Showa Denko K.K. (SDK) to Increase Dividends.

Tokyo, Japan, Aug 8, 2006 - (JCN Newswire) - Showa Denko  K.K. (SDK; TSE: 4004) decided at today's board meeting to revise its forecast of annual dividend for 2006 from JPY 3 per share to JPY 4 per share. SDK also decided to revise its performance forecast for the full-year of 2006 upward in view of the latest business trends.

Consolidated net sales for 2006 are expected to increase 0.6% from the earlier forecast (announced on June 22, 2006), to JPY 900 billion, while consolidated operating income is expected to increase 2.3%, to JPY 67.5 billion.

The upward revision in net sales forecast is due mainly to higher selling prices in the Petrochemicals segment, reflecting a rise in feedstock cost. Meanwhile, operating income in the Aluminum segment is expected to increase as the rise in aluminum ingot price will be passed on to the selling prices, except for certain product lines. Furthermore, the Petrochemicals and Inorganics segments recorded slightly higher operating income in the first half of 2006 compared with the earlier forecast. As a result, overall operating income for the full-year 2006 is expected to increase from the forecast announced on June 22.

Ordinary income and net income will also rise as a result of the increase in operating income.

Revised dividend forecast for the year ending December 31, 2006

                            Interim      Year-end           Total

Earlier forecast (A)
(Announced on 02/09/06)    --  JPY3.00 /share   JPY3.00 /share
Revised forecast (B)    --  JPY4.00 /share   JPY4.00 /share
Dividend paid for the year
ended December 31, 2005    --  JPY3.00 /share   JPY3.00 /share

Revised performance forecast for Jan. 1 - December 31, 2006

Consolidated basis

                                           (Billions of yen, %)
                           Net  Operating   Ordinary       Net
                         sales     income     income    income
Earlier forecast(A)
(Announced 6/22/06)      895.0       66.0       54.0      25.0

Revised forecast(B)      900.0       67.5       56.0      26.5

(B)-(A)                   5.0        1.5        2.0       1.5

Percentage  increase      0.6%       2.3%       3.7%      6.0%

2005 results             811.9       57.2      47.0       15.6

Non-consolidated basis

                                           (Billions of yen, %)
                           Net  Operating   Ordinary       Net
                         sales     income     income    income
Earlier forecast(A)
(Announced 6/22/06)      635.0       35.5       27.5      13.0

Revised forecast(B)      635.0       37.0       29.5      14.0

(B)-(A)                     0        1.5        2.0       1.0

Percentage  increase      0.0%       4.2%       7.3%      7.7%

2005 results             568.1       36.0       35.0       1.0

About Showa Denko K.K.

Showa Denko K.K. ('SDK') (TSE: 4004; US: SHWDF) is a major manufacturer and marketer of chemical products serving a wide range of fields ranging from heavy industry to the electronic and computer industries. SDK makes petrochemicals (ethylene, propylene), aluminum products (ingots, rods) electronic equipment (hard disks for computers), and inorganic materials (ceramics, carbons). The company has overseas operations and a joint venture with Netherlands-based Montell and Nippon Petrochemicals to make and market polypropylenes. In March 2001, SDK merged with Showa Denko Aluminum Corporation to strengthen the high-value-added fabricated aluminum products operations, and is today developing next-generation optical communications-use wafers. For more information, please visit www.sdk.co.jp.

Source: Showa Denko K.K.

Contact:

Showa Denko K.K.
Nobuhiro Kato
[e-mail]
[phone]

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