Basic policies

1 In fiscal 2005, we implement to account for impaired loss etc., related to structural reform as an extraordinary loss.
2 In fiscal 2006, the Group aims to establish a corporate structure to pursue “an operating income of ¥5.0 billion, total assets of ¥135.0 billion and a ratio of operating income to total assets of 4%,” as a management goal through ongoing implementation of structural reform since fiscal 2005. In this way, we aim to achieve “a consolidated operating income of ¥8.0 billion” in fiscal 2007.

Key measures

1. Reassessment of existing businesses
(measures against impairment loss relating to the Nihongi Plant)
(1) Industrial chemicals:
Review of the production system of potash electrolysis products due to decreasing demand, and determine the direction of the industrial chemicals business
(2) Feed additive Methionine:
Drastic overhaul of the production system
(3) Electric power, steam and other auxiliary sectors:
Utilization of excess electric power and steam resulting from decline in consumption of these energy sources in-house
(4) Reassessment of plant operations and administration as well as reduction in fixed costs
2. Major steps for expanding businesses
(1) Agro chemicals:
Pursue to increase both sales and profits, as a mainstay of the Company, while further advancement of in-house developed agents, expansion in sales of existing agents, and enhancement of tie-ups with other companies
(2) Dye stuff chemicals:
Specializing in color developers, while reviewing the production, sales and development systems
(3) Pharmaceuticals:
Commercialization of new disinfectant drugs and reassessment of existing drugs
(4) Treatment system by dechlorination for PCBs:
Completion of works for orders received and establish strategies for the medium- to long-term expansion of business
3. R&D and new business fields
  Creation of businesses in the electronic materials field:
Early commercialization of SAM (Self-Assembled Monolayer)-related themes
4. Reduction in fixed costs, etc.
  Reduction in fixed costs, including labor expenses, by ¥2.0 billion compared with the present level
(1) Reassessment of the organization and personnel structure
Establishment of an organization and personnel structure that is adapted to our businesses and an earnings system after corporate structure
Reduction in number of personnel by about 200 from the present level to 1,350
(2) Reduction in costs and capital investment
5. Reduction in total assets
  Establishment of a lean and efficient management structure by reducing tangible and intangible fixed assets, and inventories
The total assets will be reduced to ¥135.0 billion, down ¥22.0 billion from ¥157.0 billion at the end of March 2005.
6. Measures for improving group companies
  Deal with the effects of the group Companies caused by changes in the Company´s business