Annual Report 2005 - Marubenimarubeniamerica.com/our_company/financial_statements/mac2005.pdf · Annual Report 2005 Year ended December ... Reviewing the 2005 business year, I am

Annual Report 2005Year ended December 31, 2005

2 Marubeni America Corporation 2005 3

Branches, Offices & Showrooms

New York Headquarters450 Lexington AvenueNew York, NY 10017Phone: (212) 450-0100 Fax: (212) 450-0700

Canton ShowroomHorkos Machine Tool Center, 8655 Ronda DriveCanton, MI 48187Phone: (734) 354-7940 Fax: (734) 354-7939Mark Ostraff, Sales & Marketing Manager

Novi Showroom41135 Vincenti CourtNovi, MI 48375Phone: (248) 888-9200 Fax: (248) 888-0754Michael Millsaps, Sales & Marketing Manager

New York ShowroomDesign Link, 1411 Broadway, Unit 2545New York, NY 10018Phone: (212) 450-0311 Fax: (212) 450-0722Tosuke Nakamura, Assistant General Manager

Detroit Office2000 Town Center, Suite 2150Southfield, MI 48075Phone: (248) 353-7060 Fax: (248) 353-0649Yuji Umeda, General Manager

Houston Office2800 Post Oak Boulevard, Suite 6000Houston, TX 77056Phone: (713) 871-5700 Fax: (713) 871-1726Shinichiro Soma, General Manager

Los Angeles Branch515 South Figueroa Street, Suite 2000Los Angeles, CA 90071Phone: (213) 972-2700 Fax: (213) 626-1294Koichi Nakahama, General Manager

Omaha Office1125 South 103rd Street Suite 475Omaha, NE 68124Phone: (402) 934-1060 Fax: (402) 934-1063Yoshinobu Takahashi, Marketing Manager

Portland Office1300 SW Fifth Avenue, Suite 2930Portland, OR 97201Phone: (503) 224-3761 Fax: (503) 295-7943Masaaki Higuchi, General Manager

Silicon Valley Branch3945 Freedom Circle, Suite 1000Santa Clara, CA 95054Phone: (408) 330-0808 Fax: (408) 330-0807Mitsuaki Yamamoto, General Manager

Washington DC Office1776 I Street NW, Suite 725Washington DC 20006Phone: (202) 331-1167 Fax: (202) 331-1319Tetsuhide Mikamo, General Manager

Marubeni America Corporation Web Addresswww.marubeni-usa.com

Marubeni Corporation (parent) Web Addresswww.marubeni.com


Reviewing the 2005 business year, I am pleased to report

that the earning power of Marubeni America Corporation

(“MAC”) has continued to improve. Though the profi t-after-

tax declined from the previous year due to some impair-

ment losses, our gross profi t was a historical record high

of $544 million in 2005. In addition MAC has achieved its

medium term strategic target, as set in Marubeni Corpora-

tion’s “V-Plan” (Marubeni’s Turnaround Plan - FY2003, 2004,

2005). As a result, a fi rm foothold was built in both revenue

base and fi nancial strength. Furthermore MAC’s balance

sheet is now quite healthy, and the number of underper-

forming assets has been signifi cantly reduced.

The “G-Plan” (Growth and Glory - FY2006, 2007) has

now been launched focusing Marubeni towards further

achievement. In 2006, our most important and immediate

focus is to develop new business and expand our well-per-

forming assets. In that regard, MAC has made great efforts

towards major new investments and is planning to fi nalize

signifi cant acquisitions within this year. Also, in all of our

business units, new business opportunities are being de-

veloped continuously. Such initiatives will set the stage for

MAC to renew the historical high record of its profi t-after-

tax during the two year “G-Plan” period.

MAC will also strive for an even higher level of qual-

ity: this will enhance the perception and reputation of our

company internally and externally. We will continue our

efforts to further enhance our already solid company man-

agement with increased focus on internal control systems,

compliance, risk management, tax planning and corporate

culture. MAC must be healthy both fi nancially and organi-

zationally to realize sustainable prosperity.

Michio Kuwahara

President & Chief Executive Offi cer

President’s Message

We look forward to the opportunities and challenges

in 2006, as MAC enters a period of accelerated growth.

Our upcoming accomplishments will not only make us a

stronger hub of Marubeni Corporation’s North American

operation but also will enable MAC to be the strongest it

has ever been.


