To our shareholders and investors:

New Year's Greetings from the OUTSOURCING Group

Please accept my warmest felicitations to you on the New Year.

In 2014, the OUTSOURCING Group successfully engaged in establishing a new corporate structure capable of responding to the ever-evolving needs of the production outsourcing industry brought on by nationwide structural reforms.

We project that domestic production volume will decline over the long term as Japanese makers find that the added value of “Made in Japan” weakens over time. To cope with this trend, we have placed greater emphasis on providing temporary placement and outsourced contracting services for the IT field, including the training of capable system engineers. As a result, our Engineering Outsourcing Business, which is centered on IT-oriented services, achieved significant growth, surpassing our previously core business in manufacturing outsourcing.

Additionally, the OUTSOURCING Group aims to fortify businesses in the civil engineering and construction industries, where demand generated from projects to improve and add infrastructure on a national scale, including construction of a maglev trunkline, are expected to take place over many years on a sustained basis. One of the ways we are meeting this demand has been the acquisition of Kyodo Engineering Corporation as a subsidiary in 2014. Kyodo is a leading civil engineering firm, with a large corps of engineers highly skilled in construction management and operations.

As for our Overseas Business, net sales generated in India and Southeast Asia〉egions that continue to boast dramatic economic growth and expanding populations‘xceeded JYP10 billion. We have also launched an initiative that offers the placement of foreign nationals as technical intern trainees to address the growing domestic labor shortage. This initiative is already proven to be a success, and we look forward to even greater results in the future.

r However, this and other initiatives are merely the starting point.

In 2015, we look to achieve unprecedented growth by maximizing intra-Group synergy. By doing so, we believe OUTSOURCING can develop into an enterprise that can weather any obstacle, regardless of how inconceivable it may be, because our Group of companies operate across a broad spectrum of industries, thereby sheltering us against the most volatile of times.
Only by developing into such a robust group can we continue to fulfill our management philosophy: to contribute to the building of a brighter, more prosperous society by facilitating productivity enhancements in the realm of shop-floor manufacturing (monozukuri).
I ask for your continued support for the OUTSOURCING Group.

January 1, 2015
Haruhiko Doi
Chairman and CEO
OUTSOURCING Inc.

All