For Immediate Release

October 31, 2008

Sumitomo Chemical Reports
Consolidated Financial Results
For the Half-Year Ended September 30, 2008
Japan’s economy remained sluggish during the first half of fiscal 2008. High prices
for crude oil and other raw materials, together with weak export growth due to theslowing US economy and the stronger yen, resulted in lower corporate earnings,
while capital investment and consumer spending slowed.
The Sumitomo Chemical Group faced challenging business conditions such assustained high prices for naphtha and other feedstocks and the strengthening yen.
Under these circumstances, the Sumitomo Chemical Group worked to improvebusiness performance by increasing sales prices, expanding sales throughmarketing drives and cutting costs by streamlining. As a result, consolidated sales
for the half-year ended September 30, 2008 increased by ¥77.3 billion over the same
period of the previous year to ¥1,009.2 billion, while operating income, ordinary
income and net income declined to ¥31.0 billion, ¥23.0 billion and ¥6.3 billion
respectively owing to factors such as the impact of higher prices for raw materials.
Sumitomo Chemical declared an interim dividend of ¥6 per share, the same as for thecorresponding period last year.
Consolidated half-year financial results by business segment are as follows.
In the Basic Chemicals segment, despite higher market prices, sales of aluminum andraw materials for synthetic fibers decreased because of the stronger yen and lower
shipment volumes. Methyl methacrylate (MMA) sales remained at the same level as
the previous year because shipments increased in overseas markets but demand inJapan was weak. Consequently, sales for the segment decreased by ¥5.9 billion to¥153.9 billion year on year. Operating income for the segment declined by ¥9.1 billion
to a ¥1.2 billion loss.
In the Petrochemicals & Plastics segment, sales prices for synthetic resins andpetrochemical products such as propylene oxide and styrene monomer increased
because of the Company’s selling price increases in Japan that reflected the rising
prices for naphtha and other feedstocks, as well as higher market prices in Asia. As aresult, sales for the segment increased by ¥43.4 billion over the same period of theprevious year to ¥334.1 billion. However, the impact of higher feedstock costs and thestronger yen caused operating income to decrease by ¥12.2 billion to a loss of ¥10.1billion.
In the Fine Chemicals segment, sales of products such as organic intermediates andpolymer additives increased, reflecting the Company’s selling price increases taken
in response to higher feedstock costs, while shipments of pharmaceutical chemicals
temporarily decreased. The segment’s sales declined by ¥0.7 billion from the same
period of the previous year to ¥46.7 billion, and operating income also decreased by¥4.0 billion to ¥2.2 billion owing to the higher feedstock costs.
In the IT-related Chemicals segment, sales of LCD related materials such aspolarizing film and color filters increased substantially, supported by productioncapacity increases and productivity enhancements that were undertaken to meet thestrong demand in Korea, Taiwan and China. As a result, sales rose by ¥24.9 billion
over the same period last year to ¥162.5 billion and operating income increased by¥18.6 billion to ¥12.3 billion.
In the Agricultural Chemicals segment, sales of agrochemicals grew thanks to solid
demand primarily in overseas markets. Sales of feed additives increased because ofrising selling prices spurred by expanding global demand. Sales of Olyset Nets
posted continued growth. As a result, sales for the segment increased by ¥13.0 billion
over the same period of the previous year to ¥113.6 billion and operating income
increased by ¥1.4 billion to ¥12.3 billion.
In the Pharmaceuticals segment, despite the effect of the Japanese government’srevision of reimbursement prices for pharmaceuticals, sales of the segment’s fourmain products, Amlodin (therapeutic agent for hypertension and angina pectoris),
Gasmotin (gastroprokinetic), Meropen (carbapenem antibiotic), and Prorenal(vasodilator) remained at the same level as the corresponding period last year,supported by continued marketing efforts. With additional sales of new products
Lonasen (agent for the treatment of schizophrenia) and Avapro (agent for thetreatment of hypertension), sales for the segment grew by ¥4.3 billion over the same
period last year to ¥120.7 billion. Operating income decreased by ¥6.7 billion to ¥19.2
billion, primarily because of increased research and development expenses.
In the Others segment, the Company provides electrical power and steam andservices for chemical plant design, engineering and construction management,
transport and warehousing, and materials and environmental analysis. The Company
also conducts development and sales activities in new business fields such as
polymer organic light emitting diodes. Sales for the segment decreased by ¥1.7
billion from the same period of the previous year to ¥77.6 billion. Operating income
decreased by ¥5.8 billion to a loss of ¥3.6 billion mainly because of increased
research and development expenses associated with new businesses.

