On July 28, we announced the Company’s business results for the first quarter of FY 2011.

On a consolidated basis, our sales were 441.6 billion yen, operating income 2.4 billion yen, ordinary income 11.4 billion yen and net income 4.2 billion yen. Despite sales and income figures below those for the same period last year, we managed to stay in the black.

At the beginning of the current business year we braced ourselves for a deficit, since demand had plunged in the automobile-related sector, whose supply chain was severely damaged by the earthquake and tsunami. However, the results turned out better than initially anticipated, as the decline in revenue remained within the forecast range, and we succeeded in capturing post-disaster restoration-related demand while pursuing thorough cost-cutting efforts.

As for the second quarter and year-long prospects, we left our forecast figures unchanged, considering that the business environment is still uncertain in North America, Europe and newly emerging economies, due to ongoing financial problems, money market instability, economic slowdown, inflation, property speculation and other factors, while in Japan the continuously strong yen and the power shortage do not allow optimism for the immediate future.

It is said today that Japan’s industry is in an extremely challenging situation, since it suffers from the six-fold handicaps of (1) strong yen, (2) heavy corporate taxes, (3) delayed trade policy adjustments, (4) global warming control measures, (5) reinforced labor restrictions and (6) power shortage, while Japanese politics is going nowhere.

However, it is in times like these that the Sumitomo Electric Group must take the lead in exploring future possibilities with vigor and determination, to transform crisis into opportunities. Accordingly, I encouraged our Business Units to achieve steady results by capturing as much post-disaster restoration demand as possible, reinforcing sales activities in existing areas and growth markets, and promoting Group-wide manufacturing optimization and cost reduction via thorough indirect cost curtailment.

In emulating Nadeshiko Japan, we are determined to work hard, with perseverance, determination and passion, toward achieving the Group’s goal of becoming a “Glorious Excellent Company.” Your continued warm support will be most appreciated.