Denki Kagaku : New Year's Message

New Year's Message
Happy New Year. Thank you all for your support over the past year. I would like to share my thoughts as we head into a new year.

For Japan, 2011 was a difficult year. With the tsunami and nuclear disaster, the disruption of supply chains, and myriad other problems resulting from the Great East Japan Earthquake, the entire country was thrust into extremely trying circumstances. Other parts of the world faced their own challenges, as the cumulative impact of the European debt crisis, political instability in North Africa and the Middle East, restrictive monetary policy in China, flooding in Thailand, and other developments shook real economies throughout the world. As a result, many Japanese companies, including ours, inevitably suffered downturns in their results during this very arduous year. There was at least one positive development, however, and all of the year's difficulties reminded Japanese of the people-to-people bonds, or kizuna, that have been a fundamental element of Japanese culture.

Denki Kagaku Kogyo, in the run-up to the 100th anniversary of its founding, is working to achieve its DENKA100 objectives and began last year to implement the CS13 plan toward that goal. Though the year was one of tremendous challenges, we must always remember that things will not always work in our favor and that the world is constantly changing. We will, therefore, continue to push ahead with our basic plan of using earnings from our carbide chain and styrene chain operations as a foundation for developing our high-margin products, such as electronic materials, and functional and processed products, in high-growth segments and regions. We will proceed with more concrete steps to aggressively develop these businesses in high-growth regions - mainly China and other parts of Asia - and will introduce new products that leverage our strengths in segments where market growth is expected in the future. All the while, we will closely monitor developments and trends throughout the world, and respond in the ways we believe are best for achieving steady progress toward the achievement of our DENKA100 and CS13 goals.

As we move forward, it is important to note that our ultimate goal is not simply to pursue quantitative targets or achieve certain business results. What allows companies to continue pursuing their business activities is, first of all, acknowledgment by society. Beyond that, in the course of pursuing business activities, seeking and achieving profits, on the one hand, and carrying out responsibilities as a member of society, on the other, are like the two wheels of a cart, and they are indispensable and inseparable. Looking ahead to our next 100 years, we will continue to uphold this idea and our heritage of an "earnest attitude and sincere dealings."
In closing, I would like to offer my wishes for your health and prosperity in the coming year. January 1st, 2012
Shinsuke Yoshitaka
President
DENKI KAGAKU KOGYO KABUSHIKI KAISHA