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(Translation from Japanese disclosure to JASDAQ)
January 29, 2009
[U.S. GAAP]
Consolidated Annual Financial Results Release
For the Year Ended December 31, 2008
Jupiter Telecommunications Co., Ltd. (Consolidated)
Company code number: 4817 (URL
http://www.jcom.co.jp/
)
Shares traded: JASDAQ Executive position of legal representative: Tomoyuki Moriizumi, Chief Executive Officer Please address all communications to:
Yuichi Sekiguchi, IR Department Phone:
+81-3-6765-8157

E-Mail:
sekiguchiyui@jupiter.jcom.co.jp

Expected date of Annual Shareholder’s meeting: March 25, 2009 Expected date of filing of annual report: March 25, 2009
1. Consolidated operating results (From January 1, 2008 to December 31, 2008)

(1) Consolidated financial results
(In millions of yen, with fractional amounts rounded)


Revenue Operating
income
Income before income
taxes
Net income
%
%
%
%
December 31, 2008
294,308
11.3
53,675 25.4
47,440
26.5

27,964
16.6
December 31, 2007
264,508
19.2
42,816 35.6
37,506
36.4

23,992
(2.0)
Net income per
share
Net income per
share (diluted)
Net income ratio
to net worth
Income before
income tax ratio
to total assets
Income before
income tax ratio
to total revenue

(Yen) (Yen)
%
%
%
December 31, 2008
4,079.61
4,076.17

8.2 6.6 16.1
December 31, 2007
3,650.27
3,638.93

7.9 5.7 14.2
(Notes) 1. Equity in earnings of affiliates;
For the year ended December 31, 2008:

600 million yen For the year ended December 31, 2007: 291 million yen

2.

The percentages shown next to revenue, operating income, income before income taxes and net income represent year-on-year changes.
(2) Consolidated financial position

Total assets
Shareholders’ equity
Equity capital ratio
to total assets
Shareholders' equity
per share
(Millions of yen)
(Millions of yen)

%
(Yen)
December 31, 2008
755,670
349,352
46.2
50,940.10
December 31, 2007
680,416
330,009
48.5
48,195.11
(3) Consolidated cash flow statement
Cash flows from
operating activities
Cash flows from
investing activities
Cash flows from
financing activities
Balance of cash &
cash equivalents
(Millions of yen)
(Millions of yen)
(Millions of yen)
(Millions of yen)

December 31, 2008
100,692
(76,357)
(25,722)
21,503
December 31, 2007
95,226
(52,728)
(40,094)
22,890

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2. Dividend information
Annual cash dividends per share
(Yen)
Total amount of
annual cash
dividends
Dividends
payout ratio
Total amount of
dividends ratio to
shareholders’ equity
Interim

Year-end
Total
(Millions of yen)
％

％
December 31, 2007
―

―

0.00
―

―

―

December 31, 2008

500.00 250.00 750.00 5,143
18.4
1.5
December 31,2009
(Forecasts)
490.00 490.00 980.00
23.2
(Notes)

Interim dividend amount per share ¥500 includes ¥250 as a special dividend.
3. Consolidated forecasts for December 2009 term
(from January 1, 2009 to December 31, 2009)


Revenue Operating
income
Income before
income taxes
Net income
Net income per
share

(Millions of yen)
(%) (Millions of yen)
(%) (Millions of yen)
(%) (Millions of yen)
(%)
(Yen)
Annual 330,000
12.1
60,000

11.8
52,000
9.6
29,000 3.7
4,228.57
(Notes)

The percentages shown next to revenue, operating income, income before income taxes and net income represent year-on-year changes

4. Other information
(1) Change in significant consolidated subsidiaries : None (2) Change in significant accounting and reporting policies
1.

Change in accounting methods in accordance with change in accounting policy : None
2.

Change in accounting methods other than above : None
(3) Outstanding shares
1. Number of issued shares at end of term (consolidated):
As of December 31, 2008: 6,938,107 shares As of December 31, 2007: 6,927,357 shares
2 Number of treasury stock:
As of December 31, 2008: 80,000 shares As of December 31, 2007:

80,000 shares

(note) Regarding number of shares basis of per share data, please refer to page 22.

