October 31, 2008


Revision to Forecast for Business Results

Fukuoka, October 31, 2008 - SANIX Incoporated (Ticker: 4651, TSE/OSE/FSE, President & CEO: Shin-ichi Munemasa) announces revisions of its operational result forecasts for the first two quarters and for the full year, previously announced on May 14, 2008.

1. Revision to Consolidated Results Forecast
(1) First two quarters results forecast (April 1, 2008 to September 30, 2008)

(Millions of Yen)
Net Sales
Operating Income
Ordinary Income
Net Income
Previous Forecast
14,256 
291 
275 
227 
Revised Forecast
13,400 
(360) 
(370) 
(740) 
Difference
(856) 
(651) 
(645) 
(967) 
% Change
(6.0%) 
Results from year before
13,742 
270 
232 
(421) 

(2) Full year results forecast (April 1, 2008 to March 31, 2009)

(Millions of Yen)
Net Sales
Operating Income
Ordinary Income
Net Income
Previous Forecast
29,297 
1,922 
1,882 
1,680 
Revised Forecast
28,000 
630 
600 
150 
Difference
(1,297) 
(1,292) 
(1,282) 
(1,530) 
% Change
(4.4%) 
(67.2%) 
(68.1%) 
(91.1%) 
Results from year before
26,510 
596 
495 
(2,547) 


2. Revision to Non-consolidated Results Forecast
(1) First two quarters results forecast (April 1, 2008 to September 30, 2008)

(Millions of Yen)
Net Sales
Operating Income
Ordinary Income
Net Income
Previous Forecast
13,150 
289 
244 
201 
Revised Forecast
12,660 
(380) 
(390) 
(790) 
Difference
(490) 
(669) 
(634) 
(991) 
% Change
(3.7%) 
Results from year before
13,376 
335 
141 
(515) 

(2) Full year results forecast (April 1, 2008 to March 31, 2009)

(Millions of Yen)
Net Sales
Operating Income
Ordinary Income
Net Income
Previous Forecast
26,612 
1,921 
1,824 
1,632 
Revised Forecast
25,660 
600 
550 
50 
Difference
(952) 
(1,321) 
(1,274) 
(1,582) 
% Change
(3.6%) 
(68.8%) 
(69.8%) 
(96.9%) 
Results from year before
25,488 
653 
369 
(2,667) 


3. Reasons for the Downward Revision
Operating results for the first two quarters ended September 30, 2008 are expected to be almost as forecast for the HS and ES Divisions. However, in the Environmental Resources Development Division, the change in power purchasers for the Sanix Energy Tomakomai Power Plant was implemented at the end of June, one month behind the original schedule. In addition, adjustment of the debris removal system line installed during regular maintenance in September has taken longer time than expected. Accordingly, achievement of the power output target for the first half of the year is likely to be delayed into the second half of the year. In the plastic recycling plants, the accepted waste plastic volume was as forecast. However, operation profitability decreased as a result of processing fee reduction due to crude oil price rises and other cost reduction pressures. Moreover, the Hibiki Plant, where organic liquid waste is processed, temporarily had to use chemicals for waste treatment because the microorganism treatment system did not work effectively. This resulted in increased operating costs. Consequently, the ERD Division is not expected to achieve the operational result targets for the first two quarters ended September 30, 2008.
Moreover, EDI Incorporated, a Sanix consolidated subsidiary, will transfer its plot of idle land (in Shimonoseki, Yamaguchi Prefecture) in November. In connection with this scheduled transaction, Sanix will record the impairment loss of 333 million yen for the land as a consolidated extraordinary loss for the second quarter ended September 30, 2008.
In the second half of the year, employment concern is expected to increase due to the current financial crisis. Sanix will take advantage of this situation to recruit good employees. To strengthen and maintain its sales force, Sanix will implement a personnel recruitment plan earlier than scheduled. However, the newly employed workers will not contribute to sales results until the next year, since the remainder of the current year will be devoted to their training. The business plan for the second half of the year was also modified, because achievement of the power output target has been delayed into the second half, as explained above, and uncertainties have increased regarding business of the Sanix Group, including signs of economic downturn and decline in consumption.
Considering these facts and forecasts, Sanix has modified the consolidated operational result forecasts for the first two quarters and for the full year.
Non-consolidated forecasts were also modified for the first two quarters and for the full year, for the same reasons.


(Note) These forecasts are based on information available as of October 31, 2008. Actual results may be different from forecasts due to various unexpected factors in the future.

For more information, please contact:
Masahiro Shimojo, Director,
Management & Planning Division