OKI Group announced its projections for the fiscal year ending March 2009. We plan to achieve operating income of 12.0 billion yen, consistent with the mid-term business targets announced in October 2007. To achieve this target, OKI will continue to revamp its business structure. As part of these measures, OKI announced the spin-off of its semiconductor business, which had been impacted by a rapidly changing market, and its NGN division in the telecom business. OKI established a business structure characterized by flexibility in management and the ability to respond quickly to changes in the market. Regarding the semiconductor subsidiary, OKI reached a basic understanding to transfer the subsidiary's shares to Rohm Co., Ltd. The two companies will work to reach a definitive agreement. Because of the timing, the consolidated net sales and operating income projections for the fiscal year ending March 2009 do not include the share transfer.

Following are our detailed plans for this fiscal year by segment:

Info-telecom system business: Net sales will decrease by 22.0 billion yen year-on-year to 337.0 billion yen, while operating income will increase by 9.7 billion yen to 8.0 billion yen. Major reasons for the sales decline include the decrease in demand from Japan Post after its privatization. For the financial market, OKI expects growth in ATMs in China and an increase in demand for bank branch terminals in Japan.

In the telecom business, though net sales will decline due to termination of low-profit businesses and products as we accelerate our "business selection and concentration" program, income will improve. Information systems will also see a decline in net sales due to withdrawal from unprofitable business, but income will improve.

For the semiconductor business, OKI will work to reduce costs through termination of low-profit system LSIs and reduction of procurement costs as a downturn is anticipated due to the strong yen. As a result of these factors, net sales will decline by 3.2 billion yen to 135.0 billion yen, and operating income will increase by 0.2 billion yen to 4.0 billion yen.

OKI will actively invest to establish a growth path in our printer business and will aim to increase profitability through an increase in sales of consumables. We will launch new value-added products and offer printers at a price suitable to the market while anticipating increased sales of consumables. OKI expects a 4.2 billion yen increase year-on-year in sales to 190.0 billion yen, while operating income will decrease by 1.6 billion yen to 7.0 billion yen.

In total, OKI aims to achieve consolidated net sales of 700.0 billion yen, and operating income of 12.0 billion yen. OKI also expects a consolidated net loss of 14.0 billion yen as we expect an extraordinary loss of 13.5 billion yen due to an inventory valuation loss resulting from changes in valuation standards.

OKI will continue to work on revamping its business structure to improve profitability.

May 28, 2008