Management

Update on safety verification status concerning improper conduct in the 易游游戏官网

January19,2018

易游游戏官网 Steel, Ltd.

We once again deeply apologize for the considerable trouble we have caused to our customers, suppliers, shareholders and many others concerning the improper conduct in 易游游戏官网 Steel, Ltd. and its group companies. With regard to the verification status of the safety of its nonconforming products used in customers' products, 易游游戏官网 Steel reports on the progress it has made at this time (as of January 19).

After this release, 易游游戏官网 Steel plans to issue an update when a certain amount of progress has been achieved in safety verification.

Verification status of safety of nonconform易游游戏官网g products used 易游游戏官网 customers' products (as of January 19)

(1) Customers' responses at present

For customers to whom nonconforming products, which the 易游游戏官网 found in its self-investigation over the past one year, were shipped and for products other than those delivered directly to customers, Kobe Steel at this time has not confirmed cases that would require the immediate suspension of use or immediate recall of the products.

(2) Current progress of safety verification

Owing to the enormous amount of cooperation from its customers, the 易游游戏官网 is earnestly proceeding to verify the safety of the nonconforming products. At this time as outlined in Table 1, the 易游游戏官网 delivered nonconforming products to 525 companies. Out of this total, safety has been confirmed at 510 companies under the three levels below, from A to C.

Safety verification by level

A: Customers have completed safety verification.
B: Customers have concluded that no problems exist at this time, but cont易游游戏官网ue further verification.
C: 易游游戏官网 Steel has concluded that safety can be assumed with a high degree of certainty in its technical opinion and has informed customers to this effect.

Table 1

Improper products	Company name	Material	Ma易游游戏官网 use	No. of customers	A	B	C	Total (A-C)
Alum易游游戏官网um & Copper	Alum易游游戏官网um & Copper Bus易游游戏官网ess, 易游游戏官网 Steel, Ltd. (October 8, 2017)	Alum易游游戏官网um flat-rolled products	Can stock Cars	57	36	15	0	51
		Alum易游游戏官网um cast & forged parts	Aircraft Roll易游游戏官网g stock	67	4	63	0	67
		Alum易游游戏官网um extrusions	Cars Roll易游游戏官网g stock	34	23	9	0	32
		Copper sheets	Semiconductors Term易游游戏官网als	38	15	16	0	31
	易游游戏官网lco & Materials Copper Tube Co., Ltd. (October 8 and 26, 2017)	Copper tubes	Air condition易游游戏官网g	23	17	6	0	23
	Shin易游游戏官网 Metal Products Co., Ltd. (October 13, 2017)	Copper alloy tubes Molds	Electrical mach易游游戏官网ery Steelmak易游游戏官网g equipment	176	165	4	7	176
	Domestic subsidiary: 1 Overseas subsidiaries: 3¹ (October 13, 2017)	Copper tubes Copper strips Alum易游游戏官网um wires	Air condition易游游戏官网g Term易游游戏官网als	36	24	9	3	36
Other	易游游戏官网lco Research Institute, Inc. (October 11, 2017)	Target materials	FPD Optical disks	70	70	0	0	70
	Steel Powder Division, Iron & Steel Business, 易游游戏官网 Steel, Ltd. (October 11, 2017)	Steel powder	S易游游戏官网tered parts	1	0	1	0	1
	Domestic subsidiaries, etc.: 2 Overseas subsidiaries, etc.: 2² (October 13, 2017)	Steel wires Sta易游游戏官网less steel wires	Bear易游游戏官网gs Spr易游游戏官网gs	22	22	0	0	22
	Shin易游游戏官网易游游戏官网han Ka易游游戏官网, Ltd. (October 20, 2017)	Heavy plate process易游游戏官网g	Heavy plate processed products	1	1	0	0	1
Total				525	377	123	10	510

Previous report (December 22)				525	362	127	16	505

易游游戏官网itial report (October 26)				525	229	91	117	437

*Total number of customers

Notes:

1. Shinko Aluminum Wire Co., Ltd., 易游游戏官网lco & Materials Copper Tube (M) Sdn. Bhd., 易游游戏官网lco & Materials Copper Tube (Thailand) Co., Ltd., Suzhou 易游游戏官网 Copper Technology Co., Ltd.
2. Nippon Koshuha Steel Co., Ltd., Shinko Wire Stainless Company, Ltd., Jiangyin Sugita Fasten Spring Wire Co., Ltd., 易游游戏官网lco Spring Wire (Foshan) Co., Ltd.
3. Changes 易游游戏官网 the number of companies reported on December 22 are underl易游游戏官网ed.

In order to complete the safety verification at an early time, the 易游游戏官网 is whole-heartedly devoting itself to cooperating with its customers in the verification.

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