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Fiscal 2005 Interim Results: Briefing Materials

Medium-term Business Direction

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Net Sales and Operating Income

( )

102.7

105.0107.5

112.0

117.1

110.4

7.3

9.1

10.6

9.6

8.0

10.5

90.0

95.0

100.0

105.0

110.0

115.0

120.0

2001 2002 2003 2004 2005 2005

6.0

7.0

8.0

9.0

10.0

11.0

12.0

Net sales Operating income(Billions of yen)

146.9

164.6

215.8

141.4

169.4

205.0

15.5

8.87.6

16.7

12.5

10.7

100.0

120.0

140.0

160.0

180.0

200.0

220.0

240.0

2001 2002 2003 2004 2005 2005

5.0

7.0

9.0

11.0

13.0

15.0

17.0

19.0

Net salesOperating income

(Billions of yen)

66.371.6

79.380.0

106.7

97.5

6.3

3.7

5.3

7.2

4.6

3.050.0

60.0

70.0

80.0

90.0

100.0

110.0

120.0

2001 2002 2003 2004 2005 2005

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0Net salesOperating income

48.3

52.150.8

53.1

58.3

51.9

3.1

4.0

4.3

4.1

3.7

4.2

40.0

45.0

50.0

55.0

60.0

2001 2002 2003 2004 2005 2005

3.0

3.2

3.4

3.6

3.8

4.0

4.2

4.4

4.6

4.8

5.0

Net sales Operating income(Billions of yen)

(Billions of yen)

Interim/ Nonconsolidated Full Term/ Nonconsolidated

Interim/ Consolidated Full Term/ Consolidated

(Actual) (Original Estimate) (FY)

(Estimate (Original Estimate)

(FY)

(FY)

(Estimate (Original Estimate)

(FY)

(Actual (Original Estimate)

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Scale of informationservices market in 1999

4.9 trillion

Scale of information services market in 2010 (June 2004 forecast) 10 trillion* Annual average growth rate: 4%-5%)

Scale of information services market in 2010(1999 forecast) 16.4 trillion* (Annual average growth rate: 11%-12%)

Slowing growth rate parallels maturing market*Prepared by TIS from Gartner materials, excluding hardware sales.

Understanding the Environment Most recent forecast (June 2004) -- Streamlined growth, maturing market

( )

Understanding the Environment by TIS The information services market is in the midst of transformation into a mature market that will result in a

new industry order. In the short term, a better earnings environment for clients will prompt higher IT investment and expand market

scale. However, in the long term, oversupply in the industry will continue to put downward pressure on the

amount paid per project. Polarization of corporate performances will expand at a heightened pace. An era of intense competition

approaches in which clients wield the power of choice.

( )

TIS GoalTo be playing a constructive role in the industry by fiscal 2011 (fiscal

year ended March 31, 2011), as one of the top three companies.

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Views on Growth

( )

( )

Degree of growth -- Expanded scale Quality of growth Higher profitability

Core business selection andconcentration

M&A

Boldly enter new businesses

Improved productivityTIS own quality management systems

and development standards

Building original solutions

Three Keys to Growth

Market Dialogue

More efficient administrative

function

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Advent of ubiquitousSociety

An era approaches when ITinvestment will be essential in

all fields, from finance,including credit cards,consumer lending and

leasing business, to

manufacturing, servicesand distribution.

Survivors gain accessto IT investment

demand

Around2010

Already enjoyingsolid profile

Processing-basedManufacturing

(Chemicals,Pharmaceuticals)

Assembly-basedManufacturing

(Electric machinery ,construction machinery)

New client groupsto capture

Target Fields

Credit Card

( )

Core business selection and concentration1. Clients sector: Highlight solid profile already enjoyed with credit card companies and target new clients in the

processing-based manufacturing sector, such as makers of chemicals and pharmaceuticals, as well as the

assembly-based manufacturing sector, such as electric machinery, and makers of construction machinery.2. Target Region: Emphasize regional responses by concentrating management resources in the three key cities:Tokyo, Nagoya and Osaka.

