Showa Denko Postpones Achievement of Mid-term Plan by 2010

Kyohei Takahashi, president and CEO of Showa Denko, said at a press conference on 4 December that Showa Denko extends its 3-year management plan “Project Passion” by 2 years and aims to achieve the profit target of Project Passion in 2010. Mr. Takahashi said the firm could not achieve the final-year profit target of the present mid-term plan in 2008 due to sudden economy downturn.

Showa Denko launched Project Passion in 2006 and aimed to achieve consolidated net sales at 940 billion yen, operating profit at 85 billion yen, operating profit to sales ratio at 9%, interest bearing debt at 400 billion yen and D/E ratio at 1.4 at the end of 2008. The firm cleared the financial targets in advance but the operating profit is estimated at 34 billion yen through 2008.

The firm previously planned to launch the new mid-term management plan “Post Passion Project” for 2009-2012. However, the firm decided to extend the present mid-term plan by 2010.

Mr. Takahashi referred to 3 important themes toward 2010 those which are increasing of cash flow, continuous reinforcement of financial condition and more efficient business management. The firm will expect continuous growth of the hard discs and LEDs, while strengthen the black carbon electrode business for steel makers. At the same time, the firm tries to improve worse profitability of the aluminium business.