1. Business Progress and Results

The recent business situation in Japan has shown no signs of recovery with a drop in land prices, a slip of stock prices to new lows and a sharp reduction in assets value, resulting in sluggish plant and equipment investment, increased uncertainty of employment, people's anxiety of their futures, leading to their sluggish personal consumption, and other similar things to cause the nation to undergo the continued status quo where very few pieces of bright news have been heard. Under these circumstances, the coin parking industry has seen its continued smooth expansion behind the maturation of the car-oriented society in Japan, resulting in increased demand for better parking lots. Since its foundation, our corporation has specialized in the development and sale of coin parking (C.P.) systems with resultant accumulation of know-how of such systems, allowing us to make further efforts to meet the needs of our customers for higher-quality products including relevant technology by continuing advance investment to positively expand our business foundation.

With such efforts specially focused on the expansion of our sales and service networks, we relocated our Osaka Branch Office with concurrent extension of its business in December 2000 and opened new offices in Kanazawa (Ishikawa Prefecture) and Shibuya (Tokyo) in March and May 2001, respectively, to establish a system where we can render quicker and higher-quality services to our customers. In addition, as our society has undergone increasingly rapid change in its structure, we have directed our further energy toward the IT-related advance investment and new technology development.

In response to the recent increase in the number of cases of car burglary and unpaid car parking, we have improved the quality of our original system "24-hour Full Maintenance Service", leading to an increase in sales of our original product "PIKATRO 24" (patent applied for).

In the meantime, the coin parking industry has seen its rapidly increased contribution to land mobilization and activation. A representative example of the industry's contribution is its function as a receptor of government owned property sold through auction and disposal, registering the second largest number of successful bids for such property following the condominium industry. This also has served as a brake for a drop in the land prices. As a matter of fact, our corporation has received an increased number of inquiries from various businesses including bankers for sale of the lands that they want to sell, but cannot because of the sluggish land market. Among such businesses are the Japanese clothes (kimono) traders and petroleum distributors, which have changed or discontinued their businesses one after another, offering their lands for conversion into other uses. We have also seen many houses of the aged and obsolete buildings in the midtown areas demolished for conversion of their lands to other uses, suggesting that we will continue to enjoy the situation for quite some time, where we can suffer no inconvenience in land acquisition. In addition, the "Park-and-Ride" concept (where a parking lot is built in front of a station in the suburban district to allow commuters to drive to the lot from which to take a train to their workplaces in the midtown area) has attracted much attention from the standpoint of environmental pollution control and traffic congestion prevention, suggesting a future demand or necessity for construction of new large-scale parking lots near such stations.

As described above, the environment surrounding our corporation remains really favorable in spite of the bad business situation in Japan as a whole. Notwithstanding this, however, we at our corporation have continued to work harder together to accomplish further strides in our business operations. As a result of our efforts, we achieved sales of 926,439 thousand yen for the current term (compared to 539,191 thousand yen for the previous term), which represents a large increase of 172% from the previous year, with the pre-tax profits for the current term registering 56,118 thousand yen (compared to 32,592 thousand yen for the previous term), an increase of 172% from the previous year, to generate the after-tax profits of 26,218 thousand yen for the current term (compared to 5,753 thousand yen for the previous term), an increase as large as 456% from the previous year. Our corporation consists of the following divisions, whose individual business performances are as follows:

‡@ C. P. System Division
This division has expanded its business from the center of the metropolitan area to major cities in the nation's local regions such as the Chubu, Keihanshin and Kyushu districts with a resultant large increase in its sales. In addition, the C. P. System Division has established a system where it has two head offices, one each in Tokyo (at its promoted Urayasu Branch Office) and in Fukui, to improve the efficiency in its marketing and service operations. As a result of its efforts, the division achieved sales of 646,772 thousand yen for the current term, an increase of 139% from the previous year.

‡A Maintenance Service Division
This division has made efforts to increase the number of its operating bases across the nation to provide our customers with services through closer contact with them so as to make our services more satisfactory to them, while establishing a system where we can keep replacements in constant stock to respond quickly to our customers' needs for such replacements. As a result of its efforts, the division, like the C. P. System Division, achieved a large increase in its sales for the current term to 90,009 thousand yen, which is equivalent to 185% as large as those for the previous term.

