2000 ANNUAL REPORT Fiscal Year Ended March 31, 2000 COMSYS —For Excellence in Telecommunications Consolidated Financial Highlights Profile • Nippon COMSYS Corporation and Consolidated Subsidiaries • Years ended 31st March, 1999 and 2000 • • • • • • Thousands of Nippon COMSYS Corporation was founded in 1951 to perform the functions of Millions of yen U.S. dollars Change 1999 2000 2000 (%) the Construction Division of Nippon Telegraph and Telephone Corporation (NTT). Contract backlog at beginning of the year ¥ 68,995 ¥ 78,348 $ 739,132 13.6% From that time forward, COMSYS has been a leader in the building of Japan’s Contract backlog at beginning of the year adjusted for newly consolidated subsidiaries — 1,665 15,708 — telecommunications infrastructure, and has played a major role in the development New orders received during the year 229,875 228,518 2,155,830 –0.6% of the emerging information-intensive society. Fueled by employee pride, we Net sales 220,522 231,750 2,186,321 5.1% Contract backlog at end of the year 78,348 76,781 724,349 –2.0% learned to foster a corporate climate characterized by open communications and the flow of fresh ideas, where every talent and ability can be fully expressed and Net income ¥ 5,625 ¥ 6,315 $ 59,575 12.3% Total assets 171,669 188,961 1,782,651 10.1% brought to maturity. An engineering firm riding the fusion of communications Shareholders’ equity 101,721 115,834 1,092,774 13.9% and computer technologies, COMSYS is expanding the range of its operations to Ye n U.S. dollars encompass every facet of the rapidly unfolding information-technology revolution. Per share: We are striving to make a contribution to the development of the 21st century’s Net income ¥ 42.97 ¥ 46.73 $ 0.44 8.8% Cash dividends 10.00 10.00 0.09 0.0% high-order, information-intensive society. COMSYS is a creative firm, working Note: Yen figures have been translated into U.S. dollars at the rate of ¥106.00=US$1, rounded, for convenience only, from an to build a richer future. approximate exchange rate of ¥106.15 to the dollar prevailing on 31st March, 2000. Contents • • • • • Net Sales Net Income New Orders Received Consolidated Financial Highlights 1 (¥ Billions) (¥ Billions) (¥ Billions) Letter from the Management 2 Toward the 21st Century—Our Vision of the Future 4 231.8 8.3 Corporate Citizenship 6 228.5 235.9 229.9 220.5 225.3 226.6 221.6 6.3 Review of Operations 7 6.8 184.6 189.0 NTT Construction 8 5.6 Domestic Construction and Engineering 10 International Operations 12 Information Systems 16 4.2 Management 18 Financial Section 19 Organization Chart 34 96 97 98 99 00 96 97 98 99 00 96 97 98 99 00 Corporate Information 35 Corporate Directory 36 1 Letter from the Management • • • • Environment in benefit obligations to deal with. This sum We have also implemented a project of tools and instruments for purposes of the management and technological capabili- uring this term, the Japanese government will be completely amortized in the coming management system that will allow the organic upgrading technology and improving safety, ties needed to mount a nimble response to D engaged in a number of measures intended fiscal year through the establishment of a integration of the NTT and non-NTT divisions, and in the improvement of the work environ- these rapidly changing market conditions. to stimulate the economy. As a result of this, retirement benefit trust (stock contribution) promoting the efficient utilization of both per- ment through enhancement of construction We must also enhance our cost competi- there were some signs of recovery in capital and other measures. sonnel and technologies. Each branch will bases. We also want to make effective invest- tiveness in response to today’s exacting investment in some sectors. However, the thoroughly reevaluate its marketing and ments in the opening up of new fields of business environment, deploying the capa- uncertain employment picture and declining Outlook and Important Issues project-execution systems on this basis, and business for the Company. bilities of the entire Group to achieve stronger income held consumer spending down, prevent- n the coming fiscal year, NTT can this will bring companywide improvement in Dividends will continue to be the pri- and stronger performance. ing economic recovery. I be expected to continue its capital the optimal utilization of human resources. mary source of shareholder income. However, To develop a corporate climate that will Conditions in the telecommunications investments in cellular phones and other This, in turn, will take to a new level our efforts from the standpoint of diversifying returns to allow us to face the challenges of the 21st cen- industry, which is this Company’s operating mobile-communications technologies. As to expand orders received, reduce project costs, shareholders, we want to continue to retire trea- tury with confidence, we have attached a new arena, were affected by the unfavorable the NTT Group accounts for a large percent- and improve the quality of our work. sury