Marubeni America Corporation – As a “sogo shosha,”

or general trading company, we act as an intermediary,

or broker, in all types of trade between enterprises and

countries. Unlike many other large businesses, a general

trading company has few fixed assets, instead relying on

human resources, intensive information gathering and

financial resources. We are the largest overseas subsidiary

of the Japanese conglomerate, Marubeni Corporation.

While Marubeni America independently trades in a

broad range of commodities, agricultural goods, industrial

machinery and natural resources, we are more than just

brokers. We also act as major financiers and large-scale

organizers. We play a vital role in the logistics of trans-

actions, such as the global movement of products. We

assume and manage risk involved in transactions and act

as business consultants, using our vast trade experience

in new business development. We provide many special-

ized services, including sales support, transportation,

insurance, storage, financing and leasing, engineering and

construction service, and traffic and logistics planning. We

frequently make direct investments in companies inside

our core competencies.

Marubeni America’s function as an intermediary enables

us to bridge the gap between supply and demand, at

times by putting together the suppliers and those seeking

their products, and at other times by providing the actual

sources of supply or demand. In our efforts to increase

trade and to find new directions for it to flow, we construct

new plants, often leasing the completed plant to a manu-

facturer, providing raw materials, and then arranging for

the sale of the finished goods.

Marubeni America is headquartered in New York City,

with seven other U.S. locations and 33 subsidiary and af-

filiated companies. We can also access a network of over

120 Marubeni Group offices and 555 associated companies

worldwide, all of which provide Marubeni offices and affili-

ates with up-to-the-minute information on commodities,

commerce and finance. Through this network, Marubeni

America Corporation is able to facilitate complex projects

and transactions.

We appreciate your interest in our company and look

forward to assisting you in expanding your present busi-

ness or in identifying and developing new business oppor-

tunities.

About Marubeni America Corporation


Investment

Leasing, Finance & Logistics Business Unit (LBU)Marubeni America’s (MAC’s) Leasing, Finance & Logistics

Business Unit (LBU) has been playing a vital role in MAC’s

investment business, focusing on the equipment leasing

sector since the mid-1990s. LBU strategically invested in

priority areas such as the refrigerated transportation indus-

try, healthcare equipment and other niche industries in the

U.S. MAC’s wholly-owned subsidiary, PLM Trailer Leasing

(PLM), acquired in 2000, is a top-tier player specializing

in the leasing of refrigerated trailers to the foodservice

industry. As the market for fresh food products is expand-

ing every year, we expect PLM to continue to grow to meet

demand. In the near term, LBU is also considering making

further strategic investments, not only in the leasing sector,

but in the financial and logistics sectors as well.

Investment Business Unit (IBU)The Investment Business Unit (IBU) seeks sound invest-

ment opportunities for Marubeni America (MAC), whether

in private equity funds, in strategic direct investments or

in middle-market acquisition opportunities. The strategy

always is to promote growth wherever it invests by allow-

ing acquired entities to utilize the global network of busi-

ness alliances built up by MAC and its parent, Marubeni

Corporation.

To-date IBU has invested in several private equity funds

specializing in new technologies in emerging and estab-

lished industries and had them serve as deal-flow sources

for the Marubeni Group. The typical investment size ranges

from $1 to $5 million per fund, and among the IBU-invest-

ed funds are Boston Capital Venture, Boston Venture, Bear

Stearns Health Innoventures, RockPort Capital, Caduceus

Private Investment, and Morgan Stanley Venture Partners.

In late 2005, IBU expanded its regional focus beyond the

U.S. by becoming a limited partner of Banyan Capital Part-

ners headquartered in Vancouver, Canada.

IBU also searches for strategic direct investment oppor-

tunities in both early-stage ventures and established busi-

nesses. IBU invested in both Corsolutions and NxStage,

which began making successful exits in late 2005. Also

in IBU’s portfolio are companies such as Novarian (global

positioning system provider for farming, mining and

construction machines) and Selective Micro Technologies

(chlorine dioxide-based cleaning system developer).


