective from the 204th fiscal term, the year ended March 31, 2007, those companies marked with an asterisk (*) have been included as consolidated subsidiaries (P.T. Mitsubishi Logistics Indonesia was an affiliate accounted for by the equity method until the previous fiscal year).

Overview of the Mitsubishi Logistics Group (As of March 31, 2007)

Major Businesses Logistics:Warehousing and Distribution: Storage of outsourced cargo in warehouses and bringing in/delivery thereof

to/from warehouses by cargo handlingTrucking: Transportation using trucksPort and harbor operations: Coastal and in-vessel cargo handling at ports and harborsInternational transportation: Handling of international freight deliveries (including marine freight

transportation in Japan)

Real Estate: Buying, selling, leasing, and management of real estate, as well ascontracting of construction work, and design and supervision thereof

6


March 31, March 31,

ASSETS 2007 2006 2007(Millions of yen) (Thousands of U.S. dollars)

(Note 1)

CURRENT ASSETS:

Cash and deposits (Note 2) ¥ 30,310 ¥ 19,768 $ 256,756

Marketable securities (Notes 2 and 3) 3,139 145 26,590

Notes and accounts receivable (Notes 4 and 5) 41,816 41,330 354,223

Allowance for doubtful accounts (103) (113) (873)

41,713 41,217 353,350

Real estate held for sale 1,429 7,599 12,105

Deferred income taxes (Note 6) 2,492 1,727 21,110

Other 801 1,392 6,785

TOTAL CURRENT ASSETS 79,884 71,848 676,696

PROPERTY AND EQUIPMENT (Notes 7, 11 and 14):

Land 44,491 41,829 376,883

Buildings and structures 274,508 264,438 2,325,353

Machinery and equipment 24,818 23,193 210,233

Transportation equipment 6,388 6,310 54,113

Construction in progress 306 3,009 2,592

350,511 338,779 2,969,174

Less accumulated depreciation (199,774) (191,554) (1,692,283)

NET PROPERTY AND EQUIPMENT 150,737 147,225 1,276,891

INVESTMENTS AND OTHER ASSETS:

Investments in unconsolidated subsidiaries and affiliates 5,303 6,253 44,922

Marketable and investments in securities (Notes 3 and 7) 137,989 136,201 1,168,903

Long-term loans receivable 919 919 7,785

Intangible assets 8,804 8,659 74,578


Other 6,565 6,603 55,612

Allowance for doubtful accounts (128) (161) (1,084)

TOTAL OTHER ASSETS 160,959 160,021 1,363,482

¥ 391,580 ¥ 379,094 $ 3,317,069

The accompanying notes are an integral part of these statements.

7

LIABILITIES AND NET ASSETS March 31, March 31,

2007 2006 2007(Millions of yen) (Thousands of U.S. dollars)

(Note 1)

CURRENT LIABILITIES:

Short-term bank loans and current maturities of long-term

debt (Notes 7 and 8) ¥ 15,358 ¥ 9,451 $ 130,098

Notes and accounts payable (Note 5) 28,105 23,796 238,077

Income taxes payable 7,089 2,824 60,051

Other (Note 7) 4,780 6,555 40,491

TOTAL CURRENT LIABILITIES 55,332 42,626 468,717

LONG-TERM LIABILITIES:

Long-term debt, less current maturities (Notes 7 and 8) 33,556 39,733 284,252

Deposits on long-term leases (Notes 5 and 7) 32,923 40,660 278,890

Retirement benefits (Note 9) 12,548 13,346 106,294


TOTAL LONG-TERM LIABILITIES 117,686 130,791 996,916

TOTAL LIABILITIES 173,018 173,417 1,465,633

CONTINGENT LIABILITIES AND COMMITMENTS (Notes 13 and 14)

NET ASSETS

SHAREHOLDERS’ EQUITY:

Common stock

authorized – 440,000,000,000 shares,

issued – 175,921,478 22,394 22,394 189,699

Capital surplus 19,620 19,605 166,201

Retained earnings 118,510 106,164 1,003,897

Treasury stock (512) (388) (4,337)

TOTAL SHAREHOLDERS’ EQUITY 160,012 147,775 1,355,460

VALUATION AND TRANSLATION ADJUSTMENTS

Net unrealized holding gains on securities 58,849 58,321 498,509

Deferred losses on hedges (Note 15) (146) – (1,237)

Foreign currency translation adjustments (1,095) (1,095) (9,276)

TOTAL VALUATION AND TRANSLATION

ADJUSTMENTS 57,608 57,226 487,996

MINORITY INTERESTS 942 676 7,980

TOTAL NET ASSETS 218,562 205,677 1,851,436

¥ 391,580 ¥ 379,094 $ 3,317,069


8


Year ended March 31, Year ended March 31,

2007 2006 2005 2007(Millions of yen) (Thousands of U.S. dollars)

(Note 1)

REVENUE ¥ 190,111 ¥ 166,538 ¥ 156,398 $ 1,610,428

COST OF SERVICES 168,370 150,249 141,107 1,426,260

Gross profit 21,741 16,289 15,291 184,168

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 5,992 5,212 5,170 50,758

Operating income 15,749 11,077 10,121 133,410

OTHER INCOME (EXPENSES):

Interest and dividend income 1,525 1,184 997 12,918

Interest expense (952) (861) (844) (8,064)

Gain on sale of marketable and investments in

securities35 71 372 296

Gain (loss) on revaluation of marketable and investments in

securities267 (358) (500) 2,262

Gain (loss) on disposal of property and equipment, net 2,135 5 (919) 18,086

Equity in earnings of unconsolidated subsidiaries and

affiliates255 297 541 2,160

Indemnity income of exiting commercial facilities for

lease (Note 10)4,460 300 100 37,780

Impairment loss (Note 11) – – (10,717) –

Effect of change in depreciation policy – – (3,430) –

Loss on restructuring (Note 12) – – (144) –

Other, net 423 252 350 3,583

8,148 890 (14,194) 69,021

Income (loss) before income taxes and minority

interests23,897 11,967 (4,073) 202,431

INCOME TAXES (Note 6)

Current 8,810 4,277 4,740 74,629

Deferred 619 (119) (7,125) 5,244

9,429 4,158 (2,385) 79,873

Income (loss) before minority interests 14,468 7,809 (1,688) 122,558

MINORITY INTERESTS IN

EARNINGS OF CONSOLIDATED SUBSIDIARIES (64) (72) (35) (542)

NET INCOME (LOSS) ¥ 14,404 ¥ 7,737 ¥ (1,723) $ 122,016

AMOUNTS PER SHARE: Yen U.S. dollars (Note 1)

Net income (loss) ¥ 82.10 ¥ 45.89 ¥ (10.26) $ 0.70

Diluted net income ¥ – ¥ 43.51 ¥ – $ –

Cash dividends applicable to the year ¥ 12.00 ¥ 10.00 ¥ 8.00 $ 0.10


9


Balance at April 1, 2004 168,447 ¥15,495 ¥12,493 ¥103,054 ¥(260) ¥27,550 ¥ – ¥(1,143) ¥507Net loss for the year – – – (1,723) – – – – –Cash dividends – – – (1,345) – – – – –Bonuses to directors and

corporate statutory auditors – – – (45) – – – – –

Purchase of treasury stock – – – – (82) – – – –Sale of treasury stock – – 10 – 19 – – – –Adjustment from revaluation of

available–for–sale securities – – – – – (779) – – –

Adjustment from translation of foreign currency financial statements – – – – – – – (59) –

