Consolidated Financial Highlights Medium Term Business Plan IR Library Disclaimer regarding IR Information In April 2004, we celebrated the 90th anniversary of our company's inception. This memorable landmark event marks the first year of our "New Inception"; we believe that it is critical that we consolidate our group wisdom so that we will achieve greater success and reach the centennial mark. Accordingly, we have created a medium term business plan to cover the period between April 2004 and March 2007 with the intent to dramatically transform our business structure.   President, CEO & COO Koji Yamamura 1. A group that respects the posture of challenge. 2. A group in which work places are formed to allow a large number of employees in diverse age groups to work with enthusiasm. 3. A group that holds a business segment that provides a solid profit basis. 4. A group whose presence is established in various geographic areas and fields. Our company's mainstay, the glass bottle business, has seen a continued decline in demand in recent years. Rather than continue to rely on the glass bottle business alone, we have embarked on new business operations for future growth by capitalizing on the technology and know-how that we cultivated in the glass bottle business. In this medium term business plan, we established a clear vision for our group to achieve in ten years' time, when we will reach our centennial mark. This vision is termed "New YAMAMURA." We positioned the next three years to be the "period for progressing to the new stage as a corporation" so that we can achieve this vision, and adopted the "Next Stage" to be the slogan for this drive. Our business policies for the next three years are comprised of three principles. First of all, we will reform our glass business structure and plan to establish a profit-making structure. Improvement of profit structure in the core business segment, where concentrated management resources are infused, will be the prerequisite for drafting a strategy for growth. Secondly, we will allocate management resources to growth fields. Specifically, management resources will be invested in the closure and new glass business segments while we also ensure profits in the core business segment. Concurrently, we will aggressively press forward with expansion of existing businesses to overseas markets. The third and final component is the reinforcement of the headquarter functions so as to optimize allocation of management resources. With these three principles, we aim to maximize our group corporate value. Glass bottle business was what we started our company with. It is the core segment in which our group's wisdom and energy have been accumulated. Although the glass bottle market continues to stagnate, we will keep up with our efforts to "sustain and improve our position as the top brand in the industry" and "improve production efficiency and reduce cost" so as to build an organization that is capable of generating steady profits. In addition, we will strive to have the "benefits of glass bottle" reaffirmed by consumers. The products that currently serve as the locomotive of our plastic company's growth are the "TEN caps" for PET bottles, whose shipments have been steadily growing. Our future strategy is to expand our "TEN cap" production facilities and strive to increase their sales, and at the same time, concentrate our efforts on the development of new products in the closure business segment so as to establish ourselves as a closure maker in the industry. Our bottle segment, which manufactures PET bottles, will also target to establish a profit structure through productivity efforts and cost reductions. The engineering business operation can be broken down roughly to the field relating to bottle-making machinery and the non-bottle making fields. The bottle manufacturing machinery field is caught in a difficult phase, due to market stagnation. The non-bottle manufacturing fields, on the other hand, contain potential for new market development through use of our company's brand power and customer base in the packaging field to the maximum effect. Consequently, the goal of the engineering business segment is to promote a shift of the management resources from the bottle manufacturing-related field to the non-bottle manufacturing fields, and by so doing, position our sales on a growth track and firmly establish a profit-generating structure. Since we opened the New Glass Research Center in 1987, our company has conducted a quest for new glass business possibilities other than glass bottles. The efforts began to bear fruit in recent years. The segment, whose mainstay is ground glass, has been growing steadily. We will solidify our position in the ground glass field and also aggressively carry out R&D efforts for new products in the high-tech glass field, which is on an expansion path to a gigantic market. Specifically, we will develop and cultivate new business operations in such leading edge fields as optic glass, up conversion glass, and nano glass. Units: 100 million yen, % Results for the Year Ended March 2003 Projected Figures for the Year Ending March 2004 Year Ending March 2005 Year Ending March 2006 Year Ending March 2007 Net Sales 765.9 725.0 734 736 745 Operating Income 24.1 17.0 24 30 35 Recurring Income 18.7 13.5 22 29 33 Recurring Income to Net Sales (%) 2.4 1.9 3.0 3.9 4.4 Capital Investment 48.7 42.5 54 44 46 Depreciation Expense 57.3 55.6 52 52 50