Summery of Consolidated Business Results for the First Quarter Ended June 2005
July 29, 2005
Company Name
Nagase & Co., Ltd
Listing Code8012(URL http://www.nagase.co.jp/)
Representative
Position
President
Contact Details
Position
Accounting Division, Manager

Stock Exchanges Listed: Tokyo, Osaka
Location of Head Office: Osaka Prefecture
Hiroshi Nagase
Takahide Osada

Telephone (03) 3665-3103

1. Matters concerning the preparation of the Summary of Business Results for the First Quarter of fiscal 2005
(1) Use of simplified accounting procedures:(Description):
Accounting standard of income and other taxes: The amount of these taxes was calculated using the estimated yearly tax rates
based on the legal effective tax rates.
For some account items with minor effects, a simpler calculation method was used.
(2)Change in the applicable scope of the consolidation and equity method: The applicable scope was changed.
Consolidated Subsidiaries: New: 5 Excluded: 0 Equity method: New: 0 Excluded: 1
2. Consolidated Business Results for the First Quarter Ended June 2005 (April 1, 2005 – June 30, 2005)
1)Consolidated Operating Results(Note: Amounts have been rounded off to the nearest million yen)
Net SalesFirst Quarter Ended June 2005
First Quarter Ended June 2004
(Reference)
Period Ended March 31, 2005

¥ Millions
152,182
141,214

Operating Income%
7.8
6.2¥ Millions
4,515
3,394

575,636

Recurring income%
33.0
-2.5

¥ Millions
5,325
4,384

13,256

Net (quarterly) income%
21.4
-11.1

15,158EPS (quarterly)

Fully Diluted EPS (quarterly)¥ Millions
3,233
2,656%
21.7
‐4.6

¥
25.39
20.89

¥
First Quarter Ended June 2005
25.33
First Quarter Ended June 2004
20.84
(Reference)
10,38481.00
80.82
Period Ended March 31, 2005
Notes:Figures shown in percentage of sales, operating income and other items show the ratios of sequential changes comparedwith the first quarter of 2004.

Total Assets

Shareholder's Equity Shareholder's Equity Ratio2) Consolidated Financial Position

First Quarter Ended June 2005
First Quarter Ended June 2004
(Reference)
Period Ended March 31, 2005

¥ Millions
341,891
321,146¥ Millions
168,965
159,195

%
49.4
49.6

Shareholders Equity PerShare¥
1,326.64
1,251.77

335,290167,09249.8

1,311.37

Net Cash Used for
Financial Activities¥ Millions
829-436

Balance of Cash and Cash
Equivalents at Term End¥ Millions
21,984
19,279-5,119

17,2153)Consolidated Cash FlowsFirst Quarter Ended June 2005
First Quarter Ended June 2004
(Reference)
Period Ended March 31, 2005

Net Cash fromNet Cash Used for
operating activities Investment Activities¥ Millions¥ Millions
2,332
554-1,448-972
1,716-1,412

3. Consolidated Forecasts for the Year Ended March 31, 2006 (April 1, 2005 - March 31, 2006)
No change has been made to the forecasts published on April 28, 2005 both for the subsequent quarters and for the entire fiscal year.
Net Sales
Recurring Income
Net Income¥ Millions¥ Millions¥ Millions
Interim Period
300,000
8,800
5,600
Whole Year
600,000
17,40010,800(Reference) Expected EPS(Whole Year) ¥ 84.21*The above forecasts were prepared on the basis of information available on the date of release. Actual results may differ from these
forecasts due to various factors.

Business Performance and Financial Position[Business Performance]
Summary of Overall Company Performance
Although a trend of recovery continued in the Japanese economy as a whole in this firstquarter of the fiscal year, prices dropped continuously in some products in the liquid crystal
market, and a temporary slowdown was also found in export activities. From now on,
sources of worry for the Japanese economy include possible impacts from the ever-high oil
prices and the revaluation of Chinese yuan, as well as shifts in the U.S. and Chinese
economies.
Given these circumstances, our quarterly business record shows that we achieved 93.89
billion yen in domestic sales, up by 5.7% year on year, and 58.28 billion yen in overseas
sales, up by 11.3% year on year, which, put together, make our sales proceeds amount to152.18 billion yen, up by 7.8% year on year.
On the income front, operating income grew by 33.0% year on year, to 4.51 billion yen
thanks to sales growth etc. Despite such factors as a drop in investment income as a resultof the application of the equity method, we registered 5.32 billion yen in ordinary income,up by 21.4% year on year, and 3.23 billion yen in net quarterly income, up by 21.7% year
on year.
Segment Summary[Chemicals]
Sales: 66.32 billion yen

