Message from the President

I am honored to have been appointed to the position of President and CEO of Kanamoto Co., Ltd. on November 1, 2016. Along with this opportunity to offer my first remarks to all our stakeholders since assuming this position, I am pleased to report on the operating activities of Kanamoto Co., Ltd. during the Business Period ended October 31, 2016 and discuss our policies for the future.

During the consolidated fiscal year recently completed, Japan's economy exhibited a moderate economic recovery against the backdrop of steady improvement in the employment and income situation. Personal consumption and capital expenditures remained sluggish, however, contributing to a sense of stagnation.
Looking at trends worldwide, major events unfolded that signaled a paradigm shift, including Great Britain's vote to withdraw from the EU and the election of a new president in the United States.
In the domestic construction industry that is the Kanamoto Group's main customer, construction equipment rental demand for Great East Japan Earthquake restoration decreased gradually as works moved into their final phase, but current rental demand overall rose steadily, boosted by private sector construction investment related to the Tokyo Olympics and Paralympic Games and large-scale redevelopment in the Tokyo metropolitan area and execution of a public spending-based supplementary budget.
On the other hand, with the domestic construction market forecast to contract after 2020, we clearly recognize that continuing to strengthen our business structure will be critical for maintaining the Kanamoto Group's continuing growth phase.

Given such circumstances, the Kanamoto Group formulated its New Long-term Vision BULL55 to outline the form the Kanamoto Group seeks to achieve by 2019, the Company's 55th Business Period, and is moving ahead with the priority policies in its Medium-term Management Plan, the action plan for accomplishing this vision.
We are continuing our efforts to create an asset portfolio that conforms to both construction demand and our customers' needs, and working to support the latest disaster recovery and reconstruction projects being initiated in various regions, to help accomplish the mission and role of equipment rental as critical social infrastructure.

The Business Period ending October 2017 marks the halfway point toward Kanamoto's new long-term vision, and is the final fiscal year of our Medium-term Management Plan. As I take up my management position at this critical time, I pledge to resolutely maintain the Kanamoto Group's present approach and push forward to achieve the goal of our new long-term vision to be "an excellent and dynamic group that uses its solid earnings as a base to reward shareholders, customers and employees".

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