‡B Directly-Managed C. P. System Division
This division has directed its energy toward increasing the number of such parking lots across the nation as the ones that it has directly managed on a prototype basis with its original C. P. systems introduced into them so as to accomplish speedy development of our company's "Parking Lot Revolution" that we have promoted with confidence to enhance the efficiency in the operation and management of the monthly-contracted parking lots across the nation and to aim at the widespread of our company's unmanned 24-hour operating hourly/daily/monthly-rented parking system throughout the nation.

‡C Other Divisions
Other divisions of our corporation including its real estate rental management division have continued to improve the quality of their business services with a resultant increase in sales for the current term to 24,932 thousand yen, which is 222% as large as those recorded for the previous term.

‡D Production Division
This division has marketed two new models in its 3000IBR series of parking fee calculators and transferred the existing parking fee calculators to its 1000IBR model (designed for individual management with a change computation system). The division has also established a system for mass production of the parking fee calculators, while making efforts to enhance the factory operating function, as well as to reduce the production costs and improve the productivity.

‡E Development Division
This division has successfully developed our company's original product "PIKATRO 24" for application to C.P. systems to improve their security functions. During this development process, the division has also developed a system designed to use the system for transmission of the PIKATRO signals through the PHS network line by wireless to our company's data center, our customers' offices, security companies and other similar facilities so as to provide SOHOs and students' condominiums with a mobile Internet environment at low prices, and has now completed the development of the system under the name "Mob-Station", starting its test run in the fifth term at three locations ? our company's Tokyo Head Office, Fukui Head Office and Kanazawa Branch Office. In addition, the change in the creation law's provision (concerning the competent governor's recognition of any new undertaking or project by any particular small-or-medium sized company for the government's financial assistance in the undertaking or project) has allowed the division to direct its efforts toward the development of new technology to enhance the function of the PIKATRO 24 system, increase its operating speed and reduce its size.

2. Issues to be Addressed by the Corporation

With regard to the future of the economy in Japan, we believe that the present situation will last for the time being, where we cannot expect the business as a whole to get its way easily for recovery. On the other hand, the C.P. system industry, thanks to the continued parking lot shortage and land excess, is considered to continue to grow more than 20% on an annual basis. We have renewed our determination to use our best efforts to perform our business operations under our corporate policy of "first consideration to our customers", while continuing to work for the development of low-cost high-quality products to be offered to them. We will also continue our best efforts to develop and improve our operating bases across the nation to render high-quality high-value-added services to our customers through close contact with them. Especially, looking to the future, we can expect an increased number of specific purpose companies (SPC) to convert C.P systems into securities and tie up with government and municipal offices and companies/corporations of different businesses to undertake private finance initiative (P.F.I) projects, suggesting an increased demand for C.P. systems. We will also be considering responding to the enhanced society's needs for environmental protection and preservation, which have led us to direct our attention not just to efficiency and quality, but to ecology as well, encouraging us to advance into the ecology-related business field through coin parking. Our company is always ready to respond to any change in society quickly and accurately to meet the society's needs.

(The Corporation's Financing and Equipment Investment Situation)

‡@ Financing
In January 2001, our company increased its capital through allocation of new 80 shares (each with face value of 50,000yen) to third parties at 1,600 thousand yen per share to obtain funds amounting to a total of 128,000 thousand yen, the half of which was appropriated in the capital, the other half being appropriated in the capital reserve. Part of the funds was applied for the acquisition of the property evaluated as a good risk from the method of calculating the rate of return on the invested capital, the advance investment in directly-managed C.P. systems and the development of the C.P. and security systems. Part of the funds was also applied as a working capital to cope with the rapid sales increase. This caused the debts payable to be increased accordingly.

‡A Equipment Investment
The major equipment investment made for the current term is as follows:

3. Changes in the Corporation's Business Results and Assets

NOTE:	1.	Each of the shares has a face value of 50,000 yen.
	2.	The calculation of the after-tax profit per share is based on the total average number of shares issued during the term. The calculation of the after-tax profit per share for the 4th term is based on the assumption that the stock split-up on November 13, 1999 was made at the beginning of the term. The calculation of the after-tax profit per share for the 5th term is based on the assumption that the stock split-up and third-party share allocation were made at the beginning of the term.