Semi-annual financial information 2002

Kuraray Co., Ltd.

Management Policy
Basic Policy
Fiscal 2000 saw the start of the Kuraray Group’s new 5-year medium-term businessplan -- dubbed ‘G-21.’ The plan was inspired by the belief that a company that wishes
to develop in the face of global competition must: (1) maintain international
competitive power, (2) give consideration to the natural environment, (3) utilize
electronic information technology and carve out and develop markerts in that field, (4)maximize synergy among group companies, and (5) give balanced consideration to
every stakeholder. Guided by the plan, we are aiming to build ‘an eco-friendly
enterprise with unique technology.’ To attain this goal, we must expand in threecrucial areas -- businesses with international competitive strength, those that
contribute to the preservation and improvemnet of the global environment, and thosethat serve to establish our unique identity throughout the world.

Medium-Term Strategy
Under the guidelines of ‘G-21’, we will seek to achieve efficient management of ourbusiness operations by (1) attaining an ROA (target: more than 7.0%) that exceeds
capital cost, (2) emphasizing the importance of ROA and cash flow as management
indices, (3) utilizing M&A, and (4) making decisions based on ‘Business
Reevaluation Criteria’ concerning businesses with worsening achievements.

With regard to corporate organization, we will implement the following
improvements to our organization and management:

(1) Creating a flat management structure and developing authorization(2) Making businesses and group companies self-supporting(3) Maximizing synergy among group businesses by ensuring shared values andbusiness strategies(4) Creating an employee evaluation system that better reflects the achievements ofeach individual, and(5) Promoting BPR (business process reengineering) and utilizing information
technology.

The Company’s business strategy combines due concern for both product-specificstrategy and market-specific strategy. Among our operating fields, our core businesses-- which we intend to strengthen further -- are vinyl-acetate related fields (poval,“EVAL”, “Kuralon” and “Kuralon K-II”), isoprene chemical fields (thermoplastic
elastomers, fine chemicals), and man-made leather (“Clarino”).

In addition to this product-specific strategy, we have also established a marketspecific strategy focused on four areas: electronic information technologies (e.g. poval
film for LCDs, the highly heat-resistant resin PA9T, etc.); eco-friendly areas (asbestos
substitutes, gas barrier materials, substitutes for polyvinyl chloride and vulcanizedrubber); environment business areas (activated carbon, PVA gels, industrial
membranes); and the medical areas (artificial organs, dental materials). We are
seeking to expand these business areas by utilizing the market-in approach.

Dividend Policy
We are keenly aware that the distribution of profit to shareholders is our highestpriority, and we regard our mission as being to attain a steady advance in businessperformance so as to ensure that profit is distributed appropriately. Amid a businessenvironment in which competition is expected to become increasingly fierce, retained
earnings will be used for strategic investment aimed at the expansion of operations,
including M&A transactions both in Japan and overseas, whenever necessary.

Future Issues
In order to survive amid the abrupt changes taking place in the management
environment, it is essential for companies to increase profitability still further. For thispurpose, Kuraray is placing emphasis on the following measures:(1) We will boost performance by ensuring rapid realization of the effects of capital
investment already implemented.
(2) In businesses with strong worldwide growth potential, we will step up production
and sales activities in locations close to areas of demand, thereby enhancing
competitiveness. As part of this strategy, in the field of the thermoplastic
elastomer “Septon”, a core business, we established the U.S. subsidiary Septon
Company of America in the previous fiscal year, and the construction of its new
factory is proceeding on schedule.
(3) On April 1, 2001 we carried out a reorganization by which we created a structure
characterized by greater emphasis on the market-in business approach. Under this,the Company will devote its full energy to responding quickly to market trends,
developing new products and carving out new markets.
(4) We will enhance business efficiency by pushing ahead with BPR. To this end, weestablished Business Service Center on April 1. 2001, and will be amalgamating
and slimming down support divisions of group companies.

