Nichias full term consolidated net loss reaches 11.5 billion yen due to product qualification scandal; delayed mid-term settlement to be held on Nov. 29

2007/11/28 19:18

[Nov. 28, Sakura Financial News, Tokyo] On Nov. 28, Nichias (TSE 1:5393) announced its full term consolidated financial prospect for the term ending in March 2008 with downward revision. Affected by a cost of 30 billion yen in relation with the fire-resistant wall qualification problem, the full term net profits are revised down to a 11.5 billion yen from the previously estimated 9.1 billion yen surplus. Last year's results were a 7,625 million yen surplus.

Sales were revised down to 168 billion yen, a 6 billion yen decrease from the previous estimate and a 2% decrease from last year. This is partly due to reduction in demands for semiconductor and liquid crystal related equipments since the second quarter period. Reduced income from construction related business after the scandal was also affected the downward revision. Operating profits and ordinary profits were revised down to 13.5 billion yen (a 2.4 billion yen decrease from the estimate, a 6.7% decrease from the previous term) and 13.4 billion yen (a 2.4 billion yen decrease from the estimate, a 5.4% decrease from the previous term), respectively.

A scandal related expense in replacement and repair is estimated to 30 billion yen, which was appropriated in a mid-term extraordinary loss recorded as compensation allowance. A loss of 2,212 million yen due to disposal of construction facilities including those for a subsidiary also contributed to the large scale deficit.

Adjustment of damage compensation is not yet included in the extraordinary loss. The company's September 2007 mid-term settlement was rescheduled for the evening of Nov. 29.

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