TOKYO - JFE Holdings, Inc. announced today its updated forecasts for consolidated and non-consolidated earnings for the fiscal year ending March 31, 2004 (the second reporting term since the company was formed in September 2002). This announcement constitutes disclosure of the Quarterly Results Summary pursuant to the Appropriate Disclosure Regulations of the Tokyo Stock Exchange.

1. Consolidated Earnings Forecast

The recovery of the global economy is bringing about signs of recovery in the Japanese economy, in spite of worries about the yen's high rate on foreign exchange markets and other uncertainties. Among the positive signs in Japan are increasing private-sector capital spending and exports. The JFE Group has responded to this environment by faithfully implementing its First Medium-Term Business Plan and working to increase its earnings.

In comparison with the previous consolidated earnings forecast for the current fiscal year, issued in November 2003, JFE's new forecast shows gains in both net sales and income for its steel business, despite rising raw materials costs and other factors detrimental to earnings. Behind these gains are an increase in sales, especially in the domestic market, fueled by the smooth restart of the newly renovated Kurashiki No. 2 blast furnace and strong demand from the shipbuilding industry. In addition, steel sales prices are also forecast to recover due to strong demand, primarily in export markets.

The engineering business forecasts lower net sales and operating income than the previous forecast due to an increasingly difficult business environment. Declining sales in the company's urban development and LSI businesses will also produce slight declines in their respective earnings.

As a result, JFE Holdings forecasts overall consolidated net sales of ¥2,480.0 billion, representing an increase over the previous forecast. Operating income and ordinary income are roughly on par with the previous forecast at ¥245.0 billion and ¥210.0 billion, respectively.

Factoring in extraordinary losses on the amortization of transitional obligations for employees' retirement benefits and other expenses, JFE Holdings forecasts net income of ¥95.0 billion for the year.

2. Non-consolidated Earnings Forecast

3. Dividends

JFE Holdings considers the return of profits to shareholders to be among its top management priorities and has a policy of distributing dividends in line with results and needs for retained earnings to bolster the base of operations for the group as a whole.

In light of the forecasted results and retained earnings for the year, the Board of Directors today decided to propose to the General Meetings of Shareholders the payment of a dividend of ¥30 per share for the current fiscal year.

Note: The forecasts in this document are based upon management's assumptions and beliefs in the light of information available at the date of publication. Actual results may differ materially from these forecasts.