Year-On-Year Comparison: Up 5.0%

In the chemicals segment, business was positive in the area that includes automobile-related
products such as paint materials and urethane materials, the area that includes printer and1

copier ink and toner materials, and the specialty chemicals market that involves the sale ofmaterials for such specialty chemicals as surface active agents and industrial oil solutions.
Although sales dropped in the product areas related to pharmaceutical intermediates andagricultural materials, the chemicals business as a whole, backed by expanded sales in the
Asian region as well, enjoyed a positive tone of business.
[Plastics]
Sales: 52.21 billion yen

Year-On-Year Comparison: Up 18.5%

In the plastics segment, sales in China plus Hong Kong and Taiwan, the so-called Greater
China region, continued to grow by a large margin, as can be observed in sales of, as aprincipal example, armoring materials for office equipment. Business was also positive insales to the automobile industry, thanks to expanded overseas sales in North America etc.,
which was also coupled with a favorable sales record in Japan. While sales in the housing
equipment and construction materials remained unchanged, the plastics segment as a wholeachieved huge growth.
[Electronics]
Sales 30.57 billion yen

Year-On-Year Comparison: Down 1.3%

In the electronics operation, sales of products related to fine polishing abrasives expandedboth in domestic and overseas markets. We also had sales grow in the business of
surface-inspection systems etc. which are our proprietary products, and in the sale of final
consumption products such as DVD players, though we operate only on a small scale inthose market areas. In the meantime, in the liquid crystal-related market, although we fared
relatively well in products related to drug solutions and optical films that are used in thefront-end manufacturing processes of liquid crystal products, a decrease in sales in theliquid crystal module-related market due to product price drops etc. caused a slight decline
in the electronics segment as a whole.
[Healthcare and Others]
Sales: 3.07 billion yen

Year-On-Year Comparison: Up 2.9%2Although we have been making continuous efforts to create a new business model in thefields of clinical analysis systems and medical information in our healthcare and otherbusiness segment, they have not yielded a significant contribution to sales; as a result, sales
in this segment, coupled with those related to cosmetics and health food products, achieved
only slight growth as a whole.
[Financial Position]
Total assets amounted to 341.89 billion yen, a growth of 6.6 billion yen compared to theend of the previous fiscal year. The main items of growth in total assets are: 4.76 billion
yen in cash and deposits, and 6.71 billion yen in current assets resulting from, among otherfactors, a 1.78-billion yen growth in bills and accounts receivable.
Liabilities amounted to 167.95 billion yen, a growth of 4.59 billion yen compared to theend of the previous fiscal year. This was caused mainly by a 2.78-billion yen growth inlong-term loans.
Shareholders' equity amounted to 168.96 billion yen, a growth of 1.87 billion yen comparedto the end of the previous fiscal year. This is attributable principally to a 1.57-billion yen
growth in retained earnings.
As a result of the above, the shareholders' equity ratio declined to 49.4%, a 0.4-point dropfrom 49.8%, the ratio calculated at the end of the previous fiscal year.
[Status of Consolidated Cash Flow]
Cash flows from operating activities resulted in income of 2.33 billion yen. This is
attributable to the fact that, among other factors, while we generated 6.44 billion yen inquarterly net income before income taxes and minority interests, we paid 2.92 billion yen incorporate income tax etc. and spent 1.2 billion in additional operating capital.

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Cash flows from investing activities resulted in income of 550 million yen. This is
attributable to the fact that, among other factors, while we spent 540 million yen to acquire
property, plant and equipment, we earned 1.09 billion yen from the sale of property, plantand equipment.
Cash flows from financing activities resulted in income of 820 million yen. This is
attributable to the fact that, among other factors, while we paid 1.27 billion yen in
dividends and posted 510 million yen in net decrease in short-term loans, we generated 2.78
billion yen in long-term loans.
After making adjustments to these figures, including the counting-in of the 550-million yen
increase in cash and cash equivalents as a result of new subsidiary consolidation inaccounting, the balance of cash and cash equivalents at the end of this first quarter of thefiscal year grew by 4.76 billion yen from the end of the previous fiscal year, to 21.98 billion
yen.
[Financial Forecasts]
At this point in time, there have been no changes to the figures that we announced on April
28, 2005 as consolidated financial forecasts for the interim term and the entire fiscal year,respectively. We have also made no changes to our non-consolidated financial forecasts.

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