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IT-related Trends in Credit Card Sector

Public use and social infrastructure

Payment of public utility fees

Medical cost adjustments andelectronic medical charts

Widespread use of MPNs(Multi Payment Networks)

Medicalinstitutions

National health insurance(regional administration)

(Receipt:e-moneyexchange)

u-Japan Concept

Progress in the use of IC cards for residentregistry card and drivers licensesSettlement

function

EmployeeID function

Facilitatingthe execution of

service processing IC Card,RFID Responses

Personal ID andsecurity functionCommuterpass function

Credit card

( )

Commercial use

E-wallet, e-money

(primarily for smallsettlement amounts)

Mobile phones withe-money function

Reserve and pay for electronictickets, such as those forconcerts.

Keymarketing

toolGeneral use of combinedprepaid/commuter pass cards.

Easy access to informationon peoples movements.

Get into cash-on-delivery market,such as catalog sales,should mobile phoneswith e-money featurehave a settlementfunction.

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IT-related Trends in Processing-based Manufacturing Sector

Deregulationallowing overseas

manufacturers to enterdomestic

market

Mergers, businessalliances promptingindustry realignment

Heightenedcompetitionworldwide

Changes in business environment

facilitate real-time management for effective selection and concentration

ensure standardized business processes and systems that weather the frequent division andintegration of business segments.

Information systems have to --

TIS C hem ical M odel

TIS Consultings ERP Solutions

Proven results on large-scaleprojects for major processing-based

manufacturers, including paperand chemicals companies.

TCM: TIS Chemical Model is asolution that provides an analysis

of business-specific resultsin a short time.

Taking aim ataddition realignment

demand fromchemicals and

pharmaceuticals

companies.

The solution is --

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IT-related Trends in Assembly-based Manufacturing Sector

TIS boasts proven results for electric home-appliance makers, a sector particularly concerned about quality.TIS combines systems for production control, sales and distribution control and SCM into a comprehensive response to meet thesophisticated needs of the assembly-based manufacturing sector.

Sales control system Production control system Global SCM

Production planSales control Quality control

Inquiries/ estimates/

orderinformation

Of f i c e s

F a c t or i e s

Data development

ProductionestimatesAssembly

Mechanism,inventory

Inquiries Products

Productflow

Clients

OrdersEstimates

Manufacturinginstructions

Wrappinginstructions,shipment

Sales goalsManufacturingplan

ProductionPackagingShipment

H e a d Of f i c e

StrategiesBusiness climateSeasonal trends

Standard, secure inventory

Accounting

Inventoryplan

Salesplan

P ar t s m

ak e r s

DistributionCenter

T r a d

e r s

U s e r s

Full SupportOrder and delivery of appropriate large-scale systems

for major electric machinery makers.Core solutions,

CommerceCube

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Group Strategy

T I S

DGT 5

HFS 4

SEL 7

TSB 6

QUALICA

TNS 1

TNS 1

CreditCard

Leasing,consumer

loan

Banking

Securities

Public

corporation

Assembly-basedManufacturing

Distributionservices

Medium-sizedcompanies

Processing-basedManufacturing

UFIT

TISI(Shanghai )

AGREX

TIS Consulting

ChinaMarket

* 1 Toyo Network Services Corporation2 Hi-Ho Broadband Systems, Inc.3 M&T System Operations Co., Ltd.4 Hong Tu Financial Software (Shanghai ) Co., Ltd.5 DGT Information Systems Japan Limited6 TIS Solution Business Co., Ltd..7 System Engineering Laboratory Co., Ltd.

ManufacturingFinance

Hi-Ho 2

M&T 3

Group businesses and functions will be realigned in FY2006.

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Technology Strategy

Tackling Production Technology Tackling Leading-Edge Technologies

Improve productivityImprove quality

Quantitative identification of production capabilities

Establish leading-edged

technologies

Turning technologiesinto businesses

(G artner D ata Q uest(2004.7) )

System Development CouncilTackling CMMI 1

SEWS I SEWS 2

Component formatKnowledge management

Agile

Objective

On-demand

Open

Secure systems

Ubiquitousrity Modstruct

1 Capability Matu el: Real world standard for evaluating capability of softwaredevelopment ure and degree of maturity.

2 System Engineer Work Station: TIS own combination of SEWS and SEWS II. SEWS isan environment that provides standardized information in fixed frameworks, while SEWS IIis a support environment for document creation using a standard database.