News Room 2006 (The former Furukawa-Sky)

Summary of the Mid-term Consolidated Management Plan for the Fiscal Years 2007 through 2010

March 14, 2006

Furukawa-Sky has drawn up a Mid-term Consolidated Management Plan for the fiscal years 2007 (ending in March 2007) through to 2010 (ending in March 2010). An outline of the plan is provided below.

Summary of the Mid-term Consolidated Management Plan
- Furukawa-Sky Aluminum Corp.: Action Plan -

Business Vision

We will be a leading company that contributes to society by developing and providing products and services that satisfy customer needs for aluminum, a metal that is friendly to the global environment and beneficial to society.

The Corporate Image We Seek

- A company with a strong presence for its stakeholders -

For Stockholders ···a valuable company that is transparent and fair
For Customers ···a company that offers trust and satisfaction
For Employees ···a company in which employees can work with confidence andpride
For Local communities ···a company that is environmentally sound and will prospertogether with the local community

Direction of Growth

- Establishing a strong structure for profitability -

Deliver products with internationallycompetitive quality and cost based on a concentrated productionsystem that takes advantages of the strengths of three sheetmanufacturing factories (Fukui, Fukaya, and Nikko)
Set up a system for establishing andreinforcing production facilities through the simultaneouslaunching of three overseas plants (Indonesia, China, andVietnam) in fiscal year 2007
Thoroughly develop strategic businessesas a comprehensive aluminum rolled products manufacturerthrough market segmentation and identifying high-growthproducts

Targets for Fiscal Year 2010

Operating margin ratio of at least 10% (non-consolidated), D/E ratio no greater than 1.0 (consolidated)
Numerical Targets
Sales Volume
Operating Income
Consolidated D/E ratio

1.Directions of growth

Deliver products with internationally competitive quality and cost based on a concentrated production system that takes advantages of the strengths of three sheet manufacturing factories (Fukui, Fukaya, and Nikko):
- Fukui Plant ··· concentrated, high-volume production of large products utilizing one of the largest rolling mills in the world
- Fukaya Plant ··· production of a wide variety of medium-sized items
- Nikko Plant ··· production of a wide variety of items in small quantities / production of special items with high added value
Set up a system for establishing and reinforcing production facilities through the simultaneous launching of three overseas plants (Indonesia, China, and Vietnam) in fiscal year 2007:
- Aluminum extruded products for automotive heat exchangers ··· respond to increased demand emerging especially in the Asian region.
- High-quality precision compressor wheel casting ··· targeting the largest share of the world market
Thoroughly develop strategic businesses as a comprehensive aluminum rolled products manufacturer through market segmentation and identifying high-growth products:
- Expand into industrial applications such as IT, lithographic sheets, and industrial metal foils
- Expand into transport carriers for automobiles, LNG, and airplanes
- Expand into consumer goods, such as beverage cans

2.Target for fiscal year 2010 -Establishing a strong structure for profitability

We will establish a strong structure for profitability by realizing the above-mentioned directions of growth, and intend to accomplish the following goals while achieving an operating margin ratio of at least 10% (non-consolidated) by fiscal year 2010.

Concentration, increase, and streamlining of sheet manufacturing through capital investment
Achieving additional cost reductions apart from those described above
Profit growth in Group companies, including overseas subsidiaries

Unit: billion yen

		Fiscal year 2006 (ending March 2006) Outlook	Fiscal year 2010 (ending March 2010) Target	Increase/Decrease
Sales Amount	Consolidated	209.8	245.8	+36
Sales Amount	Non-consolidated (quantity)	1,800 (429,000 tons)	2,122 (478,000 tons)	+322 (+49,000 tons)
Operating Income	Consolidated	13.7	24.5	+10.8
Operating Income	Non-consolidated (Operating margin ratio)	125 (6.9%)	216 (10.2%)	+91 (+3.2%)

3.Achieving the target of D/E ratio 1.0 (consolidated)

To achieve this target, free cash flow will be utilized to decrease the balance of consolidated interest-bearing debt by 20 billion yen from the projected year-end result for fiscal year 2005 of 85 billion yen to the target result for fiscal year 2009 of roughly 65 billion yen.

		Fiscal year 2006 (ending in March 2006) Outlook	Fiscal year 2010 (ending in March 2010) Target	Increase/Decrease
D/E ratio	Consolidated	1.39	1.0 or below	-
D/E ratio	(Interest-bearing debt)	(85 billion yen)	(Around 65 billion)	(-20 billion yen)

4.Capital Investment plans