During the 9th term, Japan's economy was generally on a gradual recovery trend. This is due to the improvement in personal consumption and capital investment, latter of which was based primarily on the recovery of corporate performance. However, we still cannot be too optimistic about the complete recovery of Japan's economy. This is especially true after taking some uncertain factors such as a surge in oil prices and a slowdown of the world economy into consideration.

The parking business continues to grow thanks to the nation-wide needs of urban redevelopment and the maturation of motorized society. As the number of automobiles has grown, a lack of parking has become severe. Particularly in the urban areas, the severe shortage of parking caused various urban problems such as illegal on-street parking, degradation of the environment by pollution, traffic congestion, etc. And, as an outcome of all of these problems, the vitality of some urban centers was considerably dropped. This is why many cities now give a top priority to enhancing and remodeling parking lots. We are doing our best to keep up with this demand and to reinforce the management base by expanding sales of our parking system.

We also try to improve the level of understanding about the future potential of the coin parking business and about its role in society. Needless to say, we are improving the quality of the products and the art of construction for system installation.

We enhanced our original 24 hour service and refined our tech support skills. We also poured our efforts into strengthening of the functions of our PIKATORO 24 (a remote management system for parking lots) and continued to attach great importance to development of value-added products.

As a result of our excellent team efforts our sales significantly increased by 35.3% and reached 2,738,389 thousand JPY.

1. Coin Parking

(a) Parking System Sales

Mainly in the Tokyo metropolitan area, we increased the number of personnel of our sales team. Our flagship models, 3000IBR and a car lock plate D5 have been in great demand during this term. We made great efforts to nurture new clients and build up solid clientele. We introduced two high-security models, 3500IBR and 4500IBR, both of which enjoyed reputation and large sales.

During? this term, we ran a promotional campaign for our coin parking management system. With this system, we add something else to our existing products.

As a result of these efforts, our parking system sales division sold 1,142,626,000 JPY (year-on-year increase of 34.5 percent).

(b) Company-owned Parking Facilities

We have operated our company's own coin parking facilities throughout Japan. These facilities themselves illustrate the basic concept of our "Parking Revolution," a shift from the existing inefficient parking systems to our unmanned pay-by-the-hour parking system. We are sure that these sample parking have had a strong appeal especially to the owners of month-to-month parking and idled lands in urban areas.

We have cut costs of our parking facilities. We negotiated the landlords of the parking and tried to alter the lease of the lands to more appropriately reflect the actual market land prices. If a parking did not make business sense even after the negotiation, we just terminated the contract. This was the disposal of considerable amount of the underperforming operations.

Because of the merger with two subsidiaries wholly owned by us on November 30, 2005, the number of our company's owned parking facilities increased. Our own parking hit 198 (26.1% up over the last term) and the occupancy load limit of cars is now 2701 (14.4% up over the last term). This contributed to the enhancement of the operational base for the division of company-owned parking facilities.

In consequence, sales for this term are 869,363 thousand JPY (22.9% up over the last term).

(c) Parking System Maintenance

We launched the sale of newly-released car lock plate and "Parrott Exitfare" (a centralized parking fee control system with audio assist). Moreover, as mentioned above, we had an increased number of facilities to manage. These factors accelerated the demand for maintenance services. To meet the demand, we increased the number of the division of maintenance services and gave them intensive OJT. We also increased our spare parts inventory. More service vehicles were put in place. On September of 2005, we have opened a 24-hour call center to establish two-way communication with customers and deal with various troubles in parking.

As new banknotes came out this term, we received many orders for modification of the old models of parking fare control system from the owners of the parking we take on administration.

The number of the parking we now take on administration is 938 (26.2% up over the last term) and their occupancy load limit of cars is 10,953 (23.0% up over the last term). Sales of the arm are 312,605 thousand JPY for this term (52.5% up over the last term).

2. Asset Management

Since our company's establishment, our business activities have been built on the concept of effective utilization of idle lands. To make an entry to coin parking business is certainly an effective ways to utilize the lands. But it is not the only way. In order to maximize the values of our customers' real-estates, we have been engaged in asset management business in various areas: consultation for choice of real-estates, acquisition of them, remodeling, daily management, etc.

We have been more committed to asset management business this term. On August, 2005, we purchased the Fukui Building of Daihyaku Mutual Life Insurance Co. (renamed to the Central Building). It is located conveniently at the center of Fukui city. So we use it not only as a rental office location, but also as a　platform for revitalization of the downtown of Fukui: we? opened a complex of reputable bakeries in Fukui and "Fukui Ko-gei-sha" [Museum for traditional handicrafts of Fukui] for trumpeting the beauties of traditional handicrafts of Fukui and promote the arts. On May of 2005, we purchased another building, Bank of Ishikawa, Fukui branch. At this place, we opened "Healthy Plaza," a health farm.

As for the month-to-month apartments in Kanazawa and Urayasu, Phoenix Building in Fukui, Libro-Omote-Sando-Building in Nagano, the income from their lease is just all right.
We set up new departments for each stores and buildings mentioned above and improved our management system for our own assets. These new departments are taking part in calling for tenants, advertisement of the stores in the buildings, etc.

Sales of the arm are 85,448 thousand JPY for this term (84.7% up over the last term).