October 16, 2001
To whom it may concern
Name of the company
Code No.
Contact toNagase & Co., Ltd8012
Chief Financial Officer
Makoto Tsuruoka℡ (03) 3665-3100

Notice on the correction of achievement prospects
Please be kindly advised the correction of the previous achievement prospects
announced on May 21, 2001(at the time of the account settlement in March, 2001) as
follows on the basis of current operating activities under the business trend now
and near future:
Notice1. Modification of forecasted mid-term achievement prospect in digit March, 2002
(from April 1, 2001 to September 30, 2001)(1) Consolidated(Unit: MM yen, %)SalesOrdinary income

Mid-term net
income266,000

4,700

2,600

252,000

1,900

1,400

△14,000△2,800△1,200Percent change

△5.3

△60.0

△46.2

Actual results of the previousterm (Mid-term in March, 2002)

286,245

5,287

2,984

The
forecasted
previously
announced (A)(Announced on May 21, 2001)
The forecast corrected this time(B)
Up and down

(B-A)

(2) Non-consolidated(Unit: MM yen, %)SalesOrdinary income

Mid-term net
income220,000

2,600

1,600

212,0008001,100

Up and down (B-A)△8,000△1,800△500

Percent change

△3.6

△69.2

△31.3

Actual results of the previousterm (Mid-term in March, 2002)

248,361

3,226

2,693

Theforecast
previously
announced (A)(Announced on May 21, 2001)
The forecast corrected this time(B)

2. Correction of the forecasted figures for through-the- term in March 2002 (fromApril 1, 2001 to March 31, 2002)(1) Consolidated(Unit: MM yen, %)SalesOrdinary income

Current term net
income532,000

9,500

5,200

478,000

3,800

1,500

Up and down (B-A)△54,000△5,700△3,700Percent change

△10.2

△60.0

△71.2

Actual results of the previousterm (in March, 2001)

559,372

10,282

4,945

The forecasted the previously
announced (A)(Announced on May 21, 2001)
The forecast corrected this time(B)(2) Non-consolidated(Unit: MM yen, %)SalesOrdinary income

Current term net
income

The forecasted the previouslyannounced (A)(Announced on May 21, 2001)

450,000

5,300

3,300

The forecast corrected this time(B)

400,000

1,200

1,000

Up and down (B-A)△50,000△4,100△2,300Percent change△11.1△77.4△70.0

Actual results of the previousterm (in March, 2001)

481,294

5,697

3,004

3. Reason① For mid-term
In this mid-term, we have seen down of domestic demand due to business recession,
particularly in IT-related area being affected by more influence of market
slowdown than originally forecasted and therefore, it seems unavoidable to see
down of Sales, Ordinary income and mid-term net income both for consolidated andnon-consolidated basis more than we initially expected. For non-consolidated
operating income, it is expected to be \1.2 bn in the red.
② For through the term
we endeavor to strengthen and upbringing of the businesses based on the mid-term
management plan, but it is expected to register lower Sales ,Ordinary income andthe current term net income than originally estimated due to possibly continue
worldwide business slowdown including slump in IT-related business and others.
For non-consolidated operating income, it is expected to be \1.3 bn in the red.

4. Management rationalization plan
The world economy is now deteriorating day by day and possible market recovery
is anticipated to carry over into next year or later. We are also tackling on
toward Profit-improvement Company wide including cost saving and others but it
is not yet reach at give full effect against deteriorating achievement of thistime.
Under the circumstances, we have judged it would be the most urgent toimprove profit-structure toward fiscal 2002, and decided importation of thefollowing management streamline and cost saving at the Board of Directors meeting
held on October 16, 2001: Make a decision with operation of the following
management shake-out / measures for expense reduction.
①Concerning cutback of overhead expense* Directors' remuneration shall be cut maximum 20%.
* Managers' year-end allowance shall be cut maximum 20%.
* Implement substantial reduction of general administrative expenses and selling
cost through the promotion of operational reform via increasing businessefficiency and rationalization.
For the effect of overhead and other miscellaneous expenses, we anticipate \1.4
bn in black as expense saving effect for the second half term on consolidated
base.
For non-consolidated base, we estimate \1.1 bn in black as
expense-saving effect for the second half of this year.
②Concerning cutback of employment* We look for retiree instrument early retirement program in the second half ofthis year.
*In the next 2 years, contain attrition, and reduce 100 personnel (about 10 %of employee).
And by payment of extraordinary retirement payment, we estimate about \ 1 banfor extraordinary loss for the term ending March 2002.

We reflect the amount saved by total expense cutback by the implementation of theabove management rationalization plan in estimated correction of possible
achievements.