KONICA MINOLTA 3rd Quarter/March 2012 Consolidated Financial Results  

Initiatives to achieve forecasts for FY/March 2012

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I will now explain the key points of the initiatives that the Group will take in the fourth quarter to achieve the full-year operating performance forecasts that have been left unchanged.

The first point is to aim to maximize the sales and profits of each business in the fourth quarter, the final quarter of the current fiscal year. In doing so, the performance of the Business Technologies Business and the Optics Business will of course be key.

In the Business Technologies Business, the decisive factor will be the extent to which higher sales volumes of color products, which have maintained strong momentum in both the production print field and the office field, can be added in the fourth quarter, a period when demand peaks for the year. Both the office and production print fields will have an advantage in that new color products with superior product and cost competitiveness compared with existing products will be introduced from the fourth quarter.

The Company has been producing consistently solid results from businesses for global major accounts using the proposal and service capabilities of OPS. It needs to generate steady income from projects already won from these accounts and the related pipeline projects with which it is dealing at present. This will be another key point in the fourth quarter.

In the Optics Business, the Company will continue to bolster sales of VA-TAC films, thin films, and other products in which it excels.

Looking at issues related to the strong yen, as the assumed exchange rate of the euro has been raised by ¥5, the negative impact of foreign exchange rates on operating income comes to approximately ¥1.0 billion. In response, the Business Technologies Business will raise product prices by taking into account market conditions and other factors. I cannot provide details at the moment, but we will proceed with this when sales and profits for the fourth quarter have moved higher.

The Group will also cut costs and reduce expenses in an effective manner.

Finally, I would like to point out the downside risks that the Group needs to take into account in its effort to achieve its targets for the fourth quarter. The first of these risks is a potential rapid fall in demand, which is actually already taking place in certain markets in Europe, given sluggish corporate capital investment on concerns over the economic slowdown. This is similar to what happened after the Lehman Brothers collapse.

The second risk is the anticipated effects of flooding in Thailand in the fourth quarter of the current fiscal year. Flooding is expected to reduce net sales by approximately ¥2.0 billion and net income by approximately ¥1.0 billion. The point is the extent to which the Group can minimize these negative effects.