To all of our stockholders and investors
I would like to begin this report by expressing our sincere appreciation to our stockholders and investors for their continuing support.

Since its earliest days, Iwatani has based its activities on the philosophy of its founder Naoji Iwatani: "Become a person needed by society, as those needed by society can prosper." This idea has guided our continuing efforts to contribute to society by creating new value to meet the needs of the world and our customers.

Our energy business centers on liquefied petroleum gas (LPG). In 1953, we became the first company to supply LPG in Japan on a significant scale, and have established a number of major facilities, including the Sakai LPG Terminal (storage capacity: 80,000 tons) in 1980 and Kashima LPG Joint Stockpiling Co., Ltd. (storage capacity: 225,000 tons) in 1994. At the downstream end of the market, we have over 100 distribution centers through which we supply LPG to 3.1 million households throughout Japan. For over half a century, we have led the industry as a pioneer in the LPG market.

Another of our business operations that dates back to the establishment of Iwatani is industrial gases. While operating distribution centers for industrial gases throughout Japan, we operate nine air separation plants in Japan and two overseas. The operation of the air separation plants is founded on our history of entering the market as a manufacturer, which began with the construction of large-scale separation plants for oxygen, nitrogen and argon in Sakai City in 1977.

In April 2006, Hydroedge Co., Ltd. began to operate an integrated plant that uses LNG cryogenic power to produce air separation gases, including oxygen, nitrogen and argon, as well as liquefied hydrogen. Located in Sakai City, Osaka Prefecture, this plant is the first of its type in Japan. With its establishment, we have further strengthened our capacity to meet the expanding demand for air separation gases, while also gaining a lead over our competitors in the development of infrastructure for supplying liquefied hydrogen.

In July 2009, we will commence operation of the first liquefied hydrogen plant in eastern Japan in Chiba Prefecture, and develop systems enabling stable mass-supply of liquefied hydrogen. Furthermore, as a leading company in the field of hydrogen in Japan, we are strongly committed to exploring approaches aimed at realizing a future hydrogen-driven society.

Through these initiatives, we aim to achieve sustained income growth and improvement in our corporate value. Our target for consolidated ordinary income in FY2009, the year ending March 31, 2010, is ¥12,000 million. We are also working to strengthen our financial standing through balanced allocation of funds to investment in our growth areas and the reduction of interest-bearing liabilities. Our medium-term goal is to reduce consolidated interest-bearing liabilities from ¥171,700 million as of March 31, 2009 to ¥150,000 million or less.

As we now approach our 80th anniversary on May 5, 2010, we are making an all-out effort within our Group to achieve our goals. We are determined to celebrate this milestone as a company that is enjoying sustained growth, and for which the future holds great promise.

We look forward to the continued support of our stockholders and investors.

President