Increase in minority interest – – – – – – – – 45Balance at March 31, 2005 168,447 15,495 12,503 99,941 (323) 26,771 – (1,202) 552Net income for the year – – – 7,737 – – – – –Cash dividends – – – (1,514) – – – – –Purchase of treasury stock – – – – (112) – – – –Sale of treasury stock – – 211 – 47 – – – –Adjustment from revaluation of

available–for–sale securities – – – – – 31,550 – – –

Adjustment from translation of foreign currency financial statements – – – – – – – 107 –

Increase in minority interests – – – – – – – – 124Conversion of convertible bonds 7,474 6,899 6,891 – – – – – –

Balance at March 31, 2006 175,921 22,394 19,605 106,164 (388) 58,321 – (1,095) 676Net income for the year – – – 14,405 – – – – –Cash dividends (Note 16) – – – (1,756) – – – – –Bonuses to directors – – – (30) – – – – –Increase due to change in the number

of consolidated subsidiaries – – – 16 – – – – –

Decrease due to change in the number of consolidated subsidiaries – – – (289) – – – – –

Purchase of treasury stock (Note 16) – – – – (136) – – – –Sale of treasury stock (Note 16) – – 15 – 12 – – – –Adjustment from revaluation of

available–for–sale securities – – – – – 528 – – –

Adjustment from revaluationof derivatives – – – – – – (146) – –

Adjustment from translation of foreign currency financial statements – – – – – – – 0 –

Increase in minority interests – – – – – – – – 266Balance at March 31, 2007 175,921 ¥22,394 ¥19,620 ¥118,510 ¥(512) ¥58,849 ¥(146) ¥(1,095) ¥942

Capitalsurplus

Common stock

Retainedearnings

Treasurystock

Net unrealizedholding gainson securities

Deferredlosses onhedges

Foreigncurrency

translationadjustments

Minorityinterests

(Thousandsof shares)

(Millions of yen)

Balance at March 31, 2006 $189,699 $166,074 $ 899,314 $(3,287) $494,036 $ – $(9,276) $5,727Net income for the year – – 122,025 – – – – –Cash dividends – – (14,875) – – – – –Bonuses to directors – – (254) – – – – –Increase due to change in the number

of consolidated subsidiaries – – 135 – – – – –

Decrease due to change in the numberof consolidated subsidiaries – – (2,448) – – – – –

Purchase of treasury stock – – – (1,152) – – – –Sale of treasury stock – 127 – 102 – – – –Adjustment from revaluation of

available–for–sale securities – – – – 4,473 – – –

Adjustment from revaluation ofderivatives – – – – – (1,237) – –

Adjustment from translation offoreign currency financial statements – – – – – – 0 –

Increase in minority interests – – – – – – – 2,253Balance at March 31, 2007 $189,699 $166,201 $1,003,897 $(4,337) $498,509 $(1,237) $(9,276) $7,980

Retainedearnings

Net unrealizedholding gainson securities

Foreigncurrency

translationadjustments

Minorityinterests

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

Capitalsurplus

Commonstock

AmountShares


Treasurystock

Deferredlosses onhedges

10




(Note 1)

CASH FLOWS FROM OPERATING ACTIVITIES:

Income (loss) before income taxes and minority interests ¥ 23,897 ¥ 11,967 ¥ (4,073) $ 202,431

Depreciation and amortization 11,364 11,096 10,586 96,264

Decrease in allowance for retirement benefits (799) (179) (166) (6,768)

Loss (gain) on revaluation of marketable and

investments in securities(267) 358 500 (2,262)

Gain on sales of marketable and investments in securities (35) (71) (372) (296)

Loss (gain) on disposal of property and equipment (2,473) (203) 392 (20,949)

Equity in earnings of unconsolidated subsidiaries

and affiliates(255) (297) (541) (2,160)

Interest and dividend income (1,525) (1,184) (997) (12,918)

Interest expense 952 861 844 8,064

Impairment loss – – 10,717 –

Effect of change in depreciation policy – – 3,430 –

Decrease (increase) in notes and accounts receivable (14,059) (3,329) 561 (119,094)

Decrease (increase) in real estate held for sale 6,170 (4,007) (1,271) 52,266

Increase (decrease) in notes and accounts payable 3,435 1,114 (104) 29,098

Decrease in deposits (8,441) (4,430) (7,678) (71,503)

Other, net (646) 2,311 3,136 (5,472)

Subtotal 17,318 14,007 14,964 146,701

Interest and dividend income received in cash 1,590 1,251 1,055 13,469

Interest expense paid in cash (939) (864) (819) (7,955)

Income taxes paid in cash (4,576) (3,319) (5,217) (38,763)

NET CASH PROVIDED BY OPERATING ACTIVITIES 13,393 11,075 9,983 113,452

CASH FLOWS FROM INVESTING ACTIVITIES:

Cash investment to time deposits (1,039) (768) (763) (8,801)

Cash return from time deposits 662 804 1,482 5,608

Acquisition of property and equipment (13,791) (13,530) (16,165) (116,823)

Proceeds from sales of property and equipment 3,376 1,142 37 28,598

Acquisition of marketable and investments in securities (1,685) (3,994) (5,434) (14,274)

Proceeds from sales of marketable and

investments in securities563 4,228 5,485 4,769

Addition to loans receivable (132) (142) (134) (1,118)

Collection from loans receivable 216 355 350 1,830

Other, net (3) – (495) (26)

NET CASH USED IN INVESTING ACTIVITIES (11,833) (11,905) (15,637) (100,237)


11



(Note 1)

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from short-term bank loans 7,430 7,488 6,930 62,939

Repayments of short-term bank loans (7,553) (7,879) (7,037) (63,981)

Proceeds from long-term loans 765 10,642 400 6,480

Repayments of long-term loans (1,175) (1,439) (691) (9,953)

Repayment from bond redemption funds 13,708 – – 116,120

Payment to bond redemption funds – (13,708) – –

Redemption of bonds – (6,210) (5,000) –

Acquisition of treasury stock (129) (37) (75) (1,093)

Dividends paid (1,758) (1,516) (1,349) (14,892)

Issue of bonds – – 10,000 -

NET CASH PROVIDED BY (USED IN)

FINANCING ACTIVITIES11,288 (12,659) 3,178 95,620

Effect of exchange rate changes on cash and cash equivalents 18 27 (22) 153

NET INCREASE (DECREASE) IN CASH AND

CASH EQUIVALENTS12,866 (13,462) (2,498) 108,988

CASH AND CASH EQUIVALENTS AT

BEGINNING OF YEAR (Note 2)18,361 31,823 34,228 155,536

INCREASE IN CASH AND CASH EQUIVALENTS DUE TO:

Merger of unconsolidated subsidiary with

consolidated subsidiary– – 93 –

Newly consolidated subsidiary at beginning of year 292 – – 2,473

CASH AND CASH EQUIVALENTS AT END OF YEAR (Note 2) ¥ 31,519 ¥ 18,361 ¥ 31,823 $ 266,997


12

NOTE 1 – SUMMARY OF ACCOUNTING POLICIES

BASIS OF PRESENTING CONSOLIDATED FINANCIAL

STATEMENTS

The accompanying consolidated financial statements ofMitsubishi Logistics Corporation (the “Company”) have beenprepared in accordance with the provisions set forth in theJapanese Securities and Exchange Law and its related accountingregulations, and in conformity with accounting principlesgenerally accepted in Japan (“Japanese GAAP”), which aredifferent in certain respects as to application and disclosurerequirements of International Financial Reporting Standards.

The accounts of overseas subsidiaries are based on theiraccounting records maintained in conformity with generallyaccepted accounting principles prevailing in the respectivecountries of domicile. The accompanying consolidated financialstatements have been restructured and translated into English(with some expanded descriptions and the inclusion ofconsolidated statements of changes in net assets for 2006 and2005) from the consolidated financial statements of the Companyprepared in accordance with Japanese GAAP and filed with theappropriate Local Finance Bureau of the Ministry of Finance asrequired by the Securities and Exchange Law. Somesupplementary information included in the statutory Japaneselanguage consolidated financial statements, but not required forfair presentation, is not presented in the accompanyingconsolidated financial statements.