IBU is also seeking opportunities to acquire middle-mar-

ket companies with experienced, motivated management

teams. On June 8, 2006, IBU closed on the acquisition of

Advantage Funding Management, Inc. (Advantage), the

auto leasing company of commercial vehicles with the

largest market share in New York State. With the ad-

ditional customers of the auto dealers in New York and

Massachusetts owned by MAC’s sister company, Marubeni

Auto & Construction Machinery America, Inc., Advantage is

expected to grow to be a leading auto leasing company in

the U.S.

The Bio and New Materials Department within IBU pur-

sues investment and business opportunities in emerging

industries such as healthcare, biotechnology and material

sciences. Its specialty is facilitating the bi-directional flow

of technology and business between the U.S. and Japan

and Asia. Current activities include private equity invest-

ment, partnerships, incubation, joint ventures, technology

and product development sponsorships, and marketing

and distribution. The Department aims to become a top-

tier investor in venture capital and to establish a strategic

position in the trans-Pacific technology market.

The Bio and New Materials Department’s private equity

investment strategy targets early to mezzanine stage

companies with a definite near-term commercialization

plan. Investment size is up to $5 million and embraces all

areas of biotechnology, nanotechnology, material sciences

and other emerging technologies. Its involvement varies

from pure investment to something more hands-on and

strategic, depending on the project.


Helena UnitMarubeni America’s (MAC’s) subsidiary, Helena Chemical

Company (Helena), is one of the largest formulators and

distributors of crop inputs and services in the U.S. Helena

offers a variety of crop protection products, agricultural

chemicals, seed, fertilizer and related products. Its propri-

etary line of products includes adjuvant, seed treatments,

bioscience, nutritional and value-added generics, which are

distributed in about 20 countries. Helena has four plants

which provide toll manufacturing services for its suppli-

ers as well as manufacturing Helena’s line of private and

proprietary products. The Company has 14 sales divisions,

with over 250 sales outlets and more than 2,500 employ-

ees. In addition to traditional agricultural products, Helena

offers services in turf and ornamental products, forestry,

aquatic and vegetation supplies.

Chemicals

Chemicals UnitThe Chemicals Unit handles petrochemicals, plastics, spe-

cialty chemicals and electronic materials.

The Petrochemical Department is based in Houston at

its industry’s center. It trades petrochemical products such

as olefins, aromatics, carbon black feedstock, vinyl chloride

monomer (VCM) and caustic soda, mainly between the

U.S., Central and South America and Asia, to meet the

increasing demand in Asia and in the U.S.

The Plastics & Specialty Chemicals Department meets

the increasing challenge of satisfying the chemical indus-

try’s needs. Marubeni America’s (MAC’s) subsidiary, Maru-

beni Specialty Chemicals, Inc. (MSCI), conducts trading

and distribution operations. MSCI’s three divisions serve

various constituencies, including the paper coating, paint,

adhesive, packaging, automobile, electronics, fiber optics

and plastic compounding industries. MSCI is invested

in, and seeks further opportunities to invest in, emerging

companies that offer cutting-edge technologies.

The Electronic Materials Department, located in Santa

Clara, California, trades materials related to digital prod-

ucts and the semi-conductor industry between the U.S. and

Asia, primarily Japan.

The Development Department was established in April

2005 to pursue investments in the fields related to the

chemical industry and to create trade synergies among the

other three departments.


Plant, Utility & Infrastructure UnitThe Plant Department within the Plant, Utility & Infrastruc-

ture Unit is responsible for the development, coordination,

logistics, insurance, management, investment in, and fi-

nancing of plant-related business; for plant and equipment

financing; and for import, export and third-country plant

and equipment transactions. Notably, it invests in industrial

projects on a build-own-operate basis (“BOO”) in North

America, including with PEMEX, the Mexican state-run oil

company. The Plant Department is also involved in operat-

ing several industrial companies in various fields and in

distributing machinery for the textile industry through

Marubeni America’s (MAC’s) subsidiary, Tekmatex, Inc.

The Utility & Infrastructure Department does business

development related to the power industry in North Amer-

ica. It explores new areas of power generation, transmis-

sion, and delivery of utility-scale and distributed genera-

tion, including Engineering, Procurement and Construction

(EPC), development, financing, ownership, and operation

and maintenance.

