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News Release

October 6, 2004
Miracle Linux Corporation

Miracle Linux Achieves Greatest Ever Growth in Sales and Profits
-150% Year-on-Year Sales Growth in 2004 compared with 2003, recording a profit for 6 consecutive quarters. Consulting and Support Services Fuelling Growth-

Miracle Linux Corporation (HQ: Akasaka 4-1-30, Minato-ku, Tokyo. CEO: Takeshi Sato. Hereafter referred to as Miracle Linux), announced that it achieved 51% sales growth in fiscal year 2004 (June 2003 - May 2004) compared with 2003, profit for 6 consecutive quarters, and the greatest growth in sales and profits every recorded in the company's 4 year history.

In particular, shipments of the Linux Server Operating System "MIRACLE LINUX Standard Edition V2.1" have been increasing steadily. Professional service enterprises have been the driving force behind the business in 2004, with over 500% growth in consulting services and over 180% growth in support services such as corporate maintenance.

Miracle Linux has launched 2 new enterprises in fiscal year 2004.

The first was the corporation's strategic partnership with Korean SecuBrain Co., Ltd. on September 25, 2003 (SecuBrain Co., Ltd.: Lee Byeong-cheol, CEO) and new entry into the "Security Market", with the first shipments of high-security OS product, "MIRACLE HiZARD V2.5" on October 27, 2003. This is in addition to the corporation's ongoing development and sales of the Linux OS. Combining "MIRACLE HiZARD" with current "MIRACLE LINUX" products will realize a new development in security solutions that prevent information leakage and unauthorized access, providing a solid security foundation and supporting e-Japan and other governmental, public bodies and local councils as well as the "Personal Information Protection Bill" to be enacted in April 2005.

The second of these new enterprises was the formation of a strategic partnership with China's largest Linux distributor, Red Flag Software Co., Ltd. (Red Flag Software Co., Ltd.: Chris Zhao, Acting President, hereafter referred to as Red Flag) in January 2004 to launch the new "Asianux" project. The two companies set about jointly developing "a highly reliable, universal Enterprise Linux platform optimized for the Asian market" and started shipping "MIRACLE LINUX V3.0 - Asianux Inside" on June 30, 2004.

Utilizing highly reliable and stable open-sources that maximize ROI in the introduction of IT to public administration is gaining momentum amongst the governments of Japan, China and Korea in particular. Red Flag and Miracle Linux are contributing to Linux's development through, for example, active participation in the North Asia Open Source Software Promotion Forum (OSS Promotion Forum) being held between the 3 countries. In addition, the standardization of Linux in Asia has been making steady progress after major vendors such as Oracle Corporation and Hewlett Packard announced their formal support for Asianux in the Asia-Pacific region in July 2004. Domestic market share in Japan is also steadily increasing, as partnership with NEC Corporation has provided a strengthened sales structure, facilitating an expansion in sales of "MIRACLE LINUX V3.0 - Asianux Inside."

Miracle Linux is promoting the expansion of the new enterprises launched in 2004 in order to achieve its 3-year mid-term business development plan drawn up in 2003, entitled "MIRACLE LINUX Innovation Toward 2006". Through its "Customer First policy", through making the Linux standardization of "Asianux" in Asia and secure IT infrastructures its core business, through utilizing cutting-edge Linux kernel and security technology and through optimizing the organization of its consulting, Miracle Linux product licensing, and professional support service enterprises, the company aims to be the provider of the IT environments best trusted by clients in Japan, and Asia as a whole. Furthermore, the company has set a target of achieving 50% average annual sales growth for the period up to May 2006 (the last fiscal year covered by the plan) and a 15% operating profit for the same term.

About Asianux™
Asianux is a completely new software business project from Asia, based on the concepts of "Common", "Collaboration" and "Contribution". Asianux brings together the know-how and development staff from leading enterprises from all over Asia. They are working together to establish an Asian Linux standard, platform through developing Linux distribution that fulfils the requirements of the Asian market and requires no modifications whatsoever, wherever it is shipped.
About MIRACLE LINUX V3.0 - Asianux Inside
"MIRACLE LINUX - Asianux Inside" is a Linux Server OS that supports up to 32CPU and 64GB of memory, designed to offer the highest levels of quality, reliability, stability, scalability and security. It includes enterprise features needed by governments, public offices and local councils, such as support for external code (UTF-8) and a Japanese-language environment including JIS code (Japanese characters), measures against failures, accommodation of journaling file systems, LDAP compatibility and comes bundled with Samba 3.0 internationalization software.
About MIRACLE HiZARD
"MIRACLE HiZARD" is a security software that incorporates commercially available secure OS functions to prevent unauthorized access to important data and information leakages, and in addition, protects servers from unauthorized external access, Buffer Overflow attacks to software and internal leakages of information. It can be used not only with Linux OS but also with Windows, AIX, HP-UX and Solaris.

About Miracle Linux
Open for business since June 1, 2000 as a dedicated provider of Linux server OS-related products and services, Miracle Linux manages a wide variety of enterprises, including the development and sale of the Linux Server OS, "MIRACLE LINUX", supply of the multi-platform capable secure OS software, "MIRACLE HiZARD" and "MIRACLE CLUSTERPRO", the cluster solution that enables 365 days-a-year, 24-hours-a-day continuous operation, as well as provision of Linux-related support services including consulting, education, and maintenance.

Please forward all enquiries about this press release to:

Miracle Linux Corporation
  Miho Ishiwatari, PR Officer, Marketing Division
  Tel : 03-5562-8322
  Fax : 03-5562-8306
  mktg@miraclelinux.com

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