May 25, 2011 Kaneko Chairman and President Regular Meeting

(Moderator)

We have been waiting for you. We have just begun the 67th regular press conference.

 

(Chairman and President)

Hello everyone. Thank you very much for your busy time.
Before the topics, I would like to describe our approach to the effects of the Great East Japan Earthquake.
Regarding initiatives to address power shortages due to the effects of the earthquake, at a regular interview in April, the government policy announced that on April 8, a framework to reduce power consumption by 25% for large consumers was announced on April 8. I have just stated that we will work towards this goal.
Subsequently, the government's policy was reviewed on May 13, and a decision was made within Tokyo Electric Power's jurisdiction to control it by 15% or more compared to last year, regardless of whether it was large or small.
In light of these changes, we have set a goal of saving 15% or more of the maximum power in the jurisdiction of TEPCO from July to September compared to last year. While taking into account the safety, security and comfort of customers, in addition to the current efforts to reduce power consumption such as reducing the use of road lighting, we will also take further measures such as power savings in air conditioning in service area buildings, which will consume more electricity in summer. We carry out sequentially and achieve goal.
In addition, we will promote initiatives to conserve electricity in the jurisdiction of other electric power companies, including Chubu Electric Power Co., Ltd., where the operation of the Hamaoka Nuclear Power Plant has been suspended.
The Great East Japan Earthquake suffered enormous damage from unexpected tsunamis. NEXCO Central Japan is united with the local community by providing more detailed information to customers using the Expressway in the event of an earthquake or tsunami, and checking and guiding evacuation sites and evacuation routes around the Expressway We will work to strengthen our disaster prevention system.
In preparation for the Tokai, Tonankai, and Nankai earthquakes, the company is responsible for the precious infrastructure of the public, such as the Expressway I will continue.
In addition, as reported in the press, it is necessary to discuss the use of the Expressway as an evacuation site in the region while listening to the opinions of local residents and consulting with the national government, organizations, police, etc. I believe there is.
For the purpose of supporting the recovery from the Great East Japan Earthquake, "Charity Campaign" and "Products featuring local products from the Tohoku region" will be held in the service area and parking area of NEXCO Central Japan for 12 days from April 28 to May 9. Exhibition and flea market. About 31.7 million yen, a part of the proceeds from the event and the donation from customers, was donated today from our Companies in our Group, China Nippon Exis, to the Chunichi Shimbun Social Societies. We would like to thank our customers for their cooperation and report. Thank you very much.
That's it for the Great East Japan Earthquake.

The next topic is the status of the business in April.
Toll revenue in April was ¥ 34,560 million, down 5.8% from the same month last year.
Breakdown is that high-speed is 32,229 million yen, down 3.5%, and Ichiyu is 2,332 million yen, down 29.2%.
On the other hand, the average number of traffic in April was 18.79 million daily, up 8.5% from the same month last year.
The breakdown is that high-speed high-speed transmissions averaged 14.18 million units per day, up 3.4%, and Ichiyu 461,000 units per day, up 28.0%.
Although there was a decrease due to the Great East Japan Earthquake, the number of toll-free vehicles exceeded that of the toll-free social experiment centered on general toll roads, increasing overall by 8.5% compared to last year.
On the other hand, fee revenues were negative compared to last year due to the effects of the Great East Japan Earthquake in addition to the effects of the free social experiment.
This month's ETC discount was 28.7 billion yen, a 1.8% reduction from the previous year's 29.2 billion yen.
The discount rate is about 45.3%.

Next is the construction situation.
Is scheduled to open to the end of this fiscal year, the metropolitan area center Contact Road (Ken-O Road regard to between 2.0km of Hachioji junction from) Hachioji Minami Interchange, is promoting the business as a merger enforcement in our country (under the direct control) It is a section, and we are working together to make progress.
Next is the usage status of ETC except for the free social experiment section.
In the latest 5/6 to 5/12, the daily average number of vehicles used decreased 4.7% and the daily average utilization rate increased 0.7% from 89.0% to 89.7% compared to 4/1 to 4/7 . Looking at weekdays, weekends and holidays, the average weekly usage rate increased from 89.0% to 89.8%, up 0.8%, and the average holiday usage rate increased from 88.9% to 89.5%, up 0.6%.
The cumulative number of OBEs installed at the end of April was 0.84% higher than at the end of March, an increase of 260,000 units, or approximately 34.51 million units. [Approximately 43.06 million units including re-set-up]

Next is the service area situation.
Sales in the service area in April were 11,969 million yen, up 100.8% from the previous year. In terms of road, Higashi-Meihan Expressway 150.0%, Kisei road 136.9% were strong.
Higashi-Meihan Expressway, "EXPASA Gozaisho" is still popular with many customers, and we believe that Kisendo is the impact of a free social experiment.
Breaking down sales by category, “Food & Beverage” decreased 265 million yen, or 97.0% from the previous year.
Further breakdown of the “Food & Beverage Division” is as follows: “Food & Beverage Division” increased by 27 million yen, up 100.9% from the previous year, and “Merchandise Division” reached 293 million yen, up 94.9% from the previous year It has been reduced.