(5) We regard contributing to environmental conservation and to the local
community as important issues for corporate management, and will therefore
continue to reduce the use of substances that adversely affect the environment,
and to develop and supply products that are environmentally beneficial. As partof Responsible Care activities, we have acquired ISO14001 certification -- theinternational standard for environmental management systems -- at all ourdomestic plants, and plan to obtain the same certification for our researchfacilities by the end of March 2002.
(6) Each business will be managed in a manner that reflects its unique characteristics.
The goal is to further reinforce businesses where Kuraray is strong and improvethe earnings of businesses undergoing restructuring. One result of this policy was
the October 1, 2001 reorganization of the manufacturing and sales activities ofthe medical products business as a separate company. This will better enable theimplementation of a specialized organization that precisely addresses thedemands of this business. The employee remuneration system of the newcompany will be closely linked to specialized knowledge and contributions tooperating results.
(7) To make the polyester business more competitive, the textile business is to betransferred to Kuraray Trading, the Kuraray Group’s trading company, in April
2002. This will enable the broad-based promotion of this business, from textiles
through finished products, in a manner that is in step with market trends. Anotheradvantage will be a fully integrated production system extending from fibers
through textiles and finished products. This will produce synergies by generating
cost savings and consolidating textile-related personnel in a single organization.
The transfer will also allow the textile business to draw on trading company

expertise to pursue a demand-pull strategy to an even greater degree. Furthermore,polyester filament production division was reorganized as a separate company in
October 2001. The aim of this action is to make this business even more
responsive to changes in the marketplace while achieving still more cost
reductions.
(8) We will continue to pursue the management path set forth in our “G-21” mediumterm business plan. Recently, however, the business environment has become
even more severe, and the Company’s earnings have been declining. In thesummer of 2001, we set up an “Earnings Structure Improvement Council”
charged with the task of finding ways to arrest this slide in earnings caused by thedeflationary spiral occurring in the Japanese economy as a whole. It is necessary
to reorganize our corporate structure so that we are able to maintain a sufficientlevel of earnings even with a capacity utilization rate of 80%. Through cost
reductions, we aim to build a company that operates more efficiently, with theshort-term goal of ¥26 billion in operating income on a consolidated basis forfiscal 2002. This improvement in earnings structure will also help pave the way
for the introduction of a decentralized management structure via an in-house“company” system, the start of which will be brought forward by one year to
April 2002.

Business Performance
Performance Review
The Kuraray Group continues to encounter an extremely challenging operating
environment. In addition to the prolonged period of deflation in Japan, economies in
the U.S., East Asia and elsewhere in the world are weakening. The group worked on
raising the prices of its products and cutting costs while developing new markets withunique products. Operating results benefited somewhat from the weaker yen.
However, results were severely affected by a drop in sales volume as demand fell andby generally poor market conditions.

Net sales declined ¥2,110 million, or 1.4%, to ¥151,143 million and operating income
was down by ¥1,019 million, or 10.4%, to ¥8,743 million. Ordinary income declined¥4,132 million, or 33.9%, to ¥8,041 million. This was due in part to the posting of again of ¥3,104 million on the sale and appreciation of marketable securities in the firsthalf of the previous fiscal year. There was also a special provision for retirement
benefits of ¥3,750 million in the first half of the previous fiscal year. As there was nosuch provision this year, net income increased 113.8% to ¥3,919 million.

On a segment-specific basis, performance was as follows:

1. Business segment
a. Fibers and textiles
Sales declined ¥4,912 million, or 10.9%, to ¥39,981 million. A ¥125 operating loss

was posted, compared with operating income of ¥971 million for the first half of theprevious fiscal year.
(1) Polyester sales and income were lower due to weak consumer spending in Japan
along with a severe supply-demand imbalance worldwide.
(2) “Kuralon” sales and income were slightly lower. There was some success atincreasing sales in new market sectors by promoting the characteristics of thismaterial in civil engineering and other applications. However, results were lower
in general industrial applications and in the agricultural and fishery markets.
(3) Rayon production was terminated during the previous fiscal year.

b. Chemical products
Sales rose ¥3,410 million, or 4.7%, to ¥76,671 million and operating income
increased ¥261 million, or 4.4% to ¥6,148 million.
(1) Poval sales and income were slightly higher. Sales of PVA film were lower as
manufacturers reduced inventories of polarizing films for LCDs. However, results
benefited from higher sales of PVA resin in Europe and China and from priceincreases that began to take hold during the second half of the previous fiscal year.