The translation of the Japanese yen amounts into U.S.dollars are included solely for the convenience of readers outsideJapan, using the prevailing exchange rate at March 31, 2007,which was ¥118.05 to U.S. $1. The convenience translationsshould not be construed as representations that the Japanese yenamounts have been, could have been, or could in the future be,converted into U.S. dollars at this or any other rate of exchange.

CONSOLIDATION

In consolidation, all significant inter-company transactions andaccount balances are eliminated. Differences between theacquisition costs and underlying net equities of investments inconsolidated subsidiaries are recorded as goodwill in theconsolidated balance sheets and amortized over five years on astraight-line basis. If the amounts is immaterial, it is fullyrecognized as expenses or income as incurred. The effect onretained earnings and net income of unconsolidated subsidiariesand affiliates not accounted for on the equity method isimmaterial to the consolidated financial statements and thoseinvestments are carried at cost, adjusted for any substantial andnon-recoverable decline in value.

The number of consolidated subsidiaries and affiliatesaccounted for on the equity method at March 31, 2007, 2006 and2005 was as follows:

2007 2006 2005Consolidated subsidiaries 23 19 19Unconsolidated subsidiaries and affiliates under the equity method 10 11 11

CONSOLIDATED STATEMENTS OF CASH FLOWS

In preparing the consolidated statements of cash flows, cash onhand, readily-available deposits and short-term highly liquidinvestments with negligible risk of changes in value andmaturities not exceeding six months at the time of purchase areconsidered to be cash and cash equivalents.

CONVERSION OF ASSETS AND LIABILITIES

DENOMINATED IN FOREIGN CURRENCIES

Receivables and payables denominated in foreign currencies aretranslated into Japanese yen at the year-end rates.

Gains or losses resulting from conversion are credited orcharged to income as incurred.

DERIVATIVES AND HEDGE ACCOUNTING

Accounting standard for financial instruments requirescompanies to state derivative financial instruments at fair valueand to recognize changes in the fair value as gain and lossesunless derivative financial instruments are used for hedgingpurposes.

If derivative financial instruments are used as hedges andmeet certain hedging criteria, the Company and its consolidatedsubsidiaries defer recognition of gains and losses resulting fromchanges in fair value of derivative financial instruments until therelated losses and gains on the hedged items are recognized.

TRANSLATION OF FOREIGN CURRENCY STATEMENTS

The balance sheets of overseas subsidiaries are translated intoJapanese yen at the rate of exchange at the balance sheet date ofthe subsidiaries, which is December 31, 2006, except forshareholders’ equity accounts, which are translated based onhistorical rates. The year-end rate of the subsidiaries is also usedfor translation of income, expenses and net income for the year.The resulting translation adjustments are presented as “Foreigncurrency translation adjustment” in the accompanyingconsolidated financial statements.

ALLOWANCE FOR DOUBTFUL ACCOUNTS

Notes and accounts receivable, including loans and otherreceivables, are valued by providing a reserve by applying apercentage based on the actual rate of bad debts incurred in thepast plus an amount based on individually estimateduncollectible receivables.


13

MARKETABLE AND INVESTMENTS IN SECURITIES

Available-for-sale securities (see explanation (d) below) withavailable fair market values are stated at fair market value.Unrealized gains and unrealized losses on these securities arereported, net of applicable income taxes, as a separate componentof shareholders’ equity. Realized gains and losses on sale of suchsecurities are computed using moving-average cost. Available-for-sale securities with no available fair value are stated atmoving-average cost. Equity securities issued by unconsolidatedsubsidiaries and affiliated companies which are not consolidatedor accounted for using the equity method are stated at moving-average cost.

Upon the accounting standard for financial instruments, allcompanies are required to examine the intent of holding eachsecurity and classify those securities as (a) securities held fortrading purposes (hereafter, “trading securities”), (b) debtsecurities intended to be held to maturity (hereafter, “held-to-maturity debt securities”), (c) equity securities issued bysubsidiaries and affiliated companies, and (d) for all othersecurities that are not classified in any of the above categories(“available-for-sale securities”).

The Company and its consolidated subsidiaries only holdthose securities classified as equity securities issued bysubsidiaries and affiliated companies, and available-for-salesecurities.

If the market value of available-for-sale securities declinessignificantly, such securities are stated at fair market value andthe difference between fair market value and the carrying amountis recognized as loss in the period of the decline. For equitysecurities with no available fair market value, if the net assetvalue of the investee decline significantly, such securities arerequired to be written down to the net asset value with thecorresponding losses in the period of decline. In these cases, suchfair market value or the net asset value will be the carryingamount of the securities at the beginning of the next year.

REAL ESTATE HELD FOR SALE

Real estate held for sale is valued on the specific identificationcost method.

INCOME TAXES

Income taxes consist of corporation, enterprise and inhabitantstaxes. The provision for income taxes is computed based on thepretax income of the Company and each of its consolidatedsubsidiaries with certain adjustments required for consolidatedand tax purposes. The asset and liability approach is used torecognize deferred tax assets and liabilities for loss carryforwardsand the expected future tax consequences of temporarydifferences between the carrying amounts and the tax bases ofassets and liabilities. Valuation allowances are recorded to reducedeferred tax assets based on the assessment of the realizability ofthe tax benefits.

PROPERTY AND EQUIPMENT, DEPRECIATION

Property and equipment are stated at cost. Depreciation ofdepreciable assets, except for leased commercial facilities(buildings), is computed on a declining-balance method over theestimated useful lives based on the Corporate Income Tax Lawin Japan.

The cost and accumulated depreciation applicable to assetsretired or otherwise disposed of are eliminated from the relatedaccounts and the gains or losses on disposal is credited orcharged to income. Expenditures for new facilities and thosewhich substantially increase the useful lives of existing propertyand equipment are capitalized. Maintenance, repair and minorrenewals are charged to expense as incurred.

Effective April 1, 2004, the Company depreciates leasedcommercial facilities (buildings) by a straight-line method overthe economic useful lives of the assets (20-year period isconsidered to be a standard economic useful life, however itvaries depending on the contract terms etc.). The depreciation iscomputed assuming the residual value of the assets is nil.

The Company had applied a declining balance methodover the estimated useful lives of the assets provided byJapanese Corporate Tax Law for depreciation of commercialfacilities for lease (buildings) in the same way as other tangiblefixed assets. However, since commercial facilities for lease arebuilt on the presumption that a specific tenant uses the facilitiesfor the specific contract terms, it is difficult to renew the contractor lease the facilities to another tenant after the expiration of thecontract term. Thus, it is preferable to depreciate the leasedcommercial facilities matched against revenue from leases overthe contract term of the lease.

The Company recalculated the accumulated depreciationfor existing commercial facilities for lease as of April 1, 2004assuming that a new depreciation method and economic usefullives were applied retroactively, and recorded the difference ofas special depreciation presented in the statements of operations.

Because of the change in the depreciation method etc., thedepreciation expense is increased by ¥512 million, whichconsists of increase in ¥693 million with change in the usefullives of assets and decrease in ¥181 million with change from adeclining balance method to a straight-line method, and recorded¥3,430 million as special depreciation. As a result, operatingincome is decreased by ¥512 million and income before incometaxes and minority interests is decreased by ¥3,942 million forthe year ended March 31, 2005. The effect on this change tosegment information is mentioned in Note 18.