Next, in the “Service Division (rest-in, bath)”, sales increased 1 million yen, up 104.2% from the previous year.
Lastly, in the “GS Division”, refueling volume decreased 99.6% year-on-year from the previous year, but due to a unit price difference of ¥ 19, net sales increased 112.6% year-on-year to 372 million yen. The yen has increased.

The next topic is about opening the new "EXPASA".
Last year, five “EXPASAs” were opened: Gozaisho, Ashigara, and Taga. We talked about the current state of our business, and we have been evaluated. This time, two new commercial facilities, the Tomei Expwy Ebina Service Area (In-bound) and the ChuoExpwy Danrigaka Service Area (Out-bound), will be renewed and developed as “EXPASA”. This makes "EXPASA" 7 areas.
EXPASA Drigging Hill (Out-bound) is ChuoExpwy 's first "EXPASA" and will open two stores at 6:00 am on Thursday, June 16 as the first opening.
The Danrigizaka Service Area is the first service area on the ChuoExpwy goes from the city center to the suburbs.
Two stores will open during the first phase: Food Square, a delicatessen where you can buy delicatessen and seasonal fruits using local ingredients, and Little Mermaid, a bakery using specialty products from the fruit kingdom of Yamanashi Prefecture.
In addition, the first opening of EXPASA Ebina (In-bound) will be announced once it is decided. Please look forward to "EXPASA".

The next topic is the announcement of the Chainsaw Art Competition.
As you can see in the flyer at hand, this tournament is the one in Japan that decides the best woodworking art that makes various sculptures from logs and trees.Saturday, 28th of this weekend and Sunday of 29th, Aichi It is held in Toei-cho, prefecture.
NEXCO Central Japan will co-sponsor this event based on the “Comprehensive Agreement on Cooperation and Cooperation” with Aichi Prefecture, which was concluded in December 2009, with the aim of promoting the use of local wood from Aichi Prefecture and promoting local production for local consumption. I am.
Most of the materials used in this tournament, such as logs and trees, were cut from the construction site of the Shin-Tomei Expwy and provided by the Company.
By all means, please come to the chain saw art competition and enjoy the dynamic performance using the chain saw and its power.

The next topic is environmentally friendly initiatives.
We are promoting the use of renewable solar power, hydroelectric power, biodiesel fuel, and biomass fuel as our contribution to the environment and a sustainable society.
Photovoltaic power generation was first used in toilets in the Ashigara service area in fiscal 1995, and has been introduced at 11 locations.
This year's 3 began operations in May Mei-Nikan Expressway in, domestic Expressway introduced a power generation scale of solar power of about 2,000kw be up in, it becomes necessary during the day because it is a road structure of a semi-underground lighting 100% of our electricity.
In addition, the scale of photovoltaic power generation in our jurisdiction as of the end of fiscal 2010 was about 2,500 kw in total.
Hydropower has been using a spring generated from the Hida Tunnel on the Tokai-Hokuriku Expressway to produce approximately 50 kw of hydroelectric power since December 2010, and partially supplies electricity for tunnel lighting.
Regarding the use of biodiesel fuel, we have been using biodiesel fuel, which has been recycled from tempura oil used in service areas, etc., since FY2006. In fiscal 2010, 17 vehicles, including traffic signs and road cleaning vehicles, were used, and approximately 30,000 liters of biodiesel were converted to light oil.
The next page is about biomass fuel.
For biomass fuel, we are promoting the use of biomass fuel and technology development using plant-generated materials such as cut grass and thinned wood generated from Expressway.
The first is the use of small solid fuel pellets.
Pellets are manufactured from thinned wood and used as fuel for the pellet stove in the service area during winter. By fiscal 2010, pellet stoves were installed in eight service areas.
In addition, joint development with a private company was conducted to develop technology for manufacturing pellet fuel from cut grass, etc., and a demonstration experiment on the use of this pellet fuel was conducted in the Shin-Tomei Expressway Leading Project. Currently, we are considering the practical application.
Next is biomass gas fuel.
We are collaborating with Yanmar Co., Ltd. on technology development for producing biomass gas fuel from cut grass and generating electricity. Next month, basic experiments will begin in June at the Meishin Expwy Taga Service Area. The power generation scale is 25 kw, and the power obtained during the experiment will be used in some service areas.
This is the situation of renewable energy use that we are working on.
The other day, we met with the governor of Aichi Omura and exchanged opinions on a low-carbon society system. Based on this, we also intend to proactively work on the use of renewable energy.
This concludes our report on environmentally friendly initiatives.

Lastly, we have not distributed any materials to you, but I would like to remind you.
I mentioned at a regular meeting in March that our employees have been inspected by the National Taxation Bureau for alleged violations of the Income Tax Law, but I would like to explain the current situation.
We continue to cooperate fully with the NTA investigation. In addition, with the cooperation of external experts such as lawyers and real estate appraisers, a committee has been set up and the necessary investigations have been intensively carried out, and understanding of the facts has been prioritized. At the same time, we are considering measures to prevent recurrence.
We will notify you as soon as the committee's findings are finalized.
As of today, we are investigating and will not comment on the content.
We deeply apologize to those concerned who have been understanding and cooperating with the Expressway business on a daily basis and to customers who use the Expressway.

