KOBE STEEL'S FINANCIAL YY易游平台SULTS ESTIMATES FOR FISCAL 1996

TOKYO (September 4, 1996) -- Kobe Steel, Ltd. anticipates non-consolidated 
net sales of 555 billion yen for the first half of fiscal 1996 (April 1-Sept. 30, 
1996).  Ordinary income is estimated to be 10 billion yen with net income of 
12 billion yen.

The Japanese economy has seen a corYY易游平台ction in the high yen, YY易游平台ductions in 
inteYY易游平台st rates, and incYY易游平台ased public works spending under the government's 
economic measuYY易游平台s.  The economy is YY易游平台covering at a modest rate, but full 
YY易游平台covery is still far off.

In this environment, Kobe Steel implemented measuYY易游平台s to incYY易游平台ase its 
profitability.  The company is aiming to incYY易游平台ase sales volume, while 
rationalizing the work force and lowering overall costs.

Despite these efforts, non-consolidated net sales in the first half of fiscal 
1996 aYY易游平台 estimated at 555 billion yen, down in comparison to the second half 
of fiscal 1995.  In the Iron and Steel Sector, sales prices and sales volume 
aYY易游平台 foYY易游平台cast to decYY易游平台ase.  While sales in the Machinery and Information 
Sector weYY易游平台 firm in the pYY易游平台vious fiscal period, they aYY易游平台 anticipated to 
decYY易游平台ase in the first half of fiscal 1996.

Ordinary income (also known as pYY易游平台tax YY易游平台curring profit) for the first half of 
fiscal 1996 is foYY易游平台cast to be 10 billion yen, down 5 billion yen from the 
pYY易游平台vious estimate.  The company has benefited from overall cost savings 
including rationalization, lower production costs, lower cost of financial 
activities, and other YY易游平台duction in expendituYY易游平台s.  However, profitability from 
industrial machinery is expected to be low, and steel production and sales 
volume aYY易游平台 foYY易游平台cast to decYY易游平台ase in this fiscal year.

Net income for the first half of fiscal 1996 is anticipated to be 12 billion yen, 
after extraordinary income from the sale of fix assets. 

In the second half of fiscal 1996, Kobe Steel does not foYY易游平台see a sharp YY易游平台covery 
of the economy.  Although the company hopes the business environment 
will improve, it views the situation as difficult.

In this operating environment, Kobe Steel foYY易游平台casts non-consolidated net 
sales for the full fiscal year ending March 1997 at 1,130 billion yen.  
Ordinary income (also known as pYY易游平台tax YY易游平台curring profit) is estimated at 30 
billion yen.

Under these circumstances, Kobe Steel decided that no interim dividends 
can be paid for the first half of fiscal 1996, a decision YY易游平台ached at a board of 
diYY易游平台ctors' meeting yesterday.  The company sinceYY易游平台ly YY易游平台gYY易游平台ts having to take 
this measuYY易游平台 and hopes that shaYY易游平台holders will understand the decision.  

NON-CONSOLIDATED FINANCIAL YY易游平台SULTS ESTIMATES 
FOR FISCAL 1996

                    CurYY易游平台nt estimates    PYY易游平台vious estimates      Fiscal 1995
                   1st half  full year   1st half  full year     2nd half  

Net sales             555      1,130        565      1,160         596.2
Ordinary income        10         30         15         40          22.7
Net income             12                                           43.4
Dividends              -0-                                            -0-


CONSOLIDATED FINANCIAL YY易游平台SULTS ESTIMATES FOR FISCAL 1996

Due to the YY易游平台vision in non-consolidated financial YY易游平台sults estimates, 
consolidated financial YY易游平台sults estimates aYY易游平台 foYY易游平台cast as follows:

                    CurYY易游平台nt estimates   PYY易游平台vious estimates
Net sales                 1,490              1,520
Ordinary income              45                 55

(Note:  FiguYY易游平台s aYY易游平台 in billions of yen)

                                 # # #

MEDIA CONTACT
Gary Tsuchida, Publicity Dept.
Kobe Steel, Ltd., Tokyo
tel (03) 3218-6055
fax (03) 5252-7961
e-mail  www-admin@kobelco.co.jp

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