The Utility & Infrastructure Department also partners

with North American companies to develop and com-

mercialize new energy technologies and business models

in Asia together with MAC’s parent company in Japan,

Marubeni Corporation. Through its parent, MAC is able to

act as a conduit between North America and Japan for new

technologies, products, and business models in the power

and energy industries. To that end, the Department has

established a new line of business focused on distributed

power generation (<50 MWs), employing clean, efficient

fuel cell technology developed by FuelCell Energy, Inc. It

continues to support ongoing GE gas turbine component

sales to Hitachi, Ltd. through Marubeni Corporation. It is

also developing business for Hitachi H25 gas turbine gen-

erators in North America.

For new business development, MAC is aggressively

seeking power generation assets for acquisition. Our aim

is to add value to the acquired assets using our global

experience of EPC and operation and maintenance.

Transportation, Industrial Machinery &Information Business UnitThe Transportation, Industrial Machinery & Information

Business Unit is extremely broad. Transportation Machin-

ery includes automobiles, commercial trucks, construction

machinery, mining equipment, agricultural machinery and

aircraft, as well as their spare parts. Industrial Machinery

consists of machine tools and parts for automotive and in-

dustrial manufacturers. Information is involved in develop-

ing and exporting digital products and medical equipment.

Marubeni America’s functions relative to the machin-

ery products are as follows: import and export of digital

products, medical equipment and industrial machine tools

for manufacturers; import, export and wholesale of agricul-

tural and construction machinery, mining equipment, cars,

commercial trucks and other industrial vehicles and equip-

ment; investment in and operation of a wholesale distribu-

tor of machine tools, a wholesale distributor of cars, and

retail car dealerships; and, finally, investment in and export

of military defense products for Japan, along with leasing

and sales of aircraft and specialized commercial vehicles.

The Transportation, Industrial Machinery & Information

Business Unit is now developing new business with auto-

motive parts manufacturers.

Machinery


Agri-Marine Products Unit The Agri-Marine Products Unit buys and exports grain,

meat and other foodstuffs from the U.S. for the Japa-

nese and Asian markets; engages in commodities trading

through the New York Coffee, Sugar and Cocoa Exchange

and the Chicago Board of Trade; and assists Marubeni

Corporation in conducting commodity trading with suppli-

ers in North America and Central and South America. For

some time now, it has exported wheat, barley, rice, corn,

sorghum, soybeans, canola, beef, pork and other foodstuffs

to the Japanese and Asian markets from the U.S., while

also importing sugar to the U.S. from Central and South

America.

non-genetically modified (non-GMO) grain as well as to

promote more organic foods in Japan.

Marubeni America’s subsidiary, Columbia Grain,

Inc. (CGI), exports over 130 million bushels of wheat

and barley through its state-of-the-art grain elevator

at Terminal-5 in Portland, Oregon. CGI’s facility ships

about 12-13% of all the wheat and barley exported by the

U.S. (For more information, please see CGI’s website at

www.columbiagrain.com.) In anticipation of irregular mar-

ket conditions across the globe, the Agri-Marine Products

Unit is looking to new areas for supplies of grain, including

South America.

Forest Products & General Merchandise UnitThe Hide, Leather and Synthetic Leather Department ex-

ports Canadian and U.S. hides to Asian countries including

China, Korea, Taiwan and Japan. It also sells Clarino, one

of the most advanced synthetic leathers ever made, in the

U.S., Canada, Mexico and South America. For the U.S.

market, the Department launched the marketing of Tsuki-

hoshi lightweight, flexible children’s shoes with anti-bacte-

rial insoles for sale at high-end retailers.

The Refractory Department imports the Shinagawa

Refractories Company, Ltd.’s alumina graphite product for

steelmaking. Our customers include both integrated and

mini mills located throughout North America.

The Rubber Department imports conveyor belts, hoses

and condoms from mainly Asian countries, including Chi-

na, Taiwan, Korea and Japan, and distributes them mostly

in North America. It also seeks new business opportunities

in the general merchandise field.

Marubeni America’s (MAC’s) subsidiary, Marubeni

Pulp and Paper North America Inc., imports, exports and

distributes pulp, wood chip and paper; Marubeni Business

Machines (America), Inc. distributes Konica Minolta copiers

in Latin American countries and in the Caribbean; and Pan

Pacific Fiber, Inc. collects various waste papers from local

markets and sorts, bundles, and ships them worldwide.

