KOBE STEEL'S FINANCIAL RESULTS 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 correction in the high yen, reductions in
interest rates, and increased public works spending under the government's
economic measures. The economy is recovering at a modest rate, but full
recovery is still far off.
In this environment, Kobe Steel implemented measures to increase its
profitability. The company is aiming to increase 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 are 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
are forecast to decrease. While sales in the Machinery and Information
Sector were firm in the previous fiscal period, they are anticipated to
decrease in the first half of fiscal 1996.
Ordinary income (also known as pretax recurring profit) for the first half of
fiscal 1996 is forecast to be 10 billion yen, down 5 billion yen from the
previous estimate. The company has benefited from overall cost savings
including rationalization, lower production costs, lower cost of financial
activities, and other reduction in expenditures. However, profitability from
industrial machinery is expected to be low, and steel production and sales
volume are forecast to decrease 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 foresee a sharp recovery
of the economy. Although the company hopes the business environment
will improve, it views the situation as difficult.
In this operating environment, Kobe Steel forecasts non-consolidated net
sales for the full fiscal year ending March 1997 at 1,130 billion yen.
Ordinary income (also known as pretax recurring 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 reached at a board of
directors' meeting yesterday. The company sincerely regrets having to take
this measure and hopes that shareholders will understand the decision.
NON-CONSOLIDATED FINANCIAL RESULTS ESTIMATES
FOR FISCAL 1996
Current estimates Previous 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 RESULTS ESTIMATES FOR FISCAL 1996
Due to the revision in non-consolidated financial results estimates,
consolidated financial results estimates are forecast as follows:
Current estimates Previous estimates
Net sales 1,490 1,520
Ordinary income 45 55
(Note: Figures are in billions of yen)
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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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