Hitachi Cable News vol.372
72nd annual business report
From April 1, 2008 to March 31, 2009

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Message from the President

This consolidated fiscal year (fiscal 2009*) the world economy showed signs of a global recessionary phase in real economic terms, as the financial crisis that began with the bankruptcy of a leading U.S. securities firm worsened and currency markets experienced extreme fluctuations in exchange rates while international commodity markets suffered rapid drops.

In the Hitachi Cable Group as well, business performance fell rapidly due to factors such as the strong impact of decreased demand in the semiconductor and automotive markets beginning in the second half of the fiscal year. In response, the Group has devoted itself to carrying out improvements to its business structure, including reorganization and consolidation of production bases, a review to determine surplus facilities, and thorough cost reductions.

However, despite these efforts Hitachi Cable Group net sales in this consolidated fiscal year totaled 493,151 million yen, reflecting a 13% decrease from the previous consolidated fiscal year. In the area of income as well, the Group reported an operating loss of 14,740 million yen and an ordinary loss of 19,974 million yen due to factors including the decrease in sales. Net income showed a loss of 53,775 million yen due to factors such as the booking of an extraordinary loss in connection with the implementation of business restructuring measures as well as the reversal of deferred tax assets and the recording of resulting corporate tax adjustments. Hitachi Cable paid a dividend of 3.00 yen per share at the end of this consolidated fiscal year. As a result, regrettably dividends per share for the full year will be 1.25 yen less than in the previous fiscal year, at 7.25 yen per share.

While business confidence in the global economy has begun to show signs of bottoming out as a result of the economic measures and monetary easing of individual nations, it remains unclear whether a full-fledged economic recovery is in the works in fiscal 2010. To overcome the current economic environment and achieve a recovery in business performance as quickly as possible, the Hitachi Cable Group plans to push forward in reinforcing its management structure and building a foundation for future growth, through steady implementation of performance enhancement measures (see Special Report: policies for fiscal 2010) based on the twin pillars of cultivating market acumen and further advances in manufacturing.

Due to concerns that it may have engaged in improper restraint of trade in the area of fiber optic cables and related products for telecommunications carriers, in June 2009 Hitachi Cable accepted an on-the-spot inspection by the Fair Trade Commission. The company plans to take this opportunity to ensure even more thorough compliance with laws, regulations, and corporate ethics.

The Hitachi Cable Group appreciates the continued support of its shareholders.

June 2009

* Fiscal 2009: April 1, 2008 to March 31, 2009

President and Chief Executive Officer,
Imai Mitsuo