For Immediate Release

November 11, 2004

Sumitomo ChemicalInterim Financial Results Record High
Sumitomo Chemical Company, Limited today announced that its consolidated net sales for the six
months ended September 30, 2004, totaled ¥619.5 billion ($5,578 million), an increase of 10.0% over thefirst half of FY2003. Interim net income increased 186.8% to ¥30.5 billion ($275 million). These interim
results are a record high for the Company.
Sales in the Basic Chemicals segment grew 13.4% compared with the first half of FY2003. Sales ofaluminum performed well thanks to improved conditions in the market, as did sales of caprolactam reflecting
the soaring prices of raw materials. Sales of methyl methacrylate also grew, due primarily to increased
shipments, driven by favorable demand. The Petrochemicals & Plastics segment saw a rise of 9.1% in sales
over the same period of last year. Sales of plastics experienced a major expansion owing to the recovery ofthe market, mainly in South East Asia. Sales of petrochemicals also increased due to improved market
conditions for s tylene monomer and propylene oxide reflecting the elevated prices of raw materials. Salesof Fine Chemicals segment were 4.8% higher than the same period of the previous year. While s ales ofdyestuffs and adhesives raw materials decreased, pharmaceutical bulk and intermediates saw greater
shipments, primarily in overseas markets. IT-related Chemicals segment once again showed strong growthwith sales rising 50.9% over the same period of last year. Market conditions for liquid crystal polymer andphoto resists remained solid. Sales of polarizing film and color filters saw substantial expansion thanks tothe growth of the LCD market as well as to the increased production from the Company’s new facility inKorea which came into full-scale operation last year. Sales in the Agricultural Chemicals segment were on
par with the previous year’s corresponding period. Sales of feed additives declined owing to the continued
low price level in overseas markets. On the other hand, shipments of plant protection chemicals andhousehold insecticides performed well both in Japan and abroad. Sales in the Pharmaceuticals segment
increased 2.8% over the same period of the previous year. Sales of Amlodin (a therapeutic agent for
hyper tension and angina pectoris) and Meropen (carbapenem antibiotic) expanded thanks to vigorous
promotion efforts, d espite the drug price reduction in April of this year. Sales of the Others segment
decreased 18.8% from the same period of last year.
Total Operating Income was ¥54.2 billion ($488 million), a 122.6% increase on the same period of theprevious year thanks mainly to demand expansion in Asia, primarily China, which promoted growth in themarket for Basic Chemicals and Petrochemicals and bolstered solid demand for IT-related chemicals,significantly improving the operating climate, amid the sharp upswing in the price of raw materials .
Operating income for each segment saw a substantial increase over the same period of last year, Basicchemicals and Fine Chemicals to ¥2.2billion ($20 million) and ¥6.9 billion ($62 million) respectively,
Petrochemicals & Plastics to ¥4.5 billion ($40 million) and Agricultural Chemicals to ¥6.5 billion ($59 million).
The IT-related Chemicals and Pharmaceuticals showed even greater improvements in operating income on
the previous year’s corresponding period, to ¥13.1 billion ($118 million) and ¥18.1 billion ($163 million)
respectively.
Interim net cash provided by operating activities was ¥64.1 billion ($577 million), while net cash used ininvesting activities was ¥56.4 billion ($508 million). Interim free cash flow increased to ¥7.7 billion ($69million).
For the year ending March 31, 2005, the Company estimates that consolidated net sales will be ¥1,280billion ($11,526 million), a 10.5% increase from FY2003, with consolidated net income to increase by ¥15.7billion to ¥50.0 billion ($450 million), which would be an all-time high for the Company. Special dividendsof ¥2,000 per 1,000 shares will be paid, in addition to ordinary dividends of ¥6,000 per 1,000 shares,
thereby raising the annual dividend from ¥6,000 to ¥8,000 per 1,000 shares for FY2004.
(Note)*U.S. dollar amounts are translated from yen, for convenience only, at the rate of¥111.05= $1 prevailing on September 30, 2004.

Interim Consolidated Statements of Income
Six Months ended September 30, 2004 and 2003
20042003(¥Million)(US$1,000)*

619,476$ 5,578,352

Cost of sales

443,854

3,996,885

414,233

Selling, general and administrative expenses

121,411

1,093,300

124,780

54,211

488,167

24,353

Interest and dividend income

2,770

24,9442,569

Interest expenses(3,633)(32,715)(4,274)Equity in earnings of affiliates

9,509

85,6282,659

Foreign exchange gain

3,742

33,697−

Gain on sale of property, plant and equipment

−

−

3,275

Gain on sale of investment securities

585

5,268

1,342

2,272

20,459942−−(2,451)

Restructuring charges(1,726)(15,543)(944)

Impairment loss

(2,095)(18,865)−

Other, net(2,696)(24,277)(2,666)62,939566,763

24,805

Income taxes, net of tax effect28,233

254,237

12,494

Minority interests

4,158

37,443

1,660

Sales¥

Operating income(¥Million)¥

563,366

Other income (expenses):

Reversal of allowance for doubtful receivables
Loss associated with lease contract
cancellation

Income before income taxes andminority interests

Net income¥$

30,548275,083¥

2004

Net income per 1,000 shares

10,651

2003

(Yen)

(US dollar)*¥

18,475$166.37

¥

6,441

¥

3,000$

27.01¥

3,000(Yen)Dividends per 1,000 shares:
Interim dividends(Note)*U.S. dollar amounts are translated from yen, for convenience only, at the rate of¥111.05= $1 prevailing on September 30, 2004.

