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Message from the President

More than one year has passed since the occurrence of the Great East Japan Earthquake. Together with hoping for a quick recovery, we have been doing our best as the Kanamoto Group to play a role in the restoration and reconstruction activities.

I am pleased to have this opportunity to report on the activities of Kanamoto and the Kanamoto Group during the first half of the Business Period ending October 31, 2012 and discuss our policies for the future.
During Kanamoto's interim period, Japan's economy superficially exhibited an improvement trend that was driven by restoration demand following the great earthquake, along with other factors. Nevertheless, as the economic picture overseas grew cloudier because of Europe's currency crisis and the slowing economy in China, conditions overall remained uncertain.
The Kanamoto Group has deployed large quantities of construction equipment and materials to the disaster-stricken areas of northern Japan since immediately after the great earthquake, and with the addition more recently of heavy rainfall disaster recovery projects, our offices all over the Tohoku Region have had their hands full. To provide more finely-tuned customer service in the same region, we are aggressively strengthening our branch offices. Moreover, even in areas not stricken by disasters, where equipment rental demand had been projected to be soft, demand has remained strong because of efforts to address electric power shortages and earthquake-resistance countermeasures demand. To reflect this robust situation, we have revised our performance forecast for the current period upward.
As the Kanamoto Group, we continue to pursue optimum rental asset placement and ensure accurate supply in response to various demands, just as we have in the past, while also focusing efforts on adopting and providing products such as information-aided construction equipment and energy-efficient new products that meet the needs of the times.
Because the construction equipment rental industry single-handedly equips the construction sector, the supply obligation we must fulfill is critically important, and we will continue to perform our activities in the future with an awareness of their importance as a vital social infrastructure.

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 seek to expand earnings by working to reliably attract vigorous demand in mainland China and Hong Kong.

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

Kanchu Kanamoto, President and Chief Executive Officer

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