Kobe Steel Postpones Start of Medium-Term Plan

Kobe Steel postpones the start of the medium-term management plan from April and focuses on the achievement of the group plan for fiscal 2009 starting in April. The firm tries to maximize the benefit and cash flow in fiscal 2009 by investment reduction, cost cutback and pursuance of cost competitiveness. As for the next mid-term management plan, the firm will finalize the scheme according to circumstances.

Kobe Steel’s current profit estimation is 51 billion yen of consolidated recurring profit and 32 billion yen of consolidated net loss for fiscal 2008 ended in March 2009. The firm was forced to reduce production of steel, aluminum and copper products largely in the second half of fiscal 2008 due to economy deterioration.

The firm finalizes group total budget for fiscal 2009 when business environment takes long time and fund procurement becomes hard. The firm establishes an earnings recovery committee and progresses the reform of profit structure. The firm will continue the expansion of unique products and the enhancement of manufacturing technology, and will aim growth of group.