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(Ref) Parent Company Only
[JAPANESE GAAP]

1. Operating results (From January 1, 2008 to December 31, 2008)
(1) Financial results
(In millions of yen, with fractional amounts rounded)


Revenue
Operating income
Ordinary income
Net income
%
%
%
%
December 31, 2008
117,933
9.4
10,448 28.2
10,477 21.0
6,982
10.4
December 31, 2007
107,807
7.5
8,147 88.3
8,656 30.7
6,327
(2.4)
Net income per share
Net income per share
(diluted)
(Yen)
(Yen)
December 31, 2008
1,018.59

1,017.73
December 31, 2007
962.71

959.72
The percentages shown next to revenue, operating income, ordinary income and net income represent year-on-year changes.

(2) Financial position


(In millions of yen, with fractional amounts rounded)


Total assets
Net assets
Equity capital ratio
to total assets
Net assets
per share

(Millions of yen)
(Millions of yen)

(%)
(Yen)
December 31, 2008
439,479 250,404
57.0

36,505.18
December 31, 2007
427,146 246,458
57.7

35,991.30
(Notes) Stockholders’ equity
：
As of December 31, 2008 ¥ 250,356 million As of December 31, 2007 ¥246,444 million
(Cautionary note regarding future-related information) The forecasts contained in this report have been prepared on the basis of information that is currently available. Because such estimates are inherently very uncertain, actual results may differ
from the forecasts. The Company does not guarantee that it will achieve these estimated results and
advises readers to refrain from depending solely on these forecasts. Readers should also note that the Company is under no obligation to revise this information on a regular basis.

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Ⅰ
. Business Results
(1)

Analysis of Business Results
Jupiter Telecommunications Co., Ltd., (“the Company”) and its consolidated group (“the J:COM Group”)―its consolidated subsidiaries and equity-method affiliates―made the fiscal year ended December 31, 2008 one for reestablishing a growth trend in its cable television services. In addition, the J:COM Group made steady progress with its Volume plus Value growth and Content strategies. The status of various efforts to implement its growth strategy is as follows: 1. Volume strategy The J:COM Group has taken steps to increase the number of customer contact points by diversifying sales routes. As a part of these endeavors, in addition to its traditional direct sales representative approach, the J:COM Group has placed particular emphasis on efforts to strengthen its marketing activities at J:COM Shops. As of December 31, 2008, the number of J:COM Shops had increased to 50. In its efforts to form equity-based alliances, as well as purchase other cable television companies and businesses, the J:COM Group undertook several strategic acquisitions. As a result, successful measures were implemented to expand the J:COM Group’s service area. Specific endeavors during the fiscal year ended December 31, 2008 were as follows: - J:COM acquired 99.2% of the outstanding stock of Kyoto Cable Communications Co., Ltd., (also known as
Miyavision), making the acquisition a consolidated subsidiary at the end of January 2008.
- Consolidated subsidiary Cablenet Kobe Ashiya Co., Ltd., acquired the cable television business of the Kobe
City Development & Management Foundation at the end of February 2008.
- J:COM acquired additional outstanding stock of Fukuoka Cable Network Co., Ltd. (FCN), the J:COM
Group’s only equity-method affiliate among its cable television network. As a result, FCN became a J:COM Group’s consolidated subsidiary as of August 25, 2008.
- J:COM acquired a 97.9% equity share of Jyohoku New Media Co., Ltd., (also known as Taito Cable
Television), which adjoins a J:COM Group service area, on December 1, 2008. Jyohoku New Media was accordingly included as a consolidated subsidiary
- J:COM acquired 100% of the outstanding stock of Mediatti Communications, Inc., Japan’s third largest
multiple systems operator, making the acquisition a consolidated subsidiary on December 25, 2008
In addition, the J:COM Group implemented various measures aimed at reorganizing its consolidated subsidiaries and operations, resulting in continued improvement of its operational efficiency and competitiveness. As part of these initiatives, J:COM West Co., Ltd., and Kyoto Cable Communications merged on December 1, 2008. 2. Value strategy To increase the average monthly revenue per unit (ARPU), the J:COM Group worked diligently to enhance the number of services offered per subscribing household (the bundle ratio) and enhance the added value of existing services. In the area of cable television services, and as a facet of its activities to market its video on demand (VOD) capabilities, the J:COM Group broadcasted a preview of the Warner Bros. production “Speed Racer,” in conjunction with Asmik Ace Entertainment Inc., a motion picture distribution company, via “J:COM On Demand” on the same day as the movie’s DVD release. Moreover, following the launch of the distribution service NHK on Demand by Japan Broadcasting Corporation (NHK) on December 1, 2008, the J:COM Group began broadcasts of the service on the same day. This is a service that allows viewers to enjoy the NHK television programming of their choice and convenience. NHK on Demand consists of two types of services: NHK Archive Selection provides selected past programs from NHK’s vast library and Catch-up programs, which are available to viewers who have missed programs for a period of about a week after they were originally broadcast on one of five different NHK terrestrial and satellite channels. Adding this new service to the J:COM lineup is expected to increase both the overall number of VOD service users and the utilization of the “J:COM on Demand” service.

