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Heat Exchanger Production Capacity in Czech to be Expanded

March 4, 2002

Showa Denko K.K. (SDK) has decided to expand car air-conditioner condenser production capacity at its consolidated subsidiary Showa Aluminum Czech s.r.o. to meet a growing demand in Europe.

SDK is currently producing and selling car air-conditioner condensers in the United States, Czech and Thailand as well as in Japan. While SDK has met demand in Europe for condensers with export from Japan and local production in Czech, the Company has decided to expand the local production capacity to meet additional market demand and enhance its cost competitiveness.

Specifically, Showa Aluminum Czech s.r.o. will build a new production line to be housed in a new 7,500-squaremeter building, increasing its production capacity by 60,000 units per month, to 120,000 units per month. Investment will total approximately ¥1.3 billion.

Upon completion of the construction at the end of 2002, the plant's total floor space will be expanded to 15,000 square meters. Part of Hikone Plant's equipment will be transferred to Czech. The expanded facilities will become operational in January 2003.

The expansion is part of SDK's efforts to improve global cost competitiveness of its heat exchangers business through restructuring of production setup. Production at the Hikone Plant in Japan was suspended at the end of January 2002. Shift of production to Showa Aluminum (Thailand) Co., Ltd. is also progressing smoothly. The number of local employees at plants in Czech and Thailand will be increased following the expansion.

In the ongoing medium-term consolidated business plan named the "Cheetah Project," the automotive segment constitutes one of the major strategic growth areas for SDK.

[Profile of Showa Aluminum Czech s.r.o.]

Head office Krochehlavy 2747, Kladno, Czech Republic
Establishment & start of commercial production August 1999
Capital Koruna 277 million (¥886 million)
Shareholder Showa Denko K.K. (100%)
Main business Production and sale of car air-conditioner condensers (Supplied to major carmakers in Europe)
Sales for 2001 Koruna 1,073 million (Around ¥3,434 million)
Plant site 93,000 m2
Floor space 7,500 m2
President Tetsuo Shibata
Number of employees 285 (including four Japanese; as of the end of 2001)

[List of Overseas Subsidiaries for Heat Exchanger Production]

Location Main Business
Showa Aluminum Corporation of America (SAM) Ohio, U. S. A. Production and sale of car air-conditioner evaporators and condensers
Showa Aluminum (Thailand) Co., Ltd. (SAT) Ayuttaya, Thailand Production and sale of car air-conditioner evaporators and condensers, pipes and heater cores
Showa Aluminum Czech s.r.o. (SCZ) Kladno, Czech Republic Production and sale of car air-conditioner condensers
Showa Denko (Europe) GmbH (SDE) Munich, Germany Sale of car air-conditioner evaporators and condensers
Showa Aluminum Manufacturing Philippines Corporation (SAP) Dasmarinas Cavite, the Philippines Production and sale of evaporators for refrigerators
PT. Showa Aluminum Indonesia (SAI) Cikampek, Jawa Barat, Indonesia Production and sale of evaporators for refrigerators
Thai Refrigeration Components Co., Ltd. (TRC) Samutprakarn, Thailand Production and sale of evaporators for refrigerators