(2) Sales of the EVOH resin “EVAL” rose and income was unchanged. Earnings in
the U.S. improved as prices of raw materials and fuel declined. In Europe, higher
capacity resulted in increased sales. Solid demand in East Asia and Oceania
further contributed to a strong performance by “EVAL” outside Japan. Within
Japan, the slumping economy caused demand to fall.
(3) Sales and income from methacrylic resins increased. Demand remained strong forresins used in screens for projection TVs sold in the U.S. Sales of MMA

monomer and resins rose due to price increases implemented from the second
half of the previous fiscal year. Results also benefited from the Company’s
ongoing efforts to offset the effects of the soft economy by promoting valueadded products.
(4) Sales of isoprene chemical products were unchanged but income was lower.
Thermoplastic elastomers performed well, mainly in Europe and the U.S. Fine
chemicals such as raw materials for vitamins were affected by lower market
prices and slumping demand in Japan.
(5) In other chemical products, demand was strong for activated carbon inenvironmental applications, but the impact of weak economies caused sales toremain unchanged and income to fall.

c. Man-made leather, Non-woven fabrics and Fastening materials
Sales declined ¥221 million, or 1.4%, to ¥16,000 million and operating income wasdown by ¥421 million, or 31.9%, to ¥898 million.
(1) Sales and income from “Clarino” man-made leather were slightly lower. While
there were signs of a rebound in apparel-related demand in Europe, a full-scale
recovery is still some time away.

Results were also affected by the difficult

Japanese economy.
(2) Sales of non-woven fabrics were slightly higher and income was down. The
Company concentrated on increasing sales of fabrics used in wet tissues, a major
market, but results were hurt by lower prices of end products. The performance offastening materials remained stable, but soft consumer spending affected apparelrelated demand, causing sales to decline and holding income level.

d. Diversified businesses
In diversified businesses, which includes medical products and other items, sales
declined ¥387 million, or 2.1%, to ¥18,491 million and operating income increased¥721 million, or 48.1%, to ¥2,221 million.
(1) In medical products, sales and income were unchanged. Sales of dental materials
were strong outside Japan, particularly in the U.S. where marketing efforts are
now producing tangible results. However, this growth was offset by the impact oflower healthcare spending on other medical devices and contact lenses in Japan.
(2) In other items, sales were lower but profitability improved. The benefits of cost
containment programs at engineering, real estate and other domestic groupcompanies outweighed the challenges of an adverse operating environment.

2. Segmentation by Geographical Region
a. Japan
The Company suffered a very difficult operating environment in Japan, under the
impact of the deflationary conditions in the economy. In consequence, we posted net
sales of ¥129,418 million, and operating income of ¥7,298 million.

b. Outside Japan
Aggregate net sales in other regions totaled ¥21,725 million, and operating income
came to ¥1,805 million.
(1) In North America, sales and income were higher. Major contributors were
thermoplastic elastomers, projection TV screens, and “EVAL.”(2) In Europe, a strong performance by poval and “EVAL” was behind higher sales,
but income was flat.

(3) In East Asia, sales and income were about the same as one year earlier.

3. Cash Flows
Cash and cash equivalents (hereinafter ‘cash’) increased ¥6,623 million during theinterim period to ¥46,794 million. Principal contributing factors in cash flow were
¥11,457 in cash provided by operating activities, ¥297 million in cash used byinvesting activities, and ¥4,447 million in cash used in financing activities.

The principal components of operating, investing and financing cash flows were as
follows.

(1) Operating activities
Net cash provided by operating activities increased 8,528 million, compared with theprevious year’s first half, to ¥11,457 million. An increase in income before income
taxes and a decrease in notes and accounts receivable were two main factors.

(2) Investing activities
Net cash used in investing activities increased ¥6,090 million to ¥297 million asproceeds from sales of investment securities and redemptions surpassed payments forpurchases of investment securities.

(3) Financing activities
Net cash used in financing activities decreased ¥2,241 million to ¥4,447 million,
mainly due to a decline in long-term debt and short-term bank loans.

4. Interim dividend
It is proposed to pay an interim cash dividend of ¥4.50 per share of common stock,
comprising an ordinary dividend of ¥4 and a special dividend of ¥0.50.

Outlook for Remainder of Fiscal Year
Difficult conditions are expected to persist for Japan’s economy during the second
half of this fiscal year. Overseas, the downturn in U.S. consumer spending in the wakeof the terrorist attacks may begin to affect economies in Europe and East Asia as well.