Effective April 1, 2004, the Company adopted early thenew accounting standard for impairment of Fixed Assets(“Opinion Concerning Establishment of Accounting Standard forImpairment of Fixed Assets” issued by the Business AccountingDeliberation Council on August 9, 2002) and the implementationguidance for the accounting standard for impairment of fixedassets (the Financial Accounting Standard ImplementationGuidance No. 6 issued by the Accounting Standards Board ofJapan on October 31, 2003).

14

As a result of impairment loss of ¥10,717 millionrecognized as of April 1, 2004 which entails decrease ofdepreciation expense of ¥606 million for the year ended March31, 2005, operating income is increased by ¥606 million andincome before income taxes and minority interests is decreasedby ¥10,111 million for the year ended March 31, 2005. The effecton this change to segment information is mentioned in Note 18.

FINANCE LEASES

Finance leases, except those leases for which the ownership of theleased assets is considered to be transferred to the lessee, areaccounted for in the same manner as operating leases.

INTANGIBLE ASSETS

Intangible assets are amortized on a straight-line method.The capitalized computer software costs for internal use are

amortized on the straight-line method over the estimated usefullives (five years).

ALLOWANCE FOR BONUSES FOR DIRECTORS

The Company provide allowance for bonuses for directors basedon the estimated amounts of payment.

Effective from the year ended March 31, 2007, theCompany adopted Accounting Standards Board statement No. 4“Accounting Standard for Directors’ Bonus” issued by theAccounting Standards Board of Japan on November 29, 2005.Previously bonuses to directors are subject to approval of theshareholders and are accounted for as an appropriation of retainedearnings for the period in which their payment is made.

As a result, in the year ended March 31, 2007, operatingincome and income before income taxes and minority interestsare decreased by ¥45 million ($381 thousand), respectively. Theeffect on this change to segment information is mentioned inNote 18.

RETIREMENT BENEFITS AND PENSION PLAN

(1) Employees’ severance and retirement benefits

The Company and its consolidated domestic subsidiaries providetwo types of post-employment benefit plans, unfunded lump-sumpayment plans and funded contributory defined benefit pensionplans, under which employees severing their connection with theCompany and its consolidated subsidiaries on retirement areentitled to lump-sum retirement benefit payments or pensionpayments based on pay rates, length of service and certain otherfactors.

The Company and its consolidated subsidiaries providedallowance for employees’ severance and retirement benefitsbased on the estimated amounts of projected benefit obligationand the fair value of the plan assets at year-end.

Actuarial gains and losses are recognized in statement ofoperations using the straight-line method over five years,beginning the following fiscal year of recognition.

Effective April 1, 2005, the Company adopted the newaccounting standard for employees’ severance and retirementbenefits (Accounting Standard Board Statement No. 3, “PartialRevision of the Accounting Standard for Retirement Benefits”and the Financial Standards Implementation Guidance No. 7,“Implementation Guidance for Partial Revision of theAccounting Standard for Retirement Benefits”, issued by theAccounting Standard Board of Japan on March 16, 2005). Theadoption of the new accounting standard had no impact on thefinancial statement for the year ended March 31, 2006.(2) Officers’ severance and retirement benefits

Officers’ (directors and corporate statutory auditors) severingtheir connection with certain consolidated domestic subsidiarieson retirement are entitled to lump-sum retirement benefitpayments based on pay rates, length of services and certain otherfactors.

Retirement benefits to officers of certain consolidateddomestic subsidiaries are provided based on the Company’srules which have been approved by the Board of Directors. Suchobligations are not funded.

Effective April 28, 2006, the Company has abolishedretirement benefits to directors and corporate statutory auditorsat the meeting of the Board of Directors and was approved topay the liabilities which was recognized prior to the abolishmentby the resolution of the shareholders’ meeting at June 29, 2006.With this change, this liabilities in “Retirement benefits” wasreclassified to “Notes and accounts payable” in current liabilities.

BOND ISSUE COSTS

Bond issue costs are charged to operations in the period incurred.

NET ASSETS

The Japanese Corporate Law (“the Law”) became effective onMay 1, 2006, replacing the Japanese Commercial Code (“theCode”). The Law is generally applicable to events andtransactions occurring after April 30, 2006 and for fiscal yearsending after that date.

Under Japanese laws and regulations, the entire amountpaid for new shares is required to be designated as commonstock. However, a company may, by a resolution of the Board ofDirectors, designate an amount not exceeding one-half of theprice of the new shares as additional paid-in capital, which isincluded in capital surplus.

Under the Law, in cases where a dividend distribution ofsurplus is made, the smaller of an amount equal to 10% of thedividend or the excess, if any, of 25% of common stock over thetotal of additional paid-in capital and legal earnings reserve mustbe set aside as additional paid-in capital or legal earningsreserve. Legal earnings reserve is included in retained earningsin the accompanying consolidated balance sheets.

Under the Code, companies were required to set aside anamount equal to at least 10% of the aggregate amount of cash


15

dividends and other cash appropriations as legal earnings reserveuntil the total of legal earnings reserve and additional paid-incapital equaled 25% of common stock.

Under the Code, legal earnings reserve and additional paid-in capital could be used to eliminate or reduce a deficit by aresolution of the shareholders’ meeting or could be capitalized bya resolution of the Board of Directors. Under the Law, both ofthese appropriations generally require a resolution of theshareholders’ meeting.

Additional paid-in capital and legal earnings reserve maynot be distributed as dividends. Under the Code, however, oncondition that the total amount of legal earnings reserve andadditional paid-in capital remained equal to or exceeded 25% ofcommon stock, they were available for distribution by resolutionof the shareholders’ meeting. Under the Law, all additional paid-in capital and all legal earnings reserve may be transferred toother capital surplus and retained earnings, respectively, whichare potentially available for dividends.

The maximum amount that the Company can distribute asdividends is calculated based on the non-consolidated financialstatements of the Company in accordance with Japanese laws andregulations.

The appropriations are not accrued in the consolidatedfinancial statements for the corresponding period, but arerecorded in the subsequent accounting period after shareholders’approval has been obtained.

Retained earnings at March 31, 2007 include amountsrepresenting year-end cash dividends of ¥1,228 million ($10,402thousand), ¥7.0 ($0.06) per share, which were approved at theshareholders’ meeting held on June 28, 2007.

PER SHARE INFORMATION

Net income per share is computed based upon the weightedaverage number of shares outstanding during each fiscal year.Diluted net income per share assumes that outstandingconvertible bonds were converted into common stock atbeginning of the period at the current conversion price.

Cash dividends per share have been presented on an accrualbasis and include dividends to be approved after the balance sheetdate, but applicable to the year then ended.

Information on diluted net income per share for the yearended March 31, 2007 and 2005 are not disclosed as no shareswhich dilute net income per share are outstanding for redemptionof convertible bonds at March 31, 2007 and loss before incometaxes and minority interests is recorded as operating results forthe year ended March 31, 2005, respectively.

ACCOUNTING STANDARD FOR PRESENTATION OF NET

ASSETS IN THE BALANCE SHEET

Effective from the year ended March 31, 2007, the Company andits consolidated subsidiaries adopted the new accountingstandard, “Accounting Standard for Presentation of Net Assets in

the Balance Sheet” (Statement No. 5 issued by the AccountingStandards Board of Japan on December 9, 2005), and theimplementation guidance for the accounting standard forpresentation of net assets in the balance sheet (the FinancialAccounting Standard Implementation Guidance No. 8 issued bythe Accounting Standards Board of Japan on December 9, 2005),(collectively, the “New Accounting Standards”).

Under the New Accounting Standards, the balance sheetcomprises three sections, which are the assets, liabilities and netassets sections. Previously, the balance sheet comprised theassets, liabilities, minority interests, as applicable, and theshareholders’ equity sections.

The net assets section comprises four subsections, whichare shareholders’ equity, accumulated gains (losses) fromvaluation and translation adjustments, subscription rights toshares and minority interests, as applicable.