stock using a fixed percentage of income meaning to CI (corporate identity). At our Com- economy. However, the information-technology age of our orders received, this is a significant COMSYS treated the millennium bug as for the purpose. To this end, COMSYS plans to pany, it now stands for “COMSYS Innovation,” (IT) revolution is exploding, in turn bringing factor in the outlook for COMSYS over the the most important management issue of the extend this term’s dividend and treasury stock and our whole Company is united in furthering an increasing sophistication and rising level of coming term. At the same time, though, period of this report. The “Year 2000 Special policies into the coming fiscal year. this program. In the interests of protecting the technology in society and in economic activi- the cutbacks in NTT’s capital investments Project,” which involved a thorough inspection of Nippon COMSYS Corporation will cel- planetary ecology, we are working to achieve ties. The telecommunications market, as a called for in its medium-term management all our key systems, divisional systems, peripheral ebrate its 50th anniversary in December 2001. ISO 14000 certification in next fiscal year. result, continues its expansion. At the same reform measures can also be expected to have equipment, and all our own products (primarily The Company plans to declare an additional, The end of this fiscal year will usher in time, the market was strongly affected by the Pictured: (left) Chairman Shozo Iwasaki and an effect. software), allowed the Company to weather the commemorative dividend of ¥2 per share in the 21st century. You are aware that we desire restructuring of the NTT Group and by a series President Hironobu Takeuchi In non-NTT markets, the IT revolution transition with no significant problems. celebration of that event. to make a contribution to the development of of alliances and mergers among telecommuni- is predicted to bring rapid expansion of Internet the new century’s high-order, information-intensive cations firms, and also by the introduction of Overseas Construction Sector was hurt by the access services, online marketing, and other IT Dividends and Internal Reserves Capital Investment and Fund society, and to that end are strengthening our various new services and the intensification of economic turmoil in Southeast Asia. services. In response, and taking into account s the foundation for the continued expan- Acquisition business base as a truly comprehensive engi- A cost competition—developments which involve Consolidated net sales benefited from trends in strategic businesses such as CC Box sion of a company’s operations, dividend uring this term, the COMSYS Group neering enterprise. We request the continued foreign-owned firms as well as Japanese. the strong performance of the Domestic Con- construction, cable television, and business policy is one of the most important issues that D increased its capital investments by support of the company’s shareholders, clients, To build a management structure that can struction and Engineering Sector, which solutions, we are striving to expand orders from faces any firm. We are also seeking further ¥6,930 million (US$65 million). These included business partners, and employees as we carry deal efficiently with these significant changes achieved growth of 5.1 percent to ¥231.8 bil- the new common carriers, foreign-owned tele- strengthening of our financial structure and the purchase of the Dai Ni Tanimachi Building this effort forward. in the market, and with the diversification of lion (US$2,186 million). communications firms, and other companies improved return on equity. We also balance the and the land it stands on for the new Kansai customer needs, Nippon COMSYS Corporation The Company’s profitability has ben- outside the NTT Group. We are also conduct- best possible dividend payout to shareholders Office. We also invested in the purchase of land has established the position of corporate execu- efited from our long-term improvements in ing a full-scale marketing effort designed to with considerations of the Company’s performance for the construction of the Adachi Technostation tive officer, which has streamlined the efficiency, our establishment of internal sys- increase our business in the information indus- and its continued ability to generate dividends. (a construction base), and in the construction decision-making process and strengthened our tems and organizations, the reductions in try, as well as to expand our projects in Based on the policy described above, the of an education and training center in Omiya. competitiveness. We also enhanced our project- construction costs that we have achieved, and Southeast Asia and elsewhere overseas. From Company declared a midterm dividend of ¥5 No bonds or other instruments were issued during execution capabilities and our regional the establishment and strengthening of our sub- this, it can be seen that we regard the further per share, and a year-end dividend of another this term.