-2-Industry Segment Results
Six Months ended September 30, 2004 and 2003(¥Million)
Adjustments&Elimination

Basic
ChemicalsPetrochemicals&Plastics

Fine
Chemicals

IT-related
Chemicals

AgriculturalChemicals

Pharmaceuticals¥ 111,398¥ 193,294

¥

¥¥

¥

(Share)(18.0%)(31.2%)(6.7%)(13.6%)(13.3%)(13.4%)(3.8%)(100.0%)(Growth)(13.4%)(9.1%)(4.8%)(50.9%)(-0.3%)(2.8%)(-18.8%)(10.0%)

OthersConsolidated2004
Sales

[a]

Operatingincome (loss) [b]¥[b] / [a]

2,235

¥

4,454

(2.0%)(2.3%)

Total assets¥ 190,468¥ 351,786

Depreciation

5,512

Impairment loss
Capitalexpenditures¥

41,485

6,892¥

84,203

13,112¥

82,468

6,502¥

82,722

18,092¥

23,906

¥

2,861

¥

¥

(-63)

¥

619,476

54,211(16.6%)(15.6%)(7.9%)(21.9%)(12.0%)

91,395¥ 193,348¥ 206,566¥ 243,101¥ 217,167

8,388

2,913

7,424

5,810

4,383

−

−−

−

−

4,083

4,830

3,286

21,155

6,154

98,202¥ 177,215(Share)(17.4%)(31.5%)(7.0%)(9.9%)(14.7%)(14.3%)(5.2%)(100.0%)(Growth)(4.7%)(-1.7%)(-5.0%)(41.3%)(18.2%)(-0.0%)(13.7%)(6.0%)¥(8.8%)¥82,113¥ 1,575,944

3,349

2,021

39,800

−

2,095

−

2,095

10,203

1,992

1,542

53,245

2003
Sales

[a]

Operatingincome (loss) [b]

¥

¥

1,484

¥

(1,380)(1.5%)(−)

Total assets¥ 179,119¥ 343,556

Depreciation

5,413

Capitalexpenditures

5,316[b] / [a]¥¥39,592

3,061

¥

¥

55,797

3,392

¥

¥

82,675

2,657

¥

¥

80,43813,759¥29,447¥1,686(7.7%)(6.1%)(3.2%)(17.1%)(5.7%)

97,607¥ 146,840¥ 219,650¥ 235,289¥ 239,259

8,840

3,166

5,176

5,863

5,623

5,087

4,226

15,445

2,508

8,068

¥

¥

¥

(306)

¥

563,366

24,353(4.3%)¥

58,455¥ 1,519,775

4,139

1,404

39,624

2,247

6,964

49,861

Overseas Operations
Six Months ended September 30, 2004 and 2003
2004

Overseasoperations(Note)(¥Million)($1,000)*¥ 232,057$ 2,089,662

2003
Share(%)

Growth(%)

37.5*U. S. dollar amounts are translated from yen, for convenience only, at the rate of¥111.05 = $1 prevailing on September 30, 2004.

-3-28.4(¥Million)¥ 180,744

Interim Consolidated Statements of Cash FlowsSix Months ended September 30, 2004 and 2003
2004(¥Million)

2003(US$1,000)*(¥Million)

Cash flows from operating activities:
Income before income taxes¥

62,939$566,763¥

24,805

Depreciation and amortization

39,800358,397

39,624

Income taxes paid

(14,822)(133,471)(20,719)

Other, net(23,849)(214,760)(2,056)

Net cash provided by operating activities

64,068576,929

41,654(64,991)(585,241)(60,629)

8,615

77,5785,247(56,376)(507,663)(55,382)

Dividends paid

(4,962)(44,683)(4,963)

Net increase (decrease) in short-term debt

(15,093)(135,912)

1,509

Net increase (decrease) in long-term debt

10,131

91,22916,547

Other, net(2,596)(23,376)(1,098)Net cash provided by (used in) financing activities(12,520)(112,742)

11,995

Effect of exchange rate changes on cash and cashequivalents

1090271

Cash and cash equivalents at beginning of period

44,395

399,775

61,891

Increase in cash due to merger of consolidated
subsidiaries−−

58

Decrease in cash resulting from changes in thenumber of consolidated subsidiaries

−−

(44)

Cash flows from investing activities:
Acquisition of property, plant and equipment
Other, net
Net cash used in investing activities
Cash flows from financing activities:

Cash and cash equivalents at end of period¥39,577$356,389¥

60,443(Note)*U.S. dollar amounts are translated from yen, for convenience only, at the rate of¥111.05= $1 prevailing on September 30, 2004.
(Cautionary Statement)
Statements made in this release with respect to the Company’s current plans, estimates, strategies and beliefs thatare not historical facts are forward-looking statements about the future performance of Sumitomo Chemical. Thesestatements are based on management’s assumptions and beliefs in light of the information currently available to it,and involve risks and uncertainties. The important factors that could cause actual results to differ materially fromthose discussed in the forward-looking statements include, but are not limited to, general economic conditions in
Sumitomo Chemical’s markets; demand for, and competitive pricing pressure on, Sumitomo Chemical’s productsin the marketplace; Sumitomo Chemical’s ability to continue to win acceptance for its products in these highly
competitive markets; and movements of currency exchange rates.

-4-