The amusement device market , which is the primary market for the Company’s business at present, began to show positive signs in some segments, as exemplified by the recovery trend of pachislot machines which had been struggling as a result of the revision of amusement device regulations in previous years and the growth in the population of players for two consecutive years thanks to the wide popularization of one-yen pachinko and other low-price sales initiatives. However, demand for new units of amusement devices hovered at low levels overall, as the willingness of amusement facilities to purchase amusement devices concentrated on just a few models such as well-established models and major projects that can attract many customers, due mainly to the decline in the profitability of amusement facilities attributable to the prolonged stagnation of the Japanese economy and the popularization of low-price sales initiatives. Furthermore, the Company’s business environment was harsh due to such factors as the recycling of amusement device components including the Company’s products being implemented on a full-scale, based on the strong inclination among amusement devices manufacturers to reduce costs as a result of tough market conditions. Under such circumstances, the Company concentrated its efforts on promoting the sale of various products, focusing on “AG301”, a graphics LSI product for larger LCDs installed in amusement devices, and “AG333”, an integrated LSI product that fulfills multiple functions on a single chip including graphics, sound and LED driver functions. As for graphics LSI products targeted at the amusement device market, the migration from “AG301” to “AG333” has been progressing steadily. Nevertheless, the sales volume of the Company’s graphics LSI products decreased by 970,000 units from the previous corresponding period to 1,050,000 units, due in part to amusement facilities refraining from replacing their old units with new ones for a long period of time in view of cooperating with the authorities to reduce their workload in conjunction with the hosting of the APEC meeting, on top of the tough market conditions described above. The sales volume of sound LSI products targeted at the amusement device market declined year-on-year due to the impact of sales of products with integrated functions and the demand trends among customers, while the sales volume of other products targeted at the amusement device market fell year-on-year invariably due to the impact of customers’ demand trends. In contrast, sales of graphics LSI products targeted at the embedded system market other than the amusement device market exceeded the level in the previous corresponding period, due in part to the completion of the inventory adjustment cycle for various embedded systems, especially industrial equipment, on the back of the increase in exports to emerging countries, etc. As a result, for the third quarter of fiscal 2010, the Company recorded net sales of 5,963 million yen, operating income of 1,233 million yen, ordinary income of 1,247 million yen, and net income of 807 million yen.   Income Statement (¥1 million)   2010/3 3Q Sales ratio 2011/3 3Q Sales ratio yoy Net sales 11,899 100％ 5,963 100％ -50％ Gross profit 6,901 58％ 3,311 56％ -52％ Operating income 4,988 42％ 1,233 21％ -75％ Ordinary profit 4,999 42％ 1,247 21％ -75％ Net profit 3,083 26％ 807 14％ -74％ Balance Sheet (¥1 million)   2010/3 3Q Compo -nent ratio 2011/3 3Q Compo -nent ratio yoy Current assets 13,984 95％ 11,948 94％ -15％ Fixed assets 696 5％ 817 6％ 17％ Current liabilities 1,888 13％ 501 4％ -73％ Long-term - - 11 0％ - Net assets 12,792 87％ 12,252 96％ -4％ LIabilities and Net assets 14,680 100％ 12,766 100％ -13％