The Agri-Marine Products Unit has worked to expand

its business, especially in corn and soybeans, by securing

its supply base. In 2005, it formed a strategic alliance with

the major U.S. grain suppliers when it established the Time

Charter Vessel Operation Company with Archer Daniels

Midland Company (ADM). It also entered a new supply

relationship in Brazil in close cooperation with the Agrenco

Group. Similarly, it sought to ensure a safe and stable

supply system for meat and other foodstuffs by reinforc-

ing strong links with U.S. and Central and South American

suppliers; for example, with Premium Standard Farm in the

chilled pork trade, with Jamaican Cane Products Sales in

the U.S.-quota sugar trade, and with a Canadian supplier

of wheat. The Unit also seeks to increase its trading of

Commodities


Metal, Mineral Resources and Energy UnitThe Metal, Mineral Resources and Energy Unit is engaged

in the import, export, domestic and offshore trade of vari-

ous non-ferrous metals and ferrous materials and miner-

als. While its main activities are trading and distribution,

it is intensely involved in a variety of high-technology

related businesses and venture projects for the compound

semiconductor industry. The Unit has three offices strategi-

cally positioned in New York, Detroit and in Santa Clara,

California to oversee its businesses, ensuring reliability and

flawless service to all its customers. It anticipates further

expanding its trade and distribution of existing products,

such as copper and aluminum products. In addition, it

expects to realize some promising venture projects related

to the high-technology industry.

The New York Metals Department specializes in copper

tubing for air conditioners, copper strip for submarine ca-

ble and cellular base stations, Gallium Arsenide substrates

and epi-substrates, Japanese electrical parts and material

used for highly technical industries, import and export

of aluminum and copper products, trading of aluminum,

power and communication cables and wires, and venture

funding focusing on the high-technology related industry.

The Detroit Metals Department specializes in aluminum

wire rod for the steel industry, aluminum products for

the automotive industry, import of aluminum foil, metal-

lic powders for sintered automotive parts, import of hot

briquetted iron (HBI) and alternative irons for the steel

industry, and import of Supper Alloy (Low Carbon Ferro

Chrome).

The Silicon Valley Electronic Specialty Products Depart-

ment specializes in aluminum and glass substrate for

hard disc drives (HDDs), polishing pad and slurry for hard

disc and semiconductor wafer, compound semiconductor

template including Gallium Nitride and Aluminum Nitiride,

LEDs for 370nm to 1550nm wavelengths, and laser inspec-

tion machines and screen printing machines for HDD and

semiconductor applications.


Textile UnitThe Textile Unit primarily engages in designing, sourc-

ing, manufacturing and marketing a wide range of textile

products that serve both the U.S. and overseas markets. In

addition to supplying fabrics and finished garments to the

apparel industry, the Unit also markets various raw materi-

als, mainly yarns and fibers, to domestic weavers, knitters,

paper producers and carpet manufacturers. Like Marubeni

America, many of our customers are market leaders in

their fields with well-known brand names.

The Textile Unit goes well beyond the traditional

concept of buying and selling. Many of the manufacturers

we source from are Marubeni subsidiaries in Asia, who

work very closely with us in determining market strategy,

production planning and future market trends. In the near

future, our most promising growth areas are in automo-

tive seating and interiors, specialty yarns and fibers, home

furnishings, men’s and ladies’ fabrics, and apparel.

The Unit is also looking to develop products outside the

traditional textile area. To that end, we are currently work-

ing with a large cosmetic company on manufacturing skin

care products in Asia.


Investment

The Leasing, Finance & Logistics Business Unit

MAC Trailer Leasing, LLC Refrigerated trailer leasing(dba PLM Trailer Leasing) 100 Paragon Drive, Montvale, NJ 07645 Phone: (201) 505-0011 Fax: (201) 334-5199 www.plmtrailer.com Contact: Robert A. Sukovich ([email protected])

The Investment Business Unit

Fazix Corporation Biotechnology business Structure-based drug design company

3960 Broadway, New York, NY 10032 Phone: (212) 543-9696 Fax: (212) 543-9229 Contact: Frederick Shane ([email protected])

Marubeni Montreal Real estateSporting Club Corporation Involved with the sports club Le Sporting Club du Sanctuaire in Montreal, Canada

c/o Marubeni America Corporation 450 Lexington Avenue, New York, NY 10017 Phone: (212) 450-0515 Fax: (212) 450-0157 Contact: Patrick Gilligan ([email protected])