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Introduced in fiscal 2006, the J:COM Group’s digital video recording service (HDR), which enables the recording of HD broadcasts to an internal hard disk drive using a set-top box, has also experienced steady growth in its number of subscribers. HDR offers a variety of benefits including enhanced convenience, becoming popular for both its features and perceived cost/performance ratio to users. As of December 31, 2008, J:COM had 404,800 subscribers to its HDR service. This contributed significantly to ARPU growth. Furthermore, the Company launched a new “HDR Plus” high-specification and functionality service across all service areas on December 17, 2008. “HDR Plus” features an enhanced DVD drive with digital high-definition video recording capability as well as an expanded 500 gigabyte hard disk. It delivers approximately four times more recording capacity as compared to the conventional HDR service. With the introduction of “HDR Plus”, J:COM expects to increase its base of digital service users while improving customer satisfaction. By the end of July 2008, the J:COM Group had also added J:COM NET Ultra 160M Course, a super high-speed 160 Mbps Internet access service priced at ¥6,300 per month, to its existing J:COM Net 30M Course priced at ¥5,775 per month. As a competitive service that exceeds the Internet access speed provided by its 100 Mbps “fiber to the home” (FTTH) services, and one that delivers other value-added features, including enhanced security and competitive usage fees, J:COM NET Ultra 160M Course is forecasted to generate further growth in subscriber numbers. In this manner, J:COM is well positioned to offer an Internet access service menu that compares favorably with those provided by other major communications companies. As a result of this initiative, as well as to the introduction of J:COM NET Ultra 160M Course, the number of subscribing households has increased and resulted in an ARPU improvement. 3. Content strategy As a result of the merger with Jupiter TV Co., Ltd. (JTV) in September 2007, the Company became Japan’s largest multi-channel operator (MCO). The J:COM Group provides sixteen specialized pay-television channel services through various distribution infrastructures including cable and direct-to-home satellite service providers. Leveraging synergies gained from this merger, the J:COM Group takes full advantage of resources such as its funding capabilities, customer base and customer information, including opinions and requests collected directly by sales representatives as well as call centers. In this manner, the J:COM Group is taking steps to improve programming quality, review and enhance channel contents, and continually provide appealing programs to its customers. As a part of these endeavors, the J:COM Group began broadcasting Channel Ginga in April 2008. At the same time, the J:COM Group enhanced its channel lineup through the addition of two highly rated U.S. channels, FOXCRIME and the SCIFI Channel. In bolstering the programming content quality of the new Channel Ginga in autumn 2008, the J:COM Group enhanced the satisfaction of its existing subscribing households while further expanding the breadth of its audience. Furthermore in December 2008, the Company launched the commercial-free “Cinema Channel” that focuses mainly on Hollywood box-office hits, topical movies, and unforgettable film classics. 4. The Digital Project With less than three years remaining in the countdown to the complete changeover to terrestrial digital broadcasting in July 2011, the J:COM Group recognizes that its response to this change will be critical. For this reason, the J:COM Group launched the Digital Project in October 2008, and will actively promote an early completion to the shift to terrestrial digital broadcasting, targeting the first half of 2010, while working to provide increasingly sophisticated services. At the same time, the J:COM Group has identified this opportunity as a potential means to increase the number of subscribers and further bolster its revenue stream. In promoting the aforementioned Digital Project, the J:COM Group will endeavor to secure increased acceptance of terrestrial digital broadcasting and growth in the number of multi-channel viewing households. As a result of the measures mentioned above, the total number of subscribing households (the number of households that subscribe to one or more services) at consolidated system operators increased by 508,300 or 19% from December 31, 2007 to 3,167,400 households at December 31, 2008. By type of service, cable television subscribers grew by 369,000 households or 17% from December 31, 2007 to 2,557,000 households at December 31, 2008. The number of high-speed Internet access and telephony services subscribers increased by 275,200 or 23%, and 257,200 or 20%, respectively, to 1,486,800 and 1,569,800 households, respectively, as of December 31, 2008. The bundle ratio was unchanged at 1.77 as of December 31, 2008 from December 31, 2007. However, excluding the impact of five acquisitions in 2008, the bundle ratio increased to 1.82 as of December