Under the New Accounting Standards, the following itemsare presented differently compared to the previous presentation.The net assets section includes unrealized gains (losses) onhedging derivatives, net of taxes. Under the previouspresentation rules, companies were required to presentunrealized gains (losses) on hedging derivatives in the assets orliabilities section without considering the related income taxeffects. Minority interests are required to be included in the netassets section under the New Accounting Standards. Under theprevious presentation rules, companies were required to presentminority interests between the non-current liabilities andshareholders’ equity sections.

The consolidated balance sheet as of March 31, 2006 hasbeen restated to conform to the 2007 presentation. There were nomaterial effects on total assets or total liabilities from applyingthe New Accounting Standards to the balance sheet as of March31, 2006.

The shareholders’ equity that would have been presented ifthe previous presentation rules had been applied as of March 31,2007 is amounted to ¥217,766 million.

The adoption of the New Accounting Standards had noimpact on the consolidated statements of income for the yearsended March 31, 2007 and 2006.

ACCOUNTING STANDARD FOR STATEMENT OF

CHANGES IN NET ASSETS

Effective from the year ended March 31, 2007, the Company andits consolidated subsidiaries adopted the new accountingstandard, “Accounting Standard for Statement of Changes in NetAssets” (Statement No. 6 issued by the Accounting StandardsBoard of Japan on December 27, 2005), and the implementationguidance for the accounting standard for statement of changes innet assets (the Financial Accounting Standard ImplementationGuidance No. 9 issued by the Accounting Standards Board ofJapan on December 27, 2005), (collectively, the “AdditionalNew Accounting Standards”).

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Accordingly, the Company prepared the statements ofchanges in net assets for the year ended March 31, 2007 inaccordance with the Additional New Accounting Standards. Also,the Company voluntarily prepared the consolidated statement ofchanges in net assets for 2006 and 2005 in accordance with theAdditional New Accounting Standards. Previously, consolidatedstatements of shareholders’ equity were prepared for the purposeof inclusion in the consolidated financial statements althoughsuch statements were not required under Japanese GAAP.

CHANGE IN THE ACCOUNTING POLICY FOR EXPENSES

INCURRED FOR REAL ESTATE BUSINESS

Salaries and wages and certain expenses incurred for the realestate business had previously been included in “Selling, generaland administrative expenses”. However, effective April 1, 2004,the Company included the portion of salaries and wages andcertain expenses that were matched against revenues in “Cost ofservices” in the consolidated statements of operations in the samemanner as with other operations.

Effective October 1, 2004, the Company changed itsaccounting policy for advertisement costs etc. incurred for thereal estate business from recognizing such costs as incurred torecognizing them when construction of a related condominium iscompleted and ready for sale. The change was made with theintent to better match revenue and the related advertising costsand to present the Company’s operating results moreappropriately. This is because the importance of the effect on theincome statement difference in the timing of recognizingcondominium sales and the related advertising costs etc. hasincreased in light of recent expansion of the Company’s realestate business, increased size of condominium projects andextended construction periods.

As a result, in the year ended March 31, 2005, “Selling,general and administrative expenses” decreased by ¥421 millionand “Cost of services” increased by ¥292 million compared withwhat would have been reported using the previous accountingpolicy. As a result, in the year ended March 31, 2005, gross profitis decreased by ¥292 million, operating income and incomebefore income taxes and minority interests are increased by ¥129million, respectively.

As the estimated amounts of and the expected timing ofincurring advertising costs for large-scale condominium projectsbecame known in the latter half of the year ended March 31,2005, the change in the accounting policy was made effectiveOctober 1, 2004.

As a result, operating income and income before incometaxes and minority interests for the first half of the year endedMarch 31, 2005 were reported ¥14 million less, respectively, thanwhat would have been reported under the new accounting policy.

The effect on this change to segment information ismentioned in Note 18.

RECLASSIFICATION

Certain prior year amounts have been reclassified to conform tothe current year presentation. Also, as described in“ACCOUNTING STANDARD FOR PRESENTATION OF NETASSETS IN THE BALANCE SHEET” and “ACCOUNTINGSTANDARD FOR STATEMENT OF CHANGES IN NETASSETS”, the consolidated balance sheet for 2006 has beenadapted to conform to new presentation rules of 2007. Also, inlieu of the consolidated statement of shareholders’ equity for theyear ended March 31, 2006 and 2005, which was prepared on avoluntary basis for inclusion in the 2006 consolidated financialstatements, the Company prepared the consolidated statement ofchanges in net assets for 2006 and 2005 as well as for 2007.

These reclassifications had no impact on previouslyreported results of operations or retained earnings.


17

NOTE 2 – CASH AND CASH EQUIVALENTSReconciliation of cash and deposits in the consolidated balance sheets and cash and cash equivalents in the consolidated statements ofcash flows as of March 31, 2007 and 2006 was as follows:

March 31, March 31,


Cash and deposits ¥30,310 ¥19,768 $256,756

Add money funds invested in bonds 3,139 145 26,590

Less time deposits with maturities exceeding six months (1,930) (1,552) (16,349)

Cash and cash equivalents ¥31,519 ¥18,361 $266,997

NOTE 3 – SECURITIESAt March 31, 2007, acquisition costs, book values stated at fair values and net unrealized holding gains (losses) of available-for-salesecurities with available fair value were as follows:

March 31, 2007 March 31, 2007

Unrealized Unrealized holding holding

Acquisition Book gains Acquisition Book gains cost value (losses) cost value (losses)

(Millions of yen) (Thousands of U.S. dollars)

Securities with book values

exceeding acquisition costs:

Stocks ¥32,132 ¥131,410 ¥99,278 $272,189 $1,113,173 $840,984

Bonds 1,072 1,085 13 9,081 9,191 110

Other 558 644 86 4,727 5,455 728

33,762 133,139 99,377 285,997 1,127,819 841,822

Other securities:

Stocks 500 430 (70) 4,236 3,642 (594)

Bonds 1,075 1,066 (9) 9,106 9,030 (76)

Other 501 494 (7) 4,244 4,185 (59)

2,076 1,990 (86) 17,586 16,857 (729)

¥35,838 ¥135,129 ¥99,291 $303,583 $1,144,676 $841,093

Total sales of available-for-sale securities sold in the year ended March 31, 2007 amounted to ¥563 million ($4,769 thousand)

and related gains amounted to ¥35 million ($296 thousand).

Book values of available-for-sale securities with no available fair values as of March 31, 2007 were as follows:

March 31, 2007


Non-listed stocks ¥2,703 $22,897

Other 3,296 27,920

¥5,999 $50,817

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Maturity information of available-for-sale securities with maturities as of March 31, 2007 was as follows:

March 31, 2007 March 31, 2007

Over one year Over five years Over one year Over five years Within but within but within Over Within but within but within Over

one year five years ten years ten years one year five years ten years ten years


Bond ¥35 ¥577 ¥1,540 ¥– $296 $4,888 $13,045 $–

If the market value of available-for-sale securities declines over 30% compared with its acquisition cost, the decline isrecognized as significant. In this case, the Company and its consolidated subsidiaries write- down the book value of thesecurities considering possibilities for recovery of the market value.

At March 31, 2006, acquisition costs, book values stated at fair values and net unrealized holding gains (losses) of available-for-sale securities with available fair value were as follows:

March 31, 2006

Unrealized holding

Acquisition Book gains cost value (losses)

(Millions of yen)

Securities with book values exceeding acquisition costs:

Stocks ¥32,640 ¥130,992 ¥98,352

Bonds 60 62 2

Other 557 623 66

33,257 131,677 98,420

Other securities:

Stocks 0 0 –

Bonds 1,089 1,072 (17)

Other 501 490 (11)

1,590 1,562 (28)

¥34,847 ¥133,239 ¥98,392

Total sales of available-for-sale securities sold in the year ended March 31, 2006 amounted to ¥4,228 million and related gains amountedto ¥71 million.