Based on this outlook, Kuraray currently estimates fiscal year net sales of ¥ 315
billion, operating income of ¥18 billion, ordinary income of ¥17.5 billion and net
income of ¥6 billion.

In fibers and textiles, the Company plans to improve polyester results by speeding up
the shift to markets for profitable specialty products. For “Kuralon”, sales efforts will
focus on markets where the features of this material, such as great tensile strength andresistance to alkalinity, are in demand.

In chemical products, measures to increase sales will target markets where demand issteadily rising, such as those for poval, ”EVAL,” thermoplastic elastomers, andprojection TV screens. The Company will also aggressively target growth
opportunities in the fields of electronic information technology, eco-friendly products,
eco-businesses and medical products.

The projections for the second half of this fiscal year are premised on average yen
exchange rates of ¥120 against the U.S. dollar and ¥110 against the euro, and on anaverage Dubai crude oil price of US$24 per barrel.

The dividend for the fiscal year is projected at ¥9 per share of common stock,
comprising an ordinary dividend of ¥8 and a special dividend of ¥1.

CONSOLIDATED BALANCE SHEETS(unaudited)

Kuraray Co., Ltd. and Consolidated Subsidiaries

ASSETS
Current assets:
Cash and cash equivalents
Marketable securities
Notes and accounts receivable:
Trade
Unconsolidated subsidiaries and affiliates
Other
Loans receivable from unconsolidated subsidiaries and affiliates
Allowance for doubtful accounts

Inventories
Deferred income taxes
Other current assets
Total current assets

Property, plant and equipment:
Land
Buildings
Machinery and equipment
Construction in progress
Less accumulated depreciation

Investments and other assets:
Investment securities
Investments in unconsolidated subsidiaries and affiliates
Loans receivable from:
Unconsolidated subsidiaries and affiliates
Other
Deferred income taxes
Other
Allowance for doubtful accounts

September 30,
2001¥46,794
16,536¥40,171
14,687¥8,25913,861$393,226
138,958

86,561
999
4,096
458
(576)
91,53896,025
918
4,396
640
(689)
101,290

91,911
825
2,833
537
(597)
95,509727,403
8,395
34,4203,849(4,840)769,227

77,0996,046
1,275
239,288

75,5455,355
2,606
239,654

75,585
5,135
2,956
201,305

647,891
50,807
10,7152,010,824

24,34086,965363,996
11,934487,235(357,605)
129,630

24,34986,635357,405
7,897
476,286(348,818)
127,468

24,82485,823353,626
5,270
469,543(343,903)
125,640

204,538
730,798
3,058,790
100,286
4,094,412(3,005,084)
1,089,328

55,657
2,576

71,397
2,755

103,776
2,685

467,706
21,647

5,161
1,329
7,758
59,550(1,348)130,683¥499,601

5,616
1,326
6,323
59,244(1,304)145,357¥512,479

5,167
1,332
3,267
67,109(1,281)
182,055¥509,000

43,37011,16865,193
500,420(11,328)
1,098,176$4,198,328

Notes: The United States dollar amounts represent translation of Japanese yen at the rate of ¥119=$1.

1

Thousands of
U.S. dollars
September 30, September 30,
2000
2001

Millions of yen
March 31,2001

CONSOLIDATED BALANCE SHEETS(unaudited)

Kuraray Co., Ltd. and Consolidated Subsidiaries

September 30,
2001

Millions of yen
March 31,2001

September 30,
2000

Thousands of
U.S. dollars
September 30,
2001

LIABILITIES AND SHAREHOLDERS' EQUITYCurrent liabilities:
Short-term bank loans
Current portion of long-term debt
Notes and accounts payable:
Trade
Unconsolidated subsidiaries and affiliates
Other
Accrued income taxes
Deferred income taxes
Accrued expenses and otherTotal current liabilities¥7,62523,627¥8,807
20,228¥7,5895,146$64,076
198,546

51,850
841
4,302
2,631
19
15,724
106,619

54,147
1,277
6,160
2,196
2
17,417110,234

49,561
1,232
5,588
4,202
19
15,98389,320435,714
7,067
36,151
22,109160
132,135
895,958

