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Revisions of Earnings Forecast and Dividend Forecast for the fiscal year ended March 31, 2009

Apr. 22, 2009


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Mitsui & Co., Ltd. (the "Company") announced today that the Company has revised downward its earnings forecast and dividend forecast for the fiscal year ended March 31, 2009, both of which were announced on February 3, 2009, as follows.

1. Revision of the earnings forecast for the fiscal year ended March 31, 2009

(1) Contents of the revision

Please scroll horizontally to look at table below.

  Total Trading transactions Net Income Earnings Per Share
Forecast previously announced (A) Billion JPY
16,000
Billion JPY
310.0
JPY
170.33
Revised Forecast (B) 15,500 180.0 98.90
Difference (B-A) - 500 - 130.0 -
Increase/Decrease (%) - 3.1 - 41.9 -
Results for the fiscal Year ended March 31, 2008 17,009 410.1 227.20

(2) Reason for the revision
Following the banking crisis that erupted in mid-September 2008, the financial markets unraveled and took with them consumer confidence. The rapid demand destruction and unprecedented destocking throughout almost every value chain resulted in lower sales volume and a sharp drop in prices of all merchandises. Continued precipitation of equity markets all over the globe and depreciation of all currencies against the Yen also contributed to significantly lower earnings especially in the last three month. All of this is something none of us have ever experienced. The impact of this global economic correction starting in October 2008 was inescapable and that is reflected in the financial results we recorded in this fiscal year, with the forth quarter being the worst quarter in our history.
Upon reviewing business plans of relevant businesses taking into account the current severe economic environment, we have recognized additional impairment losses of approximately JPY 47.0 billion (after tax) on unlisted securities, goodwill and long lived assets including real estate related losses of approximately JPY 18.0 billion (after tax).
We have also recorded additional impairment losses of approximately JPY 43.0 billion (after tax) on listed securities including investments in associated companies due to the sharp decline in equity markets.
In addition, we have determined to set up an additional valuation allowance of approximately JPY 21.0 billion for the deferred tax assets evaluating the realizability of deferred tax assets based on the new tax laws to be applied for the next fiscal year ending March 31, 2010.
Factoring in all above, we have revised our earnings forecast to JPY 180.0 billion, a JPY 130.0 billion decrease from the previously announced forecast of JPY 310.0 billion.

2. Revision of the dividends to be paid for the fiscal year ended March 31, 2009

(1) Contents of the revision

Please scroll horizontally to look at table below.

  Interim dividend per share Year-end dividend per share Annual dividend per share
Dividend forecast previously announced JPY
25.00
JPY
10.00
JPY
35.00
Revised forecast 25.00 - 25.00
Dividends paid for the Fiscal year ended March 31, 2008 23.00 23.00 46.00

(3) Reason for the revision
In order to maximize shareholder value, we seek to maintain an optimal balance between (a) achieving sustainable growth through strategic investments in areas of our core strength and growth and (b) paying out cash dividends as direct compensation to shareholders. Specifically, we have set the target dividend payout ratio of 20% of consolidated net income, and through improving the performance of the Group aim to steadily increase dividends from their current levels.
In accordance with this dividend policy, in February we announced that our annual dividend per share was expected to be JPY 35 (including the interim dividend of JPY 25) on the assumption that our annual net income would be JPY 310.0 billion.
Nevertheless, as stated above, the revised net income forecast was substantially reduced to JPY 180.0 billion from the previous forecasted net income of JPY 310.0 billion, and annual dividend per share is expected to be smaller than the interim dividend per share of JPY 25, which has been already paid, according to the target dividend pay out ratio of 20%. We regret to announce that we plan not to pay a year-end dividend because we believe it is better for the shareholders to prioritize enhancing the financial strength and carrying out the sound management under the current unprecedented economic turmoil. In this case, an annual dividend per share will be JPY 25, the same dividend per share as the interim dividend per share already paid. The final annual dividend proposal for shareholder's approval will be determined based on the net income for the fiscal year ended March 31, 2009.

Notice:
This press release includes forward-looking statements about Mitsui. These forward-looking statements are based on the current assumptions and beliefs of Mitsui in light of the information currently available to it, and involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors may cause Mitsui's actual results, performance, achievements or financial position to be materially different from any future results, performance, achievements or financial position expressed or implied by these forward-looking statements. The risks, uncertainties and other factors referred to above include, but are not limited to, those contained in Mitsui's latest annual report on Form 20-F, which has been filed with the U.S. Securities and Exchange Commission.
This press release is published in order to publicly announce specific facts stated above, and does not constitute a solicitation of investments or any similar act inside or outside of Japan, regarding the shares, bonds or other securities issued by us.

Information

For inquiries on this matter, please contact

Mitsui & Co., Ltd.
Investor Relations Division
Telephone: +81-3-3285-7910
Facsimile: +81-3-3285-9819
infoTKADZ@mitsui.com