 

(Moderator)

Now, I would like to receive your questions.

(Reporter)

Expressway usage, do you see a recovery trend?

(Chairman and President)

Looking at the traffic data, the traffic volume in the first week immediately after the earthquake fell to less than 20%. After that, it gradually recovered and in the 5th week, it recovered to the same level as last year. After that, the Golden Week period was about 110% and fell slightly shortly after, but exceeded 100%. Therefore, we expect that traffic volume has recovered to the same level as last year.

(Reporter)

In talks about power saving, TEPCO has set a target of 15 or more reductions. Is there a target value for Chubu Electric Power?

(Chairman and President)

We aim to reduce power consumption by more than 15% in the jurisdiction of TEPCO, and we plan to save about 4% in Chubu Electric Power after the shutdown of the Hamaoka Nuclear Power Station. For Kansai Electric Power and Hokuriku Electric Power jurisdiction, we are considering saving 3-5%.

(Reporter)

What is the content of the power saving in the Chubu Electric Power District?

(Chairman and President)

Since safety and security are our top priority, we will turn off lights at rest facilities, save power in toilets, and save power in offices before saving power on the main line as much as possible.

(Reporter)

Are the power saving figures compared to last year?

(Chairman and President)

Compared to last year at the peak of July-September.

(Reporter)

Is there any new power savings in addition to the current power savings if the target of TEPCO's power savings is 15% or more? Is there any reason to make a difference between TEPCO's 15% and Chubu's 4%?

(Chairman and President)

We are working on a concrete policy on the details of power saving, but we believe that 15% or more of saving power within the jurisdiction of TEPCO can achieve the target. Currently, the number of lights on the main line is reduced by 47%, about half, and air towels in the service area are stopped, so we believe that a total of about 15% power saving can be achieved. The difference between the jurisdiction of TEPCO and the jurisdiction of other electric power companies is considered to be the seriousness of the electric power company or the difference in the margin of electricity supply. Outside of the jurisdiction of TEPCO, we consider "safety", "relief", and "comfort" to be less power-conserving.

(Reporter)

What is the impact of the rotation operation and what are the countermeasures?

(Chairman and President)

We don't have a full picture of what kind of rotation operations companies, especially manufacturers, will take under our jurisdiction, so we are not currently thinking about any special measures. I would like to take necessary countermeasures according to the status of initiatives in each industry in the future.

(Reporter)

I heard the term biomass gas fuel for the first time.

(Chairman and President)

We have been worried about the treatment of cut dead grass until now, but we will use these materials to generate gas and convert it to electricity. This is a new natural energy trial. It is not a big facility because it is still 25kw, but I hope that it can be adopted on a trial basis and work well.

(Reporter)

It is reported that the so-called 1000 yen discount on holidays will be abolished in mid-June. What do you think of the impact on traffic and traffic congestion?

(Chairman and President)

We believe that traffic congestion points that have occurred after the introduction will be resolved. I also think the overall traffic will drop, but we don't think it will have a significant impact on our company.

(Reporter)

What is currently being implemented?

(Chairman and President)

We are currently revising the rate system. The program revision will take about two months, so the Minister of Land, Infrastructure, Transport and Tourism is working on time in mid-June, which was announced at a conference.

(Reporter)

Today, Governor Hideaki Omura of Aichi Prefecture and Mayor Takashi Kawamura of Nagoya City have announced discounts on the Nagoya Expressway. Please let us know what you think.

(Chairman and President)

It was listed as an election pledge, so we expected to eventually offer a discount. Since it is a discount for a limited time, it seems that the impact on the traffic on the Expressway our jurisdiction is small.

(Reporter)

What is your outlook for overseas business orders?

(Chairman and President)

About two years ago, I have been working on a Expressway project near Hanoi, Vietnam. We are making good progress and are currently conducting a feasibility study with funding from the Japan International Cooperation Agency (JICA). We are trying to export infrastructure for the first time as a Expressway company. We believe it would be desirable to have government involvement in financial and risk hedging issues. At the moment, after giving a presentation to the Vietnamese government's MOT (Ministry of Transport and Transportation), I think that it is proceeding smoothly.

(Reporter)

Are employees violating income tax law still enrolled in NEXCO Central Japan?

(Chairman and President)

We are still our employees. I'm enrolled but have stopped working.

(Reporter)

Please tell us the status of the Overseas Preparation Office, which is being jointly conducted with other road companies.

(Chairman and President)

Initially, four companies were preparing for the launch of the new company, but now the Hanshin Expressway Company has joined and five companies are preparing. Currently, we are gathering frequently and packing, and I think we can probably establish it in early fall.

(Moderator)

This concludes the regular press conference.