Long-term liabilities:
Long-term debt
Deferred income taxes
Accrued retirement benefits
Other
Total long-term liabilities

62,4084,173
22,81015,753
105,144

67,527
3,859
25,336
16,001
112,723

87,2093,305
23,777
15,260129,551

524,437
35,067
191,681
132,378883,563

59

53

152

496

88,95587,147
113,574408(2,304)
287,780(1)
287,779¥499,601

88,95587,147
111,622
3,355(1,609)289,470(1)
289,469¥512,479

88,95587,147111,133
6,583(3,839)289,979(2)
289,977¥509,000

747,521732,328
954,403
3,428(19,361)2,418,319(8)
2,418,311$4,198,328

Minority interests

Shareholders' equity:
Common stock with par value of ¥50 ($0.42) per share:
Authorized−700,000,000shares
Issued and outstanding−382,863,603 shares
Additional paid-in capital
Retained earnings
Unrealized gain on revaluation of securities
Cumulative translation adjustments
Treasury stock at cost
Total shareholders' equity

Notes: The United States dollar amounts represent translation of Japanese yen at the rate of ¥119=$1.

2

CONSOLIDATED STATEMENTS OF INCOME(unaudited)
Kuraray Co., Ltd. and Consolidated Subsidiaries

Millions of yen
Six months ended
September 30, September 30,
2001
2000

Year ended
March 31,
2001

Thousands of
U.S. dollars
Six months ended
September 30,
2001

Net sales¥151,143¥153,253¥313,651$1,270,109

Cost of sales

112,763

114,454234,946947,588

38,38038,79978,705322,521

29,63729,037

58,774

249,050

8,743

9,762

19,93173,471

1,375
94(1,187)(2,614)
−
−
647

1,837
100
(1,151)(3,717)(3,750)3,104(2,205)3,659
127(2,377)(8,872)(7,596)
3,014(86)

11,555790(9,975)(21,966)−−
5,436(1,685)
7,058(5,782)
3,980(12,131)7,800(14,160)
59,311

3,138
(10)

4,286
(2,133)

6,633(2,879)26,370
(84)

3,128

2,153

3,754

26,286(11)¥3,9196¥1,833(1)¥4,045(92)¥32,933(Gross profit)
Selling, general and administrative expenses(Operating income)
Other income (expenses):
Interest and dividend income
Equity in earnings of affiliates
Interest expenses
Restructuring charges
Special provision for retirement benefits
Gain on sales and appreciation of marketable securities
Other, net(Income before income taxes)
Income taxes:
Current
Deferred

Minority interests in net income of
consolidated subsidiaries
Net income

U.S. dollars

Yen
Net income per share:
Primary
Fully diluted¥10.24
¥9.88

¥4.79
¥4.73

Notes: The United States dollar amounts represent translation of Japanese yen at the rate of ¥119=$1.

3¥10.56¥10.46

$0.09
$0.08

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY(unaudited)
Kuraray Co., Ltd. and Consolidated Subsidiaries
Millions of yen

Balance at March 31, 2000
Net income
Cash dividends, ¥4.50 per share
Bonuses to directors and statutory auditors
Effect of changes in reporting entity
Changes in unrealized gain on revaluation of securities
Translation adjustments
Balance at September 30, 2000
Net income
Cash dividends, ¥4.50 per share
Changes in unrealized gain on revaluation of securities
Translation adjustments
Balance at March 31, 2001
Net income
Cash dividends, ¥4.50 per share
Bonuses to directors and statutory auditors
Effect of change in the accounting standardof affiliate overseas
Changes in unrealized gain on revaluation of securities
Translation adjustments
Balance at September 30, 2001

Balance at March 31, 2001
Net income
Cash dividends, $0.04 per share
Bonuses to directors and statutory auditors
Effect of change in the accounting standardof affiliate overseas
Changes in unrealized gain on revaluation of securities
Translation adjustments
Balance at September 30, 2001

Commonstock¥88,955

Additional
paid-in
capital¥87,147

Retainedearnings¥111,151
1,833(1,723)(60)(68)

Unrealized
gain onrevaluation of
securities−

Cumulativetranslation
adjustments(¥4,496)

6,583
88,95587,147111,133
2,212(1,723)6,583

657(3,839)(3,228)¥88,955¥87,147¥111,622
3,919(1,723)(55)¥3,3552,230(¥1,609)(189)(2,947)¥88,955$747,521¥87,147¥113,574¥408

Thousands of U.S. dollars$732,328$938,000$28,193
32,933(14,479)
(463)

(695)
(¥2,304)($13,521)(1,588)(24,765)$747,521$732,328

Notes: The United States dollar amounts represent translation of Japanese yen at the rate of ¥119=$1.

