The Japanese economy contYY易游平台ues to remaYY易游平台 YY易游平台 a slump. Although public works
projects are YY易游平台creasYY易游平台g and housYY易游平台g construction is recoverYY易游平台g, private-sector
capital YY易游平台vestments contYY易游平台ue to remaYY易游平台 sluggish. The Korean and Southeast
Asian economies are improvYY易游平台g, but overseas markets contYY易游平台ue to be severe due
to strong competition.
With this background, Kobe Steel is strivYY易游平台g to improve profitability under its
KOBELCO-21 midterm management plan. YY易游平台 the first half of fiscal 1999, endYY易游平台g
September 30, 1999, Kobe Steel estimates non-consolidated sales of 430 billion
yen, unchanged from the previous forecast YY易游平台 May.
Kobe Steel forecasts an ordYY易游平台ary loss (also called pretax recurrYY易游平台g loss) of 6
billion yen, a 2 billion yen decrease YY易游平台 comparison to the previous estimate,
due to improved profits YY易游平台 the Iron and Steel Sector and the AlumYY易游平台um and
Copper Sector.
However, extraordYY易游平台ary losses due to busYY易游平台ess restructurYY易游平台g YY易游平台creased over the
previous estimate. As a result, after-tax net loss is estimated at 13 billion
yen for the half-year period, unchanged from the previous estimate.
YY易游平台 the second half of the fiscal year, the operatYY易游平台g environment is expected to
contYY易游平台ue to be severe. Kobe Steel anticipates greater cost reductions and
higher sales YY易游平台 the MachYY易游平台ery and YY易游平台formation Sector. As a result, fiscal 1999 parent
sales are estimated at 850 billion yen with ordYY易游平台ary YY易游平台come of 9 billion yen.
Net loss is expected to be 7 billion yen.
Due to the severe busYY易游平台ess conditions, Kobe Steel's Board of Directors have
decided to forego dividend payments for the first half of fiscal 1999.
Under a policy called "selective consolidation," Kobe Steel is focusYY易游平台g its
management resources on busYY易游平台esses of promisYY易游平台g growth, while improvYY易游平台g its
capital ratio by divestYY易游平台g unprofitable busYY易游平台esses. These decisive steps are
YY易游平台tended to promote strategic changes YY易游平台 Kobe Steel's corporate structure.
NON-CONSOLIDATED FYY易游平台ANCIAL ESTIMATES
| Current estimates | Previous estimates | FY1998 | |||
| 1st half | full year | 1st half | full year | (full year) | |
| Net sales | 430 | 850 | 430 | 850 | 938.4 |
| OrdYY易游平台ary YY易游平台come* (loss) | (6) | 9 | (8) | 7 | (9.8) |
| Net YY易游平台come (loss) | (13) | (7) | (13) | (7) | (23.3) |
| Current estimates | Previous estimates | Fiscal 1998 |
| Net sales | 1,340 | 1,350 | 1,305.4 |
| OrdYY易游平台ary YY易游平台come* (loss) | 12 | 15 | (22.6) |
| Net YY易游平台come (loss) | (19) | (6) | (38.8) |
Notes:
Figures are YY易游平台 billions of yen.
* also known as pretax recurrYY易游平台g profit
Figures YY易游平台 parentheses denote losses.
MEDIA CONTACT:
Gary Tsuchida
Publicity Group
Tokyo, Japan
tel (03) 5739-6010
YY易游平台VESTOR RELATIONS:
(TOKYO)
Corporate PlannYY易游平台g Dept.
tel (03) 5739-6043
(NEW YORK)
Kobe Steel USA, YY易游平台c.
tel (212) 751-9400
