Kadokawa-Daiei Pictures, Inc. changed its corporate name to “Kadokawa Pictures, Inc.” in April 2004 and newly started the business. Its publicly released movie “Chakushin Ari” is quite successful and the sales of “Zatoichi” series were in good shape. The company has the plan to produce big scale entertainment pictures such as the remake of “Yokai Daisenso”, “Sengoku Jieitai” and “Gamera”. And, the Kadokawa-Daiei Movie Studio in Chofu City, Tokyo, made a renewal opening in September 2004. Kadokawa Entertainment, Inc. was established in January 2004 aiming to embark on the video package market such as DVDs, which presently holds 50% share of the visual business market and is expected to expand more in the future. The company is in charge of selling the video package made of Kadokawa Group’s new products and plenty of library inventories, and aims to attain the revenue of ¥25 billion within 2 to 3 years. And in April 2004, Kadokawa Entertainment, Inc. made an investment into the film production company, DreamWorks LLC, in the U.S. and became the partner of DreamWorks in Japan.The investment amount of $100 million was not paid as the minimum guarantee but as the investment in the capital of Dreams Works, and Kadokawa Entertainment acquired the distribution right of 35 new titles and 7 titles, which have not been shown domestically, the sales right, publication right and merchandising right of the package thereof, as the partner of Dreams Works. The first title for distribution will be “Shark Tale” to be shown in 2005 and the first DVD for sale will be the animation picture “Shrek 2” to be put on the market within 2004. Regarding the business activities of Asmik Ace Entertainment, Inc., the publicly released movie series “Spy Kids 3-D: Game Over” gained good reputation, the production of “Kisarazu Cats Eye Japan Series” and “Joze to Tora to Sakanatachi” was well reputed mainly by younger generations and the film “Hotel Venus” (starring Tsuyoshi Kusanagi) was very successful. Also Asmik Ace distributed two publicly released movies, “Crimson River 2” (starring Jean Reno: released in May 2004) and “A Tulip of Love” (starring Penélope Cruz: released in Summer 2004), both produced by Europa Corp. managed by Luc Besson. Kadokawa Pictures, Inc. subscribed to the third party allocation capital increase of Nippon Herald Films, Inc. in March 2004 and acquired 43.3% of the outstanding shares of Nippon Herald Pictures. Kadokawa Pictures is distributing excellent products such as three works of “Lord of The Rings” and “Passion”, which is the story of the last 12 hours of Jesus Christ and obtained good reputation. Copyright KADOKAWA HOLDINGS, INC. All rights reserved.