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Domestic CMS (Cash Management Service) implemented from July 1 Optimizing group financing efficiency and realizing consolidated financial management

June 30, 2003

Yamaha Motor Co. (YMC) , Ltd., domestic group companies will implement the CMS (Cash Management Service) system with the aim of optimizing overall group financing efficiency and improving fiscal management. The change takes place on July 1 (Tue.) to coincide with the anniversary of the company’s founding. Four companies will implement the system on this date: Yamaha Motor Sales Co., Ltd., Yamaha Marine Co., Ltd., SOQI, Inc., and Morick Co., Ltd.

CMS has functions that provide singly-source management of all group bank accounts, borrowing and lending as well as making payments in the name of the group with the object of improving overall group fiscal management in the settlement of accounts within the group.

The CMS pooling and netting functions being implemented this time enable centralized management of the finances of domestic group companies, and along with heightening the level of overall group funding efficiency and further improving cash flow management, are designed to raise the level of management of consolidated operations. The effects of the centralized allocation of funds with the CMS system and the ability to predict financing requirements help meet those goals by enabling Yamaha and each group company to mutually manage group operations, allowing Yamaha to provide funding within the specified framework for each group company and stay connected with each company’s business plans.

In addition, the netting function provides for the counterbalancing of credits and debts among group companies and acts as the payer for group companies, increasing the operating efficiency of the overall group. As a result, compared to the time when each group company raised its own funding amounting to some 25 billion yen a year, the centralized allocations from Yamaha are expected to bring about a 100-million-yen reduction in financing and other costs.

Furthermore, by this December all 35 domestic subsidiaries in which Yamaha Motor Group holds a stake greater than 50 percent are planned to join the four companies that are implementing the system. The domestic implementation of CMS is consistent with “Strengthening the financial position,” one of the principles addressed in “NEXT 50,” the medium-term business plan for the entire Yamaha Motor Group unveiled last year in April. In the future, the establishment of a global CMS is envisioned by connecting with Group companies in the U.S. and Europe that have already implemented their own CMS systems to optimize the efficiency of domestic and international group financing and provide an even greater consolidation of fiscal management.

* Pooling:

Function that automates the movement of funds within the group, so that at the close of each business day, group company bank account balances stand at zero.

* Netting:

Function that counterbalances credits and debts among group companies.

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