1 Information Meeting 2005 Information Meeting 2005 November, 2005 November, 2005 UBE INDUSTRIES, LTD. UBE INDUSTRIES, LTD.
2 Contents Contents Contents 1. Summary Summary … …. P. 3 . P. 3 1. 2. FY05 First Half Consolidated Results 2. FY05 First Half Consolidated Results …. P.11 . P.11 … 3. FY05 Consolidated Forecasts …. P.24 . P.24 3. FY05 Consolidated Forecasts … 4. Comparison of Current and 4. Comparison of Current and Previous Forecasts … …. P.34 . P.34 Previous Forecasts 5. Appendix – – Company Profile Company Profile – – …. P.40 . P.40 5. Appendix …
3 Summary Summary Summary
4 FY2005 First Half First Half Consolidated Consolidated Results Highlights Results Highlights FY2005 FY2005 First Half Consolidated Results Highlights [Income Income] ] Year [ Year- -on on- -Year Revenue Growth and Substantial Earnings Growth Year Revenue Growth and Substantial Earnings Growth Operating Income : 17.4 billion yen (63% ) Operating Income : 17.4 billion yen (63% ) Chemicals & Plastics Chemicals & Plastics Raw Material Prices: Stable at High Levels Raw Material Prices: Stable at High Levels Improvement in margin (between product prices Improvement in margin (between product prices and raw materials) and raw materials) Specialty Chemicals & Specialty Chemicals & Products Products Specialty products: Affected by a adjustment in Specialty products: Affected by a adjustment in digital- -related product demand (which is now related product demand (which is now digital recovering, as expected) xpected) recovering, as e Cement & Construction Cement & Construction Materials Materials Impact of sharply higher fuel prices Impact of sharply higher fuel prices Increase in waste processing, increasing waste processing, increasing Increase in domestic cement demand ement demand domestic c Machinery & Metal Machinery & Metal Products Products Restructuring of North American aluminum whee Restructuring of North American aluminum wheel l operations, sales growth in die s growth in die- -casting machines and casting machines and operations, sale steel making products ducts steel making pro [Interest Interest- -bearing Debt] bearing Debt] [ 374.1 billion yen ( 23.8 billion yen YoY YoY) ) 374.1 billion yen ( 23.8 billion yen Increased earnings, draw- -down of down of Increased earnings, draw cash and deposits cash and deposits (Net interest- -bearing debt: 352.8 billion yen, 11.7billion yen bearing debt: 352.8 billion yen, 11.7billion yen YoY YoY) ) (Net interest [Stockholders’ [Stockholders ’ Equity] Equity] 114.0 billion yen (+5.7 billion yen 114.0 billion yen (+5.7 billion yen YoY YoY) )
5 Present Status and Outlook for Major Businesses (1) Present Status and Outlook for Major Businesses (1) Present Status and Outlook for Major Businesses (1) 1. Chemicals & Plastics Chemicals & Plastics 1. Confident to maintain margins Impact of sharply higher raw material and fuel prices such Confident to maintain margins Impact of sharply higher raw material and fuel prices such as Naphtha, etc. Transfer to selling prices as Naphtha, etc. Transfer to selling prices Synthetic Rubber : Expanding specialty rubber demand in Asia for tires Synthetic Rubber : Expanding specialty rubber demand in Asia for tires Favorable supply- -demand balance for the foreseeable future demand balance for the foreseeable future Favorable supply Further stabilization of profitability by increasing production ratio of specialty ratio of specialty Further stabilization of profitability by increasing production grades. Capacity expansion under study. grades. Capacity expansion under study. Caprolactam : : Caprolactam Relatively stable market medium- Relatively stable market medium -term term Maintenance of relatively high margins Maintenance of relatively high margins Caprolactam pricing pressures, sharply rising pricing pressures, sharply rising auxiliary auxiliary material and fuel prices material and fuel prices Caprolactam Earnings pressure factors Earnings pressure factors Quick transfer to selling prices Quick transfer to selling prices (monthly pricing adjustment format already introduced) ed) (monthly pricing adjustment format already introduc Business stabilization through increased internal consumption rate te Business stabilization through increased internal consumption ra Full- -fledged nylon resin production capacity under study fledged nylon resin production capacity under study Full Nylon Resin: Nylon Resin: Margin improvement Margin improvement Expanded sales of new Nylon- Expanded sales of new Nylon -12 Polyamide elastomers and others 12 Polyamide elastomers and others Internal production of compounds Internal production of compounds Further cost reductions Further cost reductions Strengthened and expanded supply and service capabilities Strengthened and expanded supply and service capabilities Seriously under study for domestic and overseas markets Seriously under study for domestic and overseas markets Industrial Chemicals: Industrial Chemicals: Speeding up transfer to selling prices Speeding up transfer to selling prices
6 Present Status and Outlook for Major Businesses (2) Present Status and Outlook for Major Businesses (2) Present Status and Outlook for Major Businesses (2) 2. Specialty Chemicals & Products Specialty Chemicals & Products 2. Return to Growth Path Return to Growth Path Specialty Products : As expected, full Specialty Products : As expected, full- -fledged recovery in the second half fledged recovery in the second half Polyimides 30% increase in production capacity underway Polyimides 30% increase in production capacity underway th facility to be completed next August) (8 th facility to be completed next August) (8 th facility already under study 9 th 9 facility already under study TAB/COF Use: Progress in COF conversion TAB/COF Use: Progress in COF conversion Already started for usage in large Already started for usage in large LCDs LCDs Working to establish de facto standard Working to establish de facto standard TAB- -use remains firm due to strong PDP use remains firm due to strong PDP- -use use TAB Flexible copper- -clad laminate(CCL) : clad laminate(CCL) : Flexible copper Capacity expansion Sales expansion of double- -sided boards sided boards Capacity expansion Sales expansion of double Battery materials Capacity expansion as needed Capacity expansion as needed. . Battery materials Working to expand battery materials related businesses Working to expand battery materials related businesses Volume recovery prominent (particularly for separators to China) China) Volume recovery prominent (particularly for separators to Pricing pressures Pricing pressures Coping with additional electrolyte Coping with additional electrolyte functionality, increased separator sales and functionality, increased separator sales and cost reductions cost reductions Fine Chemicals : Strong demand Existing businesses : profit maximization thr Fine Chemicals : Strong demand Existing businesses : profit maximization through capacity ough capacity increase increase C1 Chemicals (DMC,PCD, etc.) : Expand & strengthen C1 Chemicals (DMC,PCD, etc.) : Expand & strengthen Pharmaceutical Bulk Compounds Pharmaceutical Bulk Compounds Steady progress in Steady progress in and Intermediates : and Intermediates : Allergy treatments Allergy treatments creating creating Anti- -hypertensive agents both favorable hypertensive agents both favorable Anti Base for next leap Base for next leap New pharmaceutical consignment manufacturing forward (CS747) forward (CS747) New pharmaceutical consignment manufacturing
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