4$954,403$3,428(5,840)($19,361)

CONSOLIDATED STATEMENTS OF CASH FLOWS(unaudited)

Kuraray Co., Ltd. and Consolidated Subsidiaries
Millions of yen
Six months ended
September 30, September 30,
2001
2000

Year ended
March 31,
2001

Thousands of
U.S. dollars
Six months ended
September 30,
2001

Cash flows from operating activities:
Net income
Adjustments to reconcile net income to net cash provided
by operating activities Depreciation and amortization(Decrease) increase in accrued retirement benefits
Gain on sales and appreciation of marketable securities
Decrease (increase) in notes and accounts receivable(Increase) decrease in inventories(Decrease) increase in notes and accounts payable
Other, net
Net cash provided by operating activities¥3,919¥1,833¥4,045$32,933

7,704(2,521)−9,380(1,879)(2,536)(2,610)11,457

7,917
1,736(3,104)(2,853)(673)(1,611)
(316)
2,929

16,593
3,280(3,014)(5,799)1,213
2,122(2,553)
15,88764,739(21,185)−
78,824(15,790)(21,311)(21,933)
96,277

Cash flows from investing activities:(Increase) decrease in marketable securities
Acquisitions of property, plant and equipment
Payments for purchases of investment securities
Proceeds from sales of investment securities
Other, net
Net cash (used in) provided by investing activities(1,139)(11,090)
(7)
9,983
1,956
(297)

2,010
(7,682)(18,768)
19,793(1,740)(6,387)

2,667(17,583)(3,116)30,891
7,464
20,323(9,571)(93,193)(59)
83,891
16,436(2,496)

Cash flows from financing activities:(Decrease) increase in short-term bank loans
Proceeds from long-term debt
Repayments of long-term debt
Dividends paid
Net cash used in financing activities(1,110)1,025(2,639)(1,723)(4,447)52
717(1,252)(1,723)(2,206)

(948)
1,550
(7,604)(3,446)(10,448)(9,328)
8,613(22,176)(14,479)(37,370)

Effect of exchange rate changes on cash & cash equivalents

(90)

32

518

(756)

Effect of changes in reporting entities

−

22

22

−

Net increase (decrease) in cash and cash equivalents

6,623(5,610)26,30255,655

Cash and cash equivalents, beginning of period

40,171

13,86913,869337,571

Cash and cash equivalents, end of period¥46,794¥8,259¥40,171$393,226

Notes: The United States dollar amounts represent translation of Japanese yen at the rate of ¥119=$1.

5

SEGMENT INFORMATION
Industrial segment information(unaudited)
Kuraray Co., Ltd. and Consolidated Subsidiaries

Net sales and Operating income

Six months ended September 30, 2001
Fibers and textiles
Chemical products
Man-made leather, non-woven
fabrics and fastening materials
Diversified businesses
Total
Elimination
Consolidated total

Net sales tooutside customers¥39,981
76,671
16,00018,491
151,143−¥151,143

Millions of yen
Net sales tointer-segment
Net sales¥393¥40,374
900
77,571
122
13,378
14,793(14,793)¥ −16,122
31,869165,936(14,793)¥151,143

Operatingincome(¥125)
6,148
898
2,221
9,142
(399)
¥8,743

Millions of yen
Six months ended September 30, 2000

Net sales to

Net sales tooutside customers

inter-segment

Operating
Net sales

incomeFibers and textiles¥44,893¥455¥45,348¥971

Chemical products

73,261

1,100

74,361

5,887

16,221

134

16,355

1,319

18,878

7,277

26,1551,500

153,253

8,966

162,219

9,677−¥153,253(8,966)¥ −(8,966)¥153,253

85¥9,762Thousands of U.S. dollars
Net sales tointer-segment
Net sales$3,302$339,277
7,563
651,857

Operatingincome($1,050)
51,664Man-made leather, non-woven
fabrics and fastening materials
Diversified businesses
Total
Elimination
Consolidated total

Six months ended September 30, 2001
Fibers and textiles
Chemical products
Man-made leather, non-woven
fabrics and fastening materials
Diversified businesses
Total
Elimination
Consolidated total

Net sales tooutside customers$335,975
644,294
134,454
155,386
1,270,109−$1,270,109

1,025
112,421
124,311(124,311)$ −135,479
267,807
1,394,420(124,311)$1,270,109

Notes: The United States dollar amounts represent translation of Japanese yen at the rate of ¥119=$1.

