Financial and Performance Review for the Third Quarter of the Year Ending March 2006

(Note) Figures shown have been rounded down to the nearest million yen

Our financial and performance review for the third quarter of the year ending March 2006 was announced on Thursday, February 2 at the Tokyo Stock Exchange and Osaka Securities Exchange Press Clubs. An outline of the announcement is presented below.

Performance Review for the Third Quarter of the Year Ending March 2006
(April 1 to December 31, 2005)

The domestic economy in Japan during the third quarter of the year ending March 2006 (from April 1, 2005 to December 31, 2005) was on a recovery trend thanks to improved corporate profits and steady growth in private consumption.
In such an environment, our group has been actively involved in implementing our three-pronged development strategy (development of new products, development of new production technologies and development of new markets) and has also focused on efforts to reduce costs. Nevertheless, stubbornly high material prices and higher depreciation expenses resulted in a year-on-year decline in profits.
Consequently, in the third quarter of the year ending March 2006, we achieved consolidated sales of 130,798 million yen (an increase of 0.5% over the previous year), a consolidated operating income of 7,511 million yen (a decrease of 13.0% over the previous year), a consolidated ordinary income of 7,144 million yen (a decrease of 14.9% over the previous year), and a net income for the quarter of 3,673 million yen (a decrease of 27.8% over the previous year).

Breakdown of Results by Division

<Oils and Fats Processing Business>

Although the sales of commodity oils and fats declined under severe market conditions, the overall sales in this division increased over the previous year thanks to the expansion of the sales of high value-added specialty oils and fats and functional oils and fats. An annual growth in profits was also recorded through reducing costs and improving productivity. In particular, our group company in China has been able to realize improved profitability.
Through its efforts, this business group achieved a sales volume of 44,291 million yen (an increase of 4.5% over the previous year) and an operating income of 2,535 million yen (an increase of 7.4% over the previous year).

<Confectionery and Baking Ingredients Business>

In the Japanese market, various types of ingredient chocolate continued to enjoy steady sales, but margarines, shortenings and fillings saw a decline in both net sales and profits due to a stagnant market and other factors. Although our group companies aggressively introduced new products, the dessert products failed to maintain the growth level achieved in the previous year and recorded a year-on-year decline in both net sales and profits.
In the overseas market, sales increased slightly, but ensuring profits was a challenge because of the stubbornly high prices of the raw materials for dairy and other products.
Through its efforts, this business group achieved a sales volume of 56,569 million yen (a decrease of 0.6% over the previous year) and an operating income of 4,117 million yen (a decrease of 19.8% over the previous year).

<Soy Protein Business>

In the Japanese market, soy protein materials did well in the health-food and other markets, but new materials and soy protein products saw a decline over the previous year due to weak demand. The sales of soy milk in the retail market decreased, partly owing to the end of the first round of the soy milk boom.
Although sales increased in our overseas markets, increased costs due to the operation of a new plant along with other factors led to a year-on-year decline in profits.
Through its efforts, this business group achieved a sales volume of 29,937 million yen (a decrease of 3.0% over the previous year) and an operating income of 859 million yen (a decrease of 24.4% over the previous year).

Predictions for Consolidated Results for the Year Ending March 2006
(April 1, 2005 to March 31, 2006)

We have not changed the predictions of results, released on November 10, 2005 as our performance in the third quarter of the year ending March 2006 progressed mostly as planned.

(Note) The forecasts above have been made based on the information available at the time of this announcement, and the actual results may differ from these forecasts due to various factors.

End of report