Book values of available-for-sale securities with no available fair values as of March 31, 2006 were as follows:

March 31, 2006

(Millions of yen)

Non-listed stocks ¥2,805

Other 302

¥3,107

Maturity information of available-for-sale securities with maturities as of March 31, 2006 was as follows:

March 31, 2006

Over one year Over five years Within but within but within Over

one year five years ten years ten years

(Millions of yen)

Bond ¥1 ¥90 ¥1,042 ¥–

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NOTE 4 – EFFECT OF BANK HOLIDAY ON MARCH 31, 2007As financial institutions in Japan were closed on March 31, 2007, ¥39 million ($330 thousand) of notes receivable-trade maturing onMarch 31, 2007 were settled on the following business day, April 2, 2007 and accounted for accordingly.

NOTE 5 – RECEIVABLES FROM AND PAYABLES TO UNCONSOLIDATED SUBSIDIARIES AND AFFILIATESSignificant receivables from and payables to unconsolidated subsidiaries and affiliates at March 31, 2007 and 2006 were as follows:

March 31, March 31,


Notes and accounts receivable ¥ 346 ¥ 496 $ 2,931

Notes and accounts payable ¥2,643 ¥2,940 $22,389

Deposits on long-term leases ¥3,277 ¥4,153 $27,759

NOTE 6 – INCOME TAXESThe Company and its domestic consolidated subsidiaries are subject to a number of different income taxes which, in the aggregate, reflecta statutory tax rate of approximately 41% for the years ended March 31, 2007, 2006 and 2005, respectively.

Reconciliation from the statutory tax rate to the effective tax rate in the year ended March 31, 2006 was as follows:

Year ended March 31,

2006

Statutory tax rate 41%

Entertainment expense etc. not deductible for Japanese tax purposes 1

Dividends received etc. not taxable for Japanese tax purposes (6)

Inhabitants taxes 1

Equity in earnings of unconsolidated subsidiaries and affiliates (1)

Other (1)

Effective tax rate 35%

Information on reconciliation of the tax rates for the year ended March 31, 2007 and 2005 is not disclosed as difference between thestatutory tax rate and the effective tax rate was less than 5% of the statutory tax rate for the year ended March 31, 2007 and loss beforeincome taxes and minority interests is recorded as operating results for the year ended March 31, 2005, respectively.

20


Significant components of the Company and its consolidated subsidiaries’ deferred income tax assets and liabilities as of March 31, 2007and 2006 were as follows:

March 31, March 31,


Deferred income tax assets:

Accrued enterprise tax ¥ 539 ¥ 238 $ 4,566

Loss on investments in securities 105 219 889

Bad debt expense 71 85 601

Accrued employees’ bonuses 877 766 7,429

Retirement benefits 4,808 5,147 40,729

Depreciation 3,978 3,494 33,698

Impairment loss 3,568 3,736 30,224

Other 2,411 1,939 20,424

16,357 15,624 138,560

Valuation allowance (284) (320) (2,406)

Total deferred income tax assets 16,073 15,304 136,154

Deferred income tax liabilities:

Net unrealized holding gains on securities (40,404) (40,040) (342,261)

Reserves deductible for Japanese tax purposes (10,278) (8,992) (87,065)

Other (51) (50) (432)

Total deferred income tax liabilities (50,733) (49,082) (429,758)

Net deferred income tax liabilities ¥(34,660) ¥(33,778) $(293,604)

NOTE 7 – ASSETS PLEDGEDAssets, at net book value, pledged as collateral at March 31, 2007 and 2006 were as follows:

March 31, March 31,


Land ¥1,121 ¥ 1,141 $ 9,496

Buildings and structures 1,013 1,128 8,581

Investments in securities 7,555 45,867 63,998

¥9,689 ¥48,136 $82,075

Liabilities secured by the pledged assets mentioned above at March 31, 2007 and 2006 were as follows:

March 31, March 31,


Short-term bank loans ¥ 4,812 ¥ 6,102 $ 40,762

Other in current liabilities 737 609 6,243

Long-term debt 4,769 6,319 40,398

Deposits on long-term leases 2,435 2,594 20,627

¥12,753 ¥15,624 $108,030

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NOTE 8 – SHORT-TERM BANK LOANS AND LONG-TERM DEBTShort-term bank loans outstanding at March 31, 2007 and 2006 were ¥8,914 million ($75,511 thousand) and ¥8,842 million, respectively,and generally represented by short-term notes with interest at annual rates of 0.88% to 10.75% and 0.44% to 1.62%, respectively.

Long-term debt at March 31, 2007 and 2006 consisted of the following:

March 31, March 31,


Loans from banks, insurance companies and other in

generally secured, 0.7588%-5.1%

and 0.2146%-5.1% per annum ¥15,000 ¥15,342 $127,064

1.89% yen bonds due 2007, unsecured 5,000 5,000 42,355




40,000 40,342 338,839

Less current portion (6,444) (609) (54,587)

¥33,556 ¥39,733 $284,252

The aggregate annual maturities of long-term debt at March 31, 2007 were as follows:

Year ending March 31, Amount


2008 ¥ 6,444 $ 54,587

2009 2,858 24,210

2010 12,862 108,954

2011 4,980 42,185

2012 5,315 45,023

2013 and thereafter 7,541 63,880

¥40,000 $338,839

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NOTE 11 – IMPAIRMENT LOSSAs of April 1, 2004, the Company and consolidated domestic subsidiaries classified fixed assets by cash generating units which wereconsidered to be independent from cash flows of other groups and recognized impairment loss on certain groups of assets.

The impairment loss for the year ended March 31, 2005 consists of the following:

March 31, 2005

(Millions of yen)

Land ¥ 5,689

Buildings and structures 4,513

Other 515

¥10,717

The recoverable amounts of warehouse facilities are value in use, which is expected future cash flows discounted at a pre-taxdiscount rate of 6%. The recoverable amount of a unused land is its net realizable value based on an amount determined byvaluations made in accordance with real estate appraisal standards.


NOTE 9 – RETIREMENT BENEFITS AND PENSION PLANThe liabilities for retirement benefits included in the liability section of the consolidated balance sheets as of March 31, 2007 and 2006consists of the following:

March 31, March 31,


Projected benefit obligation ¥22,735 ¥22,958 $192,588

Less fair value of pension assets (11,531) (11,173) (97,679)

Unfunded projected benefit obligation 11,204 11,785 94,909

Unrecognized net actuarial gain 1,212 773 10,267

Employees’ retirement benefits 12,416 12,558 105,176

Retirement benefits to directors and corporate

statutory auditors 132 788 1,118

Liability for retirement benefits ¥12,548 ¥13,346 $106,294

Included in the consolidated statements of operations for the years ended March 31, 2007, 2006 and 2005 are severance andretirement benefit expenses for employees comprising of the following:



Service costs-benefits earned during the year ¥ 923 ¥ 855 ¥1,026 $ 7,819

Interest cost on projected benefit obligation 432 432 436 3,660

Expected return on plan assets (186) (163) (156) (1,576)

Amortization of actuarial gains and losses 71 360 400 601

Severance and retirement benefit expenses for employees ¥1,240 ¥1,484 ¥1,706 $10,504

The discount rate and the rate of expected return on plan assets used by the Company are 2.5% and 2.0% for 2007, 2006 and2005, respectively. The estimated amount of all retirement benefits to be paid at the future retirement date is allocated equally toeach service year using the estimated number of total service years.