Chemicals

Helena Unit

Helena Chemical Company Agricultural chemicals, seeds, fertilizers and related services Distributor of agricultural chemicals, seeds, fertilizer and related services throughout North America

225 Shilling Blvd., Suite 300, Collierville, TN 38017 Phone: (901) 761-0050 Fax: (901) 683-2960 www.helenachemical.com Contact: Troy Traxler, Jr. ([email protected]) Other Locations: Nationwide

Chemicals Unit

Marubeni Specialty Specialty chemical and plastic productsChemicals Inc. Import, export, toll-manufacture and distribution of specialty chemicals and plastics for paper, auto-motive materials, agriculture, medical devices and others

10 Bank Street, White Plains, NY 10606 Phone: (914) 428-8900 Fax: (914) 428-8859 www.chemdot.com Contact: Hiroshi Yoshimoto ([email protected])

Subsidiaries


Machinery

The Transportation, Industrial Machinery & Information Business Unit

Marubeni Motor Auto lease and finance businessHoldings, Inc. Marubeni Group’s mezzanine company to invest in Advantage Funding Management, Inc.

450 Lexington Avenue, New York, NY 10017 Phone (718) 392-1300 ext.29 Fax: (718) 392-3933 Contact : Munekazu Kawashima ([email protected])

The Plant, Utility & Infrastructure Unit

MAC-ROX, Inc. Iron oxide production Marubeni America’s mezzanine company in a partnership, AMROX

450 Lexington Avenue, New York, NY 10017 Phone: (212) 450-0405 Fax: (212) 450-0755 Contact: Masashi Kurono ([email protected])

MARCOP II, Inc. Pulverized coal injection Marubeni America’s mezzanine company for partnerships engaged in the pulverized coal business

450 Lexington Avenue, New York, NY 10017 Phone: (212) 450-0405 Fax: (212) 450-0755 Contact: Masashi Kurono ([email protected])

Tekmatex, Inc. Textile, converting, woodworking, press, industrial machinery Distribution (sales, technical service, parts supply), procurement, solution

3601 Performance Road, Charlotte, NC 28214 Phone: (704) 394-5131 Fax: (704) 393-5008 www.tekmatex.com Contact: Yuji Wada ([email protected])


Marubeni America CorporationAt December 31, 2004 and 2005(In Thousands)

Commodity

The Agri-Marine Products Unit

Columbia Grain, Inc. Grain merchandising To own, manage, and lease grain elevators both for domestic and export business

111 S.W. Columbia Street, Suite 1200, Portland, OR 97201 Phone: (503) 224-8624 Fax: (503) 241-0296 www.columbiagrain.com Contact: Steve R. Wright ([email protected])

The Forest Products & General Merchandise Unit

Marubeni Pulp & Paper Forest productsNorth America International trading of forest products (pulp, paper and wood chips)

450 Lexington Avenue, New York, NY 10017

Phone: (212) 450-0190 Fax: (212) 450-0199 Contact: Tomomi Tsunoda ([email protected]) Other Locations: Torrance, CA, Bellevue, WA, Appleton, WI, Vancouver, Canada (Marubeni Pulp & Paper Canada Ltd.)

Business Administration

Business Administration

Marubeni Canada Ltd. Machinery, energy, lumber, agriculture & marine products, chemicals, metals and mineral resources Importer / exporter and distributor agriculture & marine products, chemicals, machinery, metals and mineral resources

505 Burrard Street, Suite 1630, Vancouver, BC V7X 1E53 Phone: (604) 443-3800 Fax: (604) 681-0498 Contact: Vinh Le ([email protected]) Other Locations: Calgary



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Note to Consolidated Financial StatementsMarubeni America CorporationAt December 31, 2004 and 2005(In Thousands)

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Report of Independent Auditors

Board of Directors and ShareholderMarubeni America Corporation

We have audited the accompanying consolidated balance sheets of Marubeni America Corporation (the “Company”) as of December 31, 2005 and 2004, and the related consolidated statements of income, shareholder’s equity and cash flows for the years then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Company at December 31, 2005 and 2004, and the consolidated results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States.

February 28, 2006

http://www.marubeni-usa.com

Documents

Annual Report 2005 - Marubenimarubeniamerica.com/our_company/financial_statements/mac2005.pdf · Annual Report 2005 Year ended December ... Reviewing the 2005 business year, I am