PT Asahi Diamond Industrial Indonesia

We are currently implementing our medium-to-long-term business plan, called Global 510. The plans calls for the Asahi Diamond Group to become a leading global manufacturer of diamond tools by achieving annual net sales of ¥50 billion, which is 10% of the world market worth an estimated ¥500 billion. To help us reach this goal, we launched our first medium-term business plan, covering the three-year period from April 2008 to March 2011. The fundamental objective of the plan, called Innovation 2011, is to effect innovations that will transform Asahi Diamond into an organization capable of generating self-sustaining value.
Centered on the Group's product development capabilities, the aim of the plan is to enhance self-sustaining growth and continuously raise corporate value by mutually enhancing the Group's growth potential, profitability, and capital efficiency. Innovation 2011 seeks to make changes in three key areas: (1) medium-term business policies, (2) medium-term capital strategies, and (3) corporate governance.

(1) With respect to medium-term business policies, our target is to become a Group that can achieve sustainable growth underpinned by the development of new products, sales expansion, and increased market shares for existing products.
(2) As for capital strategies, we will focus on capital efficiency. This signals a move away from the Group's previous management policies, which emphasized financial soundness centering on revenue and profitability.
(3) In the area of corporate governance, we will clarify the division of roles between the supervisory and business execution functions. At the same time, we have embraced the challenge of adopting a public company style of management structure.

The Asahi Diamond Group will continue providing high-quality products to customers irrespective of business conditions. At the same time, we will strive to build a structure that yields appropriate income, so that we can pay stable dividends to shareholders and enhance shareholder value.

We look forward to your continued understanding and support.