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Oki Electric Revises Earnings Projections for the Fiscal Year ending March 2006

Tokyo, Japan, February 17, 2006 -- Oki Electric Industry Co., Ltd. (TSE: 6703) today announced it has revised its earnings projections for the fiscal year ending March 2006 from previous projections announced at the first-half results announcement on October 27, 2005.

1. Projections for the fiscal year ending March 2006 (Consolidated basis)

(Million yen)

  Net sales Operating
income
Recurring
income
Net income
Previous forecast (Oct.27, 2005)   (A) 710,000 19,000 13,000 6,500
Revised forecast (Feb.17, 2006)   (B) 690,000 10,500 6,500 4,000
Variance     (B-A) -20,000 -8,500 -6,500 -2,500
Variance in ratio     (%) -2.8% -44.7% -50.0% -38.5%
[Reference]
Fiscal Year ended March 2005 (Results)
688,542 27,220 21,168 11,174

2. Projections for the fiscal year ending March 2006 (Oki Electric)

(Million yen)

  Net sales Operating
income
Recurring
income
Net income
October 27, 2005 projections   (A) 450,000 8,500 8,500 4,000
February 17, 2006 projections   (B) 415,000 3,500 4,500 2,000
Variance (B-A) -35,000 -5,000 -4,000 -2,000
Variance (%) -7.8% -58.8% -47.1% -50.0%
[Reference]
Fiscal Year ended March 2005 Results
439,355 8,003 8,288 3,199

3. Reasons of revision

In the business areas in which Oki conducts its business, Oki expects a continuing trend of deflationary pressure in the overall IT market. Telecommunication carriers have been reducing investments on services to directly provide fixed phone connections, and trends to shift investment on mobile services have been increasing, those of which are expected to affect the financial performance for this business. In the financial market, full-scale installations of the security-enhanced ATMs, which had been expected, will not occur until the next fiscal year or thereafter. For the semiconductor business, Oki group's major products including P2ROMs and driver LSIs have been impacted with the falling prices and decreasing volume as the competition becomes fiercer. Though Oki will remain profitable in this segment, profit is expected to worsen. In the printer business, while Oki expects sales increase with the growth in shipment volume, continued lower price trend due to fierce competition is expected to impact the profit for this business. Taking these situations in consideration, Oki Electric revises its earning projections for the fiscal year ending March 2006.

About Oki Electric Industry Co., Ltd.

Founded in 1881, Oki Electric Industry Co., Ltd. is Japan's first telecommunications manufacturer, with its headquarters in Tokyo, Japan. With the corporate vision, "Oki, Network Solutions for a Global Society," Oki provides top-quality products, technologies and solutions to its customers through its info-telecom system business, semiconductor business and printer business. All three businesses function as a collective force to create exciting new products and technologies that satisfy a spectrum of customer needs in various markets. Visit Oki's global web site at http://www.oki.com/.

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