NOTE 10 – INDEMNITY INCOME OF EXITING COMMERCIAL FACILITIES FOR LEASEIndemnity income of exiting commercial facilities for lease represents mainly income from cancellation of leased commercial facilities bytenants.

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NOTE 12 – LOSS ON RESTRUCTURINGLoss on restructuring represents mainly loss from sub-lease of disused warehouse facilities by a consolidated subsidiary in theUnited States.

NOTE 13 – CONTINGENT LIABILITIESAt March 31, 2007, the balance of endorsed notes receivable with recourse and guarantee for loans were as follows:

Amount


Notes receivable endorsed ¥ 7 $ 59

Guarantee for loans 2,657 22,508

¥2,664 $22,567

NOTE 14 – LEASE TRANSACTIONSLESSEE LEASES

Finance lease transactions without ownership transfer to lessee(a) Purchase price equivalents, Accumulated depreciation equivalents, and Book value equivalents

March 31, March 31,


Machinery and equipment and other

Purchase price equivalents ¥1,263 ¥1,257 $10,699

Accumulated depreciation equivalents 624 689 5,286

Book value equivalents ¥ 639 ¥ 568 $ 5,413

Purchase price equivalents were calculated using the inclusive-of-interest method.

(b) Lease commitments

March 31, March 31,


Due within one year ¥218 ¥206 $1,847

Due after one year 422 362 3,575

¥640 ¥568 $5,422

Lease commitments as lessee were calculated using the inclusive-of-interest method.

(c) Lease payments and Depreciation equivalents



Lease payments ¥248 ¥284 ¥321 $2,101

Depreciation equivalents ¥248 ¥284 ¥321 $2,101

(d) Calculation method of depreciation equivalentsDepreciation equivalents are computed on a straight-line method over the lease period without residual value.

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LESSOR LEASES

Finance lease transactions without ownership transfer to lessee(a) Purchase price, Accumulated depreciation and Book value

March 31, March 31,


Machinery and equipment and other

Purchase price ¥154 ¥144 $1,305

Accumulated depreciation 91 62 771

Book value ¥ 63 ¥ 82 $ 534

(b) Lease commitments

March 31, March 31,


Due within one year ¥35 ¥ 34 $296

Due after one year 59 81 500

¥94 ¥115 $796

Lease commitments as lessor were calculated using the inclusive-of-interest method.

(c) Rental income and Depreciation



Rental income ¥36 ¥35 ¥12 $305

Depreciation ¥32 ¥46 ¥12 $271


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NOTE 15 – DERIVATIVE TRANSACTIONSDerivative financial instruments utilized by the Company are interest rate swap contracts for the years ended March 31, 2007 and 2006,which are for hedging purposes only.

The Company utilized the interest rate swap contracts to offset exposure to market risks arising from changes in interest rates withrespect to bond payables.

Interest rate swap contracts are subject to risk of interest rate changes.The Company’s financial instrument counterparties are all prime banks, and the Company does not expect non-performance by any

counterparties. The derivative transactions are executed and managed by the Company’s Finance Section in accordance with the established

policies and within the specified limits on the amounts of derivative transactions allowed. Such transactions are approved by the managerof Accounting Department.

The following summarizes hedging derivative financial instruments used by the Company and hedged items:Hedging instruments: Interest rate swap contractsHedged items: Bonds payable

The Company evaluates hedge effectiveness by comparing the cumulative changes in cash flows from or the changes in fair valueof hedged items and the corresponding changes in the hedging derivative instruments.

For the year ended March 31, 2007, the Company discontinued adoption of hedge accounting as the Company considered thecontracts utilized by the Company has unsatisfied certain hedging criteria.

The fair value of the derivative contracts utilized by the Company outstanding at March 31, 2007 were as follows:Classification: Non-market transactionsType of transaction : Interest rate swap, receive fixed, pay floating

Year ended March 31, 2007


Notional amount ¥10,000 $84,710

Portion due after one year included herein ¥10,000 $84,710

Fair value ¥ (396) $ (3,355)

Unrealized loss ¥ (396) $ (3,355)

(1) Fair value of swap is based on the prices obtained from the financial institutions.(2) The notional amount of derivative shown in the above does not measure market risks exposure of the Company.Information on the interest rate swap contracts utilized by the Company outstanding at March 31, 2006 is not disclosed as all such

contracts were effectively hedging the corresponding transactions.

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NOTE 16 – CHANGES IN NET ASSETSType and number of shares outstanding and treasury stock for the year ended March 31, 2007 were as follows:

Shares outstanding Treasury stock

Type of shares Common stock Common stock

Number of shares: (Shares)

Balance at March 31, 2006 175,921,478 446,944

Increased in the accounting period – 72,440

Decreased in the accounting period – (19,446)

Balance at March 31, 2007 175,921,478 499,938

Increase in the number of shares was due to purchases of less-than-one-unit shares. Decrease in the number of shares was due tosales by an affiliated company accounted for on the equity method and sales of less-than-one-unit shares.

Matters related to dividends were as follows:(a)Dividend payment

Approvals by ordinary general meeting of shareholders held on June 29, 2006 were as follows:

Dividends on Common stock

Total amount of dividends ¥878 million ($7,438 thousand)

Dividends per share ¥5.0 ($0.04)

Record date March 31, 2006

Effective date June 30, 2006

Approved by the Board of Directors meeting on October 31, 2006 were as follows:


Total amount of dividends ¥878 million ($7,438 thousand)


Record date September 30, 2006

Effective date December 4, 2006

(b)Dividends whose record date is attributable to the accounting period ended March 31, 2007 but to be effective after thesaid accounting period.The Company resolved approval at the general meeting of shareholders to be held on June 28, 2007 as follows:


Total amount of dividends ¥1,228 million ($10,402 thousand)


Record date March 31, 2007

Effective date June 29, 2007

NOTE 17 – SUPPLEMENTAL CASH FLOW INFORMATIONSupplemental cash flow information for the year ended March 31, 2006 was as follows:

Non-cash financing activities: Year ended March 31, 2006

(Millions of yen)

Conversion of convertible bonds

Increase in common stock by conversion ¥ 6,899

Increase in capital surplus by conversion 6,891

¥13,790

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NOTE 18 – SEGMENT INFORMATIONThe Company and its consolidated subsidiaries are primarily in operation with the following two businesses.

(1) Logistics business:

Warehousing, transportation, port-terminal operation and international freight forwarding

(2) Real estate business:

Rental for office buildings and sales for real estate

Business segment information for the years ended March 31, 2007, 2006 and 2005 were as follows:

March 31, 2007

Elimination or corporate assets

Logistics Real estate Total or expenses Consolidated(Millions of yen)

Revenues:

Non-affiliated customer ¥135,245 ¥ 54,866 ¥190,111 ¥ – ¥190,111

Intersegment 204 807 1,011 (1,011) –

135,449 55,673 191,122 (1,011) 190,111

Operating expenses 130,248 41,230 171,478 2,884 174,362

Operating income ¥ 5,201 ¥ 14,443 ¥ 19,644 ¥ (3,895) ¥ 15,749

Identifiable assets ¥114,395 ¥110,968 ¥225,363 ¥166,217 ¥391,580

Depreciation and amortization ¥ 4,893 ¥ 6,395 ¥ 11,288 ¥ 76 ¥ 11,364

Capital expenditures ¥ 4,429 ¥ 9,525 ¥ 13,954 ¥ 186 ¥ 14,140

March 31, 2006



Revenues:

Non-affiliated customer ¥127,825 ¥ 38,713 ¥166,538 ¥ – ¥166,538

Intersegment 70 863 933 (933) –

127,895 39,576 167,471 (933) 166,538


Operating income ¥ 3,578 ¥ 11,054 ¥ 14,632 ¥ (3,555) ¥ 11,077



Capital expenditures ¥ 3,498 ¥ 7,088 ¥ 10,586 ¥ 66 ¥ 10,652

March 31, 2005



Revenues:

Non-affiliated customer ¥123,528 ¥32,870 ¥156,398 ¥ – ¥156,398

Intersegment 75 823 898 (898) –

123,603 33,693 157,296 (898) 156,398


Operating income ¥ 3,091 ¥10,531 ¥ 13,622 ¥ (3,501) ¥ 10,121



Impairment loss ¥ 10,717 ¥ – ¥ 10,717 ¥ – ¥ 10,717

Capital expenditures ¥ 4,031 ¥14,612 ¥ 18,643 ¥ 83 ¥ 18,726

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The effect for the year ended March 31, 2007 of the adoption of the new accounting standards, as mentioned in ALLOWANCE

FOR BONUSES FOR DIRECTORS in Note 1, is to increase operating expenses and to decrease operating income in the

elimination or corporate assets or expenses by ¥45 million ($381 thousand), respectively.

