The steel industry found itself operating in an uncertain environment during the first half of FY2011. Precipitating factors included anxieties over European fiscal and financial systems, the historically high valuation of the yen, disruptions in car manufacturer supply chains caused by the Great East Japan Earthquake, and declining construction demand. Domestic construction-related business was sluggish in the first half as a result of this tough operating environment. While car-manufacturing levels were on the rebound as supply chains were restored, our auto-related business ended up lagging the previous fiscal year's performance, as did export transactions as a result of the yen's unprecedented strength.

Consolidated FY2011 first-half sales, gross profits, operating income, and ordinary income all trailed the previous fiscal year's performance figures for the same period. Net income of ¥7.2 billion was down ¥4.1 billion compared to the same period during the previous fiscal year.

The company's consolidated total assets were ¥1,024.3 billion at the end of FY2011's first half, down ¥20.9 billion compared to the end of the previous fiscal year as a result of declines in investment securities and accounts receivable. Consolidated interest-bearing debt increased ¥7.6 billion to ¥342.9 billion. Due to declines in net unrealized gains on securities and foreign currency translation adjustments, total net assets excluding minority interests came to ¥250.8 billion—down ¥17.2 billion compared to the end of the previous fiscal year.