6

7,546
18,66476,824(3,353)$73,471Industrial segment information(unaudited)
Kuraray Co., Ltd. and Consolidated Subsidiaries
Identifiable assets, Capital expenditure, Depreciation and amortization

Six months ended September 30, 2001
Fibers and textiles
Chemical products
Man-made leather, non-woven
fabrics and fastening materials
Diversified businesses
Total
Elimination and Corporate
Consolidated total

Identifiable
assets¥65,575
161,445
34,89858,449320,367
179,234¥499,601

Millions of yen
Capitalexpenditure¥1,357
8,294

Depreciation andamortization¥1,322
4,613

669
325
10,645

970
799
7,704

−

−

¥10,645¥7,704

Millions of yen
Six months ended September 30, 2000

Identifiable

CapitalDepreciation andassetsexpenditure

amortization

Fibers and textiles¥75,546¥1,461¥1,544

Chemical products

150,960

3,376

4,578

37,190850

1,082

58,051

706

713

321,747

6,393

7,917

187,253¥509,000−−¥6,393¥7,917Man-made leather, non-woven
fabrics and fastening materials
Diversified businesses
Total
Elimination and Corporate
Consolidated total

Six months ended September 30, 2001
Fibers and textiles
Chemical products
Man-made leather, non-woven
fabrics and fastening materials
Diversified businesses
Total
Elimination and Corporate
Consolidated total

Thousands of U.S. dollars
Identifiable
CapitalDepreciation andassetsexpenditure
amortization$551,050$11,403$11,109
1,356,681
69,697
38,765
293,261
491,168
2,692,160
1,506,168$4,198,328

5,622
2,732
89,454−$89,454

Notes: The United States dollar amounts represent translation of Japanese yen at the rate of ¥119=$1.

7

8,151
6,714
64,739−$64,739

Geographic Segment Information(unaudited)
Kuraray Co., Ltd. and Consolidated Subsidiaries

Millions of yen
Six months ended September 30, 2001
Domestic (inside Japan)
Outside Japan
Total
Elimination and Corporate
Consolidated total

Net sales tooutside customers¥129,418
21,725
151,143−¥151,143

Net sales tointer-segment¥12,338
1,540
13,878(13,878)¥ −Net sales to

Net sales tooutside customers

inter-segment

Net sales¥141,756
23,265
165,021(13,878)¥151,143

Operatingincome¥7,298
1,805
9,103
(360)
¥8,743

Identifiable
assets¥264,929
60,276325,205
174,396¥499,601

OperatingIdentifiable

incomeassetsMillions of yen
Six months ended September 30, 2000
Domestic (inside Japan)

Net sales¥134,991¥9,862¥144,853¥8,290Outside Japan

18,262

1,592

19,854

1,208

46,384

Total

153,253

11,454

164,707

9,498

324,741−¥153,253(11,454)¥ −(11,454)¥153,253264¥9,762

184,259¥509,000Thousands of U.S. dollars
Net sales to
Operatinginter-segment
Net sales
income$103,681$1,191,227$61,328
12,941
195,504
15,168116,622
1,386,731
76,496(116,622)(116,622)(3,025)$ −$1,270,109$73,471

Identifiable
assets$2,226,294
506,5212,732,815
1,465,513$4,198,328

Elimination and Corporate
Consolidated total

Net sales to
Six months ended September 30, 2001 outside customers
Domestic (inside Japan)$1,087,546
Outside Japan
182,563
Total
1,270,109
Elimination and Corporate−
Consolidated total$1,270,109

Notes: The United States dollar amounts represent translation of Japanese yen at the rate of ¥119=$1.

8¥278,357