Message from the President

I am pleased to report on the operating activities of Kanamoto Co., Ltd. during the Business Period ended October 31, 2014 and discuss our policies for the future.

During this business period, Japan's economy maintained its move toward recovery during the first half. Thanks to economic measures taken by the current administration, and a significant expansion of the money supply, a recovery in corporate earnings was evident, led by strong performance among export-oriented firms that was driven by depreciation of the yen. The employment situation also improved. Conditions shifted from April, however, as personal consumption slumped following an increase in the consumption tax hike, and household spending and corporate profits came under pressure from an upward creep in prices. Recent GDP figures have become negative as well, heightening the uncertainty of the future economic outlook.

Domestically, construction demand is exhibiting a recovery trend, and the Kanamoto Group will respond to the growth in construction demand by continuing to structure its asset portfolio to match customers' needs.
Furthermore, we remain conscious of the mission and role of equipment rental as critical social infrastructure, and will do our best to help restore areas stricken by disaster. Work has also begun on two major projects: the Tokyo 2020 Olympic and Paralympic Games to be held in Tokyo, and the Linear Shinkansen. With concentrated investment projected over the short term, we will remain focused on the capital expenditures necessary to respond to this demand, based on our conviction that equipment rental will fulfill an even greater role in the years ahead.

In our overseas operations, which we have positioned as an engine for medium to long-term growth, we will continue to concentrate on the expansion of Kanamoto's business in China and Singapore and seek to expand earnings by working to reliably capture the vigorous demand in mainland China, Hong Kong, and Singapore, while also studying expansion into ASEAN markets.

We look forward to continuing to receive your unwavering support and encouragement for the Kanamoto Group in the future.

Kanamoto's directors, auditors and corporate officers