(2) Full-year forecast
Japan’s economy will continue to be highly susceptible to downside risk from aslowdown in the US and other economies, volatile raw material prices, as well as
prolonged turmoil in global financial markets. The Sumitomo Chemical Group willcontinue to face challenging business conditions.
Assuming an exchange rate of ¥100/USD and a naphtha price of ¥54,000/kl during thesecond half of the fiscal year, the Company’s full-year sales is forecast to increase by¥113.5 billion over the previous year to ¥2,010.0 billion. Operating income, ordinary
income and net income are forecast to be ¥70.0 billion, ¥60.0 billion and ¥15.0 billion
respectively.

Summary of Consolidated Results(1) Results of operations:

Net Sales
Operating Income
Ordinary Income
Income Before Income Taxes
and Minority Interests
Net Income

Net income per 1,000 shares
Dividends per 1,000 shares:
Interim dividends（\22,491
6,288）
Yen3,809（$\6,000$

Book Value per 1,000 shares（\（\(3) Cash flows:

Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Cash and cash equivalents at end of period（\(4) Results of Operations byBusiness Segment:（Net Sales
Basic Chemicals
Petrochemicals & Plastics
Fine Chemicals
IT-related Chemicals
Agricultural Chemicals
Pharmaceuticals
Others\\Operating Income
Basic Chemicals
Petrochemicals & Plastics
Fine Chemicals
IT-related Chemicals
Agricultural Chemicals
Pharmaceuticals
OthersElimination\\57,933
26,396）*37（\Yen）
15,98458\6,000US$

As of September 30, 2008*\ Million ）（ US$ 1,000 ）
2,401,262$ 23,184,918959,253
9,261,881
Yen）
437,121

6 Months ended
September 30，2007（ \ Million ）\931,896
48,364
57,664217,157
60,713（\(2) Financial Position:
Total Assets
Total Net Asset

6 Months ended
September 30，2008*\ Million ）（ US$ 1,000 ）
1,009,207$
9,744,202
31,009299,401
22,973
221,811）
US$4,221（$*

As of March 31, 2008
（ \ Million ）\2,358,929
1,006,046（\Yen）
465,213

6 Months ended
September 30，2008*\ Million ）（ US$ 1,000 ）
17,144$165,531(105,480)(1,018,442)
80,828780,419
98,696
952,940

6 Months ended
September 30，2007（ \ Million ）\64,493(135,112)
33,80390,511

6 Months ended
September 30，2008*\ Million ）（ US$ 1,000 ）6 Months ended
September 30，2007（ \ Million ）153,946
334,056
46,731
162,549
113,612120,679
77,634
1,009,207$

1,486,396
3,225,413
451,2021,569,460
1,096,959
1,165,193
749,580
9,744,202\(1,183)(10,126)
2,173
12,307
12,264
19,240(3,572)(94)
31,009$(11,422)(97,770)
20,981
118,828
118,413185,768(34,489)(908)
299,401\$$(Note)*U.S. dollar amounts are translated from yen, for convenience only, at the rate of¥103.57= $1 prevailing on September 30, 2008.

\\

159,809290,608
47,461
137,670
100,623
116,350
79,375
931,896
7,910
2,044
6,141
(6,279)10,81525,9802,205(452)
48,364