The effect for the year ended March 31, 2005 of the change of accounting policy for depreciation method etc. of leased

commercial facilities (buildings), as mentioned in PROPERTY AND EQUIPMENT, DEPRECIATION in Note 1, is to decrease

operating income by ¥512 million and identifiable assets by ¥3,942 million and to increase depreciation and amortization by

¥512 million in the real estate business.

The effect for the year ended March 31, 2005 of the adoption of the new accounting standards for impairment of fixed

assets, as mentioned in PROPERTY AND EQUIPMENT, DEPRECIATION in Note 1, is to increase operating income by ¥606

million and to decrease identifiable assets by ¥10,111 million and depreciation and amortization by ¥606 million in the logistics

business.

The effect for the year ended March 31, 2005 of the change of accounting policy for advertisement costs etc. incurred for

the real estate business, as mentioned in CHANGE IN THE ACCOUNTING POLICY FOR EXPENSES INCURRED FOR

REAL ESTATE BUSINESS in Note 1, is to increase operating income by ¥129 million in the real estate business. As

mentioned above, the change of this accounting policy was made effective October 1, 2004, therefore operating income for the

first half of the year ended March 31, 2005 were reported ¥14 million less than what would have been reported under the new

accounting policy in the real estate business.

Geographical information and overseas revenue were omitted as they were immaterial to the consolidated financial

statements.

NOTE 19 – SUBSEQUENT EVENTSThe Company has been proposed to sell some shares in investments in securities through TOB offer which ended April 26, 2007 andapproved this transaction through TOB offer by the resolution of the Board of Directors at March 23, 2007. On April 27, 2007, theCompany was announced completion of the transaction through TOB offer. Effect on the consolidated financial statements for the yearending March 31, 2008, gain on the sale of investments in securities of ¥2,023 million ($17,137 thousand) will be recorded.

Shares to be sold: Nikko Cordial CorporationTransferee: Citygroup Japan Investments LLC


March 31, 2007


Logistics Real estate Total or expenses Consolidated(Thousands of U.S. dollars)

Revenues:

Non-affiliated customer $1,145,659 $464,769 $1,610,428 $ – $1,610,428

Intersegment 1,728 6,836 8,564 (8,564) –

1,147,387 471,605 1,618,992 (8,564) 1,610,428

Operating expenses 1,103,329 349,259 1,452,588 24,430 1,477,018

Operating income $ 44,058 $122,346 $ 166,404 $ (32,994) $ 133,410

Identifiable assets $ 969,039 $940,008 $1,909,047 $1,408,022 $3,317,069

Depreciation and amortization $ 41,449 $ 54,172 $ 95,621 $ 643 $ 96,264

Capital expenditures $ 37,518 $ 80,686 $ 118,204 $ 1,576 $ 119,780

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Company Profile (As of March 31, 2007)

Headquarters and Branches

Headquarters: Chuo-ku, Tokyo

Branches: Tokyo, Yokohama, Nagoya, Osaka, Kobe and Fukuoka

Date of Establishment April 15, 1887

Capital ¥22,393,986,570

Number of Employees 864 persons (parent only; not including 177 temporarily suspended

employees on loan and 41 temporary employees)

2,596 persons (on a consolidated basis; not including 102 temporarily

suspended employees on loan to companies outside the Group)

Number of Shares Issued 175,921,478

Authorized Shares 440,000,000

Stock Exchange Listing First Section of the Tokyo Stock Exchange

First Section of the Osaka Securities Exchange

Securities Code 9301

Notes:1. Directors with an asterisk (*) are representative directors.2. Minoru Makihara, Satoru Kishi and Jiro Nemoto are outside directors as stipulated in the Corporate Law Article2, Item15.3. Mino Hiroshi, Yohnosuke Yamada and Akio Minawa are outside auditors as stipulated in the Corporate Law Article2, Item16.

Position Name Responsibilities and/or Primary Occupation

President* Naoshi BanManaging Director* Tohru Watanabe Responsible for accounting &financing, Planning, Technical and Real Estate Business

Managing Director Hajime Suita Responsible for International Transportation Business

Managing Director* Fumio Takeda Responsible for General Affairs, Corporate Communications, Personnel, Information System and Internal Audit

Managing Director Masamichi Imaizumi Responsible for Harbor Transportation Business

Managing Director Tetsuro Okamoto Responsible for Warehousing & Distribution Business

Director Minoru Makihara Advisor, Mitsubishi Corporation

Director Satoru Kishi Advisor, The Bank of Tokyo-Mitsubishi UFJ, Ltd.

Director Jiro Nemoto Honorary Chairman, Nippon Yusen Kabushiki Kaisha

Director Atsuki Hashimoto Senior Assistant to Managing Director (Real Estate Business)

Standing Corporate Auditor Yotaro OnizukaStanding Corporate Auditor Hiroshi MinoCorporate Auditor Yohnosuke Yamada Lawyer

Corporate Auditor Akio Minawa Certified Public Accountant

Corporate Auditor Susumu Nishikawa

Directors and Corporate Auditors (As of June 28, 2007)

Major ShareholdersShareholder’s Name Number of Shares Held (Thousands) Shareholding Ratio (%)

Meiji Yasuda Life Insurance Company 9,937 5.7

Tokio Marine & Nichido Fire Insurance Co., Ltd. 9,718 5.5

KIRIN BREWERY COMPANY, LIMITED 7,415 4.2

MITSUBISHI ESTATE CO., LTD. 7,331 4.2

Japan Trustee Services Bank, Ltd. (trust account) 7,103 4.0

The Master Trust Bank of Japan, Ltd. (trust account) 7,091 4.0

The Bank of Tokyo-Mitsubishi UFJ, Ltd. 6,214 3.5

Mitsubishi UFJ Trust and Banking Corporation 3,790 2.2

State Street Bank and Trust Company 505025 3,685 2.1

ASAHI GLASS CO., LTD. 3,315 1.9

Notes:1. The Bank of Tokyo-Mitsubishi UFJ, Ltd., and Mitsubishi UFJ Trust and Banking Corporation have set 1,500,000 and 2,829,000 Mitsubishi Logistics’

shares, respectively, as trust funds for retirement benefits for which voting rights are reserved, in addition to the shares stated in the table above.2. The “Shareholding ratio” is calculated after excluding treasury stock (430,737 shares).

19-1 Nihonbashi, 1-chome Chuo-ku, Tokyo 103-8630, Japanhttp://www.mitsubishi-logistics.co.jp

ANNUAL REPORT 2007 - Mitsubishi Logistics · Currently, the Company handles about 1.7 million units...

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Transcript of ANNUAL REPORT 2007 - Mitsubishi Logistics · Currently, the Company handles about 1.7 million units...